I will explain the whole process in full below so you know what is expected:
If a party wishes to pursue another for a debt arising out of a dispute between them, they can do so by making a claim in the civil courts. As legal action should ideally be used as a last resort, there are certain steps that should be taken initially to try and resolve this matter informally and without having to involve lawyers or the courts. These can be summarised below and it is recommended the following procedure is followed to try and progress this matter further:
1. Reminder letter – if no informal reminders have been sent yet, one should be sent first to allow the other party to voluntarily settle this matter.
2. Letter before action – if informal reminders have been sent but have been ignored, the other party must be sent a formal ‘letter before action’ asking them to resolve this amicably within a specified period of time, usually 7 to 14 days. They should be advised that if they fail to do contact you in order to resolve this matter, formal legal proceedings will be commenced to pursue them for the debt in question. This letter serves as a ‘final warning’ and gives the other side the opportunity to resolve this matter without the need for legal action.
3. If they fail to pay or at least make contact to try and resolve this, formal legal proceedings can be initiated. A claim can be commenced online by going to www.moneyclaim.gov.uk. Once the claim form is completed a copy will be sent to the other side and they will have a limited time to defend it. Once they are aware that legal proceedings have commenced it may also force them to reconsider their position and perhaps prompt them to contact you to try and resolve this.
4. As an alternative to legal action a debtor can be issued with a formal statutory demand. This is a legal request which asks the debtor to pay the outstanding debt within 21 days and failure to do so would allow the creditor to bankrupt the debtor (if they are an individual) or wind up the company (if they are a business). The minimum amounts owed to be able to issue a statutory demand are £750 if the debtor is a company or £5,000 if they are an individual. For the relevant forms to serve a statutory demand see here: https://www.gov.uk/statutory-demands/forms-to-issue-a-statutory-demand
As a final tip, it is always advisable to keep copies of any correspondence sent and received as the courts would like to refer to it if it ever gets that far.
Does this answer your query?