DEBT RECOVERY – YOUR LEGAL COSTS EXPLAINED
There are two main elements to the legal costs of recovering debts for you:
- our charges; and
- expenses we must pay out on your behalf.
OUR CHARGES
Our hourly rates for debt recovery will depend on the seniority of the lawyer carrying out the work, which range from £150 per hour for a debt recovery executive up to £525 per hour for a partner based in our London office. Typically, undefended debt collection matters will be carried out by one of the debt recovery executives under the supervision of a partner.
The number of hours it will take will depend on the circumstances of your case. In particular, the size and complexity of the debt, whether the debtor is based in England and Wales, whether the debt is disputed and whether it becomes necessary to commence enforcement proceedings following judgment.
We reserve the right to increase the hourly rates if the work done is particularly complex or urgent or the nature of your instructions require us to work outside normal office hours. If this happens, we will notify you in advance and agree an appropriate rate.
As an alternative to hourly rates, we may be able to offer to undertake work before the commencement of legal proceedings based on a percentage of realisations. The percentage will depend on the value, size and complexity of the debts but the percentage is likely to be in the range of 10% to 25% plus VAT, subject to a minimum fee of £150 plus VAT.
Our charges do not include VAT, which we will add to your bill at the prevailing rate.
EXPENSES
We would usually expect to incur certain expenses on your behalf which we will add to your bill. For example, court fees and High Court Enforcement Officer’s fees. The amount of these fees depend on the size of the debt. There is a sliding scale for court fees ranging from £35 to issue the smallest claims up to £10,000 for the largest claims.
We may instruct a barrister (otherwise known as Counsel) on your behalf if the proceedings become disputed. Counsel’s brief fee for a trial can vary between £1,500 for the smallest claim up to tens of thousands of pounds for the largest claim. It will vary according to the experience of the barrister needed and the complexity of the case. The brief fee includes Counsel’s time for case preparation and time engagement on the first day of any hearing. Thereafter a ‘refresher’ fee is charged by Counsel for each additional day of any hearing, usually at between about £1,000 and £5,000 per day. These charges are exclusive of any applicable VAT. If you require solicitor attendance as well as Counsel at a hearing then our solicitor time will be based on an additional cost on a day rate between £1,750 and £3,000 plus VAT.
ESTIMATED TOTAL LEGAL COSTS
It is very difficult at the outset to predict the total cost to recover a debt. This will depend upon how much time it will take to complete and this can depend on the particular circumstances of the case and issues which may arise during the course of the debt recovery process. For example, whether the case is disputed and whether enforcement action is needed. The best guide we can give you is that our costs tend to fall in the range of £150 plus VAT for a very modest, undisputed debt recovered without the need for legal proceedings to tens of thousands of pounds for a larger, disputed debt proceeding to trial.
LIKELY TIMESCALE AND KEY STAGES
The time that it takes from taking your initial instructions to the final resolution of your matter depends largely on the stage at which your case is resolved. If settlement is reached following a Letter Before Action before proceedings are commenced, it is likely to take two to four weeks to resolve. At the other end of the spectrum, if the claim is disputed, proceedings become necessary and it proceeds to a trial, your case is likely to take between nine months and 18 months to obtain judgment as this will very much depend on the timetable of the Court. If enforcement action is necessary, it may take a further six months. This is just an estimate and we would be able to give you a more accurate timescale once we have more information and as the matter progresses.
OUR EXPERTISE
For details of the members of the team who may work on your matter, please see the relevant pages on our website. Regardless of who works on your matter, they will be supervised by one of the partners in our litigation team.
