Description
In England and Wales, County Court judgments (CCJs) are legal decisions handed down by the
County Court
A county court is a court based in or with a jurisdiction covering one or more counties, which are administrative divisions (subnational entities) within a country, not to be confused with the medieval system of ''county courts'' held by the high ...
.
[gov.uk Web site: County court judgments for debt, Overview]
/ref> Judgments for monetary sums are entered on the statutory Register of Judgments, Orders and Fines
The Register of Judgment, Orders and Fines is a statutory register in England and Wales that maintains a record of:
* Judgments entered in the High Court;
*Judgments entered in county courts;
*Administration orders made under section 112 of the ...
,[Web site of Register of Judgments, Orders and Fines]
/ref> which is checked by credit reference agencies to assess the credit-worthiness of individuals.
An alleged debtor is sent postal notification of an impending County Court case, and has fourteen days to respond, by paying the money, admitting owing a smaller sum, denying owing it, or going to a court hearing. If there is no response judgement will be granted against the debtor.
If the debtor does not make payment in response to a CCJ, the creditor may apply for a charging order, which would secure the debt on a property. Creditors can also apply for an attachment of earnings which would oblige the debtor's employer to deduct monies from their salary and send them to the court. A third-party debt order would oblige a third party who holds money belonging to the debtor (for example a bank) to pay the debt. It is also possible to have the court appoint a County Court bailiff
County Court bailiffs are employees of Her Majesty's Courts & Tribunals Service and are responsible for enforcing orders of the County Court by recovering money owed under County Court judgments. Bailiffs can seize and sell goods to recover the ...
to collect the debt. A bailiff is an official of the court who has some powers to seize goods and sell them at auction to settle a debt.
Impact on credit reference agency information
Once a CCJ has been entered, if not paid in full within thirty days it is kept on record for six years by the register and credit reference agencies (CRAs); there is no way to expunge the record of a correctly granted CCJ, although later payment will be recorded. The record is removed after six years.
The Office of Fair Trading
The Office of Fair Trading (OFT) was a non-ministerial government department of the United Kingdom, established by the Fair Trading Act 1973, which enforced both consumer protection and competition law, acting as the United Kingdom's economic ...
warned about credit repair companies that offer, for a fee, quick-fix schemes purported to remove a file from the CCJ register.[ When a person applies for credit or finance, potential creditors normally check CRA records, refusing applicants considered to have a bad ]credit history
:''This article deals with the general concept of the term credit history. For detailed information about the same topic in the United States, see Credit score in the United States.''
A credit history is a record of a borrower's responsible repay ...
; a CCJ on record makes it much more difficult to obtain finance through the normal channels. Some lenders will lend to people with CCJs against them, but usually on unfavourable terms, e.g. through a very expensive payday loan
A payday loan (also called a payday advance, salary loan, payroll loan, small dollar loan, short term, or cash advance loan) is a short-term unsecured loan, often characterized by high interest rates.
The term "payday" in payday loan refers to ...
.
Mitigation
If regular payments to the court are being made this is recorded on the credit file in addition to the record of the CCJ, and goes some way to lessen the negative credit rating impact. Once the full amount owed is repaid the CCJ is marked as 'satisfied', but remains on file. The record of a CCJ which is satisfied within one month can be removed altogether on application to the Register (and hence the CRAs).[CCJ's explained: How to avoid years of inconvenience]
/ref>
Other legislation
The Reporting on Payment Practices and Performance Regulations 2017, came into force on 6 April 2017. Under the rules introduced in April 2017, all large UK companies are required to publish specific information regarding their payment policies, practices and performance — including the average time taken to pay supplier invoices — twice yearly. This information is made public in a report.
From October 2017, all creditors in the UK are expected to follow the Pre-Action Protocol for Debt Claims, which sets out what a debtor is expected to do and sets out a time limit for the creditor and debtor to reach an agreement over the debt. This must be done before a court order for a County Court Judgment for the debt can be made.[{{Cite web , title=What is a County Court Judgment? , url=https://www.choose.co.uk/money/guide/county-court-judgments/ , website=Choose]
See also
* European Payment Order
References
English law
Legal documents