When someone owes you a debt and you know they are fully aware of it, it may seem logical to simply issue a claim against them, especially if you have warned them by email or over the telephone that you intend doing so in the absence of payment. However, the court rules require that certain steps are taken before issuing a claim at court.
Exchanging information & alternative dispute resolution
The parties are expected to exchange sufficient information prior to commencement of a claim in order to understand each others position, choose the most appropriate course of action, try to settle the case without the need to issue proceedings and consider alternative dispute resolution (˜ADR) such as negotiation, mediation or some other form of ADR. Litigation, the court says, should be a last resort.
Pre-action protocols
Civil Procedure Rules provide that the parties should comply with the relevant pre-action protocol before commencing proceedings. There are special protocols for debt claims, personal injury claims, clinical disputes, construction and engineering disputes, and housing disrepair, to name a few.
In the absence of a specific pre-action protocol the snappily titled Practice Direction – Pre-Action Conduct and Protocols (the PDPACP) governs the steps that must be taken before issuing a claim.
Sending a letter before action
The first step under the PDPACP is to send the other party a letter before action. Such a letter should include concise details of your claim, such as:
- the basis on which the claim is made and a summary of the facts relied upon;
- what you are asking the other party to do (e.g. pay a sum of money or compensation, or refrain from carrying out certain actions);
- if it is a claim for money, how the amount is calculated;
- enclose copies of key documents relevant to the issues in dispute;
- invite the other party to consider using mediation if they are not prepared to negotiate;
- give the other party a reasonable amount of time to respond (usually 14 days in a straight forward case and up to three months in a very complex one);
- a request for a copy of any documents from the other party which you need to see;
- warn the other party that in the absence of a (satisfactory) response, you intend to issue court proceedings.
In more complex or specialist cases, additional information may need to be included and, as mentioned above, a specific pre-action protocol may need to be complied with.
Consequences of non-compliance
Failure to comply with a pre-action protocol prior to issuing court proceedings may result in your position being put at a disadvantage at a later stage once the claim is issued. For example, you may potentially be deprived some or all of your legal costs of bringing the claim even if you win, or you may be ordered to pay costs for non-compliance.
