How to Recover Money You are Owed Through the Small Claims Court

By Amanda Hamilton, NALP (National Association of Licenced Paralegals).


If you run a business it is frustrating if you’re owed money for work you’ve done – especially if the person is ignoring all your phone calls and letters.


So, what can you do yourself to recover that debt – without resorting to engaging a costly solicitor?


The ‘Small Claims Court’ which is part of the County Court was originally created to enable a lay-person (someone who is not legally qualified) to take another individual to court. The maximum amount of a claim in those days was £20.


Nowadays, the maximum amount of a claim that you can deal with yourself in the Small Claims Court is £10,000.


But remember, there are costs involved. There is small fee to file the claim – starting at £25. You can see the full fee structure here:


And if the ‘Defendant’ (the person owing the money) decides not to pay or defends the action, then there will be additional costs. If it gets to a hearing, then hearing fees need to be paid (anything from £25 – £410). Beyond this you may have to apply for a judgment against the Defendant and possibly enforce the judgment using the help of a bailiff – all incurring further fees.


Therefore, think very carefully before taking the court action step.


If you do decide to proceed, then the first thing you need to do is to write the other party a letter clarifying why they owe you money and that you are thinking of taking court action if the amount owed is not paid by a certain date (state the date clearly). All the necessary evidence must be provided to the other party with the letter even though you know that they have the facts already.


Writing a letter before taking any action is a very important part of the process and fulfills what is known as the ‘protocol’. Without having done so, you may jeopardise your case if it does end up in court.


At this stage there is another option; mediation. This provides individuals and businesses with a low-cost method of resolving a legal dispute without the need to go to court. Again, there is usually a fixed hourly fee to pay by both parties.


If you intend to go to court, then after you have sent the ‘protocol’ letter and the time limit for payment has passed, you will need to fill in a form either online or by downloading and printing it. The form is known as a Claim Form N1. You then send the completed form the County Court Money Claims Centre in Salford and pay the court fee (mentioned above).


What happens next depends on whether the ‘Defendant’ (the person owing the money) agrees to pay the amount or refuses to pay or ignores the whole thing!


The Defendant has 14 days to respond, after which time, if there is no response, you may decide to issue a county court judgment (commonly known as a CCJ) against the Defendant. This, in itself, has quite serious consequences for the Defendant because a copy of all CCJs go to a public company and may affect any credit search made against the Defendant’s name – a good and useful tool to add into any pre-action protocol letter that you send.


Once you have the judgement the Defendant may still choose to ignore you and not pay – in which case you’ll need to consider enforcing the Judgement – for example, engaging the services of a bailiff to seize property to cover the amount you are owed.


You can action the entire process above without the help of a solicitor. However, if you feel you do need a bit of extra advice or support then consider using a Paralegal. Paralegals are less costly than a solicitor and can help you in exactly the same way as a solicitor would.  Check that your chosen Paralegal is registered with a membership body like NALP, and holds the relevant Paralegal qualifications and insurance.



Amanda Hamilton is Chief Executive of the National Association of Licenced Paralegals (NALP), a non-profit Membership Body and the only Paralegal body that is recognised as an awarding organisation by Ofqual (the regulator of qualifications in England). Through its training arm, NALP Training, accredited recognised professional paralegal qualifications are offered for a career as a paralegal professional.

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