Locations
New figures released by the Registry Trust show that SMEs are being priced out of the justice system. Individuals and small businesses used to be able to secure a county court judgment to ensure that debtor (often a customer) paid money they owed. However, last year the Ministry of Justice introduced a five per cent fee on those bringing claims between £10,000 and £200,000, with fees only paid back after the judgment has been secured. If the claim is under £10,000 then the claimant must pay fees up front, and Rob Surridge, head of Debt Recovery at Fieldfisher, says this is unfair and is pricing small businesses out of chasing justice.
"This is a big kick in the teeth for the small business community", he said. "Cashflow is really important to the UK's small and medium-sized enterprises - being owed £10,000 would likely put a small business on the brink of extinction, so for companies to have to pay to claim back money that is rightly theirs is very disappointing.
"For claims over £10,000 companies can get their money back, but only at the very end of the process - and they may not have the finances in place to pursue the debtor through the courts.
"Small businesses are being priced out of seeking justice and that is clearly not right."
Rob Surridge heads Fieldfisher's Debt Recovery team, which offers a 'no-win-no-fee' service for claims over £750.