County Court Judgment

Should a company not pay its debts then the creditor may issue a court claim or instruct a Debt Collection Agency or other third party to do so. Normally this will only be done after the creditor has already chased the debt and after a Letter Before Action has been sent.

Typically a company is in financial distress if it allows the county court judgment to be entered against it.

Once a county court judgment has been obtained, this will be reported on the Register of Orders, Judgments & Fines for a period of 6 years. This will inevitably affect the company's credit score and therefore suppliers or lenders will be reluctant to offer credit on reasonable terms.

It is always recommended to try and avoid having a county court judgment registered against your company as the long term affects could seriously impair future trading.

If a county court judgment is paid in full within 28 days of it being entered then you can apply to have it removed completely from the Register which will restore your credit rating. However if it is paid in full after 28 days then it will stay on the Register for 6 years but be shown as satisfied.

From a credit perspective, an unsatisfied county court judgment is much worse than a satisfied county court judgment which in turn is worse than no county court judgment at all! The same applies from a Creditor perspective, a Creditor is very likely to give credit to a company without a county court judgment, likely to a company with a satisfied county court judgment and unlikely to a company with an unsatisfied county court judgment.

You can easily see how an unsatisfied county court judgment makes it very difficult to obtain future credit.

If a county court claim has been issued against your company then we recommend you obtain expert advice as soon as possible.

Business Rescue & Recovery can help you find solutions to these problems.

For help on this and other matters please feel free to contact us.