What is the process involved in Debt Collection?

We would initially advise Clients on the likelihood of collection based on the instruction we receive. If the client decides to proceed, the Debt collection process consists of the following;

1. Initial demand letter to debtor
This is a warning letter threatening legal proceedings unless full payment is received within 7-10 days.

2. Issuing legal proceedings
If there is no response or response is not satisfactory to the Creditor within the stipulated period, Proceedings are issued (on the instructions of the client) in the District, Circuit or High Court, depending on the amount of the debt claimed. The debtor will be given more time to respond and will either pay up (together with costs), ignore the notice or decide to fight the case.

3. Judgement
If no response is given either way, then a Court judgement (a Court Document confirming the amount of the debt owed and by whom) against the debtor is issued.

Following Judgment, there are several options available to enforce the judgement.

Normally, a warning letter will be sent to the Debtor informing them that Judgment has been obtained and to avoid enforcement of the Judgment, payment should be made immediately.

- Registered in the Registry of Judgements
This method is primarily for publication purposes whereby the registered judgement will appear in Trade publications such as Dun & Bradstreet (Stubb's) and the Irish Trade Protection Association (ITPA).

- Lodgement of Judgement with Sheriff
The Sheriff will attempt to seize debtor's assets. Proceeds from the sale of assets to cover the money owed will go to you via your solicitor.

- Judgment Mortgage
The judgment can be registered as a mortgage over any land or property owned or part owned by the debtor. It prevents the property being sold and you have the right to apply to Court to have the property sold off and the proceeds used to pay the debt.

- Instalment Order
Depending on the financial circumstances of the debtor a Court Order can rule that a debt maybe paid off in instalments.

- Bankruptcy
This applies only when the debtor is an individual and the debt is substantial. The effects of becoming bankrupt have very serious and long lasting implications and usually means that all the debtor’s property will be taken in and managed by the High Court in order to satisfy unpaid creditors.

- Liquidation
This process only applies to companies. A 21-day notice is issued and if there is no response or payment, then you may petition the High Court to request the winding-up of the debtor company and a liquidator to be appointed. The Liquidator must then sell all the assets of the company and distribute the proceeds to the creditors.