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Debt Advice Handbook 15th edition

3. Taking court action

• Types of claim
• Adjournments
• Applications: Form N244
• Clients with mental health problems

The person or organisation bringing court action is called the ‘claimant’. The person or organisation against whom court action is brought is called the ‘defendant’.

Most forms used in court proceedings are prescribed and can be identified by their number and title in the bottom left-hand corner. It is important that debt advisers familiarise themselves with these. The forms advisers most commonly encounter are available at gov.uk/government/collections/court-and-tribunal-forms.

Types of claim

Court action may involve the following.

•Money-only claims – eg, for repayment of an amount due under a loan, overdraft or credit card agreement. See Chapter 12 for more information.
•Claims relating to agreements regulated by the Consumer Credit Act that are not for money only – eg, for possession of goods supplied under a hire purchase agreement. See Chapter 13 for more information.
•Claims relating to land – eg, for possession of a house by a mortgage lender or landlord. See Chapter 13 for more information.
•All other claims – eg, a claim for the return of goods supplied under an agreement not regulated by the Consumer Credit Act and claims for declarations from the courts. These differ from money-only claims in that, if the client does not respond to the claim, the creditor must make a formal application to the court for judgment and submit supporting evidence. You should obtain specialist help if you come across these claims.

Adjournments

An adjournment is a court order to delay a hearing, either for a specified amount of time or indefinitely. The county court can either adjourn or bring forward the date of a hearing at any time. It can decide to do this itself or because one or both of the parties have applied.1r3.1(2)(b) CPR

Alert: Since 19 March 2020, court staff may waive the application fee to adjourn a hearing because of the coronavirus outbreak. Ultimately, however, it is the judge who decides whether the hearing will be adjourned or can still go ahead.2Guidance is available at gov.uk/guidance/applications-to-adjourn-civil-and-family-hearings-because-of-coronavirus-covid-19

As one of the main aims of the Civil Procedure Rules is to avoid delays in hearing cases, it is important, if possible, to attend court to apply for an adjournment in case it is not granted.

An application for an adjournment on the grounds of illness should be accepted, provided it is supported by a sick note, unless there is evidence that the illness or medical evidence is not genuine. Similarly, if an important witness cannot be present, a district judge should adjourn a hearing.

It is reasonable to grant an adjournment if there would otherwise be a miscarriage of justice. For example, if a client comes to a court desk in a county court hearing centre at 10am to ask for representation at a possession hearing a quarter of an hour later, it should be argued that there are (or may be) legal points which the court must hear and which cannot be adequately presented without further preparation. However, there must be some explanation of why the client has left it until the last minute to obtain advice or representation.

It is not a sufficient reason to adjourn a hearing simply because one (or even both) of the parties is not yet ready. Judges are often impatient or suspicious of applications to adjourn which they believe are merely means to prolong an action in which they believe the creditor should succeed. On the other hand, if the need for the adjournment arises because the creditor (or its representative) has failed to supply information or documents reasonably required by the client in connection with her/his defence, the judge is more likely to grant the adjournment.

A district judge should consider the merits of an adjournment, whether or not one or both parties are requesting one. However, it is clearly much easier to get an adjournment if the creditor agrees, and it is always worth contacting the creditor or its representative before applying for one.

 

1     r3.1(2)(b) CPR »

2     Guidance is available at gov.uk/guidance/applications-to-adjourn-civil-and-family-hearings-because-of-coronavirus-covid-19 »

Applications: Form N244

Applications are usually made on Form N244 – eg, an application to set aside a judgment or to stay (ie. put a hold on) execution of a High Court writ of control or to stay enforcement of a judgment debt.1CPR PD 23 Guidance notes to help complete the form are in leaflet N244.2Available from assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/952015/n244-notes-eng.pdf The court fee on an application made on Form N244 is usually but not invariably £275 for court fee 2.4(a), which is payable ‘on an application on notice where no other fee is specified’. A commonly found example of another fee being specified is court fee 2.7, which is ‘payable on an application to vary a judgment or suspend enforcement’, which is currently £14, and that would apply to the applications for a stay referred to above. See here for details of how to apply for full or partial remission of the fee.

An application can also be made verbally at a hearing that has already been fixed and can be made without using Form N244, but the creditor and the court should be informed (if possible in writing) as soon as possible.3CPR PD 23, paras 2.10 and 3(5)

The various sections of Form N244 should be completed as follows.

•Header. The court name is likely to be ‘In the County Court Business Centre’, but otherwise will be the name of the court which last contacted the client – eg, ‘In the county court at Northampton’. ‘Fee account’ is a fee payment system available for businesses who regularly use the courts. The ‘Help with fees - Ref no.’ box should be completed with the reference number provided by the court if the client has successfully applied online for full or partial remission of the court fee (see here).
•Section 1 should be completed with details of the client’s name, unless s/he has a legal representative (eg, a solicitor) acting for her/him.
•Section 2 should usually indicate that the client is the defendant (unless s/he has a legal representative acting for her/him or, exceptionally, if s/he is the claimant).
•Section 3 asks what order the client is seeking and why. This information must be supplied.4r23.6 CPR The following are suggested wordings for some common applications.
◦Redetermination/reconsideration: ’The judgment be paid by instalments of £x per month because I cannot afford to pay at the rate determined.’
◦Variation: ’Payment of the judgment debt be varied to £x per month because my circumstances have changed and I can no longer afford to pay at the rate ordered.’
◦Suspension: ’Payment of the judgment debt be suspended under s71(2) of the County Courts Act 1984 on the ground that I am no longer able to pay it because…’
◦Stay of enforcement: ’Any enforcement proceedings against me be stayed until a further order is made (Rule 83.7 of the Civil Procedure Rules).’
◦Stay of execution: ‘Execution of the Writ of Control be stayed under Rule 83.7(4)(b) of the Civil Procedure Rules so long as I pay the judgment debt and costs by instalments of £x per month because I am unable to pay the amount due in a lump sum’.
•Section 4 asks whether a draft of the order being applied for has been attached. This is not usually required unless the application is being made by consent.
•Sections 5 and 6 ask for information about the application. The client must indicate whether or not s/he wants the court to deal with the application at a hearing or at a telephone hearing. If a hearing is requested, the court fixes a time and date, and notifies the parties at the same time as it serves Form N244. You should use your experience to estimate hearing times, but can just leave the box(es) blank. If no hearing is requested, the application is referred to a district judge to decide whether it is suitable for consideration without a hearing. If no hearing is requested, the district judge may disagree and order a hearing anyway and the other party can apply to set aside or vary any order made without a hearing.5CPR PD 23, para 2.4 You should only ask the court to deal with an application without a hearing if it will not automatically be transferred to the client’s local court, and should also ask the court to use its discretion to transfer the case to the client’s local court if it decides that a hearing should take place.6Quoting r30.2(1) CPR

If it is not possible (or it will be extremely difficult) for the client to attend a hearing in person, s/he can ask the court to arrange a telephone hearing on Form N244. If it is the creditor’s or lender’s application, the client can request a telephone hearing in writing.7CPR PD 23A, para 6

•Section 7 should contain details of any hearing date already allocated for the case.
•Section 8 should usually specify a district judge for the hearing.
•Section 9 should usually specify the other party/ies as the persons to be served with the application.
•Section 9a asks for the address of any party named in the response to the previous section who is not the claimant or defendant.
•Section 10 should indicate whether the client is relying on a separate witness statement, her/his statement of the case or the evidence set out in the box on Form N244 in support of her/his application. The amount of text that can be fitted into the box is limited to 840 characters and so, in many cases, a separate witness statement may be needed. Evidence is required in certain cases (eg, set-aside applications) and the court can ask for evidence in support of an application. The client will not usually have served a defence and so any facts that s/he wants the court to consider should be set out in the box and any written evidence referred to and attached – eg, a financial statement. The client should sign the statement of truth at the foot of the box. There is no need for a financial statement to contain a statement of truth.
•Section 11 is a new section reflecting the provisions of Practice Direction 1A of the Civil Procedure Rules which requires the court to take all proportionate measures to address whether the ability of the client and/or a witnesss to participate in the proceedings and/or give evidence may be adversely affected by that individual’s vulnerability. The factors the court should take into account when assessing an individual’s ability as above are set out in para 5 - eg, undertanding the proceedings and her/his role in them. A non-exhaustive list of matters which may cause vulnerability for this purpose is contained in para 4. These include: age, communication difficulties, physical disability, mental health condition, learning difficulties, the impact of having witnessed a traumative event relevant to the case or her/his relationship with a party or witness - eg, domestic abuse. Once vulnerability has been identified, the activities covered by para 5 should be checked sequentially in order to assess how the client’s vulnerability impacted on them.8AXX v Zajac [2022] EWHC 2463 (KB) is an example of the court’s approach You should indicate whether the client and/or any witnessses are believed to be vulnerable in any way which the court needs to consider, including in what way(s) s/he is vulnerable and what steps, support or adjustment should be considered (a non-exhaustive list of possible measures is set out in para 10).
•Statement of Truth section reflects the additional wording required since 6 April 2020, acknowledging that the maker understands that contempt of court proceedings may be taken against anyone who makes a false statement in a document verified by a Statement of Truth without an honest belief in its truth. You should point this out to the client and the form should then be signed and dated, and the details of the client’s address completed.

 

1     CPR PD 23 »

2     Available from assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/952015/n244-notes-eng.pdf »

3     CPR PD 23, paras 2.10 and 3(5) »

4     r23.6 CPR »

5     CPR PD 23, para 2.4 »

6     Quoting r30.2(1) CPR »

7     CPR PD 23A, para 6 »

8     AXX v Zajac [2022] EWHC 2463 (KB) is an example of the court’s approach »

Clients with mental health problems

A client who ’lacks capacity’ for the purposes of the Mental Capacity Act 2005 (see here) is a ’protected party’ in any county court proceedings and can only take part in them through another person, known as a ’litigation friend’.

A creditor can issue a claim and it can be served on a client who is a protected party even if s/he does not have a litigation friend, but any further step taken before a litigation friend has been appointed (eg, entering default judgment (see here) or taking enforcement action – see here) is of no effect unless the court subsequently ratifies it.1r21.3(4) CPR. See also C Bradley, ‘The MCA 2005 and Litigation Issues’, Adviser 127.

 

1     r21.3(4) CPR. See also C Bradley, ‘The MCA 2005 and Litigation Issues’, Adviser 127. »