MOJ to change the transfer up value of Judgments to High Court

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#1 MOJ to change the transfer up value of Judgments to High Court

Post by Schedule 12 » 20 Sep 2016 16:13

Ministry of Justice
102 Petty France
London
SW1H 9AJ

general.queries@justice.gsi.gov.uk





Proposal to amend legislation to change the minimum claim value in a county court to transfer to the High Court for enforcement.



Article 8 of the High Court and County Courts Jurisdiction Order 1991 states:


  • Enforcement

    8.—(1) A judgment or order of a county court for the payment of a sum of money which it is sought to enforce wholly or partially by execution against goods—

    • (a)shall be enforced only in the High Court where the sum which it is sought to enforce is £5,000 or more and the proceedings in which the judgment or order was obtained did not arise out of an agreement regulated by the Consumer Credit Act 1974(1);

      (b)shall be enforced only in a county court where the sum which it is sought to enforce is less than £2,000;

      (c)in any other case may be enforced in either the High Court or a county court.


    (2) Section 85(1) of the County Courts Act 1984 is amended by the insertion, at the beginning of the subsection, of the words “Subject to article 8 of the High Court and County Courts Jurisdiction Order 1991,”.



Paragraph 8 of the High Court and County Courts Jurisdiction (Amendment) Order 1999 states;
  • 8. In sub-paragraph (1)(b) of article 8, for “£2,000”, substitute “£600”.




Members of the public with low value judgments against them are being unfairly penalised by having them transferred up to the High Court by commercial enforcement companies to attract for themselves, higher enforcement fees against the debtor.

Since April 2014 with the introduction with the Tribunals Courts and Enforcement Act 2007 (TCEA 2007), all debts regardless of their source and value, are enforced using the same procedures under Schedule 12 of the TCEA 2007.

In 1991 the threshold at which a judgment debt may be transferred up to the High Court for enforcement, was £2000, and any judgment sum below this value could only be enforced in a county court.

The threshold has been reduced on two separate occasions in 1995 and again in 1998 to the current threshold of £600. This is possibly the result of lobbying by groups supporting the commercial interests of High Court Enforcement Officers.

This results in low value county court judgments being transferred up and enforced in the High Court, burdening individuals on low income with thousands of pounds in enforcement charges under the Schedule of the Taking Control of Goods (Fees) Regulations 2014 (TCGFR 2014). It can amount to a debt/fee ratio of over 100%, which is far remote from Parliament’s original intention when it introduced the TCEA 2007 and TCGFR 2014.

Many debtors are forced onto benefits because the demands force their disposable incomes below the government poverty threshold for their circumstances, and this does not benefit to the taxpayer supporting commercial enforcement agencies.

This proposal invites Parliament to introduce an amendment to Article 8 of the High Court and County Courts Jurisdiction Order 1991 to change the minimum judgment value from £600 to be pegged the prevailing maximum claim value for the small claims track as prescribed in Civil Procedure Rule 27.1(2), currently £10,000



  • 8. In sub-paragraph 8(1)(b) of article 8, for “£2000”, substitute “The prevailing rate prescribed under CPR 27.1(2)
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#2 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Pote Snitkin » 20 Sep 2016 17:34

It can amount to a debt/fee ratio of over 100%
It could be over 200% on a £600 debt.

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#3 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 18:04

Ive seen much higher. I'm including some examples from HCE and DCBL to illustrate the extent of abuse of the fees regulations.

I've just taken an HCE case a few minutes ago from the helpline. I'm staying it and doing a variation because the fees are just mental. Its to take HCE out of the loop.
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#4 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 20 Sep 2016 19:21

From what I have seen, VAT can be charged on HCEO fees but not in other cases.
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#5 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 19:31

The VAT is reclaimable but only through a detailed assessment.

One judge missed it, and a solicitor is now representing the client to make an appeal on one count of error of fact and 2 counts of error of law.

I'm finding it easier to send detailed assessments unrepresented, and assign a solicitor to do the appeal after the judge makes an error.

My drafts are all digital and designed to be appealed. They all contain embedded appeals script containing all CPR's and Practice Direction's to enable me to process a higher volume of cases using the least amount of solicitor resources. The appeal can be done by selecting the relevant evidence, CPR or PD breached and it creates the appeals statement.

An appeal commands much higher fee incomes because of the nature of the work unraveling and writing up the judge's errors. Only the solicitor gets the Reasons Why statement. The judge has no way of knowing about it.
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#6 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Pote Snitkin » 20 Sep 2016 19:39

Michelle wrote:From what I have seen, VAT can be charged on HCEO fees but not in other cases.
QUESTIONDoEnforcementfeesattractVAT.pdf
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#7 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 19:40

Old material. Its been passed in a detailed assessment.
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#8 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 20 Sep 2016 19:50

http://thesheriffsoffice.com/high-court ... and-stages
HCEO fees are recovered in full from the judgment debtor when enforcement is successful. If enforcement is unsuccessful, as judgment creditor you only have to pay a Compliance fee of £75 plus VAT (£90)
This stage is known as Enforcement Stage 1 and the fixed charge at this point is £190 plus VAT (£228) plus 7.5% of the sums to be recovered over £1,000, again plus VAT.
For example, if the outstanding debt was £3,000, the 7.5% plus VAT would only be charged on £2,000 (£150 plus VAT [£180]). The sums to be recovered are the judgment debt, court costs, execution costs and interest.
:roll:
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#9 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Pote Snitkin » 20 Sep 2016 19:54

jasonDWB wrote:Old material. Its been passed in a detailed assessment.
Explain further.

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#10 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 19:55

You can't use it because its not authority. Its a website belonging to a company.

He even posts on the CAG board which says it all really.
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#11 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 19:56

Pote Snitkin wrote:
jasonDWB wrote:Old material. Its been passed in a detailed assessment.
Explain further.
The material you quoted has been used in a detailed assessment hearing and was allowed by the court.
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#12 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Pote Snitkin » 20 Sep 2016 19:58

jasonDWB wrote: The material you quoted has been used in a detailed assessment hearing and was allowed by the court.
Jason, you need to be clear! I know it was used in court - it's one of yours. Are you saying that VAT can now be added?

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#13 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 20 Sep 2016 20:02

jasonDWB wrote:You can't use it because its not authority. Its a website belonging to a company.

He even posts on the CAG board which says it all really.
Yes, but it's obvious VAT WILL be added on to the fees, and who is going to question it?

Surely if it was against the law they wouldn't put it on their website.
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#14 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 20:03

No it can't. There is no relationship between the bailiff and the debtor.
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#15 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 20:04

Michelle wrote:
Surely if it was against the law they wouldn't put it on their website.
They get away with it.

They only have to pay it back when a detailed assessment is brought.

I'm not sure the point of Chris Badger advertising those fees on his website. Its not like the "customer" has a choice.
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#16 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Pote Snitkin » 20 Sep 2016 20:06

Michelle wrote: Yes, but it's obvious VAT WILL be added on to the fees, and who is going to question it?

Surely if it was against the law they wouldn't put it on their website.
The really seem untouchable at times don't they? HMRC have clarified that VAT is not charged between a debtor and an EA, nor has it ever been. The EA's do it because they often get away with it.

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#17 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 20:22

A detailed assessment sets the creditor back about £3500 a pop. Its not known whether the creditor passes it on the bailiff company.
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#18 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 20 Sep 2016 20:31

Trouble is, most people wouldn't have a clue that they can get a detailed assessment done. :(
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#19 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 20 Sep 2016 20:36

They applied VAT to this OP's fees: viewtopic.php?f=7&t=3936&p=56721#p56672 :x
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#20 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 20 Sep 2016 20:37

He paid the amount outstanding. The fees no longer apply.
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#21 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Tuco » 21 Sep 2016 10:03

Why would HCEO's want to charge VAT if they weren't allowed? They only have to pass it on to the VAT man, there is no financial gain for them, it's not like the 20% goes into their coffers.

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#22 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 21 Sep 2016 10:06

There is no evidence it is paid as output tax. Its not output tax anyway.
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#23 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 21 Sep 2016 10:24

Tuco wrote:Why would HCEO's want to charge VAT if they weren't allowed? They only have to pass it on to the VAT man, there is no financial gain for them, it's not like the 20% goes into their coffers.
HCEOs are often used to enforce debts against businesses, most of which would be VAT registered, so there's no issues there. Judgments arising from debts reguled by the CCA cannot be transferred and these make up most CCJs against individuals for credit cards, catalogue accounts, bank loans, car finance, etc.

The problem is when an individual gets a CCJ for a different type of debt that can be transferred for enforcement, they will have to pay the extra 20% on top of the already extortionate fees and can't pass it on. :x

The £600 minimum doesn't apply to Employment Tribunals awards, although it would hardly be worth the hassle and fees to be awarded such a derisory amount. 20x that amount is more like it. :mrgreen:
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#24 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Pote Snitkin » 21 Sep 2016 10:41

The fact still remains that HMRC have confirmed that VAT should not be charged to the debtor. I know the advice was for CRAR, but there is no logical reason to assume this would not apply to other debts enforced by the HCEO.

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#25 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 21 Sep 2016 10:58

Pote Snitkin wrote:The fact still remains that HMRC have confirmed that VAT should not be charged to the debtor. I know the advice was for CRAR, but there is no logical reason to assume this would not apply to other debts enforced by the HCEO.
They have confirmed it shouldn't be charged, so what happens when the HCEO company submits their tax returns? They are clearly charging it, so where does it go? :roll:

Either HMRC is happy to pocket the money, as that's where VAT ultimately goes, or else the HCEO company is committing fraud by referring to that money as "VAT" when they never declare it as such. Either way, there's something very fishy going on. :?
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#26 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 21 Sep 2016 12:02

If the debtor is VAT registered, he still cannot reclaim it as input tax. See the HMRC briefing note.
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#27 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Michelle » 21 Sep 2016 12:05

jasonDWB wrote:If the debtor is VAT registered, he still cannot reclaim it as input tax. See the HMRC briefing note.
So WHERE does that money go? It can't just disappear down a black hole!
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#28 Re: MOJ to change the transfer up value of Jugments to High Court

Post by Schedule 12 » 21 Sep 2016 12:06

It seems to do just that.
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