Late payments are putting significant pressure on business cash flows and it is no surprise to see that more and more companies are using the courts to obtain money that is outstanding.
During the first quarter of the year the total value of adverse county court judgments (CCJs) recorded in England and Wales rose sharply, according to figures released earlier this month by Registry Trust.
Compared to the first quarter in 2017 CCJ’s have risen by 7%, bucking a four-year trend where the number of CCJs issued had fallen year-on-year. Significantly affecting these numbers was the unusual presence of 2,125 judgments against the airline EasyJet.
The average value of an adverse business CCJ rose by 17% to £3,164. Combined, these changes caused the total value of CCJs to increase by a quarter. A 41% increase in the total value of judgments against the generally smaller, unincorporated businesses disproportionally accounted for the scale of this increase; the total value of CCJs against companies rose 19%.
20 judgments were issued in the High Court in the first quarter of 2018, which was six more than during the same quarter of the previous year. However, the average value of a judgment fell, by 96%. As a result, a 95% decrease in the total value of High Court judgments occurred.
The chairman of Registry Trust, Malcolm Hurlston CBE said: “The figures show an increasing tendency to take unincorporated businesses to court for debt leaving a lasting mark on their records.”
In total Q1 2018 has seen 32,003 CCJs registered against businesses in England and Wales.
Breakdown of Statistics
CCJs against all businesses Q1 2018 (compared with Q1 2017)
o Total number: 32,003 (up seven percent)
o Total value: £101.2m (up 25 percent)
o Average value: £3,164 (up 17 percent)
o Median: £1,013 (up 12 percent)
CCJs against incorporated businesses Q1 2018
o Total number: 24,156 (up 13 percent)
o Total value: £70.7m (up 19 percent)
o Average value: £2,927 (up six percent)
o Median value: £958 (up six percent)
CCJs against unincorporated businesses Q1 2018
o Total number: 7,847 (down seven percent)
o Total value: £30.6m (up 41 percent)
o Average value: £3,894 (up 52 percent)
o Median value: £1,145 (up 13 percent)
High Court judgments against businesses Q1 2018
o Total number: 20 (up six)
o Total value: £5.3m (down 95 percent)
o Average value: £264,500 (down 96 percent)
o Median: £8,170 (down 96 percent)