Understanding High Court Writs and How to Protect your Business

There are various actions a creditor can take against your company for failure to pay the money you owe. High court writs are used by creditors to enforce unpaid County Court Judgments (CCJs). A creditor applies to the high court for a writ of execution, which can take various forms according to the circumstances and their needs.

If your business is facing action by high court enforcement officers (HCEOs), it’s important to know the type of action they can take, and also how to protect your business. So what are the various forms of high court writ available?   

Writs of execution

Writ of Control

A writ of control allows a high court enforcement officer to visit your business premises and identify assets for potential seizure. The purpose is to take control of goods to the value of the debt, and usually an additional amount to cover the HCEO’s fees, and then sell them at auction for the benefit of creditors.

Writ of Delivery

A writ of delivery may be served if your creditor wants to recover specific goods rather than receive monetary payment. It’s a form of enforcement commonly used by finance companies - where their customer has fallen into arrears, for example.

Writ of Possession

This type of writ relates to property or land, and is sometimes used in conjunction with a writ of control. A good example of its use is when high court enforcement officers carry out evictions at the same time as recovering arrears of rent.

What powers do High Court Enforcement Officers hold?

• High court enforcement officers hold more authority than county court bailiffs, but they must still provide seven days’ notice (excluding Sundays and Bank Holidays) of their intention to visit.
• They can visit your premises on any day of the week between 6 am and 9 pm, but also outside these hours if that is when your business operates, forcing entry if necessary.
• If you cannot pay, under the Taking Control of Goods Act, the HCEOs may either seize and remove goods immediately or make an inventory of goods for seizure, and demand you sign a controlled goods agreement. In this case, if you don’t pay they can return to seize the goods for sale at auction, but they must provide another seven days’ notice of the sale.
• Goods earmarked for seizure typically include office furniture and office equipment, company vehicles, portable plant and machinery, and stock.

Although a visit from high court enforcement officers is intimidating, the removal of goods is generally a last resort. HCEOs typically prefer to come to a payment arrangement using the threat of seizure to encourage a binding agreement.

How can you protect your business from a high court writ?

Know your rights

It’s important to remember that high court enforcement officers are bound by strict regulations, both in terms of their powers and their conduct - they must not seize goods belonging to a third party, for example.

If this does happen, you should provide proof that the goods don’t belong to you if possible, otherwise you’ll need to contact the owner so they can use retention of title if appropriate, or make a claim.

Additional finance

Seeking additional funding can help to protect your business from the threat of high court writs, but given the timescales involved you would need to raise cash quickly. Alternative finance options include asset-based lending, invoice finance, and merchant cash advances, but which would best suit your business depends on its structure and the industry in which you operate.

Seek professional advice

Contacting a licensed insolvency practitioner early on may help to find a solution before high court enforcement officers visit. It may be possible to apply for a ‘stay of execution’ that delays enforcement of the debt, for example, and allows you to organise your finances.

The professional advice given could also lead to your business entering a formal insolvency process that protects it from creditor legal action, such as:

• Company Voluntary Arrangement (CVA)
  A Company Voluntary Arrangement may be appropriate if the company’s financial issues are believed to be temporary. It’s a legally binding agreement to repay the company’s debts via a single monthly payment, which is distributed to creditors in the agreed proportions.
• Company Administration
  When your company enters administration an eight-week moratorium period begins that stops legal action, allowing a decision to be made on the best way forward. A number of options may be available including selling the business as a going concern, turning the company around, and entering a Company Voluntary Arrangement.

If you’ve received a high court writ and are facing enforcement action, Begbies Traynor can offer valuable professional guidance. We are the UK’s largest professional services consultancy and offer expert independent advice. Call one of the team to arrange a same-day consultation at one of over 80 offices nationwide.