Continued Fall in Judgments

Published on February 24, 2014    |     No Comments   by in Enforcement

The raw material of many High Court Enforcement Officers shows a drop again in figures released by the keepers of the registers – Registry Trust Limited. Judgment Debts against businesses fell by 6% last year accordingly to the reliable stats of the RTL team.

Here at Shergroup we are big fans of the discreet RTL service which has had a bit of a rough ride from Government on whether it can justify its position as keepers of this all important judgment data. Personally I find that a bit of a joke because when Government started its review of enforcement in 1998 it had to admit it had little or no judgment information.

Over the years since I have been involved with RTL – from the time when the charming Paul Mudge was Chief Exec – through to the stewardship of the immensely sensible Jon Hale, I have been a big admirer of how this modest and low key provider of information has kept its cool, delivered an accurate service and woven itself into the fabric of the credit industry.

Through the changes to the Sheriffs, and into our new world as High Court Enforcement Officers, Jon has been a strong support of all HCEOs, and I do thank Jon and his entire team for that. When the Sheriffs reformed in 2004 and had to produce a central register of insolvency notices, the RTL board supported NICESheriffs to the hilt.

Unfortunately the powers that be on the HCEOA Board walked away from that support – for reasons I don’t entirely understand – to leave HCEO data shall we say “a little up in the air”. Personally I would have preferred to see a growing relationship with RTL on all things to do with stats for HCEO business because they could have produced an independent audit to the business transferred from the county court to HCEOs that could have been used by HCEOs to strengthen their position with Government based on real enforcement experiences.

The data that NICESheriffs collated could have been extended into a central database for judgment debt activity showing not only that a Writ had been issued, but the behavior of debtors after an HCEO knocked on the door. This in turn could have been used by the credit industry as a more sophisticated measure of a judgment debtor’s determination to pay.

I am not saying all is lost in this regard – and indeed I would encourage the production of more meaningful behaviours around what happens to CCJs when they are enforced.

So going back to the data that was released apparently there were 115,700 business CCJs in England and Wales in 2013 compared with 122,900 in the previous year, continuing a decline from 207,100 in 2009. This downward trend in the county courts is consistent across both incorporated and unincorporated businesses.

The only thing I find a little strange in the RTL data was an upward trend when it came to report on High Court judgments. Apparently High Court judgments against the smallest businesses (non-corporate) rose nearly 50 percent last year to 100, whereas there was a small decline to 109 in the number of judgments in the High Court against companies (incorporated businesses).

The figures for High Court are tiny compared to the numbers of county court judgments, and again RTL, along with the previous Senior Master, Robert Turner, were instrumental in getting the registration of High Court judgments formalized into an RTL process. As you may know a High Court judgment is for a claim started in the High Court which is over the threshold for High Court claims. Years ago people started routine litigation in this forum which was then transferred down to the county court if the case became too complex. I still yearn for that system! But like all things that was washed away when Lord Woolf’s reforms were introduced in April 2004 – blimey that’s nearly a decade ago! Suffice to say I am not sure 100 High Court judgments are really an indication of anything except that a tiny number of people went straight to the High Court for a judgment rather than starting their claim in the county court. They must have been above the threshold and resulted in judgments either by default, summary judgment, or a full hearing.

Can we read anything into all of this? Well I think personally people are still litigating and entering judgment but are looking more carefully at their ROI when spending money on litigation. Here at Shergroup we support this approach, as it means the judgments that are issued, are usually more likely to be enforceable and we salute RTL for providing us with all this reliable information year after year!

 

Bungling Ideas on Government Debt

Published on February 17, 2014    |     No Comments   by in Enforcement

One of my pet hates is the failure of Government to get to grips with its own debt collection while the taxpayers have to dig deeper to fund the gap.
This week I saw more information seeping out from the National Audit Office (NOA) that there is no integrated approach for managing debt across government. No surprise there then!

Apparently the Cabinet Office has raised awareness of the issue across government and HM Treasury has agreed new financial incentives for departments, but the centre of government has not yet fully got to grips with debt management, and the report highlights the need for the Cabinet Office and Treasury to work together better.

Individuals and businesses are in debt to government for overdue tax liabilities, benefit or tax credits overpayments and other reasons, including outstanding fines and court confiscation orders. The NAO data suggests that overdue debt identified by government was at least £22 billion at March 2013, against total collected revenue of over £600 billion in 2012-13. I mean just how many hospitals, schools could be built with this sort of money.

According to today’s report, £6 billion of debt was written off in 2012-13 as irrecoverable, or ‘remitted’ on the basis that it was not a good use of scarce resources to pursue it. Really? And who made that decision? Was it made by people who understand data and pursuing people through the courts or was it made by people who only have an interest in collecting the “cream” at the top of the milk?

You see I just don’t believe enough is done to collect in debt owed to HM Government. I see Government partnering up with large almost institutional collection agencies, ignoring specialists like my own company, and countless other providers I know personally, in favour of collection strategies which miss some easy wins because it needs some out of the box thinking.

In total, government accounts show losses of more than £32 billion over the last five years. The time limit for statute barred debt is 6 years – so this debt is still within the time zone for advanced collection strategies!

As the report rightly says Government cannot easily control all losses – apparently around 70 per cent result from write-offs in insolvency cases. But it intends to learn lessons from the way the tax credits system works to create overpayments to ‘design out’ unnecessary debt when implementing future policies such Universal Credit. I don’t much like the sound of that – sounds like tinkering to me to massage the figures!
And again as the report states Government allows too much overdue debt to age, and this can lead to its value being eroded, as older debt is more difficult to collect – ain’t that the truth. A shocking statistic was that some 61% of debt owed to HMRC was more than 180 days old and for DWP, 81% of benefit overpayment debt was more than 180 days old, although legal restrictions limit the rate of repayment from people on benefit, who make up 66% of DWP debtors.

I mean it is truly shocking to me that HMRC should have 61% of its debt over 6 months old. I feel the largest debt collection machine in the land has virtually given up on enforcement for fear of sending the wrong message – the message of compelling people to pay their tax! What’s wrong with that? In years gone by Shergroup enforcement collected this debt for HMRC using High Court Enforcement Officers who would remove goods if the tax was not paid. It was a simple and immediate remedy which served HMRC well – I know because I went to the meetings. At that time local collectors managed debt in their own areas and the whole situation was overseen by the Head Office in Bradford. Then gradually the local offices were closed and everything was centred in Bradford and I think that’s where it went wrong for HMRC – the enforcement part of their civil debt recovery programme got to far away from the people on the ground who knew the taxpayers better and the local conditions in their areas.
Today’s report acknowledges that HMRC and DWP are working to reduce old debt by improving their understanding of debtors. However, the ability across government to manage debt is undermined by poor quality data, barriers to data sharing and inconsistent definitions. HM Courts & Tribunals Service, for example, found in a pilot that more than 96 per cent of aged debtor records were missing one or more basic pieces of information, such as a telephone number.

Again that is a shocking statistic to me. I mean as High Court Enforcement Officers we have our challenges on getting the correct data – in fact you could say it is a personal passion of mine to get the best data possible before working a case for enforcement but in this day and age there is no excuse for Government not to have access to the best systems and ways to extract data from a variety of systems by API links. This year I have already seen two systems that have blown me away in terms of their ability to extract data and converge it into a database that is so far out of the stratosphere that I am now busy implementing that technology in our revenue management and enforcement divisions. So if a company the size of Shergroup can do that – why can’t Government?

And then there was that big fanfare in 2012 of Ministers agreeing to look at bringing together government debt management and to make better use of departments’ buying power for specialist debt services. Conflicting priorities, poor data and uncertainties over departmental take-up have led to delays in agreeing a way forward. All I can say is “let me at ‘em!!!”. This is all such a waste of time – and blustering!

Apparently a business case is now being considered by the Treasury for departments to have a single point of access to external debt services, but the timetable is challenging, with services planned to start in late October 2014. Now that sounds more encouraging – but again will it actually happen?

The NOA report confirms it is not currently possible to produce a ‘single view of the debtor’ across all departments. Furthermore, suitable data with which to benchmark the costs of debt management and collection across government does not yet exist, making it difficult for the centre of government to identify where best to target resources, and for departments to compare their performance. Now we need this tackled to be able to put into place some of the innovation which was anticipated in the Tribunals Courts and Enforcement Act 2007 – Part 4. A ‘single view of the debtor’ would enable us to improve and strength court based enforcement in the area of attachment of earnings, orders to obtain information, third party debt orders, and departmental information orders and requests. All these improvements require “joined up data”.

In short I remain skeptical of those advising Government of what is possible and I remain unimpressed with Government’s failure to work smarter to collect in its cash. It’s easy to push the burden of tax on to those who can least afford it while bungling the big stuff of getting databases to join up! That needs to stop and Government needs to work faster and smarter to ensure it collects its current debt, and its past due debt, right up to the statute limit and without allowing political correctness to ensure a fair and universal approach for all.

 

Commercial Rent Arrears Recovery (CRAR)

Published on February 12, 2014    |     No Comments   by in Enforcement

Commercial Rent Arrears Recovery Update
As many of you will know by now the Tribunals, Courts and Enforcement Act 2007 (TCEA 2007) received Royal Assent on 19 July 2007. Part 3 of the TCEA 2007, which is due to come into force on 6th April 2014, introduces the statutory procedure for taking control of goods in England and Wales. The procedure is set out in Schedule 12. Part 3 also abolishes the ancient remedy of distress, replacing it with a modified statutory procedure—CRAR – which is due to come into force on the same date. The Taking Control of Goods Regulations 2013, SI 2013/1894 set out the detail of the procedure.

So what is CRAR -Commercial Rent Arrears Recovery?

CRAR is a self-help remedy for landlords which replaces the ancient remedy of distress. The purpose of the initiated by a landlord’s instruction to an enforcement agent (formerly a bailiff) to either take control of goods at the premises or to collect rent up to the value of the arrears. The Government’s decision to reform the old rules, which date back to medieval times, was based on the fact that the old procedure was found to be lacking on the all-important question of a tenant’s human right to a fair hearing. Distress for rent was a pretty open and shut procedure which didn’t give the tenant an opportunity to oppose the landlord’s decision to call in the bailiffs.

So in reforming the law the Government decided to bring in this new procedure as part of the overall reform of enforcement law.

So under CRAR the landlord can recover outstanding rent – and only outstanding rent which means that interest, VAT and permitted deductions are deducted. The rent must also exceed a minimum amount (currently proposed to be the equivalent of seven days rent, but subject to change).

In deciding to send in an enforcement agent CRAR – Commercial Rent Arrears Recovery gives a landlord three methods for taking control of the goods:

  • by securing goods on the premises or on a public highway
  • by a controlled goods agreement (this was known as a walking possession agreement)
  • by removal from the premises

Naturally we hope that landlords will choose Shergroup Enforcement as their providers for the enforcement of the CRAR procedure by securing goods and ultimately removing them from property if the need arises.

When is Commercial Rent Arrears Recovery (CRAR) due to come into force?

Following a consultation, the Government has confirmed it will proceed with the abolition of distress and will be introducing CRAR. Part 3 establishing CRAR, is due to be in force on 6 April 2014.

Points to Note
In broad terms landlords can expect the following changes:

  • CRAR can only be undertaken by certificated enforcement agents (the new term for bailiffs)
  • Before the enforcement agent takes control of the tenant’s goods, he must give the tenant 7 day’s notice in writing. This can be hand delivered to the tenant
  • When the agent returns to take control of the goods, it can be on any day of the week between the hours of 6am and 9pm. However, if the tenant’s business operates outside those hours, the agent can attend at a time when the business is in operation
  • CRAR will only apply to commercial rent and cannot be used at all if any part of the demised property is residential
  • Only rent arrears can be recovered – even if service charge etc is reserved as rent, CRAR cannot be used to recover the outstanding money
  • A minimum of 7 days’ unpaid rent will be necessary to use CRAR

So, for landlords, the main issue will be the giving of notice in writing by the enforcement agent to the tenant 7 days before any action can be taken to secure the tenant’s goods.

Some commentators are worrying about goods disappearing in this 7 day window but in our experience it is unusual for people to take steps to deliberately avoid enforcement action in this way.

Our view is that the Commercial Rent Arrears Recovery process will become more aligned with the work of High Court Enforcement Officers when enforcing a Writ against goods – soon to be called a Writ of Control. High Court Enforcement Officers always given notice of the intention to remove goods in a commercial setting and it is rare to go back and find the goods have been wilfully removed to avoid further enforcement action.

In any event the requirement for a notice to be served can be dispensed with if a landlord seeks a court order believing that goods are at risk and Shergroup Legal will be happy to make that application for our landlord clients and their advisors.

Otherwise, landlords will need to make sure that they are ready to instruct an agent to send notice as soon as rent becomes overdue and here our client can utilize the services of our Sherlock brand to serve notices.

A notice by the landlord, possibly on the rent invoice itself, will, it seems, not satisfy the regulations and a further 7 days’ notice must be given by the agent.

Regulation Update

New regulations have been published (see the Taking Control of Goods Regulations 2013, SI 2013/1894 (the Regulations)) which set out the detail of the procedure.

Part 2 of the Regulations relates to the procedure for taking control and the notice period. This is now seven days not the suggested 14 as per the draft consultation. This part deals with the time limit for taking control, the circumstances when a landlord can take control, controlled goods agreements and securing goods.

Part 7 addresses CRAR and confirms that the minimum amount of net unpaid rent that needs to be due to exercise CRAR is now seven days rent. This part also deals with the landlord’s right to recover from a sub-tenant.

What is the practical effect on landlords?

CRAR is designed to be a human rights compliant system. However, many commercial landlords see it as a watered down version of distress, which will inevitably make the recovery of arrears more difficult as:

  • CRAR can only be exercised on purely commercial premises (TCEA 2007, s 75)
  • CRAR only provides a remedy for pure rent arrears, not service charge or any other payment, even if it is reserved as rent
  • a landlord must serve seven days written notice on the tenant prior to taking any steps unless there is a reasonable chance the tenant will try and dispose or relocate the goods

If the system does not prove effective, there may be a rise in litigation and/or amendments to the Regulations.

Landlords may be forced to rely more on other recovery options including utilizing rent deposit deeds, recovering from guarantors, serving statutory demands and issuing proceedings for unpaid sums.

Now the small claims limit has been increased to £10,000 under the Jackson Reforms, an increased number of court applications may be seen.

Next steps for lawyers?

We would encourage our lawyer clients to highlight the limited scope of CRAR regime to their landlord clients as now only pure rent can be recovered. And with that in mind, the question is going to come back about the other forms of outstanding payment. We feel sure there are opportunities for people to use the full force of the law to collect the bits that CRAR can’t reach.

Don’t forget Shergroup offers a complete one-stop shop for CRAR as follows:

Service of CRAR Notice | Sherlock | www.sherlock.uk.net
Enforcement of CRAR Notice | Shergroup Enforcement |www.shergroup.net/enforcement
Legal back up for CRAR procedure | Shergroup Legal | www.shergroup.net/legal
We look forward to supporting you through this change with our expert service and passion for enforcement!
31 January 2014

 

An Outline of the New Taking Control of Goods (Fees) Regulations 2014

Published on February 11, 2014    |     No Comments   by in Enforcement

New Taking Control of Goods (Fees) Regulations 2014
It was as long ago as 1997 that the writing was on the wall for the Sheriffs that their future as an independent provider of enforcement services to the English and Welsh court system was going to change or be extinguished. When I think back I realize how much has been achieved as a result of my determination to save the Sheriff’s service and which we all now know is part of the world of High Court Enforcement Officers or HCEOs.

At the nub of driving reform forward was the need to make the Sheriffs accountable to Government (rather than to the judiciary or The Sovereign) so as to bring the whole Office of Sheriff into a modern day framework of accountability.

There was no point arguing against Government’s determination then or now, and instead the Sheriffs took the pragmatic view to work with Government and get the system for enforcement sorted out. We have as a national agency achieved that and indeed have gone way beyond I suspect what we expected from our efforts.

Perhaps the most positive thing to come out of reform for me is the reform and simplification of the fees that High Court Enforcement Officers and other enforcement agents will be able to charge in the future. These new Regulations make the whole system of enforcement easier to understand and apply for creditors and debtors alike and that has to be a good thing. Of course there will be a need for the new fees to “bed in” and no doubt grey areas in the legislation are already becoming apparent but the system will evolve and it will be up to us as enforcement agents to make it work for the judicial system and for our businesses.

So what do these new Regulations mean? In essence they follow the process of how enforcement will be conducted in future. Either it will be under a High Court Writ of Control – or it will be under some other enforceable instrument. Either way the Regulations make provision for the recovery of fees and disbursements from debtors by enforcement agents where the procedure for taking control of goods is conducted under Schedule 12 to the Tribunals Courts and Enforcement Act 2007 (TCEA).

The TCEA provides a new statutory code for how goods will be taken in future to pay debts and updates the ancient rules on execution against goods and distress for rent. Under section 62 of TCEA the “Schedule 12 procedure” is available where an enactment, writ or warrant confers the power to take control of a debtor’s goods which can be sold eventually if payment is not made. It is also available in relation to commercial rent arrears recovery under section 72 of the Act .

Where an HCEO or enforcement agent (formerly known as a “certificated bailiff” or some other generic term for the word “bailiff”) uses the Schedule 12 procedure then new Fee Regulation 3 will apply and this will extend to the new procedure called “CRAR” or commercial rent arrears recovery. It is also worth understanding new Fee Regulation 2 which sets out general interpretative provisions including a number of new terms such as replacing “Walking Possession Agreement” with “Controlled Goods Agreement” which I personally like. I never liked the term “Walking Possession” which was hard to explain to a lay person – be it creditor or debtor. Now it’s pretty obvious – if an enforcement agent takes control of your goods you will be enforced to sign a “controlled goods agreement” which sets out the terms of the arrangement with the enforcement officials.

Regulations 4 to 7 concern the recovery of fees from debtors out of the proceeds as defined in new Fee Regulation 2.

Going forward fees will be recoverable by reference to the newly introduced stages of enforcement as defined in new Fee Regulation 5 and 6 (Regulation 5 is for fees applied without a High Court Writ and Regulation 6 applies to cases where a High Court Writ is in place for cases where the enforcement power is derived other than from a High Court writ, and in regulation 6 for High Court writs.

Fees are recoverable on a fixed basis for each stage, but in certain situations an additional fee is recoverable as a percentage of the value of the sum to be recovered which is of course the incentive for the enforcement agent to get the creditor paid (see new Fee Regulations 4 and 7). All the way the process of reforming the fee provisions Government was constantly reminded that HCEOs are the agency that recover the fees for judgment creditors when their own public sector bailiffs have not always recovered the cash and remains the position and experience of Shergroup users today as it did in 1997! Not much has changed on that front I am sad to say.

Where the enforcement agent and the debtor enter into a controlled goods agreement (as defined in paragraph 13(4) of Schedule 12 to the Act) and which the debtor complies with, only the first enforcement stage fee is payable. However, if the debtor does not enter into such an agreement, or does so but breaches the agreement, both the first and second enforcement stage fees are applicable. In our experience judgment debtors get nervous about signing any paperwork and advisors should do their utmost to encourage the public to sign the new agreement or expect enforcement agents to add on second stage enforcement fees.

Disbursements are also recoverable from the debtor out of the proceeds, and are addressed in regulations 8, 9, and 10. They may only be recovered in accordance with the new Regulations (regulation 8(1)).

Regulation 8 provides for common disbursements such as storage of goods, hire of locksmiths to enter and to secure premises, and court fees for various applications relating to the Schedule 12 process where the enforcement agent’s application is successful.

Regulation 9 provides for the cost of sale, including by public auction and also for internet auction.

Regulation 10 permits application to the court for permission to incur or recover exceptional disbursements (for example, the cost of insuring a valuable or rare item whilst it is out of the debtor’s control). Only recently Shergroup Enforcement Officers have been engaged in the taking control of aircraft for sale and as you might expect the cost of the enforcement activity is largely not covered in the costs which are allowed.

Regulations 11 and 12 make specific provision to protect debtors. Regulation 11 requires enforcement agents to minimise the fees and disbursements charged where they act in relation to more than one enforcement power. This has to be right – and over the years Shergroup Enforcement Officers and their support teams have always been sensible about this sort of multiple fee situation. Where practicable, they are expected to deal with the goods together and on as few occasions as possible.

Regulation 12 makes provision to protect vulnerable debtors. The enforcement agent is required to give such a debtor an adequate opportunity to obtain assistance and advice prior to removal of the goods. The enforcement stage fee (or fees) is not recoverable unless such an opportunity has been given.

Again the new Regulations do not prohibit the removal of goods where a person is identified as “vulnerable” and I think it is important that everyone understands that vulnerable people can be enforced against fairly and professionally where the situation is right to do so. As in the past this has often been at the discretion and good sense of the enforcement agents concerned and I think my team has always treated people in vulnerable situations with fairness and empathy for their predicament.

Regulation 13 provides for the order of application of the proceeds of sale where the amount recovered is less than the amount outstanding. Any fees and expenses owed to an auctioneer, and the compliance stage fee for the enforcement agent, are prioritised, with the remaining proceeds being divided pro rata between payment of the debt and payment of the remaining fees and disbursements due to the enforcement agent. Again this is not dissimilar to what we do now – and means that we continue to work with judgment creditors to give them a successful enforcement outcome.

Regulation 14 requires the enforcement agent to provide the debtor and any co-owner with specified information relating to sale or disposal of the goods, and equivalent provision is also made for the situation where the debtor has paid, or seeks to pay, the amount outstanding prior to sale or disposal.

Regulations 15 and 16 make provision for disputes about a co-owner’s share of proceeds, and about the amount of fees and disbursements recoverable by the enforcement agent, to be referred to the court for resolution. I welcome this although we probably don’t see this problem as much in High Court enforcement as in other types of enforcement business.

Regulation 17 prevents recovery of fees or disbursements by an enforcement agent in relation to any enforcement stage during which the enforcement power ceases to be exercisable.

And finally specific provision is made for orders made under section 78 of the Act relating to commercial rent arrears recovery. I will be blogging about CRAR separately! I don’t see the need to mix that up in a blog piece which is essentially about the fees that will be charged in relation to the enforcement of a High Court Writ of Control for a sum of money.

So please treat this blog as a prelude to more information coming from me and my team about how we will be working with our stakeholders after the 6th of April (my son’s 13th birthday). We are here to help anyone understand the application of the new fees and the new enforcement process and we can be reached on 0845 890 9200.

 

City lawyers warn fees increase will drive away litigants

Published on February 6, 2014    |     No Comments   by in Enforcement

In a recent article in the Law Society Gazette published on 30th January, City lawyers have warned the Government that they risk driving international litigants out of England and Wales if it insists on a sixfold increase in court fees.

The City of London Law Society have this week given a damning verdict on Ministry of Justice plans to generate around £200m a year in higher fees.

Proposed changes include increasing fees paid by parties in commercial disputes to up to £20,000 and introducing a daily hearing fee of £1,000.

Fees for cases involving claims for money will increase on a sliding scale, with a maximum fee of £1,870. In future the government is to consider introducing a system where the fee is calculated as a percentage of the amount under dispute in a case.


In a damning comment the litigation committee of the City of London Law Society chaired by Clifford Chance partner Simon James, accused the government of seeking to ‘exploit the courts’ near-monopoly position by using them as a means to raise money’.

The committee’s response said: ‘Many international parties may be able to afford the higher fees proposed, but a more than six fold increase in fees will make the level of court fees a subject that lawyers must discuss with their international clients, will not encourage parties to litigate in England and will inevitably offer a marketing opportunity to competitors. I guess by “competitors” then other jurisdictions could try and edge out the English court system. But then you have to ask yourself where exactly would you want to litigate other than England? I mean where are the bastions of efficient civil justice process in the world? Would it be right to say that the English courts for the moment have an edge on pretty much any other Court in Europe? And even if you thought there were more efficient courts would you say that the enforcement systems were equally as efficient? I say this as I am on a mission to find a jurisdiction where the whole process of civil justice is as efficient as England – from start to finish – not just start to mediation – it has to include the enforcement process as well.

For 10 years Shergroup clients have been driving us forward to meet their expectations – such is the want of the private sector. And when it comes to driving down transfer times for money judgments to the High Court and ensuring visits are made by our High Court Enforcement Officers within days to achieve a result I think it fair to say we have pushed every performance standard forward to meet the expectation of the judgment creditor.

Courts minister Shailesh Vara said last month: ‘We have the best court system in the world and we must make sure it is properly funded so we keep it that way.



‘Hardworking taxpayers should not have to subsidise millionaires embroiled in long cases fighting over vast amounts of money, and we are redressing that balance.’

The consultation closed on January 21 but there is no date yet for a response from the MoJ.

Let’s hope that the changes proposed under the Taking Control of Goods Regulations 2013 continue to underpin a successful and energetic High Court enforcement system – which has been created as a result of Government intervention in the old Sheriff system.

 

Still Unconvinced About The Effort Going In To Collect Fines

Published on January 8, 2014    |     No Comments   by in Enforcement

So let’s talk about the amount of money outstanding to Government in the form of fines. Whilst the country continues to try to fund everything from immigration to the health service the Government continues to grapple with the question of being to collect the fines it imposes through the criminal courts.

These fines are ordered by the criminal courts for payment by offenders at sentencing and include financial penalties such as fines, prosecutors’ costs, compensation orders and victim surcharge.

In fact fines are the most commonly used sentence and form a significant part of HMCTS’ collection and enforcement business. Accounting centres also enforce penalty notices for disorder and fixed penalty notices transferred to Her Majesty’s Courts and Tribunal Service as fines.

Fines can be imposed by the magistrates’ courts and the Crown Court; however they are all collected and enforced by the magistrates’ courts.

In the latest set of Government stats to be published, being for the third quarter of 2013, the total value of fines paid, regardless of the age of the imposition, was £74 million; which is a pleasing 9% increase compared with the same quarter of 2012 and a 6% increase on the previous quarter.

The total value of fines imposed in the third quarter of 2013 was around £106 million; an increase of 6% compared to the same quarter of 2012. And in the same period of 2013, 13% or £14 million of fines which were imposed by the criminal courts were paid within the month they were made.

Each year there are a number of fines that are cancelled, either administratively or legally. Legal cancellations can be applied after the case has been reconsidered by a judge or a magistrate and may follow a change in circumstances. Administrative cancellations are only applied in accordance with a strict write off policy, e.g. where the defendant has not been traced, these can then be re-instated if the defendant is then traced. So that poses a question in just why is it so hard to trace a person who has been found guilty of a criminal offence – what about tax or benefit information to make it virtually impossible to stay under the radar when it comes to paying what is required? Of course a person may not have the funds – but that is not the same as saying they cannot be traced.

The latest stats show that around 6% (£6.5 million) of the financial penalties imposed in the third quarter of 2013 had been cancelled.

And here’s the biggie …. in the third quarter of 2013, the total value of financial impositions outstanding in England and Wales was £566 million. This has consistently fallen and is down 2% on the previous quarter. It is good to see a reducing figure – but when all around is getting tougher, and services are being cut left right and centre I still remain unconvinced that enough is done by Government to chase in this part of its coffers so that the burden is less on the rest of us who stay on the right side of the law.

 

Taking Control of Goods Regulations 2013 | 2014

Published on December 17, 2013    |     No Comments   by in Enforcement

Taking Control of Goods (Fees) Regulations 2014 laid in Parliament

Couple of things hit my desk today which as an authorised High Court Enforcement Officer for the High Court in England and Wales and I need to share with my blog followers!

First there is the announcement from the MoJ that the Taking Control of Goods Regulations are being laid before Parliament ready for implementation in April 2014 – and a quick review of these (there will be more blogs to follow) confirm we are seeing the standardization of process and compliance which the enforcement industry badly needs and which we fully support here at Shergroup in our business delivery. I have, as many of you know, over the last 20 odd years been able to add my two penneth on the development of the law in this area. Sometimes it has been frustrating – I didn’t like it when the word “Sheriff” disappeared from the Civil Procedure Rules, and I have never supported the fact that the Government have been slow to modernize, invest in, or cut altogether their private civil enforcement teams. This issue has all sat on the fence for far too long – at no fault of the bailiffs themselves I may add. But in an environment in which police officers are cut with gay abandon it is a bit that the county court bailiff system has stood still in time.

Apparently there are to be three statutory instruments the first of which is The Taking Control of Goods Regulations 2013 – which will underpin the Government’s package of reforms to bailiff law, and this was laid before Parliament yesterday. Here’s the link http://www.legislation.gov.uk/uksi/2013/1894/contents/made
The new Regulations will be implemented in April 2014. They will be followed by regulations – which Government intend to lay before Parliament in the autumn which will specify the fees an enforcement agent is allowed to charge. There is to be one further instrument which will set out the requirements an individual must meet, including certification and training, before they can work as an enforcement agent. This latter instrument will also include details of the complaints processes which will be available. These instruments will be implemented alongside the Taking Control of Goods Regulations in April 2014.

The approach has been to lay the Taking Control of Goods Regulations ahead of those regarding fees and certification. Governments see it as “crucial” that the procedural detail is settled in law first, as this will impact on the detail of the fee and certification regulations. Apparently Government is continuing to work with stakeholders to finalise the content of the Fees and Certification Regulations, as well as supporting guidance, to ensure the new regime will be robust enough to stamp out abuse while continuing to allow the civil justice system to function effectively.

Highlights in the new Regulations include protection for debtors including, amongst others:

  • the introduction of a 7 day notice of enforcement, designed to encourage early payment where possible or an additional opportunity to seek advice where a debtor is in difficulty;
  • restrictions on the days and hours that enforcement action can take place as well as how and when an enforcement agent may access a property;
  • restrictions on the goods an enforcement agent can take, ensuring those needed for the basic domestic needs of a debtor and their family are protected;
  • mandatory information to be given to the debtor when they enter a controlled goods agreement (walking possession agreement), ensuring they know what goods are under the control of the enforcement agent and the terms of the agreement and;
  • how any sale of goods will be handled and how a debtor can pay the debt to prevent this.

None of this is very much further from how we operate at present – although in the High Court arena we have argued that a 7 day notice that we are on our way will result in a percentage of goods “disappearing”. I guess that will be a bridge we will have to cross when the time comes. But consider this for a moment; in the last few weeks I saw first-hand a judgment debtor take active steps to deny a young judgment creditor justice in paying what she owed under a Tribunal Award by deliberately hiding goods from a shop when she knew my officers would be returning to enforce a court order. The judgment creditor was a 20 year old hairdresser apprentice who was the victim of the boss’s wrath and who dared to enforce her Tribunal Award against her.

All I can tell you is that when I met the young person at Court she was shaking with fear and both her and her poor mum were scared stiff of the Master. I took my hat off to them in an earlier blog about this young person stood up in Court to tell the Master what had happened. You won’t often hear about those stories unless people like me comment first hand on what we see. I sincerely believe in the need for balance in enforcement but sometimes the voice of the judgment debtor and those that support them denies justice to people who have followed the court system to obtain a judgment – often at very considerable personal effort and heartache.

That said, I see the need to protect the truly vulnerable although the Government have stopped short of defining “vulnerability” in the Regulations. I am pleased to see a common sense approach has been taken of allowing us, as enforcement agents, to work on a case by case basis when confronted with someone who needs to be treated with care. Mandatory training is seen as providing the safeguard to ensure we recognize the signs of vulnerability and deal with this in our process.

Alongside today’s announcement, staff in Magistrates’ Courts went on strike as the wheels of reform took a step forward to privatise the collection of court fines. Strangely one objection put forward by striking workers was the fact that the private sector was not sufficiently regulated but of course today’s announcement on the Regulations makes that argument a bit lame.

So what do I deduce from all this change. Well firstly there is no point standing on the beach saying the sea isn’t going to come in – it is. I have worked in a changing enforcement industry for 30 odd years and the reforms of today were being discussed when I started. It has just taken a time for them to come to fruition. What does it mean for the industry? I guess the bigger bailiff companies will continue to grow bigger and fatter on the new fee structure – the fees for routine enforcement matters are set to rise under the new regime. For the rest of us who don’t want to be a Marstons or a Rossendales or now both, there will be niches to dig into and develop.

We look forward to exploring these and continuing to deliver excellence in any enforcement activity we do. The civil justice regime must serve the interests of all types of litigant – not just the public sector – and we have demonstrated a capability to deal with the individual and the large corporate as well as the small debt and the large one.

What the announcement today of course fails to do is to bring justice to creditors who would like to choose their enforcement provider where their judgment is regulated or where their judgment debt is still considered too small for an HCEO to handle. The Government’s stated position is that judgment debtors under regulated agreements must be saved from “interest on interest” and that judgment debts under £600 are too small and therefore are uneconomical for HCEOs to collect. I disagree with both these schools of thoughts and now that the process of enforcement is going to be subject to far greater regulation I say again there is no need for two different regimes. Surely under the new rules HCEOs will work in the same way as county court bailiffs and it will be up to the HCEO to outperform the county court bailiff on every level?

 

The Benefits of Global Standard Operating Procedures

Published on December 13, 2013    |     No Comments   by in Security

What price do you put on Security?

When it comes to protecting your buildings, staff and members of the public, you can’t put a price on security – or on the peace of mind that comes from knowing you’ve got the best people in the security industry working for you.

Our Global Standard Operating Procedures are a blend of the best security standards recognised in the United States and United Kingdom. Our standards are audited to UK Government standards – for which there is still no federal equivalent in the United States or at State level.

As a result this audit results provides a recognised hallmark of quality which will work in any country in which our operations are deployed and which continues to be improved and strengthened with input from our customers, and stakeholders.

So when you choose Shergroup Security as your security provider you are choosing a company that is on a mission to work to the very highest standard across 89 different measures of security excellence.

In particular Shergroup Security takes a pride in meeting all insurance, health and safety and financial measures which you would expect from a premier provider of security systems and personnel.

What our standards means for your organisation

To meet the standards of our clients and our internal audit requirements, Shergroup Security managers must meet 89 different performance indicators which are based upon widely recognised business improvement models (including ISO 9001:2000 and the European Foundation for Quality Management Excellence Model).

Choosing Shergroup Security can help your organisation to deliver best value and meet your security obligations in many ways:

Good practice and continuity of quality
Our employment practices have been thoroughly assessed for good practice, including employee screening through background checks and drug testing, welfare and support afforded to officers, training and conditions for our entire team, and payroll processing.

Greater flexibility and operational effectiveness
Our standards promote service customisation and added value, so the services delivered can be tailored for your precise requirements.

Leadership and innovation
Because we appreciate you have a choice in your selection of security provider, you can be sure that the Shergroup Security team is customer focused, highly responsive to change and eager to adopt new methods and working practices.

Good Neighbors
Our attention to standards means Shergroup Security teams enjoy positive working relationships with local law enforcement officers, in-house security teams, security directors and other senior security professionals who are on the same mission to deliver security services to an exceptional standard.

Transparency
All our information is available to our clients and our new online reporting system will enable our clients to check our reports and alerts on their own devices whether it be at their desk, on their cell, or tablet device.

Shergroup Security can demonstrate that:

• It has processes in place to monitor and manage service delivery to both customers and those affected by our operations which include your visitors and customers

• It trains and develops its people to deliver customer satisfaction and added value, to an agreed standard

• Our senior managers have developed and implemented an effective management system that continually improves the organisation and its performance

• It measures and improves performance against key customer indicators

• It measures and improves performance against key indicators for the way in which it supports the community and the environment in which it operates

• It meet 84 further performance requirements and is independently audited

Our website provides further insight on our portfolio of our security services so please visit us at:

www.shergroup.com

+1 (407) 566 2317

Shergroup Security
Suite 311
1420 Celebration Boulevard
Celebration
Florida
USA

 

Hell’s Courts or Virgin Justice

Published on December 10, 2013    |     No Comments   by in Enforcement

UK Civil Courts to Turn a Profit Under Fee Reforms

Well well well, the “powers that be” I see have had to admit in a recent report that the Court Service is losing the taxpayer money and as a result they have decided to take the unpopular decision of putting up fees.

You have only to read the comments attached to the report on the Law Society website this week – some of which I have set out at the end of this blog piece – to show that the decision by Government is seen as a mistake and denies access to justice.

The report that has got everyone hot under the collar was report in the Law Society Gazette which confirmed that under new proposals “wealthy litigants will have to pay higher court fees to help put the civil courts on a ‘solid financial footing’”.

A consultation published by the Ministry of Justice aims to ensure that wealthy litigants taking high-value cases through the civil courts pay fees that more accurately reflect costs to the system and help balance the books at HM Courts and Tribunals Service.

The running costs of civil courts in England and Wales add up to £600m a year. At present the service apparently runs at a £100m deficit, leaving us poor old taxpayers to foot the bill. The MoJ expects the changes to generate nearly £200m a year.

Proposed changes include increasing fees paid by parties in commercial disputes to up to £20,000 and introducing a daily hearing fee of £1,000. Hardly the stuff to encourage more litigation so let’s hope someone has factored into the cost saving equation that these price hikes won’t instead drive people to alternative forms of dispute resolution.

Fees for cases involving claims for money will increase on a sliding scale, with a maximum fee of £1,870. In future the government is to consider introducing a system where the fee is calculated as a percentage of the amount under dispute in a case.



A standard fee of £270 will be introduced for civil cases that are not about claims for money, instead of the current mixture of fees.

A review of judicial statistics published in the last month shows that the amount of business going through the civil courts continues on a downward trend.

There are two problems here – firstly the fact that the service from the civil courts is so bad no one wants to use them – and secondly when the litigant gets to enforce the judgment debt the system does little or nothing to make it easy to choose the best method of enforcement – leaving “the customer” totally bewildered and disilluisioned.

Best customer service, use of technology and clear results are what will get the courts back on a solid financial footing – it’s what the Government charged High Court Enforcement Officers with back in 2004 and the officials in charge there should be standing back and watching with amazement as HCEOs joust for position to promote the best service delivery possible which is all wrapped up in some professional marketing ideas.

Charging customers a premium for a poor service will drive them away – you’ve heard of Hell’s Kitchen, well this is like Hell’s Court. Poor venues, uninterested staff, and toilets that would look better on a railway station are just some easy cosmetic changes that could be made. Perhaps Gordon Ramsay should come in and shake them all up – with a bit less effing and blinding – but certainly the drive to get the courts to make money from giving people the successful recipe of dispute + winning = money recovered in a professional environment.

In fact I remember getting hot under the collar at a Civil Court Users Association meeting some 15 years ago when I heard an official say the courts wouldn’t be networked for at least 10 years.

The time for investment in IT infrastructure was that long ago. It has never happened and it is this building block more than any other that has in my view hampered the development and improvements in the civil court system.

A joined up network of information, and assistance still eludes court managers even today and yet it is the very thing that could be used to bring costs down with initiatives such as virtual hearings, online small claims, online legal support and countless other steps. Of course some of these things exist but they don’t exist as part of an end to end strategy which works whatever the value of the claim or type of case.

Someone somewhere needs to clear out the vested interests of all parties and look at the interests of the customer and ask the question, “How can we deliver justice today using the best in technology to make our customers spend more money with us”.

Perhaps its time for Sir Richard (my personal hero) to deliver a new brand, “Virgin Justice”! Now I like that! And just to show I am not alone in my thinking here are some of the comments added to the Gazette webpage:

  • A pre-privatisation strategy perhaps ???
  • Clearly the Courts minister has not used the court system recently if he thinks it’s the best system in the world, or if it is then there’s not much to live up to!
  • There is NOTHING efficient about the current court system-it’s creaking at the seams caused by the closing of courts and slashing the staff numbers. Maybe we should just go back to settle disputes by trial by combat!
  • “In future the government is to consider introducing a system where the fee is calculated as a percentage of the amount under dispute in a case.” Oh, brilliant. Let’s make accessing civil justice more confusing and hard to build predictive models for.
  • Trying to get the court system to pay for itself was bad enough. Turning it into a profit making venture is offensive. It’s not supposed to be a business. Isn’t there something about justice not being sold? Punitive fees are not only a denial of justice, but are counter-productive, as the MoJ will discover when the courts are completely clogged by LIPs. And in what way is the closure of 138 courts and a reduction of 3500 in court staff an efficiency? Whose efficiency? The Minister obviously needs to get out more.
  • Higher fees might be more acceptable if enforcement of court judgements was free. Many people obtain judgement and then have to decide whether to throw more money after the bad already spent to actually enforce the order of the court. Should the court service not take responsibility for enforcement?
  • As a non litigant who has had the misfortune to get embroiled in a few cases recently in the County Court and one in the High Court I can only say that anyone who seriously thinks we have the best system in the world is barking mad. The County Court was probably by far the most disorganised and inefficient organisation I have ever dealt with and that includes HMRC and Santander. It was genuinely pathetic. The High Court was so unhelpful and slow I was driven to despair by it
    Both organisations made me ashamed to be a solicitor and to be tarnished in the eyes of the public by being connected in their eyes with them
 

Halloween Security Courtesy of Shergroup!

Published on November 1, 2013    |     No Comments   by in Security

Shergroup Security marketing is creeping up all over the place! And as it’s Halloween and I’m going to use a few Halloweenesque phrases in my blog today.

So for example on an eerily empty street somewhere in London, a Shergroup Security banner promoting our security officers is fixed on a window.

In the banner you can see the Shergroup team lined up securing the boundary of a major protest site in London last year.

That operation along with several high level operations in 2012 really put Shergroup Security on the map as a provider of eviction and security services. Our process is “spookily” simple. We simply receive a court order for possession, plan the operational requirements and then execute the Writ. We built our own security division to handle the back end requirements of keeping unwanted visitors out once possession had been regained.

And today we now go beyond that to not only secure but to place our newly launched “Shergroup Guardians” into empty properties like the one below, to put a warm body in the property to deter any further intrusion.

In fact when you count up our years of experience it comes to a staggering 100 years plus of carrying out enforcement business. This enables us to tackle monster assignments in days rather than weeks, and to do more of our “No Frills” possession work that has really caught the imagination of all our customers.

For properties where we are engaged in active assignments you will see our banner ads, which actually count towards our SIA scores for marketing our services. The SIA is pretty creative in its requirements on wanting security companies to promote good practice and we wholeheartedly support that view.

Of course not everything that we do is high profile and often we prefer to be in shadows in the background to the media fuss that can be made of larger evictions and protest sites. If you spot an orange vest you will know its shergroup security officers at work!

So for this Halloween blog while you may find the process of eviction scary, you can turn to a team who handle it professionally, with careful attention to the law, and I am proud to say a 100% safety record.

 
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