Changes affecting enforcement by Sheriffs
On 6 April 2014 changes were
made to The Tribunals Courts and Enforcement Act 2007 Part 3 in
respect of the Taking Control of Goods Regulations which affect how
Sheriffs can enforce Judgments.
Changes to terminology have
been made as follows:
- Sheriffs are renamed
"Enforcement Agents" ("EA")
- The term "debtor" is no
longer allowed and they must be called "customers"
- Writs of Fi Fa are renamed
"Writs of Control"
- Walking Possession Agreements
are renamed "Taking Control of Goods Agreements"
What procedures must
the EA follow ?
There is a new procedure the
EA must follow, they can no longer turn up unannounced and must now
send a letter to the customer notifying them of the visit. If
it is felt this will give the customer time to dispose of assets an
application can be made to the Court for a visit to be made without
prior notice being given. If the first visit is not
successful in recovering the amount due the EA must send a notice
giving notice of a second visit.
How can the EA gain
entry to premises?
The hours an EA can visit have
been extended to between 6.00 am and 9.00 pm seven days a week
(excluding Christmas Day and Bank Holidays) whether the customer is
a business or an individual. If attending business premises
and they are only open outside these hours the EA can attend during
the opening hours of the business.
The rights of entry of the EA
have also changed. In respect of commercial premises the EA
can no longer enter through a window or any other opening other
than the main entrance or a loading bay but they can force entry
through the door even if locked provided the building it is not
attached to a house. They can also visit the home of a
Director if this is the Registered Office of the company or the
home of any Partners in a Partnership (provided they are named
personally on the Judgment), they are then bound by the rights of
entry in respect of residential premises below.
In respect of residential
premises the EA can only gain entry through an unlocked front or
back door i.e. a main entrance. They can climb over a fence
or wall to gain access to grounds of a house. They cannot
force entry through external doors but once inside can force
internal doors and if ejected from a property can use force to
regain entry through a main entrance. They can also force
entry into a garage, outhouse, stable, barn, etc if not attached to
a house. If they obtain a signed Controlled Goods Agreement
they can force entry upon any future visits even via a locked
What goods can be
If the EA gains entry but does
not recover payment they must prepare a Taking Control of Goods
Agreement and list all assets that can be seized. They must
ask the customer or a "responsible adult at the premises" to sign
the Agreement. Once the Agreement is signed the EA can secure
goods on the premises or remove goods.
Goods that can be seized have
been extended to include vehicles including a boat or aeroplane,
stock and machinery, household furniture, jewellery and art, money,
banknotes and cheques, bonds, shares, deeds and securities,
livestock and animals, firearms, jointly owned property of a
married couple, items held by Police and goods on finance providing
the finance company agree to the sale.
Goods which cannot be seized
have been extended to include bedding, clothing, furniture and
provisions required for a basic level of domestic life (the EA can
also remove luxury items and replace them with cheaper items),
items required for the care of a person under the age of 16, over
the age or 65 or a disabled person, perishable goods, refrigerated
goods and fresh flowers, vehicles with a valid disabled person's
badge, vehicles belonging to the Police, Ambulance Service, Fire
Department or displaying a British Medical Association Badge,
assistance dogs, sheep dogs, guard dogs or domestic pets and art on
loan to the UK from another country.
Tools of trade are no longer
exempt and can be seized provided the customer is a sole trader
(not a Limited Companies or Partnership), the tools must be used
solely by the customer in their work and not by any other person
and they must be worth at least £1,350.00.
Third party claims have also
changed and it is now the responsibility of the third party to make
an application to the Court for an Order that the EA must cease
action, until this is obtained the EA can continue with
How can seized goods
be sold ?
The ways in which goods can be
sold has also been extended to include public auction by a
qualified auctioneer, private treaty, sealed bids, advertisement
and independent online auctions such as Ebay. If goods are to
be sold at auction the EA must provide the customer with notice of
the auction date and time and provide an estimated valuation of the
goods in writing.
The EA can also sell goods on
site by entering a shop (or standing behind a market stall) and
taking over the sale of items. They can also secure the goods
on site and sell them on site.
What fees are payable
One of the major changes has
been to the fees that are recoverable from the customer.
These are now limited to fixed fees set by the Court which include
sending of the first letter to the customer, two visits and removal
and sale fees. The only additional fees that can be charged
are storage charges and locksmiths fees where a Taking Control of
Goods Agreement has been signed and fees if specialist equipment is
required to remove a large asset such as machinery. However
an application would have to be made to the Court in respect of
these fees and would only be granted in "exceptional circumstances"
so where possible it would be preferable to attempt to sell such
goods on site.
The life of the Writ of
Control has been changed so that it is suspended if a repayment
plan is entered into and re-starts if payments stop. However
EA's can no longer charger for collection by instalments so if
payment is not received in a lump sum or goods are sold but do not
cover the full amount due Claimants will be encouraged to collect
their own instalments or pay the EA to do this for them.
There have been several
reports in the news questioning what effect these changes will have
upon the way in which Judgments are enforced. For many, the
changes will have little impact. However, for those
organisations who have, in the past, operated in a way which many
would describe as "sharp practise", they will have to change their
ways to ensure they operate within the new rules.
Posted on: 29/05/2014
This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.
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