Debt recovery can be a difficult subject at the best of times with creditors needing to strike a delicate balance between preserving relationships with customers and maintaining cashflow.

There are a number of simple steps that can be taken to reduce the risk of invoices going unpaid:

  • Assess the creditworthiness of new customers;
  • Issue invoices promptly;
  • Provide clear instructions for payment on any invoice;
  • Provide multiple methods for payment; and
  • Send regular payment reminders.

Ensuring the above steps are followed can help avoid invoices going unpaid. However, even customers with the best intentions may now be facing financial difficulty as a result of the Covid-19 pandemic, so it is important to consider how debt can be managed.

Creditors are being urged to discuss unpaid invoices with debtors and try to come to a mutually acceptable arrangement for payment. Many debtors will be willing to work constructively with creditors to ensure the preservation of the professional relationship during this difficult time.

If you are concerned about a debtor’s ability to pay, you should act promptly to seek professional advice. A failure to take proactive steps could affect your ability to recover the debt.

Can you commence legal action to recover a debt during the coronavirus pandemic?

Yes - You are entitled to issue a county court claim during the current pandemic.

Before issuing a claim, you will need to send a letter before action (LBA), which is a formal request for payment and sets out the basis on which the debt is owed. As an LBA is the first formal step in recovering a debt, it can often help establish whether the customer is truly in financial difficulty and can open up a line of formal communication. If a debtor fails to respond to the LBA, you are entitled to issue court proceedings.

Can you enforce a judgment?

Yes - You are still able to take steps to enforce a judgment you have received. Creditors are still able to obtain charging orders and third-party debt orders which will increase the chances of recovery in the future.

One area of enforcement that has been affected by the coronavirus pandemic is the execution of Writs and Warrants of Control. These are options that can be used by creditors to retrieve money owed by debtors by enabling Enforcement Officers to enter properties to take goods for the purpose of satisfying the debt. At present, Enforcement Officers are not permitted to enter residential properties so goods cannot be recovered in this manner at the current time.

Can you commence insolvency proceedings during the pandemic?

Yes - However, proving a company is insolvent and cannot pay its debts is more difficult at present due to the temporary measures contained within the new Corporate Insolvency and Governance Act 2020.

Statutory demands which are generally used to prove a debtor’s inability to pay are currently void if served between 1 March 2020 and 30 September 2020. Creditors must therefore find another way to demonstrate a debtor cannot pay.

Creditors are also prohibited from issuing a winding up petition against a company unless they reasonably believe the company’s inability to pay its debt is not related to issues arising from the Covid-19 pandemic. Creditors must be able to demonstrate to the court that the pandemic is not the reason that company cannot pay the debts.

Can you commence insolvency proceedings during the pandemic?

Yes - As lockdown lifts and businesses re-start, the financial difficulties caused by the Covid-19 pandemic should begin to alleviate. The temporary measures imposed to protect debtors will be lifted and payments will have to be prioritised as the law surrounding debt recovery slowly transitions back to normality.

Should you require further information or assistance on this topic, please contact a member of the Dispute Resolution Team.




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Content Contacts


James Kalicinski


Legal Assistant, Cardiff



Michael Evans


Partner, Cardiff

+44 (0)29 2039 1736


Ruth Thurland


Senior Associate, Nottingham

+44 (0)115 983 3699