Have you been asked to pay a County Court Judgment (CCJ) that you think you shouldn’t have received in the first place? It can be daunting to receive a court order for money you don’t owe, but you might not have to pay it after all if you can prove the debt isn’t yours to pay.
Whether you repaid the debt before receiving the CCJ or you didn’t receive sufficient notice of the court order, there are some circumstances in which you might be able to stop a CCJ in its tracks.
What is a County Court Judgment?
A County Court Judgment, or CCJ, is a type of court order that a creditor (someone you owe money to) can serve you with if you have an unpaid debt and you have ignored several attempts at trying to repay what you owe. It is only available in England, Wales, and Northern Ireland.
Put simply, if you’ve received a CCJ, it means the court agrees with your creditor and you must legally repay the amount you’re being asked to pay. Depending on your level of cooperation with the court, you could be asked to pay the debt back in full or in regular instalments.
CCJs can be issued for the non-payment of most unsecured and non-priority debts, such as personal and payday loans, store cards, credit cards, and loans from friends and family.
However, you should be given multiple chances to repay what you owe before you’re officially served with a CCJ. This is why, if you’re ever served with a CCJ out of the blue with no warning letters first, you could have grounds to get it removed.
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How does a County Court Judgement work?
If you’ve been served with a CCJ, it can be useful to know how the process generally works and what you can expect from the experience.
Here are the steps typically followed during the CCJ process:
Your creditor applies to the court
If your creditor has failed to recover payment of a debt from you, they can make an application to the court to request a CCJ. They will need to complete a claim form to do this, which will include details of the debt and how it came to be.
They must also prove that they have attempted to recover payment through other, less serious means before resorting to court action and applying for a CCJ.
The court makes a decision
Once your creditor has submitted the court forms and paid the court fee, the court will review all the information provided and make a final decision on whether or not to issue the CCJ.
If the court decides that you owe the money claimed and your creditor agrees with your proposed payments, you will receive a claim form with an admission form attached which must be completed and returned within 30 days to avoid a CCJ being lodged.
You begin the CCJ
The court will let you know how to pay the CCJ. Usually, if you respond to the court claim with details of your financial situation, all the payments will be set at a rate you can comfortably afford. However, if you ignore the claim form, the court won’t know your financial circumstances and could issue you with a default judgment, which is when you’re ordered to repay the full amount upfront.
If you pay the CCJ in full within 30 days of receiving the order, it will be considered settled and will be removed from your credit file. If you pay it in full after 30 days, it won’t be removed from your credit file but it will be marked as ‘satisfied’ to let lenders know that it has been resolved.
Will a County Court Judgement affect my credit rating?
Like most court orders, a CCJ will negatively affect your credit rating. This is because a CCJ is evidence that you’ve failed to repay a debt and your creditor went to the lengths of taking legal action against you to recover the money they were owed.
From the judgment date, a CCJ and all supporting information (the amount owed, the court, your claim number etc.) will be visible on your credit record for six years. During this time, you’ll find it difficult to find a lender willing to give you credit as there’s a good chance that you’re still in financial difficulty and could potentially default on your payments.
As well as your credit score, a CCJ will also be added to a public register called the Register of Judgments, Orders, and Fines from the Registry Trust for six years. This is an online database of all individuals who have court orders, judgments, and fines in England and Wales.
The Register of Judgments, Orders, and Fines can, in theory, be accessed by anyone who knows your name and postcode and is willing to pay a fee of between £6 and £10 for information about your credit history. However, it is usually only accessed by people who have a reason to check your finances, such as lenders, employers, and landlords.
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How to stop a County Court Judgement
If you’ve received a CCJ that you don’t think you deserve, you might be wondering whether you can stop it and, more importantly, stop it from damaging your credit score and lending prospects.
There are two main ways of stopping a CCJ: Paying the debt in full within one month or applying to get it set aside.
Pay the debt in full within a month
If you’re in a position to repay the debt in full within one calendar month of being served with a CCJ, this can succeed in getting it cancelled. However, you’ll need to prove that the debt was repaid before this deadline.
To do this, you must write to the court that issued the CCJ and send them evidence of the settled balance. You can also request that they send you a certificate of satisfaction for a fee of £19, which can be used to protect yourself if you’re ever asked to pay the debt after it’s been settled.
Once you’ve gotten your entry in the register removed, all the credit reference agencies will be notified and your credit records should be updated accordingly.
Apply to vary the order
If you’re on a low income or your circumstances change and you can no longer afford to pay the CCJ as originally set by the court, you can apply to reduce your payments by ‘varying’ the terms of your arrangement. This might be an option if:
- You made an offer of payment and your creditor accepted it
- You defended the claim but lost
- You admitted the claim but didn’t make an offer to pay
- You didn’t respond to the claim form
However, varying the CCJ is at the court’s discretion, so they don’t have to agree to adjust your payments and will only do so if you can prove you can’t afford to stick to the terms of the original claim. The court will review all the evidence and decide if varying an instalment order would be fair to both you and the creditor.
When you apply to vary a CCJ, it’s recommended to ask for a court hearing as this gives you a chance to discuss your circumstances with the judge. If you don’t want a hearing, you’ll need to include a witness statement to explain why your payments should be changed.
Apply to get it set aside
If you firmly believe you’ve been issued a CCJ in error, you can apply to get it ‘set aside’. This essentially stops a CCJ in its tracks and prevents it from being noted on your credit report or the Register of Judgments, Orders, and Fines.
This can be done by completing an ‘application notice’ (Form N244) and submitting it to the court for a fee (currently £313). In most cases, you’ll be asked to attend a court hearing to explain to a judge why you don’t owe the money and both you and the claimant will need to present your case.
You might be able to get a CCJ set aside if:
- You repaid the full amount before your creditor applied for the CCJ
- Your creditor didn’t follow court rules when issuing the CCJ
- You were unable to attend a hearing and a judgment was made in your absence
- The court papers were sent to the wrong address
- You missed the court hearing due to a sudden illness, accident, or emergency
It’s crucial that you provide as much detail as you can and attach any proof you have when applying to get a CCJ set aside. For example, if you couldn’t attend court due to a sudden illness, you should include a letter from your GP.
It’s worth noting that the claim form being sent to the wrong address isn’t always grounds for getting a CCJ set aside as the court is legally allowed to send it to your last-known address.
Defend the claim
If you’ve received a claim form and you want to dispute the debt, you can ‘defend’ it by completing and submitting a defence form (Form N9B). This is essentially a document outlining why you shouldn’t have to pay the debt.
To increase your chances of successfully defending a CCJ, it’s important that you act quickly and send a defence form within a few days of discovering your creditor’s intention to take legal action against you (ideally within 14 days of receiving the claim form).
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What happens if I ignore a County Court Judgement?
It’s never wise to ignore a CCJ, even if you’re confident you don’t owe the money you’re being asked to pay.
Regardless of whether you owe the debt, if it has escalated to the point where a court order has been served against you, you’ll be legally required to pay it because you’ve missed several opportunities to pay what you owe or dispute it.
Here are some of the things that could happen to you if you continue to ignore a CCJ:
Enforcement action
One of the first actions likely to arise as a result of an unpaid CCJ is enforcement action, which is when bailiffs visit you to demand payment of a debt or seize your belongings to raise enough money to recover your outstanding balance.
This can have a detrimental impact on you, both financially and mentally, but there are strict rules that enforcement agents must follow when they visit you to ensure they don’t cause undue distress to you and anyone you live with.
Attachment of earnings order
An attachment of earnings order is a court order that takes money a creditor is owed straight from your wages. The court will base your monthly deductions on your income and total debt to ensure you’re only paying what you can reasonably afford.
However, you’re legally not allowed to be left with less than 60% of your total net earnings each month.
Third party debt order
A third party debt order is a type of court order where the money you owe is taken from the third party holding it (usually a building society or bank account).
Your creditor will apply to the court to freeze an amount equal to the outstanding debt and order that it be paid directly to them, essentially stopping you from using the money for anything other than debt repayment.
Charging order
A charging order is a court order that takes an unsecured debt and secures it to one of your assets (usually your home), essentially turning it into a secured debt.
If you were to sell your home with a debt secured to it, any proceeds will go straight to your creditor and will be used to repay your debt. Once a charging order is in place, your creditor can apply for an order for sale, which forces the sale of your property to satisfy the debt.
Bankruptcy petition
If the CCJ is for a debt of over £5,000, your creditor can petition the court for your bankruptcy. This could force you into becoming bankrupt against your will, which can have serious consequences for your finances, home, and career.
However, this action is usually only taken as a last resort. Before they do this, they must also prove that they have attempted to collect payment on a court order, for example, by sending bailiffs to your home.
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Conclusion
A County Court Judgment, or CCJ, is a type of court order where the court orders you to repay a debt in full or in instalments. CCJs are usually only considered after a debt has been left unpaid for a prolonged period and the creditor doesn’t believe they will recover the money without taking legal action.
A CCJ can be cancelled in some circumstances, but this is usually only an option if you can prove you shouldn’t have to repay the debt included in the judgment. If this is the case, you must act quickly.
There will be further action for ignoring a CCJ, even if it’s determined that you don’t owe the debt. In any case, you should inform the court of your financial situation and whether you want to pay the debt or try to get it stopped as soon as possible.
