What can directors do?
Bailiffs and High Court Enforcement Officers perform a useful function in enforcing the lawful decisions of the courts but you’d be waiting a long time to hear anybody thank them for their service.
Nevertheless, even if somebody is performing a necessary but unpopular task, they still have rules and regulations to follow. If they start ignoring them then not only does the whole industry get brought into disrepute but word gets out quick.
New research from Citizens Advice has found that more than a third of respondents (2,000) who came into contact with a bailiff were subject to behaviour that broke Ministry of Justice rule including forcing their way into homes, taking goods needed for work reasons and not taking into account vulnerabilities such as disability or illness.
60% said they had experienced harassment or intimidation through doorstep visits, the misrepresentation of powers and threats to break into property.
Dame Clare Moriarty, chief executive of Citizens Advice, said that bailiffs were “a law unto themselves” and called for more regulation.
She said: “Rogue behaviour is making things far worse for people in really difficult situations – sometimes pushing them further into debt.
“Rules are in place to try and ensure bailiffs act fairly to recover debt, but our advisers are hearing from people every day who are being intimidated and harassed by bailiffs.”
72% of those who came into contact with a bailiff said it had affected their mental health with many claiming they were left feeling unsafe in their home, afraid to answer the door and not wanting to leave their house as a result.
One thing to note is that the industry itself has little formal regulation and the current Enforcement Conduct Board only provides independent oversight of bailiff firms that choose to be accredited.
Citizens Advice believes that with more debt building up and more companies and individuals being exposed to bailiff action, a voluntary, self-regulation model is no longer able to meet the scale of the issue and instead wants the regulation of bailiffs to be put on statutory footing.
A Ministry of Justice spokesperson said: “It is vital directors and vulnerable people in debt are protected and not harassed by rogue bailiffs which is why we have announced plans to make body worn video cameras compulsory and backed the recently established Enforcement Conduct Board to better hold bailiffs to account.
“We will review whether the Board requires statutory footing after it has been running for two years.”
Bailiffs and High Court Enforcement Officers resumed their lawful duties in August 2020 but it might be a good time to refamiliarise what powers they can exercise against directors.
They can execute any of the following judgements or awards against outstanding debtors:-
- High Court Judgements issued in England and Wales – also known as High Court Writ of Control. (The High Court Writ of Control empowers the HCEO to enforce a claim and they will contact debtors sometimes visiting in person to agree a repayment plan.)
- County Court Judgements (CCJs) for £600 or above which have been sent to the High Court for enforcement
- Employment Tribunal decisions or ACAS Awards
- High Court or County Court Possession Orders
HCEOs and bailiffs have authority to seize and then sell assets if no payments have been made or if no payment plan has been agreed and stuck to.
They can access land and enter buildings to retrieve goods but their actions are limited. For instance, they can’t force entry to a residential property or a combined business/residential property without first gaining peaceful admittance.
Once inside however, they are allowed to return and can force entry later if required and if the debtor has reneged on terms agreed to during the previous visit.
They can force entry to any purely commercial or business premises although they have to give prior notice of this action and re-secure the premises to the same standard as before once goods have been removed.
What goods are they allowed to take?
While there are some restrictions on what bailiffs and HCEOs can remove from a premises it’s easier to say they can take anything except for the following:
- Basic essentials which could include clothing, furniture and bedding
- Goods considered “tools of the trade” that allow the defendant to work such as tools, books, laptops, vehicles – anything up to a maximum value of £1,350
- Third party goods – items belonging to anybody apart from the debtor
- Any goods rented, leased or on a hire purchase agreement
- Any goods that have already been seized by another bailiff or HCEO
“They’re coming to company director’s homes”
Chris Horner, Insolvency Director with BusinessRescueExpert, said: “We’re starting to hear more evidence that some bailiffs are just not following the rules such as starting to pursue business debts by coming to company directors’ homes and making threats while they do so.
“This is unprecedented behaviour and as Citizens Advice have outlined, is happening more and more all over the country with little recourse as the Enforcement Conduct Board is not statutory.
“If you or your business receives a CCJ or notice of enforcement then there are some protections that can be applied to stop them in their tracks but only if directors act quickly and get in touch with us at the first sign of contact.”
Receiving a notice of enforcement or actually having a bailiff knock on your door can be a frightening experience – especially if this hasn’t happened to you before.
Sadly as Citizens Advice and thousands of others can testify, the rules are being bent, broken and ignored leading to mental stress and financial hardship.
Even if they are experiencing only a minor downturn, they can take some decisions now that will hopefully head off any threat of things worsening and will be able to concentrate on what they do best for a living rather than have to worry about threatening letters or a knock on the door of their home.