Courts and Statute
Most commercial claims begin in the County Court, with higher-value or more complex matters in the High Court. A judgment against a company is recorded as a CCJ on the public register, which credit reference agencies pick up - for a trading business that entry is often more costly than the debt itself. Note that Scotland and Northern Ireland run separate systems, with different courts and terminology; a Scottish debtor is not simply an English claim filed elsewhere.
What the Late Payment Act Gives You
The Late Payment of Commercial Debts (Interest) Act 1998 entitles a business creditor to statutory interest at 8% above the Bank of England base rate on a late commercial payment, together with a fixed sum in compensation that rises with the size of the debt, and a further amount for reasonable recovery costs where those exceed it. These accrue automatically - you do not need a contractual interest clause. Quantifying them in the first demand changes how a UK finance department reads it.
Statutory Demand and Winding-Up Pressure
Where the debtor is a solvent company that is simply not paying, a statutory demand under the Insolvency Act 1986 is frequently more effective than a claim. The company has 21 days to pay or reach agreement; failure exposes it to a winding-up petition, and a petition once advertised can freeze bank facilities.
The mechanism only works on a debt that is genuinely undisputed. Using it where there is a substantial dispute invites an injunction and an adverse costs order, so the assessment of whether the dispute is real comes first.
How Long Does a UK Claim Take?
| Stage | Typical Duration | Cost |
|---|---|---|
| Pre-legal demand Formal demand with statutory interest | 2–4 weeks | Low |
| Statutory demand 21 days to pay, then petition available | 3–6 weeks | Low |
| County Court claim Undefended, to judgment | 6–12 weeks | Low |
| Defended claim Allocation, directions, trial | 9–18 months | High |
| Enforcement Writ of control, third party debt order | 1–3 months | Medium |
The Six-Year Limitation Period
Under the Limitation Act 1980 a simple contract claim must be brought within six years of the cause of action - normally the date payment fell due, not the invoice date. A written acknowledgement of the debt or a part payment can restart the clock, which is why an email in which the debtor accepts the balance is worth more than it looks.
How Does SXB Global Handle a UK Case?
We assess first whether the debt is genuinely undisputed, because that decides between the statutory demand route and an ordinary claim. The demand quantifies statutory interest and fixed compensation, and sets out what a CCJ or a winding-up petition would mean commercially. Where legal proceedings become appropriate, SXB Global coordinates the instruction of appropriately authorised local counsel. Legal services are provided by the relevant independent legal professionals.