Utilising Statutory Demands and Other Legal Approaches
Video 2 of 4 in our series discussing issues relating to solicitor fee debt
One of the ways in which a creditor can exert pressure on a debtor, strongly urging them to pay, is by issuing what is called a "Statutory Demand". This is a formal written demand of debt. If the debtor then fails to pay the debt within three weeks,the creditor may commence insolvency proceedings against the debtor.
However, the Insolvency Act of 1986 states that a bankruptcy petition cannot be filed if it is based solely on unliquidated debt. Generally, a solicitor's standard retainer gives that solicitor the right to receive a reasonable fee for their services. If that fee remains unpaid, then there are various ways of turning this into liquidated debt. For example, a binding agreement,a court assessment of the fees under the Solicitors Act of 1974, Estoppel, a legal rule that prevents someone from changing their mind about something they have previously said is true, usually in court. For example, if a client previously agreed that he was happy to pay the fees,the solicitor relies on that agreement. Should the client try to change their mind, the solicitor then ends up at a distinct disadvantage.
To find out more on this matter,you can book a meeting with us on 01883 212121 or email enquiries@tclsllp.com