How to Issue a Money Claim

If an individual or business owes you money, you may have tried everything to recover payment outside of court, but to no avail. Pursuing a formal money claim can feel daunting, but sometimes it’s the only option. 

Understanding the procedure for filing these applications is vital to give you the best chance of succeeding and recovering what you’re owed. Its incredibly important that you dont make a technical or procedural mistake- doing so might mean you ‘win’ but don’t maximise your claim. Worst case you might lose even though you should have won, and you might be ordered to pay the other party’s costs as well as your own. You must complete the court application and file it correctly, which isn’t always as simple as it seems. 

This article explains how to issue a money claim, the steps you need to take before doing so, and what happens afterwards. Our litigation team are specialists. We only act in disputes nationally; if you need further information or an assessment of where you are and your best next steps, don’t hesitate to contact us. We’d love to assist you; contact Helix Law. 

What Is a Money Claim?

A money claim is a type of litigation which allows creditors to recover funds that they are owed. People commonly use such claims to seek payment for unpaid invoices, rent arrears, personal loans, and damages arising from a breach of contract. 

As the name suggests, they focus solely on recovering specific funds from the responding party. 

How Do I Make a Money Claim?

Debt cases can become complex, particularly where large sums are involved. As a claimant, you must take several legal steps to ensure you complete and file the correct documents. 

Preparing to Issue a Claim

You should always try to resolve matters by corresponding with the debtor before starting legal proceedings. Thiscan include casual discussions. If this fails, the next step is to take formal legal advice. 

Before filingany documents withthe court, you must comply with the Civil Procedure Rules and any applicable Pre-Action Protocol. If you are a business or company claiming a debt from an individual, you must follow the Pre-Action Protocol for Debt Claims.. The Protocol requires claimants to send a ‘Letter of Claim’ to the debtor stating the debt’s amount, including interest, details of the agreement giving rise to the debt, how the debtor can pay it, and enclosing certain key documents such as an Information Sheet, Reply Form, and Financial Statement Form. In other cases, you must follow the Practice Direction on Pre-Action Conduct and Protocols, which again requires that a formal letter of claim be sent to the debtor.

There can be exceptions to needing to follow any protocol, including where a potential claim risks becoming time barred because of the expiry of a limitation period. If you don’t know what the limitation period is that applies to your claim, you should seek legal advice from specialist solicitors. 

Generally speaking he letter should be accompanied by supporting evidence, such as the relevant contracts, correspondence, and up-to-date accounts. You can send it by post or electronically, but its important to get the correct address. Its also important to make sure you maximise the value of your claim. 

If the Protocol is applicable, and after 30 days you have received no response from the debtor, you can begin legal proceedings. If the Practice Direction is applicable, the debtor only has 14 days to provide their response. 

Before issuing a claim, you should always think practically about whether the debtor has sufficient assets or money to make payment. It is one thing obtaining a judgment on paper, it is another thing actually enforcing that judgment andreceiving money in your account. If the debtor is insolvent, you may end up in a worse position by incurring the time and costs of litigation, only to receive no financial benefit from the debtor. This is an important point that can often be missed by creditors. We look at all aspects where we’re instructed- including cost; benefit at the outset. Sometimes it can be appropriate to threaten insolvency as an alternative to a claim, precisely to put an opponent under pressure. In other situations that might not be appropriate.

The letter of claim and any follow on claim obviously escalate matters, but the real aim is to get paid. Positioning is incredibly important in this context and is often overlooked. How you position yourself in a dispute determines where you stand in the order of people being paid or not being paid. For example taking a long time to action next steps puts you naturally on the backfoot; why should an opponent reply or engage quickly if you’re not forcing them to? Instructing solicitors incurs costs, and it also says very clearly ‘we’re taking this seriously’, which is precisely the message to send to a debtor. Most people also understand that where solicitors are instructed we’re going to be seeking to recover your legal costs- in this way you’re also positioning yourself so that the other side should understand that they are now in a hole which is getting deeper. This in turn can help better position you to force settlement. 

Where and How to Issue Your Claim

Where and how you issue your application depends on the case’s complexity and value:

• The County Court: You should file your application here if the claimvalue is less than £100,000. You can choose one of the following services:
• Money Claim Online: You can use this service if the claim is for a fixed sum of less than £100,000. There must only be one person or organisation claiming and no more than two defendants, who must have an address in England and Wales. 
• The Civil National Business Centre: This court handles paper claimsif you don’t opt for or qualify for the online service. It may also be appropriate if the case is more complex. 

• The High Court: You should file your claim here if the value exceeds £100,000 or involves complex legal issues or matters of public importance. The High Court can also be used if the application requires urgent action, such as a freezing injunction. Generally, you canfile such applications on paper, but you may be able to use the online Ce-Filing service in some circumstances.. 

Upon filing, you must pay a court fee before your application can be processed, which depends on the claim’s value plus interest. You can find up-to-date fees on the government website. A good starting point is that the court fee is generally equal to 5% of the claim value.

You should always seek independent legal advice on the appropriate court and filing method to avoid delays, wasted costs, and potential penalties. If you fail to take the appropriate procedural steps, or are unsuccessful with your claim, the court may order that you pay the debtor’s legal costs. It is therefore vitally important that you are clear on what steps you need to take before commencing proceedings. 

Completing the Claim Form

Whether making your application online or on paper, you must complete all relevant sections accurately. The paper application is made on Form N1 and can be found on the government website.

You must provide both parties’ details and the amount claimed, including any interest. You should also draft a ‘Particulars of Claim’ (PoC), which is a short statement explaining the basis of your case. The PoC should be concise and only refer to relevant information. You should attach any supporting evidence, such as loan agreements and correspondence. 

What if Your Case Goes to Court? Track Allocation Explained

Once the court issues your claim, it will be allocated to the appropriate “track” based on its value and complexity. 

Small Claims

This track manages straightforward cases under £10,000 and is designed to be more accessible to individuals and organisations without legal representation. The process is more informal, and parties generally cannot recover legal costs. 

Fast Track

The fast track is suitable for claims valued between £10,000 and £25,000, and they may be slightly more complex. The process is more structured and generally takes more time to reach trial.If the claim reaches trial, there will be a maximum of a one-day hearing. Parties must comply with a standard timetable and often it will be helpful and necessary to have legal representation.

Fixed recoverable costs (‘FRC’) apply to this track. Under FRC, the successful party can recover a specific sum of money to cover their costs. The FRC sum is based on the claim’s value, complexity and the stage at which the proceedings have come to an end.

Intermediate Track

The intermediate track is suitable for claims valued between £25,000 and £100,000. The trial in this track generally lasts up to 3 days. As with the Fast Track, fixed recoverable costs are appliable in this track.

Multi-Track

Complex cases over £100,000 are usually allocated to the multi-track. More senior judges tend to oversee such cases with tailored case management directions. These cases often involve multiple hearings and expert witnesses; legal representation is strongly advised. 

What Happens After You Issue the Claim?

The court will issue the claim and send a copy to the defendant, who generally has 14 days to respond. They can:

• Settle the claim by paying the owed amount. 
• File an Acknowledgement of Service, which confirms they’ve received the claim and gives them an additional 14 days to file their defence. 
• File a defence disputing all or part of the alleged debt. 
• File a counterclaim if they believe the claimant owes them money. 

You can apply for a default judgment if the defendant fails to respond. If they do respond, and you decide to file a reply to the defence and a defence to their counterclaim, you must do so by the time you file your directions questionnaire.. 

The court will then make directions for the case’s progression, which may include disclosing witness evidence and expert reports. In higher-value cases, a judge usually schedules a separate hearing, known as the CCMC, to set the case timetable. 

There will then be a final hearing, at which the court hears from both parties and decides whether the claim should succeed. Throughout proceedings, parties should continue to try to resolve the dispute to avoid the need for a full hearing. 

A high percentage of claims settle before the proceedings reach trial. This is significantly because of positioning- opponents becoming concerned at the impact of continuing litigation on them, where we’re instructed. In tandem the court emphasises the need for parties to engage in alternative dispute resolution, and punishes those who unreasonably refuse to do so. You should always be prepared to make offers of settlement, and attend mediation to prevent the additional time and costs of proceeding to trial.

Frequently Asked Questions

What Is the Time Limit for Issuing a Money Claim?

Most money claims should be issued within six years of the date the cause of action arose. For debts, this means from the date the money became due. If the claim relates to a contract made by deed, the period extends to twelve years.

How Long Does a Money Claim Take?

The timeframe varies depending on case complexity, whether it’s undefended, and court backlogs, which are often significant. Simple, uncontested claims can be resolved within a few months, while defended cases with complicated issues can last at least a year. Before filing, consider whether it makes sense commercially, as you will want to avoid the situation where your legal fees exceed the value of your claim. 

Do I Need a Solicitor to Issue a Money Claim?

Technically you don’t have to instruct a solicitor but it can be really sensible to obtain advice and to consider doing so, not least to increase the pressure on an opponent because you will be able to seek recovery of some of your costs from them if you win (unless your claim is a small claim as above). Some people manage small claims unrepresented- perhaps seeking advice only at the beginning and then pursuing it further themselves. However generally speaking in claims for more than £10,000 there is considerable value in obtaining legal advice to ensure that the risks of litigation are mitigated and known to you, and to try to maximise both the value fo your claim, and your overall prospects of success. If the debt is substantial or the case involves complexissues you should certainly be obtaining legal advice. A specialist litigation solicitor can guide you through the process and protect your interests. 

Final Thoughts

Issuing a money claim can feel overwhelming, and it’s crucial you understand the various steps. Before applying to the court, you must comply with pre-action protocols. If legal proceedings become necessary, you must file your claim with the appropriate court and provide all relevant details.

The defendant’s response can significantly affect the timeline and outcome of the case. From settlement to full trial, it’s essential to remain well-informed and prepared throughout. 

Whether you’re considering making a claim or need to defend a claim, our experienced solicitors at Helix Law can help. We are a specialist litigation firm, and we advise individuals and businesses on a daily basis on how best to recover debts and challenge existing claims. We act in disputes nationally ranging from debt claims valued at tens of thousands, to claims in the High Court with tens of millions in dispute. Contact us today for more information and tailored advice.