It goes without saying that every business looks to save money where it can and attempting to carry out your own debt recovery and enforcement might seem like an attractive option.

However, if you plan to go down this route, one of the first pitfalls you will face is how to identify the correct defendant.

It might sound obvious, but it’s surprisingly easy to make mistakes when it comes to identifying the correct defendant, and suing the wrong person or company is always embarrassing, sometimes expensive and often time-consuming to sort out.

The most common legal entities are:-

  • An individual, such as Mr John Smith
  • An individual trading under another name – Mr John Smith trading as ‘Smithies’
  • More than one defendant – Mr John Smith and Mrs Susan Smith
  • More than one individual trading as a partnership – Mr John Smith and Mr Jimmy Jones trading as ‘Smith and Jones’
  • A limited company – Smith and Jones Limited
  • A limited company trading under another name – Smith and Jones Trading as ‘High Street Grocers’

Less common are – unincorporated associations, trustees with personal representatives of a deceased estate and government departments.

So how can you avoid this problem?

Ensure that your customer completes and signs an account application form before trading starts.

If you have terms and conditions, make sure that a copy is supplied with the application form and that the form refers to those terms and is signed by the customer.

The form should identify unambiguously what type of entity your customer is and should identify as a minimum:-

For limited companies:-

  • The name of the company.
  • Its trading name or names (if different).
  • The trading and registered office addresses.
  • The company number and the date of incorporation.
  • The names and addresses of the directors.

For partnerships and sole traders:-

  • The name and home addresses of the partners or business owners.
  • The trading name of the partnership or business owner.
  • The trading addresses.

To have the best chance of recovering any monies owned to you or your business, call Richard Anderson and the Debt Recovery Team at Beswicks on 01782 205000 or email richard.anderson@beswicks.com.