In a recent newsletter, Roula Khalaf, the Editor of the Financial Times, highlights an alarming trend in the enforcement of court orders in England and Wales. A report from the Civil Justice Council (CJC), which is chaired by Sir Geoffrey Vos, Master of the Rolls, reveals that creditors are increasingly encountering significant obstacles in recovering unpaid debts. These challenges stem from ongoing funding pressures within the justice system, which have led to what the report describes as an extremely slow and ineffective enforcement process.

The CJC's findings indicate that both businesses and individuals are enduring very significant delays when attempting to reclaim sums owed to them, even after having secured legal judgments against their debtors through the County Court. This situation has caused a considerable erosion of confidence among creditors, as they find themselves unable to enforce court orders in a timely manner.

According to the report, which was compiled by a working group led by Judge Karen Walden-Smith, the civil enforcement process has become an area of significant concern, often overlooked by those in power. Robert Thompson, a partner at the law firm Brachers and chair of the Civil Court Users Association, emphasized that the enforcement system has been in dire need of reform for years, yet has remained largely unattended.

The CJC's report does not ignore the plight of defendants; it acknowledges that many individuals facing legal actions and the threat of bailiffs are struggling financially, often living paycheck to paycheck. As of January 2024, it is reported that approximately 14.6 million people, or 28 percent of UK adults, are experiencing financial difficulties, according to data from the Financial Conduct Authority.

Despite recognizing the challenges faced by debtors, the report also highlights systemic issues that hinder effective debt recovery. During public consultations conducted by the CJC last year, debt advice charities reported that current debt collection practices often dissuade meaningful interaction with individuals who owe money. The report states, Both sides of the enforcement debate complain that the current system is arcane and difficult to understand.

The CJC underscored the need to acknowledge that while many debtors are genuinely struggling to meet their financial obligations, there are also individuals who could pay, but wont pay. This duality raises concerns for creditors, who feel that defendants are able to evade enforcement too easily due to a system that is under-resourced and inefficient.

The report elaborates on the frustrating experience creditors encounter when navigating the enforcement process through the County Court. A judgment in their favor is often just the beginning of a long and arduous journey to reclaim funds. Enforcement methods available to creditors include requesting Court bailiffs to act through a Warrant of Control, which allows the court to instruct bailiffs to recover the debt. Depending on the nature of the debt and its size, creditors may also engage High Court Enforcement Officers.

Other avenues for enforcement comprise Attachment of Earnings Orders, which mandate employers to deduct owed amounts directly from wages, and Third Party Debt Orders that can freeze bank accounts to secure funds. However, the CJC report reveals that enforcement of judgments is currently performing poorly, with many creditors abandoning their warrants of control due to the limited availability of court bailiffs and the overwhelming workload that causes delays and frustrations.

The Civil Justice Council has made several key recommendations to address these challenges, including the introduction of a unified digital court for the enforcement of judgments and an online portal where all debts could be systematically recorded. Sir Geoffrey Vos commented on the report, stating that civil enforcement has been overly complex for too long and expressed hope that all stakeholders would carefully consider the recommendations put forth.

In response to the findings of the CJC, the Ministry of Justice issued a statement thanking the Council for its report and assuring the public that it would thoroughly evaluate the findings before formulating a response in due course.