Taking Control of Goods Regulations 2013 come into force

Taking Control of Goods Regulations 2013 come into force

The Taking Control of Goods Regulations 2013, part of the Tribunals, Courts and Enforcement Act 2007, came into force on 6th April 2014.

The purpose of the regulations is to make it easier for successful litigants to recover their costs and damages by way of enforcement, particularly in relation to seizing property.

As before, the creditor can apply for an enforcement agent to attend at the debtor’s property and seize goods to sell at auction. The funds raised are then used to pay off the debt.

One useful change is that ‘tools of the trade’ are no longer exempt. The only goods that are exempt are those up to the value of £1,350. This allows the seizure of vehicles and machinery which had previously been excluded.

As before, force can’t be used by the enforcement agent in a private property but can in a commercial property to gain entry. But the regulations have removed the right of the enforcement agent to enter by open window or skylight in a private property. They must only use the door. Attendance can be any day of the week between 6:00 a.m. and 9:00 p.m, which is a further restriction.

The most unhelpful part of the change for creditors is that 7 clear days notice has to be given to the debtor before attending to seize the goods. The reason for the change is try and encourage payment before the enforcement agent attends. But in reality it may simply give the debtor much more time to remove or ‘hide’ the goods.

Lastly, the fees are now fixed at each stage of the enforcement, from compliance (£75.00), enforcement (£235.00 plus 7.5% of the amount of any debt above £1,500) through to sale (£110.00 plus 7.5% as before).

What this means for you

The difficulties with trying to enforce a claim against an individual/private debtor still remain as the debtor can still refuse to let the enforcement agent in, hide property or claims it belongs to others.  Also, individual debtors are unlikely to have vast amounts of items that are each worth £1,350 or more.

The real benefit is for those enforcing a debt against a commercial debtor. One of the biggest ways of avoiding having goods seized was to claim that they were ‘tools of the trade’.

Now that anything worth above £1,350 can be seized regardless of its importance to the business, this should hopefully encourage commercial debtors to settle their debts more swiftly.

Need advice? We can help you

Call Nathalie Stewart now on 01482 324252 or email nls@gosschalks.co.uk.

You can find out more about our Employment Law service here, and our Commercial Litigation service here.

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