For our asset finance client, Greenhalgh Kerr successfully defended a Part 8 claim and Issued a claim for damages in response. We were able to agree a resolution before the Contested Hearing – with an agreement for the debtor to pay the full balance on the finance agreement, plus interest and costs.

Our client’s finance agreement with the company was for the hire of a vehicle; it was guaranteed by the company’s director. When the company went into liquidation the director requested the agreement be novated into his individual name. Our client refused as the director did not meet individual credit requirements.

Dissatisfied, the unrepresented director issued Part 8 Proceedings, seeking an Order for the agreement to be novated. After our careful review of the papers we provided a detailed case plan to our client. Our succinct advice outlined our planned steps to a conclusion, and estimated costs.

As the debtor was unwilling to negotiate we were instructed to seek payment of the terminated balance on the agreement – or recovery of the asset. Typically, we strategically balanced our clients’ commercial interest with the risks, while mindful of the overriding objective of the Civil Procedure Rules. Rather than simply opposing the claim at a Hearing, our client agreed we should pursue further action against the director.

In response to the current claim we made an Application to bring a Part 20 claim, for sums due under the agreement and/ or return of the vehicle. We invited the Court to utilise its power under CPR 3.1(2)(g) to consolidate the Part 8 and Part 20 claims together. We also offered realistic Directions to bring the matter to a Final Hearing; our Application was agreed by Consent, with the Directions also agreed.

Shortly before trial the director admitted defeat. He acknowledged his claim had little prospect and requested time to pay. We agreed by Consent Order that his claim be dismissed, and the director would pay the full amount plus interest and costs within 28 days. If payment was not made, the vehicle would be returned immediately.

By invoking the Court’s case management powers to consolidate both claims, we were then able to swiftly direct the matter towards a Final Hearing. This minimised costs and focused the director’s mind on offering a resolution.

If you have a problematic debt matter in asset or leasing finance, please contact the team at Greenhalgh Kerr for a confidential chat.

for Greenhalgh Kerr; Adam Tiesteel, Solicitor.

April 2022.