Recovering Debts From Companies Or Individuals – Which Is Easier?
Debt recovery can be a complex process with a lot of variables but there are certain things that are more likely to happen when your debtor is a company or an individual.
Every case is different when it comes to debt recovery whether you are dealing with a sole trader who hasn’t paid on time or a large organisation that has a problem with its accounting process.
Individuals as well as businesses can be equally stubborn about paying the money they owe and recovering the debt isn’t guaranteed in either case if the individual claims hardship or a company plays hardball and threatens to take away the business you depend on to keep trading.
A sole trader for example is personally liable for their debts but if it’s an individual then you may not recover the money owed because they can simply choose not to pay even if you win the court case against them.
If money is owed by a public sector organisation and there are no issues with the service or product you have delivered to them, then most debts are guaranteed by the governments which makes recovery a lot easier.
In contrast there are plenty of cases where company directors have been allowed to walk away from their debts by exploiting loopholes. In every case you should check on your client’s ability to pay and put together a clear watertight case before going to court.