What's being said

Back to Listing
PreviousNext

The reason government stepped in and cancelled enforcement during Covid-19

27 May 2020

Secondary legislation was laid by the Government on Friday, April 24, 2020, to address the impact of coronavirus on matters relating to enforcement. The legislation was laid due to concerns of inappropriate actions of some of the companies in the industry.  

The steps that were taken to prevent Government intervention

On the 17th of March 2020, Just wrote to the High Court Enforcement Officers Association, suggesting they should issue guidance around adopting a more flexible approach when enforcement agents are visiting debtors. A response was received saying no, it was not for the association to do.

As an organisation that represents some of the industry’s largest creditors and also employs the services of several enforcement businesses, Just thought it was essential to take the lead issuing its own guidance on the 19th of March. Four days later, a meeting was held with a working group of clients and a decision to suspend enforcement across the country with immediate effect was made.

Taking the lead had an impact. A day later, the first enforcement agency that was un-connected to Just closed its doors, and within a few days, most of the industry followed. Unfortunately, not all followed and some saw this as an opportunity to continue and gain market share.

On the 27th of March, one organisation went too far by posting a video of an enforcement agent wearing a military-style uniform with black latex gloves and a bottle of hand sanitizer. The message seemed to imply that they would collect debts, no matter what. While many had suspended operations, it was clear; some were going to continue.

Government then stepped in

On the 24th of April, the Government laid legislation. The measures came into force the next day, and now, all enforcement agencies must stop enforcement visits.

The amending regulations are:

  • Prevent enforcement at residential premises and on highways while, due to the coronavirus pandemic, restrictions that prevent a person from leaving the place in which they live without a reasonable excuse are in place;
  • Automatically extend, by 12 months, the period for taking control of goods in cases where this period is within one month of expiry, while the restrictions are in place;
  • Increase the minimum amount of net unpaid rent that must be outstanding before commercial rent arrears recovery (CRAR) may take place to an amount equivalent to 90 days’ rent, while protections from forfeiture for business tenancies are in place under the Coronavirus Act 2020; and
  • Automatically extend, for a period of six months, enforcement agent certificates in cases where these are within three months of expiry, while the restrictions are in place.

In the space of a few weeks the Government stepped in and took control.


Summary  

The Government was concerned that some enforcement agencies were undertaking enforcement visits inappropriately. They stepped in, laid legislation and resolved it. They should be praised for this.

Will all enforcement agencies have a more sympathetic approach to the current global crisis when they return? We hope so.  


Just.

To find out more about the professional layer Just adds to the most powerful of collection route of post litigation enforcement, please email: nj@just-dm.co.uk or schedule a meeting to speak to him soon.