Q&A - Bank repossessed client’s house before he had paid us for conservatory. Who do we go after for the money?

Q:        Pre pandemic lockdown we quoted for a fancy conservatory for a client which came in at just under £50,000. The client ordered the work and paid £10,000 deposit. There were several delays due to covid, but we eventually finished the work in July this year. We were then unable to contact the client to get the outstanding payment. Now we have heard his business went bust and the bank repossessed his house. Who do we go after for the money? Him or the bank?

A:        Similar situations happened often enough in ordinary times, but covid brought another layer of complications. First you should check your contract to see who entered into the agreement with you to do the work? As it is a private home, we would expect it to be an individual, but other arrangements could have been made if the property was owned by a business, and you may have sought a personal guarantee from the director of the business. 

If it was an individual with whom you entered into the contract, then it is him personally that you need to chase for the money.  If his business has gone bust, he may not have an income, but he could have set up another business or gone into paid employment.

If the bank has repossessed his house, then ultimately you could not secure any court judgment you obtained against the property.  You should check whether he has appointed a Trustee in Bankruptcy with a view to declaring himself bankrupt.  If so, you need to ensure that your debt forms part of the bankruptcy, so you at least have a chance of recovering part of that debt. 

 It is worth taking advice from a local solicitor about your options.  Whilst that could be seen as throwing good money after bad, spending a few hundred pounds to increase your chances of recovering a few thousand pounds could prove worthwhile.

This question has been answered by Rod Waters, a Senior Solicitor with GHP Legal.  If you would like to speak to someone about this or any other legal matter it is still possible, and we are doing everything we can to ensure that we continue to offer our high levels of service to our clients.  In accordance with government guidelines, most of our lawyers are currently working remotely which means you may not now receive a response as promptly as you may expect. Please kindly bear with us and we will respond as soon as we are able.

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