Pursuing a debt through the courts

P. Breathnach

Suppose I had a contract with somebody under which he was to pay me €100 per month for a service. Over a period of time, because of missed payments and underpayments, he fell considerably behind - say by €1800, but continued to receive the service.

Suppose further that I instructed a solicitor to proceed against him for the arrears. He then pays me €150 per month by credit transfer for the next three months, thereby making a relatively small reduction in the arrears.

Can I proceed with the litigation, and when the case arrives in court, ask the judge to amend the claim? Or am I driven back to square 1, and do I need to re-commence proceedings? Should I have returned the overpayments to keep the action clean?

Water John

Did he stop after 3 payments.
If so you could proceed I think
But if he is paying anything regular you won't get any more from a judge.
This is not a legal type answer but about a choice you can make.

Does this come under small claims?

screamer

From experience all the person has to do is say they have no means to pay you. They can offer to pay you like a fiver a week and the judge will accept that. It's a horrible situation to be in OP and too easy for shysters to get out of paying what you're owed even with signed contracts. It's fraud and borders in theft IMHO but the laws an ass.

P. Breathnach

Happily for me, it's a hypothetical question.

It's based on a story I heard of somebody trying game a creditor in various ways, and this is one of the things that happened. Litigation was suspended, and then payments tailed off again.

Steve

What happened the 'Irish water' legislation whereby you could attach private debt to an individuals property, income or dole? Was it ever passed?

Water John

You could always attach private debt to a property, if the debt was to due with some service to the property not having been paid for TMK.

NUTLEY BOY

P. Breathnach wrote: »

Suppose I had a contract with somebody under which he was to pay me €100 per month for a service. Over a period of time, because of missed payments and underpayments, he fell considerably behind - say by €1800, but continued to receive the service.

Suppose further that I instructed a solicitor to proceed against him for the arrears. He then pays me €150 per month by credit transfer for the next three months, thereby making a relatively small reduction in the arrears.

Can I proceed with the litigation, and when the case arrives in court, ask the judge to amend the claim? Or am I driven back to square 1, and do I need to re-commence proceedings? Should I have returned the overpayments to keep the action clean?

Looks like classical failure to render consideration/performance under a contract.

Paradoxically, I do not think that one party's failure of consideration actually entitles the other party to decide to fail likewise e.g you are not paying me so I am going to stop rendering my services to you.

The terms of the contract might be relevant if they make provision for the contingency of failure of consideration/performance. If there was a contractual "escape" the supplier in this case could terminate the contract at a date after the breach of performance/consideration. In this event I would see no impediment to OP then pursuing for the balance owed under the contract in respect of the consideration/performance that he actually rendered.

As far as litigation goes I would expect the correct course to be to issue proceedings for the losses incurred to the date of the issuing of proceedings but to include on-going losses in the pleadings. That should end up with a court determining what is owed less what has been paid.

Voluntarily continuing to accept partial payments allows the other guy to render partial performance for which he might expect reciprocal performance from OP on a quantum meruit basis and that can get really messy.

P. Breathnach

There are situations where it is not easy for one party to terminate a contract because of incomplete compliance by the other party - for example, the long-term hire of a piece of equipment that is not easily recovered by the hirer (or for which the hirer has no other reasonable use).

So the answer to my question seems to be that the plaintiff has to be careful to get the figures right at the time of issue of proceedings. If, after proceedings have issued, the defendant makes a part-payment, there is no need to step back and start proceedings afresh: the court will make the necessary adjustment.

Have I got that right?

Fred Swanson

This post has been deleted.

NUTLEY BOY

P. Breathnach wrote: »

There are situations where it is not easy for one party to terminate a contract because of incomplete compliance by the other party - for example, the long-term hire of a piece of equipment that is not easily recovered by the hirer (or for which the hirer has no other reasonable use).

So the answer to my question seems to be that the plaintiff has to be careful to get the figures right at the time of issue of proceedings. If, after proceedings have issued, the defendant makes a part-payment, there is no need to step back and start proceedings afresh: the court will make the necessary adjustment.

Have I got that right?

A small additional point.

Yes, the plaintiff must be careful to get figures right when issuing proceedings. Some plaintiffs take a wild estimate for purposes of proceedings but that can actually damage credibility if they go too far.

Some cases involve losses that run to the day of trial or settlement. Some cases involve losses that will actually run in to the future beyond the date of trial or settlement. This is dealt with by wrapping up all of those losses in the one set of pleadings thus obviating the need to issue several sets of proceedings for each loss.

When quantum is assessed the defendant will receive credit for what has already been paid.

P. Breathnach

It used to be standard for a creditor to refer any offer of payment or part-payment to the solicitor handling the proceedings, who was then in a position to be fully up to date on the amount outstanding.

The easy facility nowadays for making payments by credit transfer can bypass that protocol, and be used to muddy the waters.

clocks

NUTLEY BOY wrote: »

Looks like classical failure to render consideration/performance under a contract.

Paradoxically, I do not think that one party's failure of consideration actually entitles the other party to decide to fail likewise e.g you are not paying me so I am going to stop rendering my services to you.

The terms of the contract might be relevant if they make provision for the contingency of failure of consideration/performance. If there was a contractual "escape" the supplier in this case could terminate the contract at a date after the breach of performance/consideration. In this event I would see no impediment to OP then pursuing for the balance owed under the contract in respect of the consideration/performance that he actually rendered.

As far as litigation goes I would expect the correct course to be to issue proceedings for the losses incurred to the date of the issuing of proceedings but to include on-going losses in the pleadings. That should end up with a court determining what is owed less what has been paid.

Voluntarily continuing to accept partial payments allows the other guy to render partial performance for which he might expect reciprocal performance from OP on a quantum meruit basis and that can get really messy.

Yes to this and to answer the initial question directly : the faltering payment plan does not bar the creditor from suing again and enforcing his debt. This is the rule in Foakes v Beer [1884] UKHL 1, the repayment of a lesser amount does not satisfy a larger debt. In practice a creditor will of course agree to a payment plan for practical reasons as there is no disadvantage to doing so. In short, you can always sue for the balance

(Note that the rule in Williams v Roffey Bros applies to ongoing duties under a contract and not the partial repayment of debt.)