Writs and Warrants: Can you really trust the process?

When considering enforcement of money judgments, creditors will often be drawn to writs or warrants of control due to the low cost implications and that the cases are often allocated to enforcement agents who will carry out the writ or warrant. Writs and warrants of control enable enforcement agents to visit the debtor’s address and seize goods to the value of the debt and any associated costs. The goods are then sold, realising funds to offset the debt and any fees incurred by the enforcement agent. There is a catch though, not all goods can be seized and those seized must be found to belong to the person named on the writ or warrant.

These enforcement methods are attractive to creditors due to the fact that the enforcement agent takes conduct of the case and progresses recovery of the debt on the creditors’ behalf. The creditors can usually sit back and wait for the debt to be recovered and paid to them, placing a significant amount of trust in the enforcement agents’ hands.

So, what would happen if the creditor’s trusty enforcement agent exceeds their enforcement powers by unlawfully seizing goods?

Well, unfortunately for creditors, the Court of Appeal recently concluded that a creditor can be deemed liable to its debtor for loss and damage arising out of an enforcement agent’s breach in Burton v Ministry of Justice [2024] EWCA Civ 681.

Facts

In Burton the debtor received a speeding fine of £193 and the Magistrates’ court issued a warrant of control to effect recovery of the fine. The creditor instructed an enforcement company to enforce the warrant, and the company engaged a self-employed enforcement agent. The agent made an attendance at the debtor’s property and found a vehicle parked outside of the address. The debtor indicated to the agent that he did not have an interest in the vehicle which was, in fact, subject to a hire purchase agreement. The debtor provided the agent with a letter from the hire-purchase company which confirmed that the debtor did not have any interest in the vehicle.

Despite the debtor’s claims, the agent took control of the vehicle and proceeded to immobilise the vehicle by applying a clamp. The debtor commenced proceedings against the creditor for damages and requested that the clamp be removed from the vehicle. The debtor sought general damages in relation to loss of use of the vehicle as well as special damages for the cost of alternative transport during the 14 day period in which the agent had clamped the vehicle.

The basis for bringing the claim against the creditor was pursuant to Paragraph 66 of Schedule 12 of the Tribunals, Courts and Enforcement Act 2007. Paragraph 66 enables a claim to be brought against an enforcement agent or creditor for damages in respect of loss suffered as a result of a breach by an agent under Schedule 12, or as a result of enforcement action taken pursuant to a defective writ, warrant or liability order. This would not apply, however, where the agent had a reasonable belief that he was not breaching Schedule 12, or that the instrument was valid.

Decision

At first instance the District Judge held that the agent should not have taken control of the vehicle given that it was subject to the financial interest of a third party. It was concluded that the creditor could, in theory, be liable to the debtor pursuant to paragraph 66. However, the District Judge concluded that the agent had a reasonable belief that the vehicle was owned by the debtor.

On appeal the court determined that the creditor was not liable for the damages claimed as it had not caused or contributed to the loss and also because the agent was not a direct agent of the creditor, but instead an officer of the court and therefore the creditor could not be liable for the agent’s breaches.

The creditor’s legal representatives argued that the creditor could only be liable if it had ‘caused or contributed’ to the debtor’s loss. The court rejected this submission on the second appeal and concluded that the provisions at paragraph 66 are explicit and are not conditional on any act or omission. The trigger for liability to occur was simply the agent’s breach.

Summary

On conclusion of litigation and receipt of judgment it may be tempting to instruct an enforcement agent and forget about the case. However, it is hugely important for creditors to be vigilant in monitoring the actions of their enforcement agents.

Knowledge and visibility are the tools needed to ensure that creditors are kept up to date on their instruction in order to lower the risk of liability.

Authors

Shauna-Leigh Thompson, Solicitor, shauna-leigh.thompson@weightmans.com

Benjamin Davies, Partner, benjamin.davies@weightmans.com