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You are advising a company that sells beer. Your client recently sold a large quantity of beer to a sole trader on 14-day payment terms. The sole trader has failed to pay for the beer. Despite having initially contacted your client to advise the beer was not of satisfactory quality, the sole trader has not responded to any correspondence for some time. Six weeks ago you sent a Letter of Claim in accordance with the Pre-Action Protocol for Debt Claims and have received no response.
Which of the following best represents the advice you will give with regard to the next steps?
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Your client should commence court proceedings as it will place pressure on the sole trader to engage with the claim. Paragraph 3.4 of the Pre-Action Protocol for Debt Claims states that "If the debtor does not reply to the Letter of Claim within 30 days of the date at the top of the letter, the creditor may start court proceedings.” Since six weeks have passed without a response, your client is at liberty to commence court proceedings. This step is likely to prompt the sole trader to engage with the claim due to the deadlines for filing an Acknowledgment of Service and Defence. Other options, such as adjudication, arbitration, and mediation, are either not applicable or less effective in this scenario.
Key Point: Under the Pre-Action Protocol for Debt Claims, a creditor may start court proceedings if the debtor does not respond within 30 days of the Letter of Claim.
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