Informal mediation is a better route to resolution than the trial of court action
Chasing down debts and late payments can be a tough business but sometimes you need to be blunt with the debtor whose fantastical excuses for non-payment would seem far-fetched even to the keenest fan of those sword-and-sorcery psychodramas on subscription TV.
Robyn is very good at plain speaking, for example – you ought to hear her take her bookmaker to task – but sometimes even she can be lost for admonishing words and the only answer is to take a debtor to court.
No one really wants to do it at the best of times and certainly not now as the court system resembles a giant fatball clogging an underground tunnel, backed up with the monumental Covid logjam.
Informal mediation is a much better route, more cost-effective and less overwhelming and it’s the way we routinely go when dealing with schools.
Our approach is to sit down with client and the late-payer – individually but sometimes together – to figure out a way forward and agree a payment plan that suits both sides.
Late-payers often respond to this third-party methodology when they have been deaf to repeated calls and emails from the school itself.
Even then, though, schools may be nervous of entering into a payment plan with a parent who has previously proved unreliable in the extreme.
In these circumstances, one way forward is for the debtor to agree to a voluntary charge on their house or other property they own as part of the plan, agreeing to repay the debt in instalments with the house effectively acting as security.
In the worst case scenario, the school can reclaim the money when the house is sold.
The school has peace of mind, knowing that it will retrieve its money eventually, so it is more happy to enter into a long-term payment plan which will be regularly reviewed.
For the debtor, meanwhile, the voluntary charge does not show up in their credit report or affect their credit score in any way.
It means both sides have a degree of certainty … and that fatball dissolves just a little more.
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