Creditors may face fewer circumstances where county court judgments (CCJs) are allowed by default, under new proposals.
The Ministry of Justice (MoJ), which has launched a consultation on new rules for how CCJs are issued, wants to limit the circumstances in which default judgments can be made against people without their knowledge. The proposals it is consulting on include:
The MoJ has proposed that a judgment may be moved from the statutory register of fines, orders and judgements where:
To improve public awareness of CCJs and how they affect people, the MoJ also wants to produce a “clear, simple and comprehensive source of information”, by working with advice organisations.
The consultation comes off the back of the justice minister’s perception that some rogue companies were deliberately sending claims to consumers using incorrect addresses.
The consultation also follows the MoJ’s concern for the scale of judgments being issued – the number of CCJs has risen by almost two thirds (59 percent), with more than one million being sent out in 2016.
“Debts should be paid, not exploited by a minority of cowboys who need reining in”
Justice minister Dominic Raab said: “We want to protect vulnerable consumers from abuse by rogue companies that can destroy the credit rating of innocent people without them even knowing about it.
“Debts should be paid, not exploited by a minority of cowboys who need reining in.”
The original catalyst for the government’s move was a Daily Mail investigation published in the autumn of 2016, in which the newspaper reported findings from a freedom of information request on the number of CCJs issued that year, with case studies of families affected by CCJs issued without their knowledge.
This article precipitated an information-gathering exercise by the government, which has since led to this latest consultation.
One of the government’s primary concerns is the impact of CCJs on people’s credit ratings. The consultation points out the potential adverse impact of CCJs on individuals who, unaware that a judgment has been made against them, find out months or years later that their credit score has been damaged.
Launching the consultation, the justice minister said work in this area is being carried out in other departments. The government has taken steps to tackle what it called "rogue private parking operators", including banning wheel clamping and towing.
The MoJ is also considering how it can deliver standardised practice across all parking companies, eliminating unfair charges and reducing the instances of claims where the consumer may be unaware of a parking charge being applied.