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Third Party Claims Procedure Tribunals Courts & Enforcement Act 2007

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An Enforcement Agent (Bailiff) has a duty to take control of the goods that belong to a debtor and if necessary any goods that a debtor has a share or interest in.

If an Enforcement Agent (Bailiff) has reason to believe the goods belong to a debtor then they can take control of the goods.

The Enforcement Agent should not be reckless and should not knowingly take control of goods when they have been shown valid proof of third party ownership.

The Enforcement Agent (Bailiff) also has the right to remove the goods for Sale or Storage.

If the Enforcement Agent (Bailiff) is told that the goods belong to a third party then the Enforcement Agent should leave at the property an inventory form as per Part 2 (34) Schedule 12 of the Tribunals Courts and Enforcement Act 2007.

Interpleader process for third party claims

When the new Enforcement regulations came into effect on 6th April 2014 one of the effects was to simplify the Interpleader process for third party claims.

The Enforcement Agent is expected to sit outside this procedure as an independent third party acting as an agent of the creditor.

Whilst it is not the responsibility of the Enforcement Agent (Bailiff) to determine ownership, the agent has a duty not to waste the courts time and incur unnecessary litigation expense for the creditor.

In the case of a complaint being made about the actions of the Enforcement Agent (Bailiff) he should be able to justify to a Judge why he had reasonable grounds to believe that the goods taken control were that of the debtors.

Third party claims

Third party claims are now covered under the Tribunals, Courts and Enforcement Act 2007 Schedule 12 Part 2 paragraph 60, and The Taking Control of Goods Regulations 2013 Part 6. The Procedure also comes from the Rules of the Superior Courts (RSC) Order 17 (Rule 2).

Once the goods are taken control of and removed for sale / safe keeping and storage, the third party then has seven days in which to provide evidence as to the validity of their claim.

Once this claim is received the Enforcement Agent should direct the third party making the claim to make the claim in writing to the creditor via the Enforcement Agent.

The claim should contain the claimant’s full name and address, and list of all goods claimed with the grounds for the claim for each item.

When the Enforcement Agent receives the claim and evidence they should within 3 days of receipt send it to the creditor for them to admit or dispute.

The creditor has a further 7 days to respond to the Enforcement Agent as to if they dispute or admit the claim.

If the creditor admits the claim the Enforcement Agent should withdraw from the control of the goods and allow the third party to collect them.

If the creditor disputes the claim the Enforcement Agent should write to the third party within 3 days of receipt from the creditor of the answer.

It is then up to the third party to issue an application to the county court against the creditor.

An application may be made to the court by a third party claiming title to the goods and claiming they are not the property of the debtor.

The third party may be required to pay into the court an amount equal to the value of the goods or a proportion as directed by the court, or the Enforcement Agents costs of keeping the goods.

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Tribunals, Courts and Enforcement Act 2007 Schedule 12 Part 2

Third party claiming goods

  1. This paragraph applies where a person makes an application to the court claiming that goods taken control of are his and not the debtor’s.
  2. After receiving notice of the application the enforcement agent must not sell the goods, or dispose of them (in the case of securities), unless directed by the court under this paragraph.
  3. The court may direct the enforcement agent to sell or dispose of the goods if the applicant fails to make, or to continue to make, the required payments into court.
  4. The required payments are-
    1. payment on making the application (subject to sub-paragraph (5)) of an amount equal to the value of the goods, or to a proportion of it directed by the court;
    2. payment, at prescribed times (on making the application or later), of any amounts prescribed in respect of the enforcement agent’s costs of retaining the goods.
  5. If the applicant makes a payment under sub-paragraph (4)(a) but the enforcement agent disputes the value of the goods, any underpayment is to be-
    1. determined by reference to an independent valuation carried out in accordance with regulations, and
    2. paid at the prescribed time.
  6. If sub-paragraph (3) does not apply the court may still direct the enforcement agent to sell or dispose of the goods before the court determines the applicant’s claim, if it considers it appropriate.
  7. If the court makes a direction under sub-paragraph (3) or (6)-
    1. paragraphs 38 to 49, and regulations under them, apply subject to any modification directed by the court;
    2. the enforcement agent must pay the proceeds of sale or disposal into court.
  8. In this paragraph “the court”, subject to rules of court, means-
    1. the High Court, in relation to an enforcement power under a writ of the High Court;
    2. a county court, in relation to an enforcement power under a warrant issued by a county court;
    3. in any other case, the High Court or a county court.

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