Debt recovery through court: what you need to know
Situations where a debtor avoids its financial obligations are quite common. Sometimes all attempts to resolve the issue amicably fail. In such cases, going to court becomes the only way to restore justice and get your money back. But what is the right way to act and what is important to know before filing a …
Situations where a debtor avoids its financial obligations are quite common. Sometimes all attempts to resolve the issue amicably fail. In such cases, going to court becomes the only way to restore justice and get your money back. But what is the right way to act and what is important to know before filing a lawsuit?
- Documents are the basis of your success
- a loan agreement (written or notarized);
- a debtor’s receipt confirming receipt of funds;
- bank statements showing the transfer of funds;
- e-mails or correspondence in messengers that can confirm the agreement.
- Pre-trial settlement: try again
Before filing a lawsuit in court, you should send a written claim to the debtor demanding repayment of the debt. This should be a registered letter sent by postal service. If the debtor ignores the claim, this document will be an important proof of your attempt to resolve the conflict out of court..
- Choosing a court
A lawsuit is filed with a general jurisdiction court at the debtor’s place of registration. Commercial courts, on the other hand, consider cases in disputes arising in connection with the conduct of economic activity and other cases in cases specified by law, in particular: cases in disputes arising from the conclusion, amendment, termination and execution of transactions in economic activity, except for transactions to which an individual who is not an entrepreneur is a party.
- Drafting a statement of claim
- your contact details and the debtor’s details;
- the circumstances of the case, a description of the debt and outstanding obligations
- references to evidence supporting your claims;
- clear requirements (amount of debt, interest for delay, penalties, etc.).
- Court fees
Filing a lawsuit requires payment of a court fee. Its amount depends on the amount of the claim. For individuals, it usually amounts to 1% of the amount of the claim, but not less than 0.4 of the subsistence minimum (as of 2024).
- Case consideration and court decision
After filing a lawsuit, the court sets a hearing date. The parties have the right to provide additional evidence, call witnesses, or submit their explanations. If the court decides the case in your favor, the debtor will be obliged to repay the debt.
- Enforcement of a court decision
In order to enforce a court judgment, it is necessary to obtain an enforcement document from the court and apply to the relevant state enforcement service or private enforcement officer within three years from the day after the judgment enters into force with an application for the opening of enforcement proceedings and the attached enforcement document. The aforementioned application together with the enforcement document may be submitted by the recoverer either independently or through a representative, or by postal means (it is recommended to send it by registered mail with acknowledgment of receipt and a list of attachments).
- Can I recover additional costs?
If you have spent money on legal assistance or court fees, you have the right to claim reimbursement. The court may order the debtor to cover these costs if your claim is successful.
- What if the debtor has no property?
If the debtor does not have any property or funds that can be recovered, this may complicate the process of debt recovery. However, the bailiffs can seize bank accounts and garnish the debtor’s salary.
- Should I contact a lawyer?
Although you can theoretically file a lawsuit on your own, the assistance of a lawyer significantly increases your chances of success. A professional will help you properly draft a claim, prepare evidence, and represent your interests in court.
Debt recovery through the courts is not always a quick process, but it allows you to achieve justice and restore your rights. The main thing is to prepare for the case, collect all the necessary evidence and act in accordance with the law.
Your efforts will definitely pay off, and justice will prevail!
Link to the Commercial Code of Ukraine.
Link to the Civil Code of Ukraine.