Whether you are a business or an individual, when money is owed to you there's usually a clear deadline specified for when payment is expected to be made. For example, your business invoices will have a payment period detailed on them, and if you've loaned money to a friend then you will have an agreed repayment date or schedule.
But if this date passes and no payment has been forthcoming, can you claim interest on the money owed to you?
Interest on business debts.
The ability to charge interest on an overdue invoice or order will depend on the status of your customer and the contractual terms you have agreed that deal with late payment. If you have a contract in place that contains a provision or clause for interest to be charged, then this should be sufficient to add interest to the overdue amount at the agreed rate.
If there is no specific contract in place with your customer that dictates interest charges, you may still be able to claim interest via legislation known as the Late Payment of Commercial Debts (Interest) Act 1998 if your customer is also a business (limited company, sole trader etc.).
Late payment of commercial debts.
This late payment legislation permits you to charge 8% interest plus the Bank of England base rate on overdue debts owed by your business customers (B2B). You can begin charging interest as soon as payment becomes overdue, and if no payment date was documented or agreed payment is classed as late 30 days from the customer receiving your invoice or delivery of the service/product.
There are some exceptions and additional items that can be claimed as part of this legislation, so please read our full guide on claiming interest on unpaid invoices. Alternatively you may wish to instruct business debt recovery solicitors who will be able to calculate your late payment interest and compensation entitlement on your behalf.
Business to consumer debts.
If the customer whose payment is overdue is an individual and not a business, there is no statutory right to charge interest on the amount. So, unless you have an agreed contract or terms of business in place that specifies additional charges will be made in the event of late payment, no interest is able to be added to the debt until court proceedings are started.
When dealing with debts incurred by consumers (and sole-traders) it is also important to comply with the Pre-Action Protocol for Debt Claims. Failure to do so before commencing court proceedings may result in sanctions being imposed on you, likely in relation to court costs.
Quick Reference - Interest on Debt Claims
* Based on statutory annual interest entitlement, details correct as at June 2019.
Interest on personal debts.
If you are owed money as an individual such as through a private sale, shared bills or a personal loan, there is no entitlement to claim interest on the debt unless you have a signed contract or agreement that permits it.
For example, in the case of lending money ideally you will have documented the arrangement in a loan agreement which should have a provision for any interest and what occurs in the event of the borrower defaulting on their repayments.
Without a written contract interest is not able to be added to a personal debt prior to court proceedings being started.
Interest on court claims.
Regardless of the status of the debtor and the absence of a right to contractual interest, if you get to the stage of issuing a court claim to recover the debt, interest will often be able to be added to the amount owed.
Section 69 of the County Courts Act 1984 permits interest to be added to most non-commercial debts at the rate of 8% per year. This is a statutory interest rate and you can usually claim it from the date the debt was due up to the date you issue the claim.
At the point of issuing court proceedings, other court fees and costs can also be added to the amount that is being claimed. However, note that interest as with any other element of a claim is awarded at the discretion of the court.
The applicable interest is just one of the items that needs to be considered and calculated as part of a court claim for a debt. Therefore, it is always advisable to seek early legal advice if you are contemplating pursuing a substantial debt.
As a responsible dog owner, receiving notification that someone is pursuing a compensation claim against you after being bitten by your dog can be a shock.
UK research indicates that one in four people have been bitten by a dog in their lifetime, with a third of bites requiring medical attention but only 0.6% requiring hospital attendance. So, while being seriously injured by a dog is relatively rare, any injury to a human which involves your pet will still be a cause for concern.
In the immediate aftermath of a dog bite, the police often become involved to assess if your dog is dangerous or could be considered out of control. The outcome of this investigation could be a warning, fine, banning order or even prison sentence in the most serious of cases.
But regardless of any action the police may take in a criminal capacity, you may still be subjected to civil legal proceedings in the form of a compensation claim made by the injured party.
If this occurs, then you'll need to be aware of the options available in defending a dog related personal injury claim and that you cannot always be held legally responsible for injuries that have been caused by your pet.
Insurance covering dog bite claims.
There are various insurance policies which you may have in place that can cover you in the event that a personal injury claim is made against you as a dog owner.
Should you receive a claim, it's recommended to first check for any possible insurance policy and if cover exists, report the claim to your insurer as soon as possible. They will then take over the handling of the claim and instruct a solicitor to act on your behalf.
If no cover exists, or your insurer refuses to indemnify you, then you need to seek advice from a personal injury defence lawyer.
Dog bites and the law.
For a claimant to be successful in their damages claim they must prove that the owner of the dog was responsible for the actions of the animal, and/or have been negligent in some way.
The Animals Act and dog bites
A key piece of law that is often cited in animal attack cases is the Animals Act 1971. This legislation defines the conditions that a dog’s keeper can be responsible for the behaviour and damage caused by their dog.
The act provides three tests that must be met before the owner or person in possession of the animal can be held liable for any damage that has been caused. Basically, these tests are that:
a. The damage or injury was likely to be caused by the animal unless it was restrained, and
b. It was caused by a characteristic of the animal, and
c. The characteristic was known to the owner or keeper of the animal.
While any dog has the ability to bite, they will generally only ever do this in unusual circumstances which may not be able to be reasonably foreseen by the keeper.
Proving negligence in dog bite cases
Being the owner or handler of a dog, you owe the public and any visitors to your home a 'duty of care' to prevent the animal from injuring them. If a claimant can prove that an owner has breached this duty, and so been negligent, then they may be entitled to compensation.
A person simply being bitten by a dog does not mean that the owner has been negligent. A claimant would need to show that they were aware that the dog attack could happen and failed to take adequate steps to prevent it.
Defences to a dog bite injury.
As you have probably gathered, defending a dog bite compensation claim is a complex task and you should obtain specialist legal advice when faced with a claim.
An experienced solicitor can investigate the circumstances of the incident, as well as the history of the animal, to present all mitigating factors on why you may not be liable for the injuries caused. For example, common defences may include:
When it comes to the law, your beloved family pet is simply considered a piece of property that has inflicted damage on another person. So if you are placed in the position of defending a claim, ensure you seek the legal advice you need and your pet deserves.
If you purchase a second-hand item from a business or trader, the consumer rights that you are entitled to are extremely similar to those you have when buying an item that's brand new. Namely the goods should be:
These rights in the UK are defined in the Consumer Rights Act and cover any purchase from a trader made since October 2015.
If you discover a fault with an item, this act gives you the right to return it for a full refund within the first 30 day of purchase. After the first 30 days (but within the first 6 months) you can still return the item, but you must give the retailer the opportunity to replace or repair the fault.
After 6 months, to return the item you must prove that the fault was present when it was first purchased, which can be more difficult if a product was second hand or pre-owned from the outset.
Second hand products may have imperfections and faults that are attributed to normal wear and tear. In some cases, there may be quality issues with a product due to its age and how it has been previously used.
When considering your consumer rights, it's important to remember that second hand products do not have to be of the same quality as new items. Therefore, you cannot simply reject an item because it is not of the same standard as you would expect if it was brand new.
Fit for Purpose with second hand goods.
Fit for purpose means that the item must function correctly and last for a period of time that is 'reasonable'. In relation to used goods the item should function fully for the purpose it was designed and sold for. However, being a used item, it may show signs of being pre-owned and not last as long as you would expect a brand-new item to last.
Satisfactory Quality with second hand goods.
Satisfactory quality is basically a standard that a reasonable person would consider as acceptable taking into consideration the item's description, price and circumstances of the purchase. It is most often relating to a product's appearance, freedom from defect, durability and safety. Obviously, the quality of an item can be subjective, but expectations should generally be lower if you purchase an item that has been previously used.
As Described with second hand goods.
As described means that an item must be accurately advertised and described by the trader. If you asked questions about the product in store prior to purchasing, such as its warranty status, service history or how it currently operates, the information given should all be correct. Likewise, if the salesperson advises you of a fault with an item, then it is 'as described' and you can't reject it due to it having the fault.
Buying second hand goods online.
When buying second hand goods online, over the telephone, at home or through mail order from a retailer you will also benefit from additional protections. Namely the Consumer Contract Regulations, or to give it its full name The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.
These regulations cover what was previously known as 'Distance Selling' and provides some extra rights, even when purchasing a used product. These rights include:
The retailer is entitled to expect that anything sent back is returned in the exact condition as it was received. This can sometimes be a point of dispute when returning second hand goods as they are likely to have not been in original packaging etc. in the first instance.
An important point to remember when buying second hand products online is that not every website purchase is classed as buying from a business. When you buy from sites such as eBay, Gumtree, Shpock or Amazon Marketplace you will need to check if the seller is a business or trader. As if they are a private individual, then consumer rights and contract protections will not apply to your purchase.
Consumer Rights and private sellers.
If you purchase items from a private seller via a web advertisement, local newspaper ad or car boot sale it is important to be aware that you don't have any consumer rights. For the Consumer Rights Act to apply you need to be an individual making a purchase from a business.
If you do buy a second-hand item from a private individual it only has to match any advertised description. This limited protection falls under The Misrepresentation Act for when an untrue fact or statement is made by the seller to convince a buyer to make a purchase.
A private seller isn't under any obligation to tell you about any faults or defects, and there's no requirement for the item to be of satisfactory quality or suitable for any specific purpose.
So, as you may have heard, purchasing from a private seller is a matter of 'buyer beware'. You should check the product thoroughly to ensure you are 100% happy before buying it.
Legal advice on second hand rights.
In the majority of cases once you make the retailer aware of the fault, they should deal with your concerns inline with your consumer rights. If they refuse, the next step is escalating the matter as a complaint and then involving any associated ombudsman which should be detailed in the retailer's terms and conditions.
If all these steps fail, your only available method of resolution may be to start court proceedings. If the value of your claim is less than £10,000, it will be treated as a 'small claim' which means there are set fees to issue the claim and only limited legal expenses are able to be added (see our guide on how much does it cost to take someone to court).
Therefore if the value of your consumer claim is significant, it will be worthwhile seeking legal advice on your dispute before beginning court action.
Catalyst Law are team of legal professionals with over 20 years' experience helping businesses and people with their legal problems.
Follow us on: