MoJ to tighten rules for default CCJs
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:
- Striking a CCJ from the register immediately once unknown debts are resolved and a judge agrees the person was unaware;
- Better protecting consumers who don’t receive mail because it is sent to an old address;
- Introducing an information campaign with a centralised, trusted source to raise awareness and help people deal with unresolved debts.
The MoJ has proposed that a judgment may be moved from the statutory register of fines, orders and judgements where:
- The court is satisfied that the defendant was unaware of the claim/judgment when originally issued/entered;
- The court is satisfied that the defendant has only just become aware of the claim and judgment;
- The defendant pays in full immediately.
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.
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.”
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.