Can I enforce a debt judgement during the COVID-19 pandemic? 

The government has implemented temporary changes to insolvency procedures to support businesses affected by Coronavirus COVID-19. 
 

Statutory Demands and Winding Up Petitions 

Statutory demands served between 1st March and 30th September 2020 cannot be used as a basis for winding-up petitions. Statutory demands may still be served, but will have limited effect without the option of a winding-up petition. 
 
A statutory demand isn’t the only method of presenting a winding up petition, and petitions may still be served with a different basis. However, for the petitions to be successful the court will need to be satisfied either that COVID-19 has not had a financial impact on the debtor, or that the company would have been unable to pay it’s debts regardless of the pandemic. The threshold for proving that COVID-19 has not impacted on the debtor is set very high, and so it will be very difficult to satisfy the court. If the petition is not successful, the claimant may be liable for the debtors costs, and so this is a risky route. 
Given these restrictions on winding up petitions and the risk involved, we would currently suggest that creditors explore other options. If a winding up petition is the only option, we would suggest waiting until the restrictions are removed. Currently this would mean waiting until October, but it is important to remember that these measures have already been extended once. 
 

Wrongful Trading Provisions 

The wrongful trading provisions have been suspended, so that businesses can continue trading, paying staff and suppliers, and purchasing goods even when insolvency is likely. The aim is to avoid unnecessary insolvency during this time, so that struggling businesses will have the opportunity to recover once the current situation has passed. 

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Phone: 0121 452 5130 
Address: Spencer Shaw Solicitors Limited 
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