Debt collection and recovery services

Once all efforts from your part to collect and recover your credit have failed, it is time to look for expert help in the collection of the debt. Although we will never be able to guarantee you a favourable result, putting the file in our hands will surely increase your chances of recovering your money.

Any effort for the collection and recovery of the credit will normally start with a last extrajudicial effort: an attempt to collect the credit prior to filing a court claim. In our experience, most debt problems get solved at this stage, once the debtor is told by local attorneys such as our firm that it faces the possibility of being subject to a court procedure, which on the long run will considerably increase its costs. We will typically contact the debtor by phone as well as sending him a written formal notice claiming your credit, and try to force the debtor to either pay or sign a fractional payment agreement which you or your company will in any case have to confirm.

If extrajudicial attempts fail, we may have to follow a judicial procedure in the competent Court until we reach a favourable sentence and are able to enforce it.

I.- Prejudicial services

a) Debt claims and payment arrangements:

Once we take care of your file, our efforts to recover your credit will start by contacting your debtor by phone as well as sending him a written formal notice claiming your credit, and try to force him the debtor to pay or either sign a fractional payment agreement which you will in any case have to confirm.

Our main objective will always be to reach an amicable settlement with the debtor, by signing a fractional payment agreement with the necessary guarantees for your company; if there is ever an alternative to the complications and cost of proceedings in a Court, and we may avoid such costs and complexities, we will always opt for a reasonable agreement rather than a late and costly award by the Court.

b) Legal reports:

Depending on the reasons of the debtor to oppose payment, and prior to the initialization of judicial proceedings, it may be interesting for you to have a legal report concerning the feasibility of the projected proceedings, in order to avoid its potential failure due to determined legal rights that may assist the debtor. We may, of course, prepare this report for you.

II.- Judicial services

Depending on the type of credit and the documentation you have, we may help you by initiating in Court and action to obtain a declaratory judgement, or an action to obtain an enforcement judgement. We may also opt to file for a payment injunction, which may result in either a declaratory or an enforcement judgement. Lets take a brief look to the legal framework that will govern your claim.

a) Precautionary measures.

The provisional and temporary seizure of any assets of the debtor that may guarantee with their value the enforcement of the judgement if the claim is successful. They may be applied for in certain special cases, and, if they are successful, they may be the key to effectively recover your money.

b) Payment injunctions.

A payment injunction is an injunction issued by the Court (prior application by the creditor) against the debtor requiring him the payment in 20 days to the creditor of any commercial debt, and which must be documented in commercial invoices, delivery notes, or any similar documents commonly used in commercial transactions. When the creditor applies for the issuance of a payment injunction, the Court limits itself to examine the existence of those documents, and if it finds them formally correct, it issues the injunction. Upon notification of the injunction, the debtor may:

• Pay the claimed debt to the creditor.

• Formally oppose to payment, in which case the creditor should initiate a declaratory proceeding, either ordinary or verbal, depending on the amount of the credit.

• Do nothing, in which case the creditor may start a common enforcement proceeding.

The application for a payment injunction shall be filed in the Courts of the place where the debtor is domiciled.

c) Declaratory proceedings (ordinary proceedings and enforcement proceedings)

Declaratory proceedings are those proceedings designated to obtain a declaratory judgement from the Court. A declaratory judgement is a judgement that states the reciprocal rights and obligations of the parties, and which the parties are supposed to comply with upon its notification. If the condemned party were not to comply with the sentence, the party interested in its enforcement must initiate an enforcement procedure.

For the purposes of our interest, declaratory proceedings under Spanish law are divided in ordinary proceedings and summary proceedings:

Ordinary proceeding

An ordinary proceeding is the due procedural course for the judgement of any claim that exceeds Euro 6,000 (six thousand).

It requires the parties to be represented in court by a barrister and a solicitor, and it basically consists of four phases: a written phase, in which both parties set forth their allegations, followed by a preliminary hearing, in which the Court will examine formal considerations as well as the admissibility of the proof proposed by the parties, the trial, in which the proof will be examined and the parties make their final allegations, and the sentence.

Summary proceeding

A Summary proceeding is the due procedural course for the judgement of any claim under Euro 6,000 (six thousand). It follows a simplified proceeding in which only the claimant must submit its allegations in written in a simplified form and in which there is no preliminary hearing.

d) Enforcement proceedings.

Enforcement proceedings are those proceedings designated to enforce an enforceable title, which may either be a previous Court sentence resulting from a declaratory proceeding, or some other document which, by virtue of law, has a directly enforceable nature (e.g., some documents issued by the Government, notarial deeds, arbitrations, bills of exchange, etc.). Basically, we can distinguish between the common enforcement proceeding and the special proceeding for the enforcement of cheques, bills of exchange and promissory notes. Both type of proceedings allow the claimant to directly enforce his title against the assets of the debtor.

Common enforcement proceeding

Proceeding for the enforcement of any enforceable title. An enforceable title may be one of the following documents:

• • • A definite sentence, including foreign sentences provided certain requirements are met.

• • • An arbitration award.

• • • A court decision approving an agreement between the parties in the course of a proceeding.

• • • Notarial deeds, as well as private commercial agreements legalised by a Notary.

• • • Certain bills and certificates.

Special proceeding for the execution of bills of exchange, cheques and promisory notes

Proceeding for the immediate enforcement of a debt represented by a bill of exchange, a cheque or a promissory note.