Tough quarter for Scottish business debts

There were 754 decrees issued against all businesses in Scotland during Q3 2018, 34 per cent more than during the same period the previous year.

A 44 percent rise in the number of decrees issued against companies accounted for most of this increase. In contrast the number of decrees registered against unincorporated businesses, which are generally smaller, increased by just two per cent.

The total value of all business decrees rose by 21 per cent to £2,874,044 over the year. Within this, the total value of company decrees, rose 17 percent to £2,116,734 and the average company decree’s value fell by 19 per cent to £3,398, the lowest corporate average for a third quarter, despite rising in number. The total value of non-corporate decrees increased 31 per cent to £757,310 with the average at £5,781, a 29 per cent increase on Q3 2017.

Registry Trust is the non-profit organisation which collects decree and judgment information from jurisdictions across the British Isles and Ireland. In Scotland it collects information on small claims, summary, ordinary cause and simple procedure sheriff’s court decrees. A decree is incontrovertible proof that debt has not been managed.

During Q3 2018, 5,668 debt decrees were registered against Scottish consumers, six per cent more than in the third quarter of 2017.

A further one per cent increase on last year’s historic Q3 high in the average value of small claims and summary cause decrees set a new record, whereas a 22 per cent drop in average value of ordinary cause decrees, to £13,102 gave the lowest Q3 figure on record. This combination caused the total value of all consumer decrees to remain approximately flat at £15,100,752.

Only 3.38 percent of decrees were marked as satisfied during Q3, far lower than the 15.75 per cent of satisfied debt judgments in England and Wales, where satisfaction rates are generally higher owing to legal differences.

Trust chairman Malcolm Hurlston CBE said: “Both consumers and businesses need to be more alert to having decrees marked satisfied when they have been paid. It gives an immediate boost to credit records and several thousand are currently missing out.”