Decrees against businesses drop to record low

In the first three months of 2019, the number of decrees against Scottish businesses dropped by 25 percent, compared to the same period of 2018, according to figures released today (May 9) by Registry Trust. The total of 561 was the lowest of any quarter on record.

The total value of decrees against businesses in the first quarter fell three percent to £3.1million. The average value of a business decree rose 30 percent to £5,599 while the median, at £1,900, was up by 23 percent compared to the same period the previous year.

The total number of decrees against companies dropped by 30 percent from the previous year’s figures, to 398, though the average value of a decree in Q1 2019 jumped 98 percent to £6,663 – a record high for the first quarter. The median increased by 38 percent to £2,067 and the total value of decrees against Scottish companies rose by 39 percent to £2.7million.

The total number of decrees against generally smaller unincorporated businesses fell 11 percent on Q1 2018’s figures, to 163 – also a record first quarter low. The total value also dropped to a record first quarter low of £489,041, down 63 percent compared to the same period of 2018. The average value decreased by 58 percent to £3,000, while the median value fell 15 percent to £1,632.

During the first quarter of 2019, 5,253 debt decrees were registered against consumers, 28 percent lower than Q1 2018. There was a 29 percent decrease in the combined value of consumer decrees to £11.9million. The average value of all consumer decrees fell to £2,267, two percent lower than in the same period of 2018, and the median consumer decree increased by nine percent to £1,289.

The number of small claims against consumers fell by 28 percent in Q1 2019 to 4,857, with the total value down 24 percent on Q1 2018’s figures to £7.4million. The average value increased by five percent to £1,520, and the median value rose by 11 percent to £1,201.

Ordinary cause decrees against consumers in the first quarter of 2019 dropped by 23 percent to 396, compared to the same period the previous year, while the total and average values fell to all time first quarter lows of £4.5million and £11,437 respectively. The median value at £8,655 rose four percent from Q1 2018 figures.

Registry Trust is the non-profit organisation which collects decree and judgment information from jurisdictions throughout 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.

Only 4.39 percent of decrees were marked as satisfied during the first quarter of 2019, less than half the 10.52 percent of satisfied debt judgments in England and Wales, where satisfaction rates are generally higher owing to legal differences. This suggests advice agencies in Scotland should encourage clients to report when they have satisfied a debt.

Trust chairman Malcolm Hurlston CBE said: “These figures show a Scottish economy in robust health despite headwinds. The absence of judgments makes it easier to borrow responsibly – an important element to a strong economy.”