What it is
Schedule 12 to the Tribunals, Courts and Enforcement Act 2007 defines it as an agreement under which the debtor:
- is permitted to keep custody of the goods,
- acknowledges that the enforcement agent is taking control of them, and
- agrees not to remove or dispose of them, or let anyone else do so, before the debt is paid.
It replaced the old “walking possession” agreement in 2014.
What it must contain
The agreement must be in writing and signed by the agent and by the person entering into it. Regulation 15 requires:
- The debtor’s name and address, the reference number and the date.
- The names of the people signing.
- How and when the agent or their office can be contacted.
- A list of the goods, described well enough to identify them. For a vehicle that means make, model, colour and registration.
- The repayment terms.
A copy must be given to the person who signed it at the time.
Who can sign
The debtor, as long as they are not a child. Or a person aged 18 or over whom the debtor has authorised. At business premises, a person in apparent authority.
An agent may not enter into an agreement with anyone who appears not to understand its effect.
What changes once it is signed
While the agreement is kept
- The goods stay in the home and can be used as normal.
- No goods are removed and the sale stage fee is not reached.
- The agent may come back to inspect the goods.
If payments are missed
- The agent can give notice of intention to re-enter, of at least 2 clear days.
- After that notice they can use reasonable force to get in, which for other debts they could not do.
- The listed goods can be removed and sold.
- The 12-month time limit starts again from the date of the breach.
Selling, hiding or giving away listed goods while the agreement is running is serious. Intentionally interfering with controlled goods without lawful excuse is a criminal offence.
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The notice before they return
A notice of intention to re-enter must be in writing and signed by the agent. It has to identify the agreement, say how it was broken, give the amount outstanding and the deadline for paying it, and state that reasonable force may be used. Sundays, bank holidays, Good Friday and Christmas Day do not count towards the 2 clear days.
Fees
An agreement is normally made on a visit, so the £247 enforcement stage fee will already apply. Keeping to it avoids the £116 sale stage fee. For High Court enforcement, keeping to an agreement or a repayment arrangement means only the first enforcement stage fee can be recovered, not the second.
A payment arrangement without an agreement
Not every payment plan is a controlled goods agreement. A plan agreed over the phone or in writing before any visit, with no goods listed, is a repayment arrangement. It gives the agent no right of entry and no power to use force. If it is broken, the 12-month time limit starts again and the case can move on to a visit.
Common questions
Does a controlled goods agreement have to be signed?
Nobody can be made to sign one. It is an agreement. Without one, the agent’s other ways of taking control are securing goods on the premises, securing them on a highway, or removing them.
Can goods on a controlled goods agreement be sold by the owner?
No. The agreement includes a promise not to remove or dispose of the goods before the debt is paid.
What counts as breaking the agreement?
The power to re-enter with force arises where the debtor “has failed to comply with any provision of the controlled goods agreement relating to the payment by the debtor of the debt”. In other words, a missed or short payment.
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These organisations give free, impartial debt advice and are independent of Bailiff Support Team. Nobody has to use a paid or commercial service to get help with their debts, and using one of the free services does not reduce the options available. Their advisers can also ask an enforcement firm to extend a notice period or apply for Breathing Space where it fits.
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- National DebtlineFree advice and sample letters, run by the Money Advice Trust.
Sources
- Tribunals, Courts and Enforcement Act 2007, Schedule 12
- Taking Control of Goods Regulations 2013, regulations 14 and 15 (controlled goods agreements)
- Taking Control of Goods Regulations 2013, regulation 25 (notice of re-entry)
- Taking Control of Goods Regulations 2013, regulation 9 (time limit)
- Taking Control of Goods (Fees) Regulations 2014 (as amended)