News about Global Recovery Services(GRS)

 

12.08.2017 -  An Interview with Bilhan SELEK (Managing Director)

bilhan selek general manager

 

“It’s quite pleasing to see that insurance awareness is increasing rapidly.” 

The collection of receivables has been a long time burden for Maritime companies and the matter has been being discussed in the sector, for several years. In 2013, Global Recovery Services (GRS) was founded, in regard to pursue this entire process on behalf of the claimant, thus relieving these companies; from this big and time consuming task.

Could you tell us a little about your company’s past?

Our company was founded in 2013. This is the official date that we were enrolled in the Turkish Trade Registry and the relevant Professional Chambers, but this was preceded by a 5 year period of field and market research. 

How many people does your team exist of?

It’s actually not easy to give a specific number. Because, to be able to render the best possible service to recover the subrogated indemnities belonging to our corporate clients, and to ensure that this process is topped of with a successful collection, we have a broad network, spread all over the World. This network consists of lawyers, brokers, agents, asset management companies in various countries. So the team differs from case to case. We really give utterly importance to handle each collectable with the specific team and resources. 

What kind of steps do you take, to recover the receivables of companies?

The receivables that we pursue have to be contractual corporate receivables. Before we accept to pursue the collectable; we confirm that there is a contract between the debtor and the creditor. If there is a contract, and a jurisdiction has not been agreed in the contract, we determine a competent jurisdiction, according to International Private Law. Afterwards, we assess the file, with a lawyer competent in the field and law of the specific case. Meanwhile, we work with an international as-set management company, to establish the financial capacity and assets of the debtor.

cargo damageIf the creditor is a maritime company, as in your question, and the receivable concerns a damage to the cargo carried on a vessel; in this case we examine documents such as bill of lading of the damaged cargo; charter party between the ship-owner and charterer; the cargo stowage plan; if the loading and discharging has been carried out by a certified stowage company, the certificate that was issued to this handling; evaluations if the vessel was seaworthy or not; survey reports issued at loading and discharge ports; reports issued by customs officers; high resolution, colored photographs of the damages. After reviewing all these documents, we contact the debtor and ask for an appointment. If possible, we prefer to meet with officials of the debtor company, face to face. If for some reason, meeting face to face is not possible, we use the merits of technology and with mutual goodwill by us and the debtor, we collect the due amount as swiftly as possible.

How does this process work? I mean, can you explain the process after the creditor contacts your company?

After the creditor reaches out to us; we get the file they want to refer to us, we start by examining the file as quickly as possible. Companies that work with us for the first time, usually prefer us because of our working principle of “no cure, no pay”; which means that, we do not charge anything for examining the file or chasing the debtor, nor do we charge anything if we have to return the file without making a collection. So we do our utter best not to charge any costs. 

The debtors usually do not want to make advance costs, either because they do not have financial resources, or because they cannot foresee the collectability of the claim. That is the main reason that these companies prefer us. On the other hand, we have to manage our own financial resources somehow. Thus, if it is even slightly possible for us to handle the claim on a “no cure, no pay” basis, we require a letter of authority, in which the creditor gives us the authority to pursue and collect the collectable. This letter of authority is essential, to prove our capacity to represent the creditor, against the opponent.  After this step, we start to negotiate with the debtor company. To be successful in collection, there are some prerequisites: the first one is time bar, according to  the laws the debt is subject to. Before we approach the debtor, we make sure of this legal status. If, legally the party that we represent is in its right, and if the debt has not been time barred yet; then we explain to the debtor that legal procedures, in all legal systems are difficult, time consuming and costly; and we invite them to settle amicably. To make this amicable settlement even more attractive, we sometimes offer a reduction from the amount due or even let them pay the debt in installments. Surely, we make these offers after getting approval of our principals. In cases where the receivable has already been time barred, the debtor are not really legally pushed into a corner, so they are not tempted to settle amicably. The second precondition is that, the debtor must accept his debt and must be willing to settle his debt; if the debtor is not willing to pay, sadly neither recovery agents like us, nor court decisions have much sanction power. Malicious debtors, while making the debt, cook up the entire scheme on a “not to pay” basis. The third premise to be able to collect the receivable is that the debtor has the financial means to pay. Even if the legal time bar has not been extended and the debtor is willing to pay; if the company does not have financial assets, there is nothing to be done.

If it is not possible to collect the receivable amicably, legal procedure is initiated I suppose?

marine claimsYes, we position our company mainly at the pre-legal stages of debt collection; however, if despite our good willed efforts, amicable settlement is not possible, due to the reasons explained above, our lawyers can start legal action. But even a beneficial decision of the court, sometimes may not be enough to actually make a collection. In some cases, our company is active as part of this process again to chase the debtor towards collection of the receivable.  If you have a Court Order or an Arbitration Award in hand that needs to be executed, just let us know.  With marine claims that are subject to English Law, provided some conditions are met, we have a system that enables us to provide financing.

Are you specialized in the laws of a specific foreign country, or are you able to take action in several countries?

Since we have partners in several countries, we can take action in all countries. But usually, the maritime sector, if the parties have not agreed upon the rules of another jurisdiction, the standard Bills of Ladings and Carriage Contracts are subject to English Law. Therefore, all damages such as: cargo damage occurred during sea transport, damages to the sea vessels, even damages due to collisions etc. are subject to English Law. Since most of our files concern marine claims, it would not be wrong to state that we have accumulated substantial knowledge on English Law. In the US and Western-Europe, the legal system and legal traditions are established, and the concept of recovery agencies and recoveries based on settlement procedures are widely accepted and well known. Sadly, we cannot state the same about the countries of the previous Eastern Block and the Middle Eastern countries.

What is the role of your company during the legal procedure?

dept collection lawyersDuring the legal procedure, we keep in close contact with the lawyers who are actively pursuing the case, thus making sure that the interests of our principal are protected in the best way possible. Sometimes, there is a language barrier between the lawyers and the client; sometimes, because of the circumstances the legal procedure needs to be initiated in a different country than the one of the client. The follow up of this entire procedure, the reporting and taking decisions in urgent situations, are all matters that we take care of.

You also offer an insurance that is a big advantage for the legal procedure. Can you tell us about that?

When there is a maritime claim, subject to English Law; if some specific conditions are met, we are able to finance the expenses that need to be made during the judicial procedure. The finances that we offer, releases our creditor clients, from having to suffer the heavy burden of up front expenses that need to be made to pursue the lawsuit. We have a policy that covers these kinds of legal expenses. To offer them to make use of our insurance policy, the case needs to be subject to English Law and the creditor needs to be in his right. After the Lawsuit is concluded, the Court imposes the costs to the party that lost the Lawsuit; or splits the costs between both parties, in proportion to their fault.

Is there anything you would like to add?

My advice to Cargo Interests is that, they investigate the vessel that is going to carry their cargo and that they prefer classed vessels owned by renowned companies in the sector. We also advise them to make sure the vessel they load their cargo on, has a reliable liability insurer.

With marine claims that are subject to English Law, provided some conditions are met, we have a system that enables us to provide financing.