Action through small claims court before bankruptcy

Hi,

We are in the process of saving bankruptcy fees for my husband, who was a sole trader, and lost his business almost a year ago.

We delayed the process to enable us to move into a new rented home a couple of weeks ago.

He's been in and out of temporary work for the last 10 months which hasn't helped in terms of saving the fees. Good news is that he has been offered a permanent job starting in April. Unfortunatley, this won't save him from bankruptcy.

So, as per what I've read on here, we've been basically ignoring all demanding/threatening paperwork from all of the larger creditors.

However, on Friday he received a copy of a claim form which a small advertiser states they will submit to the local small claims court on Tuesday unless payment is received in full. The amount isn't huge (approx. £200) but we don't have it and don't know what to do. Feel rubbish about a small business having to go through this hassle to recoup what they are owed, but it certainly wasn't down to choice that they were not paid.

What should we do? What happens if we ignore that too? I mean, it can't be worse than bankruptcy, but what are the implications if we do nothing?

I'd appreciate any advice.

Thanks

r710