There is some good advice on this thread. The most important thing is to not ignore this - it won't go away.
I went through a similar issue (though that was due to an ex housemate defaulting, and the rest of us being held responsible for his share of the rent). I went to the court hearing - the only of 4 of us who actually showed up - and agreed a payment plan. The good thing about this is that you will have a court order supporting your payment plan, so your former landlord won't be allowed to demand more in future. You will also be under legal pressure to pay as agreed, however, with *serious* issues if you default on the payment plan.
If this is the first court hearing in this case that you have been asked to attend, take along with you every bit of evidence you can find about your contract, communication with the landlord and your reasons for leaving the accommodation. I would strongly suggest taking legal advice - your student union might be able to help, or the Citizen's Advice Bureau - and if you know anyone with experience of courts ask them to be there with you for support.
Also, don't panic too much. You will find this will affect your credit rating, possibly for a few years, but that can be fixed (six years after my own problems, I now have excellent credit scores again!). The most important thing is to take control of the situation again and stop it from getting any worse.
I really hope things turn out ok for you.