Most people (lawyer’s included) are often so content with the conclusion of a litigation and the procurement of a Court Judgment that they forget the war is not completely over.
Judgment enforcement is, if anything, the second part of a long-winded battle that all litigants should be weary of.
Generally, enforcing a judgment from a Court of competent jurisdiction against a judgment debtor will only be successful if the debtor has three things:
- Money;
- Assets that can be seized and sold; or
- A debt owing to the debtor by a third party (eg. Bank account, employment income) that can be garnished.
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Money
As self-explanatory as it seems, when a debtor possesses sufficient money they an pay the creditor the judgment amount without reasonable delay.
If delay is met, which can often be the case, post-judgment interest can begin to accrue automatically on the judgment award owing to you.
You can calculate the amount of post-judgment interest owing as follows: (total judgment amount) x (post-judgment interest rate %) ÷ (365 days per year) x (number of days from date of judgment to date payment received) = post-judgment interest owing.
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Assets that can be seized and sold
If the debtor has been ordered by the Court to pay the creditor money but he or she has not paid, the creditor can ask the enforcement office to take specific personal possessions belonging to the debtor and sell them at public auction so that the money can be used to pay the judgment debt.
This is known as a Writ of Execution of Personal Property.
The costs of this procedure can be relatively high. The creditor risks paying these costs with no chance of recovery if the debtor does not have any goods worth seizing and selling, and other enforcement remedies fail. It is a good idea to confirm beforehand whether this procedure will be worthwhile.
A creditor can also file a writ of seizure and sale of land against a debtor in any country or district where the debtor may own land (including a house). The writ would encumber any land presently owned or land which may be purchased in the future by the debtor in the ounty(ies) or district(s) where the writ is filed.
The writ of seizure and sale of land can be very effective in the long run since it will be difficult for the debtor to sell or mortgage the land until the debt is paid.
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Garnishment
If a Court has ruled in your favour and you have not received payment, you can claim/demand money owed to the debtor by someone else. This is called garnishment. Most often, garnishment is used to garnish funds from a person’s wage or bank account.
However, please be advised that the rules for garnishment are contained in the Rules of the Small Claims Court. The rules on garnishment are strict and have to be followed carefully.
Notwithstanding, section 7 of the Wages Act which also restricts the amount of wages that can be garnished, there are certain exemptions from garnishment, such as employment insurance, social assistance, and pension payments.
As every case in unique and will depend on the given facts of a scenario, it is always advisable to seek legal advice from experts in the legal field. To determine the strengths and weakness of your case, please contact Lakhan Tram LLP for more information.
