Once a judgment is obtained, if payment is still not received from the debtor, you will need to consider the different judgment debt recovery options, which will allow you to enforce the judgment. Some of these judgment debt recovery options are listed below.
Examination Summons
If you are unsure of the financial circumstances of the debtor, as is often the case, a public examination of the debtor can be a useful tool to allow you to identify the debtor’s assets and income, so that you may choose the most effective judgment debt recovery option. If the debtor is a company, the examination can be issued to a director of that company to disclose the company’s financial details.
Whilst an examination by examination summons will not of itself result in payment of a judgment debt, the thought of being publically examined can sometimes encourage a recalcitrant debtor to face up to the need to deal with a judgment debt and may lead to discussions regarding payment, making an examination summons a useful judgment debt recovery option.
Garnishee Orders
Another judgment debt recovery option which is extremely useful is a garnishee order. If granted by the Court, the garnishee order can be served on a chosen bank or employer (or in fact any other person who owes money to the debtor). The order requires any monies owed to the debtor (up to the amount in the garnishee order) to be paid to the judgment creditor and not to the debtor. If the debtor’s bank is not known, garnishee orders can be issued against each of the major banks, often leading to the discovery of the debtor’s bank account/s.
This debt recovery method can be a very successful and efficient method for collecting money, and can allow you to recover a judgment debt immediately.
Writ for the Levy of Property
A judgment creditor can also apply for a writ for the levy of property. If granted, this will allow the Sheriff to attend the debtor’s premises and seize goods owned by the debtor, in order to sell them at an auction.
This option is not always the most time efficient method, however, it can be useful if you are collecting a small judgment debt or if you have knowledge that the judgment debtor is in possession of valuable goods.
It should be noted that not all goods owned by the judgment debtor can be seized. Excluded goods include clothing, tools of trade worth up to $2,000 and bedroom and kitchen furniture. Issues can also arise if the judgment debtor lives with other people, as it can be difficult for the Sheriff to ascertain what property belongs to the debtor.
If the judgment debt is greater than $3,000 a separate writ can be registered against any real property registered in the name or the debtor. This will affect what dealings the debtor can undertake in respect of the land and can sometimes be an effective debt recovery tool, particularly if a debtor is in the process of selling or refinancing the land.
Bankruptcy
If you are owed a debt above $5,000* by an individual, bankruptcy can be a useful judgment debt recovery option. For more information click here.
Liquidation
If you are owed more than $2,000* by a company, liquidation can be a useful debt recovery option. For more information click here.
Debt Collection
If you would need assistance with collecting money owed under a judgment, or to recover any debt, contact Matthews Folbigg Lawyers for specialist advice as to which judgment debt recovery option will be most effective for you.
* the minimum amounts for a debt in bankruptcy and liquidation have increased during the COVID-19 pandemic to $20,000. Additional time requirements have also been put in place. Contact us for further details.
