Enforcement of civil judgments

Contributed by Ian Macdonald and Andrea Highman and current to 1 September 2005

At the same time as the lower court structure of the State is changed, the system of civil judgment enforcement has also been radically altered. The important thing to note is that the new system of civil judgment enforcement affects all levels of State civil courts. The system for enforcement is accordingly the same for the Supreme Court, the District Court, and the Magistrates Court.

This means that features of the old enforcement systems which differed from Court to Court have been abolished. Writs of fi fa, warrants of execution, and judgment summons have been abolished.

Similarly, the same personnel enforce judgments in the three levels of State courts. All civil judgment enforcement is the responsibility of the Sheriff, who can appoint people as bailiffs to assist in this work.

INTEREST ON JUDGMENTS

Pre-judgment interest

Courts can include in a judgment interest at a rate they decide is appropriate, unless the debt claimed is one on which interest is payable within the terms of the agreement sued on. No rate is set in the Acts governing the Courts.

Post-judgment interest

A judgment carries interest from the date of the judgment, to the date on which the judgment sum is paid, at the rate prescribed by the regulations, or at a rate set by the Court.

LIFE OF A JUDGMENT

A judgment is enforceable only within twelve years of the date of the judgement. After that, the judgment cannot be enforced. If six years have passed since a judgment took effect, the person seeking to enforce the judgment must first obtain the leave of the Court to do so.

TYPES OF ENFORCEMENT ORDER

There are six ways a civil judgment for the payment of money can be enforced in Western Australia. These are:

a) a Time For Payment Order, by which a debtor is ordered to pay the amount immediately, or within a time set by the Court.
b) an Instalment Order, under which a debtor pays amounts set by the Court, by dates set by the Court.
c) an Earnings Appropriation Order, which is referred to in other States as garnishment of wages. This order can only be made if an instalment order has been made, and disobeyed and cancelled. It is applicable only to employees. Centrelink and Veterans Affairs benefits are not included in the definition of earnings, nor is child support or child maintenance received by the debtor. No percentage of debtor’s earnings is protected, but the Act does provide that the Court must ensure that the order made does not impose unreasonable obligations on the debtor.
d) a Debt Appropriation Order, by which a person who owes money to the judgment debtor can be ordered to pay it to the judgment creditor instead of the judgment debtor.
e) Appointment of a Receiver, a remedy likely to be used in regard to judgments under which large sums of money are outstanding.
f) a Property (seizure and sale) Order, which authorises the Sheriff to sell as much of the debtor’s property as is necessary to satisfy the judgment debt. The Sheriff is required to sell personal property rather than real estate, if the personal property is sufficiently valuable to satisfy the debt. The Sheriff is given wide powers to obtain information about the debtor’s property, and has a right to enter property for the purpose of enforcing a Property (seizure and sale) Order. The Sheriff is required to seek the consent of the occupier, if the place in question is a dwelling. If the Sheriff cannot contact the occupier, or if the occupier unreasonably withholds consent, the Sheriff can force entry at any time between 9.00 am and 5.00 pm.

There are four types of property which cannot be seized or sold under the Property (seizure and sale) Order. These are:

1) property which the debtor holds for another person, and in which the debtor does not have a beneficial interest;
2) clothing and personal items of a kind and value set by regulations;
3) household property of a kind and value set by the regulations; and
4) tools of trade, and other property used by the judgment debtor to earn income by their own personal effort of a kind and value set by the regulations. A motor vehicle, unless it comes within this category, is not protected.

A Property (seizure and sale) Order has a life of twelve months. At the time of writing (February 2005) no regulations have been made setting types and value of protected property.

MEANS INQUIRY

A means inquiry is conducted by a Court to find out about a debtor’s means to pay the judgment debt. This involves looking at the income, assets and liabilities of the judgment debtor. The Court may also examine the income, assets and liabilities of the debtor’s husband, wife or de facto partner, and the income, assets and liabilities of their dependents.

A means inquiry must be conducted before a time for payment order, an instalment order, or an earnings appropriation order is made. There is no requirement for a means inquiry to be conducted before a Property (seizure and sale) Order is made. A creditor may decide to follow this path immediately after obtaining a judgment against the debtor. However, some judgment creditors may wish to use a means inquiry to find out about the debtor’s property, which they can then pursue with a Property (seizure and sale) Order. A means inquiry may also be requested by a judgment debtor who is seeking a suspension order (see following section).

SUSPENSION ORDER

Judgment debtors who are unable to pay a judgment debt can apply for a suspension order, and can apply for a means inquiry to be held at the same time. An example of a situation which could lead to this is where a debtor has been ordered to make payments on an instalment order, but due to unemployment, ill health or other good reason cannot meet the required payments. The debtor can apply to the Court for a suspension order, and a means inquiry, which may provide the evidence which satisfies the Court that it is appropriate to suspend the enforcement of all or part of the judgment for any period of time, including for an indefinite period.

DEFAULT INQUIRY

A judgment creditor may apply for a default inquiry if a judgment debtor has failed to comply with a time for payment order, or has failed to pay two or more instalments of an instalment order. If a Court is satisfied that the judgment debtor had the means to pay but did not, and did not have a reasonable excuse for not paying, the Court may find the debtor guilty of contempt of Court. The Court can imprison the debtor for up to forty days for the contempt, or suspend such imprisonment to enable the judgment debtor to comply with a new time for payment, or instalment order.

A debtor who fears he or she may be imprisoned under these provisions could consider the alternative of bankruptcy, which, as a Federal Law, overrides any inconsistent State Law: see BANKRUPTCY.

FURTHER INFORMATION

The new Court structure is set out in the Magistrates Court Act 2004 (WA). Civil proceedings in that Court are governed by the Magistrates Court (Civil Proceedings) Act 2004 (WA). Enforcement of civil judgments of the Supreme, District and Magistrates Court are governed by the Civil Judgments Enforcement Act 2004 (WA). These Acts are written in plain English and are easy to follow. They are available from the State Law Publisher at 10 William Street, Perth or phone 9321 7688. State legislation may also be accessed on the State Law Publisher website, which is www.slp.wa.gov.au.

Rules under the above legislation dealing with court procedure, relevant forms etc had, at the time of writing, not yet been published. For information regarding these issues, contact the Magistrates Court Registry nearest to you or go to the Ministry of Justice website: www.justice.wa.gov.au or the State Law Publisher website: slp.wa.gov.au.