Where a judgment is awarded in your favour from either the Queensland Courts or Queensland Civil and Administrative Tribunal, for a debt owing to you, you may be faced with enforcing this judgment against the debtor to recover payment of the outstanding debt.
Enforcement options available to you vary determined by whether the debtor is an individual or a company. Methods of enforcement against an individual are as follows:
- Enforcement hearing;
- Enforcement warrant for redirection of earnings (also known as a garnishee order);
- Enforcement warrant for seizure and sale of property; and
- Bankruptcy.
The purpose of the enforcement hearing is to obtain information from the debtor as to their financial position and to facilitate the enforcement of the judgment. Prior to filing an application for an enforcement hearing, the debtor is to complete a statement of financial position. In the circumstances where the debtor ignores or refuses to do so, the court may issue an enforcement hearing warrant for the debtor to be publically examined as to their financial position. At an enforcement hearing, the court may make an order as to the enforcement of the judgment. The court may order an enforcement warrant for redirection of earnings where payments are made directly from the debtor’s income to you.
If a debtor is a registered owner of any real estate or personal property, an application for an enforcement warrant for seizure and sale of the property may be filed. This will effectively register a writ over the debtor’s property preventing them from being able to sell it. In this period of time, you hold the right to instruct a bailiff to seize and sell the property by auction.
If the judgment is for a debt of $5,000 or more, you may be in a position to make an application to bankrupt the debtor. To commence the process of bankrupting an individual, the person has to have committed an act of bankruptcy. This can be proven if a debtor fails to comply with a bankruptcy notice within 21 days.
The methods of enforcement available against a company are as follows:
- Enforcement warrant for seizure and sale of property; and
- Winding up of the company.
Similar as to enforcement against an individual, if a company is the registered owner of any real estate or personal property, an application for an enforcement warrant for seizure and sale of property may be filed.
The process to commence corporate insolvency is by issuing and serving a statutory demand on the debtor company. To go down this avenue, the debt must be for $2,000 or more. A statutory demand may be issued without a judgment if there is not a dispute as to the debt owing to you by the debtor.
If the debtor does not comply with a statutory demand within 21 days, you may then be in a position to make an application to wind the company up. If a debtor continues not to pay for an outstanding debt owing to you after receiving a judgment in your favour, that is not the end of the road. There are options available to you to enforce the judgment.
Please contact us if you wish to enforce a judgment against a debtor.
