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If a judgment is made against you - enforcement process

 

I have received paperwork which says I have to go to court for a means inquiry. I don't owe the money. What do I do?

Get legal advice. You should not ignore the summons to go to court.

A means inquiry is part of the enforcement process. This means an order has already been made against you that you owe money to the creditor.

You can go to the court registry and ask for a form to fill in to inspect the court file so that you can work out when an order was made against you and why.

In some cases you can get the court order (judgment) set aside. Before you apply to the court to do this get legal advice.

I have received paperwork which says I have to go to court for a means inquiry. What does this mean?

If the court has made an order that you owe money and you have not paid or avoided payment, the judgment creditor may start 'enforcement proceedings'. There are two common ways of doing this:

  • by a means inquiry or 
  • by a property (seizure and sale) order

Judgment creditor means the person who the court says you owe money.

You are the judgment debtor. This is the person who the court says owes money.

What is a means inquiry?

It is important to get legal advice before attending a means inquiry hearing. You may also find it useful to see a financial counsellor.

A means inquiry hearing is where the court decides if you can pay the debt. It is a chance for the judgment creditor to get details of what you owe and own, your income and anything else about your financial position. You or the judgment creditor can ask the court for a hearing. If you get a summons for a means inquiry you must go to court and answer questions under oath or by affirmation from the judgment creditor about your income, expenses, assets and debts. Orders for payment can be made if the court decides that you can pay.

You may also be asked to bring to court records or evidence about your finances, eg bank statements, tax returns, payslips. You must bring them.

In some cases you can get a summons to produce evidence but not have to give oral evidence at the inquiry.

Why would a judgment creditor want a means inquiry?

Information you give at the means inquiry hearing about your income, expenses and assets helps the judgment creditor to know which enforcement option is best to take to get the money owed under the judgment.

Can I ignore the summons to go to the means inquiry?

No. But you should check if it is summons for you to go and/or for you to produce evidence at the inquiry.

If you do not go to the means inquiry hearing the court may make an order that you be arrested and brought before the court. You may be found in contempt of court for not attending. You can be fined or go to prison. Get legal advice.

What if it is a summons to only produce evidence at the means inquiry? Do I have to go?

If you receive a summons to produce evidence but not give oral evidence, instead of providing the evidence at the inquiry you can deliver the evidence to court personally or by post two clear days before the first day of the hearing. Otherwise you will need to go and take the evidence requested.

What if the means inquiry is at a different court to where judgment was entered?

The judgment creditor can ask for the hearing to be at a different court to where the judgment was entered against you. If this is not convenient or you do not think this is fair, you can tell the court. The same applies if you think the hearing should be at a different court. You must tell the court. The court will listen to both of you and then decide where the hearing will be. You must go at the time and place the court says.

How do I prepare for the means inquiry?

You may find it useful to see a financial counsellor. For information about free counsellors, contact the Financial Counsellors Association of WA's Financial Counselling Hotline on 1800 007 007.

You will need to complete a form called a "Statement of financial affairs". You must fill in the form and take it to court unless you have complied with a court order to get it to court earlier (see heading below What if I am ill and cannot get to the means inquiry?). If you do not you can be fined.

Make sure you take any of your financial records to the inquiry, eg recent tax returns, mortgage statements, bank statements, recent payslips, bills, which may help you.

Carefully work out what, if anything, you can afford to pay.

What if I am ill and cannot go to the means inquiry?

If because you are ill or have another very good reason why you cannot go to the means inquiry, the court can make orders about how to get the statement of financial affairs from you. You will need to apply to the court.

If the court decides you cannot go to the means inquiry through illness or other special circumstances you could be ordered to:

  • complete the statement of financial affairs in the form of an affidavit (Form 38B)
  • deliver the affidavit to the court personally or by post at least two clear days before the first day of the inquiry.

You should follow the court orders. Get legal advice.

What will happen at the means inquiry?

At the means inquiry hearing, the judgment creditor will ask you questions about:

  • your financial situation, including income, assets and expenses and
  • the financial situation of your partner and/or dependants

If the court believes that you cannot pay the debt at all, it may decide that you do not have to pay anything.

If the court believes you can pay the debt the court could order:

  • You to pay the debt in regular amounts (an instalment order).
  • You to pay the debt straight away or by a set date (a time for payment order).
  • Your employer to pay part of your wages to the judgment creditor (an earnings appropriation order). The court can only make this order this if a previous instalment order has been disobeyed and cancelled.

If the judgment creditor has not already done so, after a means inquiry, the court can be asked to make one of these orders.

What can happen if I don't pay the debt after the court makes an order?

If you can't or don't pay the debt after the court makes an order you should get legal advice. The judgment creditor can ask the court to send you to prison for up to 40 days if you do not follow the order. The debt must still be paid even if you go to prison.

I have got a notice for a property (seizure and sale) order. What is it?

It is important to get legal advice if you are the judgment debtor and you have been served with a property (seizure and sale) order.

A property (seizure and sale) order lets the Sheriff or bailiff seize and sell your personal property or real estate (eg house or land) to pay the money the court says you owe. This will include the debt, interest, and enforcement costs.

What will the bailiff do?

Once the bailiff receives the order they will visit your home. The bailiff will want to see what you own in order to decide what to sell. The bailiff may seize personal property to be sold and store it or leave it with you. You will not be allowed to move it or give it to anyone else without the permission of the bailiff.

There is certain property that cannot be seized by the bailiff. Get legal advice.

Personal property is to be sold before the bailiff can seize and sell real estate.

The bailiff has certain powers of entry to seize personal property and real estate. Get legal advice.

What happens to the personal property taken by the bailiff?

The bailiff must store the goods securely for at least seven days before they may be sold, unless the goods are perishable.

Unless you pay the debt, the goods will be sold at public auction unless the court orders otherwise.

What can I do if I do not want my property sold?

Get legal advice.

If you do not want your property to be seized or sold by the bailiff, you can:

  • Pay the judgment debt, including all interest and enforcement costs.
  • Negotiate with the judgment creditor to arrange payment of the debt.
  • Apply for the property (seizure and sale) order to be put on hold. This is called a "suspension order". Get legal advice before applying.

If you disagree the judgment debt is owed, you can apply to set aside default judgement if there are grounds. Get legal advice.

What happens after the goods are sold?

The bailiff will first pay any costs, for things such as storage, removal of the goods and auction fees. The rest of the money from the sale goes to the judgment creditor. If money is left over it will be paid to you.

You can ask the bailiff for a record in writing of the sale and how the proceeds of the sale were distributed.

If you still owe money, the judgment creditor can take further action to get you to pay.

Are there time limits to apply for enforcement orders?

Yes. An application for an enforcement order must be made within 12 years from when judgment was given. If six years have passed since the judgment, the judgment creditor must obtain the leave, or permission, of the court to apply for certain enforcement processes.

A debt collector has contacted me about a debt. What are my rights?

For information about dealing with debt collectors go to the MoneySmart website to download a copy of the publication Dealing with debt . See also the ACCC-ASIC publication Debt Collection Guideline: for collectors and creditors which can be downloaded at the ASIC website.

Where can I get more information?

Last reviewed: 23/02/2012

Last Modified: 23/02/2012

Disclaimer

The material displayed on this page is intended for information only. If you have a legal problem, you should see a lawyer. Legal Aid Western Australia believes that the information provided is accurate, however does not accept responsibility for any errors or omissions.