Debt Recovery -
The Writ of Execution against Goods.

In debt recovery, once you have a Court judgement debt, the writ of execution against goods is a relatively cheap form of debt collection.

Below is an outline of how you go about taking this form of debt collection, and the advantages, and disadvantages of this form of action.

To take this form of action, you need to have a Court judgement in your favour against the Debtor, which entitles you to file a Notice of Motion in the Court for a Writ of Execution against Goods. There is a prescribed fee to file this application which is paid to the Court.

Debt recovery costs money, click to find out the Local Court fees in NSW.

What Happens After the Application For A Writ Is Filed!

Provided the Notice of Motion for a Writ of Execution against goods, is correctly completed, and lodged with the Court, together with the right fee, the debt recovery collection of the debt, is then transferred to the Sheriff. The Sheriff is authorised to attend upon the Debtor, and demand payment of the debt.

If the Debtor does not pay, the Sheriff is also authorised to seize goods belonging to the Debtor, which can be sold by public auction to pay the amount of the claim obtained by the court judgement.

However, the goods are not taken on that day. They are are marked by the Sheriff, and stay in the Debtor's control.

If the debt is not paid by a certain date, the Sheriff will then ask you pay a further fee to cover the seizure, and the costs of collecting the goods, for the debt recovery. You have to pay the fee by a certain date, and the Sheriff will then collect the goods to take to auction.

After the auction, you should then receive a cheque for the money collected at the auction. If the goods are sold for more than is owed to you, you will be refunded the Sheriff's fees, and any prescribed legal costs and Court fees that you have paid, which are added to the amount of the debt owing.

If there is not enough money, to pay the court judgement debt amount and any prescribed fees and costs you are entitled to recover, you still have an outstanding debt you can take other actions to pursue.

The advantage of this form of debt recovery collection, is that it is relatively inexpensive, and if the Sheriff does their job promptly and properly, and the Debtor has assets that can be seized, it should only take about 4 months from when you first filed the Notice of Motion for the Writ to issue, to when you get the money.

However, several things can happen as a result of filing this kind of writ for debt collection which can delay you getting your money.

Firstly, the debtor can file an application in the Court to pay the debt by regular installments. The Court will either grant, or decline, this application. You will receive advice from the Court, and either you, if the application to pay by installments is granted, or the debtor, if it is not, can then file an application to the Court in the debt recovery action, to have a hearing on whether the debt should, or should not, be paid by regular installments.

If this happens, normally the Court will stay (stop) the debt recovery action of the Writ, until the application is resolved.

This Application is heard before a Court Registrar, who will then make the decision whether the installment order to pay the debt should be made. If the Application to pay by installments is declined, the Sheriff will return to the Debtor's premises to seize goods.

It is noted, that when a debtor files an application to pay by installments, they also have to file an affidavit of their assets. If you want to see it, you will have to ask the Court for a copy, as they will not normally give it to you. 

This affidavit can provide very useful,information, such as the property owned and bank accounts, of the Debtor, which can be a useful resource, if you have to take other action to collect the debt, such as a garnishee.

Click, if you would like to find out what a Garnishee is in debt recovery.

Secondly, the Debtor might contact you, or your commercial debt recovery agent if you have one, to offer to pay the debt in full, or by regular payments. Once a writ is filed, only you, or your agent can stop the Sheriff. 

It is up to you, whether a deal is struck, but if the Debtor does not keep up with regular payments,or, pays as promised, you then have to go through the whole process again, or consider the alternatives.

Also, if payments by regular installments, whether it is by Court order, or agreement with you, are not maintained, it is unlikely the debtor will succeed in any subsequent application to the Court for an installment order. You would raise this fact with the Court.

The disadvantages of this form of debt collection is that you are at the mercy of the Sheriff. If they attend the debtor's property, and the debtor is not there, they will inform you of that, and if you require the Sheriff to go out again to collect the debt, you have to pay another fee. 

You pay the prescribed fee for debt collection, each time the Sheriff goes out to try and contact the debtor, even if there is no contact with the debtor. Click to discover the fees charged by the Sheriff.

Also, the debtor can deny ownership of the goods in his property, that have been seized. If this happens, the person who says they own the goods, files a document in the Court to have a hearing on the question of ownership. 

This is known as an interpleader, and can be very time-consuming. If this happens, you should seek legal advice.

How Long Does It Take?

When you file a writ with the Sheriff to collect a debt, do not expect anything to happen for about 4-6 weeks. This is about the time it takes for the Sheriff to do something. Sometimes, it can take even longer.

Ultimately, unless the Sheriff's office that is executing the writ to collect the debt, is properly staffed, and efficient, you will have to call them, to follow it up, and remind them that they have your writ to execute. 

Do not forget, the Sheriff is a public servant. You can draw your own conclusions, from that.

Debt Collection and Debt Recovery can be quite involved and complicated. You really should let the professional debt collection agent or solicitor advise you as to the best course of action, and look after it for you. It will cost you money, but in most cases, provided the debtor has assets, you should recover the additional costs you spend.

Contact:

Phone 02-4333 1690    Fax 02-4333 5144