Writ of execution
A writ of execution is a court order to implement the ruling of a court or tribunal relating to financial rights. For example, when a person or business is owned money they can activate a writ of execution to recover the debt. As with any legal process there have to be clear rules, and debt recovery offices must operate in parallel with the court. There are two parties to a writ of execution: the Creditor, who has requested the enforcement of a debt and the Debtor, the person who owes the debt.
Implementation procedures for the creditor
For the creditor there are several ways to use the writ of execution: impounding, foreclosure, seizure of personal property, subpoenas as well as warrants, ban on leaving the country or confiscation by third parties.
Implement procedure for the debtor
There are also a number of procedures that the debtor can use to better manage his debts and their consequences, demonstrate that he has limited means, objection to the enforcement of the debt or claim that the debt has already been paid entirely.
- Motion to consolidate
When a debtor is unable to pay all his debts, he has the possibility to make a motion to consolidate his files so that they will be combined into one. He will pay an amount roughly equivalent to 3% of his debt, and will have restrictions that can make his private life quite difficult. Consolidation files only works in cases of financial obligations, and not in the case of mortgage loans or child support, for example.
- Debtors locating
Many people and companies have debtors but it is not always easy to find them to recover the debts. Thus, creditors can use private investigators or specialized offices whose job is to locate debtors and bring them to justice so that they pay their debts. Debtors can try to escape, but it’s hard to hide, most often those who seek them find them quickly.
- Debt collection
Debt collection is one of the enforcement process for creditors to be reimbursed their money from their debtor by a judgment, a bill of exchange or a check.
- Negotiable instrument
A negotiable instrument is a document that gives a person the right to recover money or property for the payment of a debt. There are various negotiable instruments such as promissory notes, bills of exchange, letter of recognition, mortgages and checks.
- Debt settlement
The debt settlement is actually an agreement where the debtor and creditor agree on a debt reduction as a compromise. In this case the debt is regarded as paid in full.
- Suspension of proceedings
The suspension of proceedings procedure is a process that the owner of the bankrupt company uses to delay the recovery of debts owed by the company. This procedure gives the debtor time to breathe and to try to settle his debts without pressure from those to whom he owes money.
- To pierce the corporate veil
By law, a company and his owner or shareholder are two different legal entities. Usually when a company has difficulties, it will be against it that complaints will be filed, not against the owner or shareholder personally. In some rare and specific cases, such as when there is evidence that the owner or shareholders of a company lied or where not truthful, a court may lift the corporate veil, so that they will be directly accountable for any of the society’s problems.
- Credit capacity estimation
The credit capacity estimation is a survey that tests the credit capacity of a debtor, not a corporation, association or other. It is a debtor’s right to apply to court to prove to the writ of execution what his real credit capacity is.
- Debt already paid argument
The debtor can bring forward before the office of the bailiff or court the argument that he already paid his debt and that there isn’t any rivalry anymore between him and the creditor.
A receivership is when a receiver is set as the custodian and administrator of the possessions or properties of a debtor that are sequestered because of unpaid debts. The receiver’s goal is to attempt to repay the debts to the creditors.
- Limited liability
The limited liability is an argument that a creditor, a court or an enforcement order can declare when a debtor has no ability to repay his debt, it reschedules the debt over a longer period and sometimes reduces it too. For the debtor that means many personal restrictions like the ban on leaving the country, being unable to use credit cards and many more.
- Ban on leaving the country
Many debtors have fled abroad to avoid paying their debts, the ban on leaving the country now prevents them from doing so. A ban on leaving the country may be given at any stage of enforcement cases where the debtor fails to pay his debts and has a term of payment.
- Confiscation of possessions
As part of enforcement proceedings there are many penalties, one of which is the confiscation of personal possessions. This means that an employee comes to the debtor’s home and records all its possessions, it is his duty to prevent any movable possession to get out of the house. The only things that are excluded from the confiscation are the food needs of the debtor and his family, animals, tools and furniture that the debtor uses to earn a living, pets, and a number of items such as personal computer, television, phone and washing machine, but only when their value is less than the amount specified in the schedule of execution.
A warranty is a guarantee, a legal term that indicates a person who agrees to pay the debtor’s debt if he does not pay them. The person who gives the guarantee is the guarantor.
- Appeal to writ of execution
An appeal to writ of execution is an appeal against the decision of the writ of execution. There are two types of appeals, one for which court approval is not necessary and one that has to be subjected to court approval.
- Arrest warrant
An arrest warrant is an order issued by the court or writ of execution to arrest and imprison a person because of his debts. This is the most severe sanction for a debtor that did not pay his debt to his creditor.
- Payment order
A payment order involves opening a file to with the writ of execution against a person who has debts, this order determines the payment of these debts.
- Accounts payable
The accounts payable is a document in which the creditor indicates the amount of the debt that the debtor owes him, this usually happens when a company goes bankrupt or a company is liquidated.