When a business is in jeopardy, it is crucial that both lenders and borrowers involved receive prompt, experienced legal advice and representation, so that steps can be taken to produce the best possible results under the circumstances. Lawrences has extensive experience in bankruptcy and insolvency matters: we represent financial institutions, trust companies, receivers, landlords, suppliers, and creditors. We act on behalf of both lenders and borrowers in various secured transactions under the Bankruptcy and Insolvency Act (BIA) and the Companies Creditors Arrangement Act (CCAA). In addition, we prosecute and defend all types of actions involving debt recovery, from the issuing of a demand letter, to issuing a claim, to judgment enforcement.
At Lawrences, we work closely with our clients through all stages of a claim, from investigative searches through discovery, to enforcement. We maximize our clients’ chances of not only obtaining judgment, but also realizing payment through garnishment, locating, and seizure of assets, conducting examinations in aid of execution, and other enforcement strategies and techniques.
There are three main mechanisms for enforcing judgments:
- Writ of Seizure and Sale of Debtor’s Real and Personal Property
- Garnishment of debts owing to the debtor, such as wages and bank accounts
- Examination in Aid of Execution
Writ of Seizure and Sale
A “writ” is a document issued by the court that essentially binds all of the debtor’s real estate and personal property within a certain jurisdiction. If the debtor has property in different jurisdictions, separate writs must be filed in each of those jurisdictions. A writ is registered on title to property and must be renewed every six years.
Once filed, the writ remains on title. If a debtor ever acquires new property and later sells it in the jurisdiction where the writ is filed, the execution search that the prospective purchaser undertakes will reveal the judgment and the sale will not take place without the execution being satisfied.
Garnishment
Garnishment allows a judgment creditor to receive payments of debts owing to the debtor by third-parties. Examples of such debts include wages owed by an employer and bank accounts. If done properly and with the correct information, garnishment can be a very useful tool in enforcing a judgment.
Once served with the appropriate documentation by the creditor, the third party, known as the garnishee, is required to pay any amounts it owes to the judgment debtor into court. These amounts are then paid out to the creditor. The garnishee cannot simply ignore the garnishment and must file a Garnishee’s Statement with the court.
Examination in Aid of Execution
A judgment creditor is entitled to question the judgment debtor under oath. This process is also called a judgment-debtor examination. At the examination, the judgment creditor may ask questions about the judgment debtor’s financial standing and means of repaying the judgment debt. This method is particularly useful in obtaining such information as bank account numbers, employer names, assets, or other income that the judgment creditor can use to pursue other means of enforcement, such as garnishment or writs. An examination in aid of execution against a debtor can generally be conducted only once a year.
Each case must be separately evaluated to determine the most effective and efficient method of enforcement.
In addition to experienced legal counsel, we are supported by exceptional clerical staff who assist in making the whole process expeditious and cost-effective.