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Summary - A number of legal procedures to
recover outstanding school fees from parents are discussed.
PART 2
Options for enforcing judgment
debt
If it is known where a judgment debtor works, their wages can
be garnished. A garnishee order is a court order which attaches the
judgment debt to any salary or wage the judgment debtor earns above
a minimum amount (currently $432.50 per week) and is effectively, a
court order against the judgment debtor's employer. This is a
very effective method of enforcing a judgment.
If examination of the judgment debtor reveals that funds are
held in his/her name in financial institutions or he/she receives
rental payments, a garnishee order for debts in respect of those
funds can be filed. Judgment debtors generally do not supply this
information.
If the judgment debtor owns property such as furniture or other
goods, a Writ for Delivery of Goods may be applied for from the
court. This method of enforcing the judgment debt involves the
sheriff attending the judgment debtor's residence or business
to seize goods belonging to the judgment debtor for sale at public
auction. This method of enforcement can often be frustrated by
claims by a judgment debtor that goods belong to a third
party.
If the judgment debtor is the sole owner of real property, a
Writ for the Possession of land can be sought. The writ cannot be
executed unless the judgment debtor consents or the sheriff is
satisfied that the land should be sold before other property in
order to minimise the hardship to the debtor.
Generally a judgment creditor has six years from the date of
judgment to commence bankruptcy proceedings. This is achieved by
serving a Bankruptcy Notice on the judgment debtor. If the judgment
debtor does not comply with the Bankruptcy Notice within 21 days of
service, bankruptcy proceedings may be commenced against the
judgment debtor. Such proceedings effectively liquidate most of the
judgment debtor's assets and obtain some of the earnings of the
debtor for up to three years following bankruptcy proceedings.
Bankruptcy proceedings can be very lengthy and costly and a trustee
must be appointed to investigate the debtor's affairs and
realise the judgment debtor's property for the benefit of
creditors. Secured creditors will have priority over unsecured
creditors.
Take home point
As a garnishee order for wages can often be the most effective
and cheapest form of enforcing a judgment debt for fees, we
recommend enrolment forms completed by parents to include details
of their employment.
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