Using the Legal System to Collect Debts in Australian Capital Territory

Originating Claim & Statement of Liquidated Claim

After expiry of default notice the initiating action in the Magistrates’ Court is a Claim.

• Can be served via post or in person
• Can apply for Judgment 28 days after service

* Magistrates’ Court does not deal with matters under $10,000. Disputes less than $10,000 are fall within the jurisdiction of ACT Civil and Administrative Tribunal (ACAT).

* ACAT costs $123.00

* Costs for Original Claim and Statement of Claim between $764.00 to $1,334.00 depending on amount

This can be compared against the other states and territories here.

 
Judgment

• This action formally registers the debt with the court and allows further collection action.
• Judgment stands for 12 years.

*Obtaining Judgment costs between $500.00 to $1,350.00 depending on amount of Claim (undefended)

This can be compared against the other states and territories here.


Once Judgment granted then 4 choices of enforcement proceeding are possible.

Before enforcement of the Judgment the debtor must be served with a copy of the Judgment made against them. Further enforcement must not commence until 7 days after service has been affected on the debtor.

Enforcement Hearing Subpoena

• This is used where you are unaware of Debtors Assets, Employment.
• Documents are personally served on the debtor to attend court.
• Hearing is conducted by the Registrar and debtor must provide details of income expenses and assets.
• Registrar may make an Order for Instalments, Earnings Redirection or Seizure and Sale Order at this hearing.
• If debtor doesn’t attend then you can apply for a Warrant.

This can be compared against the other states and territories here.

*Cost is $139.00 to $562.00 for the Court Application + preparation (attendance charges additional) (undefended).

Redirection Orders

• Three types – Earnings Redirection, Debt Redirection and Regular Redirection
• Must know the financial institution details or employers details
• documents are served on the financial institution or employer
• A copy of the Order must be served on the debtor within 5 days of service on the financial institution or employer
• Financial institution, employer or debtor may apply to rescind or vary the Order on the grounds of financial hardship

Recommend an Enforcement Hearing Subpoena prior to the Redirection Order to obtain current financial details

* Cost is $91.00 to $249.00 depending on amount of Claim for the Court Application + preparation (attendance charges additional) (undefended).

This can be compared against the other states and territories here.

Seizure and Sale Order

• Sheriff attends property of debtor to demand payment and tag any assets of value.
• If payment cannot be made goods to the value of the debt are seized and sold.

*Cost is $345.00 to $460.00 depending on amount of Claim (undefended)

This can be compared against the other states and territories here

Bankruptcy

• Judgment must be obtained then a bankruptcy notice served.
• Once Bankruptcy notice has expired then Bankruptcy can be applied.
• Once bankruptcy obtained all debts owed by the debtor are captured under the Bankruptcy.

*Cost is a minimum of $2500.00 if matter is undefended (after Judgment costs)

* Important Note: All costs are estimates as at 16/08/2011 and do not include costs of counsel and preparation for hearing.


Workflow - a copy of this can be downloaded here -

ACT Legal System and Debt Collection (33 KB)