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At LCollect we believe that knowledge is power. Every month our debt collection blog gives you practical tips, stories and news from around Australia and the world.

Councillor Fights Sheriff in Property Sale

Wednesday, May 30, 2018 - Posted by Michael McCulloch

Julie Hoskin, a councillor in Bendigo Victoria, has won her fight with the Sheriff following the sale of her family home.

Cr Hoskin was issued with a Warrant to Seize Property by the Sheriff after failing to meet repayments on a $386,819.53 debt to Ask Funding following a family law matter which arose 10 years ago. In an Affidavit submitted to the Court Cr Hoskin indicated that she struggled to repay the loan because of a chronic fatigue diagnosis that kept her out of employment until 2013. This was followed by foot injuries in 2015 and shortly thereafter deep vein thrombosis.

The Sheriff originally scheduled the sale of the property in May 2017 however Cr Hoskin was able to negotiate a 3 month moratorium while attempting to secure finance to repay the debt. With her application being declined to refinance the Sheriff proceeded with the auction and sold the property on 23 November for $389,000. Cr Hoskin however refused to hand over the property and argued in Court that the sale price was unfair.

Cr Hoskin said in an Affidavit that the sale price of $389,000 was significantly less than the valuation of $750,000 to $825,000. It is alleged that the Sheriff obtained 2 kerbside valuations from the Valuer-General that priced the property at $450,000 in 2015 and $470,000 in 2017.

Justice Michelle Quigley, of the Supreme Court, ruled in favour of Cr Hoskins saying that the process followed by the Sheriff was fundamentally flawed and led to a sale significantly undervalue. She found that the Sheriff breached their duty to act reasonably in the interests of the Creditor and Cr Hoskin in which to obtain a fair price for the property. Justice Quigley went on to say, "Stopping the Final Auction would have been a reasonable step to take in all the circumstances and would represent a balance of the best interests of both the judgment debtor and the judgment creditor."

While Cr Hoskin is asking that the sale of the property be set aside, Justice Quigley will hear further submissions before handing down a Decision.

Source: Bendigo Advertiser - May 2018


Sheriff attempts seizure on Commonwealth Banks assets

Monday, October 21, 2013 - Posted by Philip Harvey

A Sheriff attempted to seize goods from the Commonwealth Bank in Sydney. According to the Australian Financial Review, the NSW Office of the Sheriff attempted to seize paintings, furniture, lounges and televisions from the Sussex Street office. The NSW Supreme Court had ordered the CBA to pay Mr O'Brien's legal fees over a disputed failed Queensland property development.

The bank apparently refused to oblige the Officers, with the Officers unsuccessful in his attempt to remove the goods. The bank claims the legal costs are offset by another amount the bank is pursuing Mr O'Brien for.


Debt collection and writs and caveats - the requirements to record on title in NSW

Tuesday, September 10, 2013 - Posted by Philip Harvey

The LPI has made changes to the application forms of Writs and Caveats. These changes outlined below take effect from 1 February 2014.

Changes to Application to Record Writ

A new requirement before a writ can be recorded is that an affidavit must be sworn verifying that the judgment debtor named in the writ is identical to the registered proprietor of the land. The affidavit must record the steps taken to confirm the identity and demonstrate that the judgment debtor and proprietor are the same person.

This new requirement is to reduce the risk of writs being incorrectly recorded against registered proprietors with the same name as a judgment debtor. It should be noted that when you perform a title search and have a name match, no date of birth is provided in the search.

Changes to Caveats

The statutory declaration included in a caveat application now requires confirmation that the registered proprietors address is correct. This is to ensure that the LPI can notify a registered proprietor when a caveat has been entered.

 This information was sourced from the Land & Property Information Circular No 2013/07 August 2013.

Melbourne Property sold at Sheriff Auction for $1,000 reversed / cancelled

Wednesday, June 13, 2012 - Posted by Philip Harvey

It was widely reported in December 2010 in the Sheriffs auction rooms (Carlton, Melbourne) a six bedroom house was sold at auction for $1,000 after being seized by the sheriff.

Before going any further, it is important to deal with a possible misconception surrounding the $1,000 sale price. Under this sale process by the sheriff, the person who purchases the property also assumes the mortgage associated with it. In this case, the mortgage had an outstanding mortgage debt of approximately $465,000. If you factor in this mortgage, if the purchaser was to pay this out, the total cost of acquiring the property is actually $466,000 (plus any applicable stamp duties etc). The property was valued at around $620,000. So the real gain to the purchasers would have been approximately $160,000 (on the assumption it sold at the valuation figure).

The auction performed by the sheriff was set aside on appeal by Justice Vickery, noting that the sale price was so unfair that the sheriff did not act reasonably in accepting it.

Justice Vickery noted;

"It is important to note that, although the order of Associate Justice Mukhtar expressly authorised the sheriff to conduct a sale of the property without a reserve price, this was not an unfettered authority to sell at any price which could be obtained. The order expressly directed that any such sale must be conducted in a manner which did not “derogate from, or relieve the sheriff of a duty at law to the owner of the land when exercising power of sale”

“Whatever may be the inclination of the court to support a public officer in the unprecedented circumstances of this case, the sale as a matter of law cannot be allowed to stand,” it was ruled.

“Because the sale was not one which was properly concluded under Division 5 of the Sheriff Act for the reasons which have been explained, s 25(1) of the Sheriff Act cannot apply and [buyer Ronald] Kousal does not gain good title to the property under it."

“As to the breach of the common law duty, at the time of the second auction the value of the equity in the property was approximately $165,000.

“This was known to the sheriff’s officer conducting the sale, who announced the amounts owing on the property to the bidders prior to commencing the auction.

“The sheriff’s officer also had in his possession the kerb-side valuation of the Valuer General placing the market value of the property at $630,000.

“There was some $465,000 owing on the property.

“Nevertheless, it was knocked down to the highest bidder on the day, Mr Kousal, for $1,000.

“This price bears no relationship to the evident market value of the property or the Zhou’s equity in the sum of approximately $165,000 which was put up for sale.

“In my opinion, and after taking into account all of the relevant factors to which I have referred, this price was so unfair that the sheriff did not act reasonably in accepting it.

“The transaction cannot remain in place at common law.”


Slower Actions on Writs

Friday, October 01, 2010 - Posted by Philip Harvey

Currently the Public Service Association (PSA) have work bans in place re the actioning of writs by Sheriffs.This means that letters are sent but visits not being made to seize goods.


This affects only NSW. Not all sheriffs are adhering to these bans.

The purpose of these bans is to achieve better pay and personal security for NSW Sheriffs.

In addition the PSA believes that policies introduced by the current government have adversely affected the provision of services.

Currently in NSW only one visit to a defendant is covered on the cost of a writ and other visits are charged per visit.

The PSA  believes the fee for a writ should be slightly increased but should cover a letter and then 3 visits by the sheriff.

This would be of great benefit to LCollect and its clients.

This should be resolved shortly .


Writs in Debt Collection

Tuesday, June 01, 2010 - Posted by Philip Harvey

New South Wales

Prerequisites 

Judgment 

Execution Method

Execution by the Sheriff

 Valid for

 12 Months

 Official Name

 Writ for Levy of Property

Notes for New South Wales;
Sheriff cannot seize:

  • Personal clothing & bedding
  • Tools of trade

Victoria

Prerequisites 

Judgment

Execution Method

Execution by Sheriff

 Valid for

12 months

 Official Name

Warrant to Seize Property

Notes for Victoria;
Sheriff cannot seize:

  • Personal clothing & bedding
  • Tools of trade

Queensland

Prerequisites 

Judgment 

Execution Method

Execution by Bailiff

 Valid for

12 months

 Official Name

 Warrant of Seizure & Sale

Notes for Queensland;

Bailiff cannot seize:

Personal clothing,  bedding & Tools of trade

South Australia

 

Prerequisites 

Judgment

Execution Method

 Execution by Sheriff

 Valid for

 12 Months

 Official Name

 Warrant of Sale

Notes for South Australia;

Sheriff cannot seize:

Personal clothing, bedding & Tools of trade
Warrants of Sale are executed against personal property prior to proceeding against real property

Tasmania

Prerequisites 

Judgment 

Execution Method

Execution by Bailiff

 Valid for

12 months

 Official Name

Warrant to Seize & Sell Property

Notes for Tasmania:
Any personal property to be sold before  real property 
Bailiff cannot seize:Personal clothing & bedding, Tools of trade

Western Australia

Prerequisites 

Judgment / Means Inquiry

Execution Method

Execution by Bailiff

 Valid for

12 months

 Official Name

Property (Seizure and Sale) Order

Notes for Western Australia:
A Judgment Debtor’s saleable interest in any real estate property must not be sold unless the Bailiff is satisfied that the sale of personal property will not be sufficient to satisfy the Judgment.

Bailiff cannot seize:

  • Wearing apparel of the judgment debtor to the value of $1,250.
  • Wearing apparel of a dependant of the Judgment Debtor to the value of $1,250.
  • Family diaries, photographs and portraits.
  • Medical and dental aids and equipment.
  • Kitchen, dining furniture and implements up to a value of $1,250.
  • Bedroom furniture and bedding up to a value of $500.
  • Bedroom furniture and bedding of the Judgment Debtor’s dependents up to a value of $200.
  • Laundry equipment up to a value of $200.
  • Electrical goods used for family entertainment to a value of $300.
  • Ordinary tools of trade, plant and equipment,
  • professional instruments and reference books to the value of $2,500, which are used by the Judgment Debtor to earn income by personal exertion.
  • Refer here for a case study on a successful Writ

Northern Territory

Prerequisites 

Judgment 

Execution Method

Execution by Bailiff

 Valid for

 12 months

 Official Name

Warrant of Seizure & Sale

Notes for Northern Territory;
Sheriff cannot seize:
Personal clothing, bedding & Tools of trade

Australian Capital Territory

Prerequisites 

 Judgment

Execution Method

 Execution by the Sheriff

 Valid for

 12 Months

 Official Name

Seizure and Sale Order 

Notes for ACT;
Sheriff cannot seize:
Personal clothing, bedding & 
Tools of trade


Seizure of Real Estate under a Writ in NSW

Sunday, November 01, 2009 - Posted by Philip Harvey

The process of seizing real estate under a Writ in NSW has recently been simplified. This can be an effective collection tool for debtors who have the capacity to pay but refuse. The basic process is as follows;

1. Obtain Judgment

2. Issue a Writ. The Writ can then be registered with Land Titles.

3. Receive a Notice of Non-Levy from the Sheriff. 

4. Lodge an affidavit at Court with the Non-Levy and registration of writ attached.

5. Lodge a Form 67 with the court who stamp 2 forms and return them to be served.

6. If no payment has been received 28 days after service, then Form 68 is issued. The court directs the sheriff to sell the property.

There are two things you need to be aware of before undertaking this process;

i) The debtor can lodge an instalment order at any stage which stops the process. If they default on the installment order, the process recommences.

ii) The sheriff's sale costs are paid prior to the mortgage.  Therefore searches have to be performed to make sure that enough equity exists to warrant undertaking the process.


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