There are various ways of executing court-issued judgments against the debtor in order to satisfy the judgment, with the most common being where the debtor settles the judgment debt by way of monetary payment, sale in execution of assets owned by the judgment debtor, issuing of a garnishee order or the issuance of an emoluments attachment order. However, it often happens that the debtor is not in a position to satisfy the judgment. This leaves the judgment creditor in a quandary as to what can be done in such a situation. In this article, we shall discuss another way of executing a judgment debt, a way that is not commonly used.
The initial stages usually present no problems, all is well right, the tenant knows he is owing and the excuses keep coming. Your patience starts to fizzle but the actions of the tenant are not helping either. Finally, you decide to take the matter head-on and institute legal action. The tenant is served with a summons and in a show of remorse, goodwill or maybe heavily laden with a sense of guilt, he chooses not to oppose the action.
Armed with a default judgment/order from the court, you instruct the sheriff to request the tenant to pay up. What with the gloomy expression on your face when you receive the sad news via the sheriff’s return of service, that the judgment debtor does not have any funds to settle the judgment debt. Realising that the tenant might probably be playing a not-so-funny mind game, you vengefully instruct the sheriff to attach and remove the assets of the tenant, in order to auction them. Soon you realise that it is not raining, it is actually pouring on you as the sheriff reports back that the tenant moved his belongings to his relatives in some faraway city, where he intends to relocate to. As we speak, the apartment is empty.
It soon dawns on you that perhaps the tenant is deliberately frustrating all efforts to have the judgment debt settled, and therefore you have to take the war right into his backyard.
The Uniform Rules of the High Court, specifically 45(8) read with 45(12) enable a judgment creditor to execute a judgment debt by way of freezing a bank account.
If incorporeal property, whether movable or immovable, is available for attachment, it may be attached without the necessity of a prior application to court in the manner hereinafter provided…
Whenever it is brought to the knowledge of the sheriff that there are debts which are subject to attachment, and are owing or accruing from a third person to the judgment debtor, the sheriff may, if requested thereto by the judgment creditor, attach the same, and thereupon shall serve a notice on such third person, hereinafter called the garnishee, requiring payment by him to the sheriff of so much of the debt as may be sufficient to satisfy the writ, and the sheriff may, upon any such payment, give a receipt to the garnishee which shall be a discharge, pro tanto, of the debt attached.
(Please note that Rule 45 (8) must be read in greater detail, for the purposes of this article and to keep it brief, we only quoted a part thereof).
The ultimate effect is that the judgment creditor may request that the bank account of the judgment debtor be frozen and the funds therein be remitted to satisfy the judgment debt. In the case of South African Congo Oil Co (Pty) Ltd v Identiguard International (Pty) Ltd, the interpretation of Rule 45 was buttressed by the court for the benefit of judgment creditors who intend to execute their judgment debts.
Following the reasoning in the case of Absa Bank Ltd v Hanley, it is clear that credit in a bank account is incorporeal property for the purposes of Rule 45 and the bank is a third party who owes the “debtor” (when the bank account has credit), which credit may be used to settle a judgment against the account holder.
In conclusion and as discussed above, all is not lost when the debtor is dodging each legal bullet meant to make him pay up and settle the judgment debt. It is required that the judgment creditor furnish the bank details of the judgment debtor as practically, the dodgy judgment debtor will not furnish these even upon request by the creditor.
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