Debt collecting COURT ACTIONS

DISTRICT COURT ACTIONS

DOCUMENT	PURPOSE	COMMENTS	CHARGE
Notice of Claim	Commencement of an Action	Must be personally delivered to the debtor and creditor must wait 30 working days after service before proceeding to judgment	$185.00
Judgment by Default	Proves to the Court that the debt is owing. It is on this that all future action is based	This forms the basis of enforcement action against a debtor for further Court action.	$85.00
Certificate of Judgment	Certificate of the Judgment	Required if registering in High Court (Bankruptcy)	$35.00
Distress Warrant	A warrant addressed to the Bailiff authorising seizure of goods except tools of trade and various personal effects.	Must be sure debtor owns goods to be seized. Generally the bailiff makes a return of "Nulla Bona" Latin for "No Goods". This in itself is an Act of Bankruptcy	$60.00
Order for Examination	Requires debtor to attend Court to be examined under oath as to means & completion of financial statement	If debtor has the means to pay the Court will generally make an Order for payment by installments. Debtors do not like having to appear at Court	$92.00
Attachment Order	Order on debtor's income (wages or benefit) for payment to the Judgment Creditor	From debtor's financial statement the Court determines if the debtor has the ability to pay and an Order can be made on wages, salary or even Social Welfare Benefit.	$82.00
Warrant for Arrest	Issued on Creditor's request if debtor fails to Appear on Order for Examination	Debtor is brought before the Court for Examination
Community Service	When it has been shown from Examination that the debtor has the means to pay and he fails to pay as ordered a creditor can apply that he undergo Community Service	Effective as a last means of obtaining payment on smaller debts. Generally if a debtor prefers to serve Community Service we recommend writing off or bankrupting
Garnishee Order	Used when you know of money owed by a 3rd party to the debtor	Useful if you know specific details of money owing to debtor. Can also be used to get money from a debtors bank account.	$110.00
Charging Order	A charge against land the debtor owns	Restricts the debtor's ability to sell a property in that any charges against the property would need to be satisfied	$85.00

WINDING UP COMPANIES

DOCUMENT	TIMEFRAME	COMMENTS	CHARGE
Statutory Demand	Gives the debtor company 15 working days in which to pay	Can only be issued on undisputed debts over $1,000.00
Winding Up Application Notice of Proceeding Statement of Claim Verifying Affidavit	Must be filed within 30 working days of the debtor company being in default after being served with a Statutory Demand. (i.e. 45 working days after service)	Most effective on undisputed company debts over $1,000.00. A date of hearing is allocated and documents must be served within 15 working days of the date of hearing.	$610.00
Advertising	Advertisements must be placed in a daily newspaper in the area and in the N Z Gazette at least 5 working days before the hearing but cannot be placed until at least 5 working days after service.	Quite often if a debtor is going to pay the debt before the hearing they will do so before the creditor gets a chance to advertise.	Cost approx $325.00
Court Hearing		If there has been no response to the claim from the debtor the Court will order that a Liquidator be appointed.

BANKRUPTCY ACTION
Subsequent to having obtained judgment

DOCUMENT	TIMEFRAME	COMMENTS	CHARGE
Bankruptcy Notice	Must be personally delivered to debtor within 1 month of issue. Can be renewed up to maximum of 3 months from the initial date of issue.	Effective on judgment debts against individuals on amounts over $1,000.00 - Courts will not bankrupt persons on small amounts. The Bankruptcy Notice notifies the debtor that the creditor may apply to the High Court to make him bankrupt if he fails to make arrangements within 10 working days of the date of service.	$100.00
Creditor's Application Verifying Affidavit Summons to Debtor	The Creditor's Application must be filed in the High Court within 3 months of an Act of Bankruptcy. The Summons to Debtor and a copy of the Creditor's Application must be served at least 10 working days prior to the hearing. The Summons to Debtor has a hearing date on which the debtor is obliged to appear but is not required to do so.	This is the final stage in making a debtor bankrupt. Frequently a debtor will leave it till the day before the hearing, or even on the steps of the Court, to make payment, or an arrangement. The Court may adjourn a hearing if the debtor is making an honest attempt to settle.	$510.00

OTHER REMEDIES

ACTION	COMMENTS
Caveat	This is an agreement given by a debtor to a creditor whereby the creditor is able to place a charge on a person’s property if the debtor fails in an arrangement. It is basically an informal mortgage with the creditor being protected by being able to register a mortgage if the need arises.
Mortgage	This is a formal registration against land and gives the creditor the protection of being able to proceed to mortgagee sale if required.
IWS Instrument by Way of Security	This is a charge signed by a debtor giving a charge over specific assets (e.g. Motor Vehicle). The creditor then has the right to seize the asset if the debtor does not comply with the terms of repayment set out in the IWS.
Assignment	A debtor could give an assignment to a creditor of benefits that may accrue to the debtor (Insurance Policy, Shares, debts owed to him, etc.)
Debenture	This is where a company gives security to a creditor over the assets of the company - except land.
Personal Guarantee	This is generally in the case of a creditor taking a personal guarantee from the Directors or Shareholders of a Company. It can also be used where someone acts as guarantor for another person's debts (e.g. a father guaranteeing the debt of his son)