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GARNISHEE PROCEEDINGS IN SINGAPORE
What are Garnishee Proceedings?
If you’ve obtained a court judgment in your favour which orders the losing party (Judgment Debtor) to pay you certain sums of money, the Judgment Debtor may refuse or fail to pay you the money, or part of it.
One of the courses of action open to you to secure your money is taking out Garnishee Proceedings in the courts. Garnishee Proceedings are a good option for Judgment Creditors of the Judgment Creditor is aware of a third party which owes the Judgment Debtor some money, or if the Judgment creditor knows the Judgment Debtor’s bank account details.
Garnishee proceedings are the legal way of getting someone who owes money to the judgment Debtor (the Garnishee) to pay the money to you (the Judgment Creditor) instead of the Judgment debtor. When the Judgment Creditor garnishes a debt, the Garnishee will be ordered to pay over the debt to the Judgment Creditor instead of to the Judgment Debtor.
The Process for Garnishee Proceedings
- With your lawyer’s help, you would file a summons to apply for a Provisional Garnishee Order. This has to be supported by an affidavit which usually includes:
- Details and proof of court judgment and amount outstanding
- Details and proof that the garnishee is within the jurisdiction of the court
- Details and proof that garnishee owes a debt to the Judgment Debtor (this could be bank account details or even a Loan Agreement)
- Do note that the burden of proof of showing that there is a debt due to the Judgment Debtor from the Garnishee is placed upon the Judgment Creditor.
- Once a Provisional Garnishee Order is made, the debt of the Garnishee to the Judgment Debtor is “frozen” in the hands of the garnishee until the final order is made.
- The court will allow the garnishee to show cause why the garnishee order should not be made final. The order to show cause must be served on the judgment debtor and the garnishee personally at least seven days before the date of the hearing.
- If the garnishee does not show up at the hearing or does not dispute the debt, the order can be made final.
- If the garnishee disputes the debt to the judgment debtor, the judge will conduct a hearing and make a final order after hearing arguments from both sides.
- In some instances, a third-party claims to be entitled to the money. In such cases, the court may order such a party to appear before the court to determine the issue.
- If a final order is granted, the garnishee must pay the judgment debt to the creditor. This order against the garnishee may be enforced in the same way as any other court order for the payment of money.
- The Garnishee may be held in contempt of court if he fails to comply with the Garnishee Order.
- Do take note that garnishee orders typically cover not only the money owed but the costs of the garnishee proceedings as well.
Garnishee Proceedings Against Banks
Garnishee proceedings are commonly taken out against banks. Order 49 Rule 1(3) of the Rules of Court allows for a current or deposit account with a bank or other financial institution to be attached to satisfy a judgment debt (do take note that money in an overdraft account may not be garnished). When a person maintains a bank account, the bank is considered a debtor who owes money to that person.
Successful garnishee proceedings against a bank changes the obligations of the bank – instead of being duty-bound to pay the bank account holder, the bank is now under an obligation to pay the money to the judgment Creditor.
If the bank account in question is a joint account, the court will examine whether all the money in the joint account actually belongs to the Judgment Debtor and not the other joint account holder. Where it can be determined that there is a strong prima facie case that all the money in the account actually belongs to the Judgment Debtor (for example, when all contributions into the account were made by the Judgment Debtor), provided all other requirements are met, you may be able to obtain a Garnishee Order against the bank.
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At Lions Chambers LLC, we pride ourselves on being responsive. We understand that some problems need immediate attention, let us assist you.
Conclusion
Garnishee proceedings is a very practical step to take when faced with a Judgment debtor who simply refuses to pay even though they have monies in their bank accounts or if they have a valuable contractual arrangement with another person or entity.
One should only explore this option if they are sure that the debtor has sufficient funds in their bank account or if they are in a contractual relationship with another entity or person that has consistent payments being made.
How We Can Help You
Garnishee proceedings is a useful way to recover your judgement debt against a stubborn debtor. However, this process is complicated and one needs to know how to navigate the process. This is where we come in.
At Lions Chambers LLC, we have experienced lawyers who are patient and well-versed with the legal system in Singapore. We will guide you through the process and explain to you each and every stage of your matter, and see you to safety on the other side.
Lions Chambers LLC is an established law firm in Singapore. Our team of lawyers specialise in various areas of law and will be able to assist you. Our consultations are free. Please call +65 8777 3677 or click here to WhatsApp us today.