Enforcing Financial Orders
Once made by a court, financial orders are both binding and enforceable. Each person bound by the orders must comply with their terms. This article outlines the various methods that exist for enforcing financial orders when a party has failed or refused to comply with their terms.
Before filing enforcement proceedings in financial matters, you should consider the outcome you want to achieve. If a party has failed, refused or neglected to comply with a financial order, there may be default provisions contained within the existing order which can ensure a required payment is made. For example, there may be a provision contained within the existing orders that the Registrar of the court could sign the documents on behalf of a defaulting party, or there may be orders that provide for the sale of property to facilitate the required payment. Interest may also be payable under the relevant rules of the court from the date of default until the date payment is received.
Enforcing Financial Orders: Refusal to sign documents
If the existing order does not contain a provision for a document to be signed on behalf of the person refusing to sign it, a party may apply for an order under section 106A of the Family Law Act 1975, asking the court to appoint a person – usually the Registry Manager of the court – to sign the required document (or documents) on behalf of the defaulting party.
However, if there is a more serious breach of the terms of existing financial orders, which the above options do not address in your circumstances, you should seek legal advice on the most appropriate method of enforcement as the law around the enforcement of financial orders can be complicated and there are stringent technical requirements which apply.
Enforcing Financial Orders: registering the order
If an order is made in a different court, it must be registered in the enforcing court in accordance with the relevant regulations. Any party to a financial order can apply to enforce it.
Enforcing Financial Orders: other options
If a financial Order is breached, and default provisions contained within the existing orders do not remedy the situation, the options for enforcement of orders in financial matters include the following.
Seeking an order that the defaulting party attends an enforcement hearing.
At the enforcement hearing the court may make an order:
- about the total amount owing;
- that the total amount owing should be paid in full or by instalments, and when the amount must be paid;
- for enforcement or in aid of the enforcement of an obligation;
- to prevent the dissipation or wasting of property;
- for costs;
- staying the enforcement of an obligation;
- requiring the defaulting party to attend an enforcement hearing, to give further information or evidence or file a financial statement;
- dismissing the Application; and/or
- varying, suspending or discharging an enforcement Order.
Seeking an Enforcement Warrant
An Enforcement Warrant appoints an enforcement officer for the seizure and sale of real estate or personal property. An enforcement warrant remains in force for twelve months.
Until the debt is satisfied, the property remains subject to the enforcement warrant, and the enforcement officer has the power to sell the property, if necessary, to recover the debt.
Where there is a risk that the defaulting party will abscond with any personal property subject to the enforcement warrant upon receiving notice of the enforcement notice, applying for a warrant of seizure and detention can allow the enforcement officer to seize the items without prior notice to the defaulting party.
Seeking a third party debt notice
A party may seek a third party debt notice which requires a person or a third-party organisation which is alleged to owe money to the defaulting party to pay some or all of that money to the applicant rather than the defaulting party (for example, from the defaulting party’s wages or from the defaulting party’s bank accounts).
Because defaulting parties can take steps to avoid a third party debt notice (such as leaving their employment and refusing to disclose their new employer), these notices may be a last resort.
A party may seek an order that a property be temporarily placed into the hands of a sequestrator, who can then seize property belonging to the defaulting party and collect rent, profits and takings from a business, until the full amount due to the Applicant is paid; and
A party may seek an order appointing a person as a receiver (or receiver and manager) of the defaulting party’s income or property. The receiver is then entitled to receive any income due to the defaulting party from that property, and pay amounts owing to the Applicant under the original order.
There are detailed rules which set out the relevant procedures and what the documents supporting the applications for the above orders are required to contain. There are also rules regarding the allowable timeframes between swearing and filing of supporting documents.
There are also detailed rules relating to how a person affected by orders for enforcement can object to it or apply to the court for procedural orders, such as how a receiver or sequestrator should be remunerated for their efforts.
If you require legal advice or representation in any legal matter, please contact Armstrong Legal.