Everyone knows that debts should be repaid, but some people simply refuse to pay back their debts, forcing creditors to resort to civil litigation to seek justice in court. Even after a creditor obtains a court judgment, don’t assume the debtor will obediently repay the debt. Often, debtors ignore court judgments, and creditors must consider legal actions to compel repayment.

Legally, creditors typically apply for the following six court orders:

1. Garnishee proceedings
2. Judgment Debtor Summons
3. Writ of Seizure and Sale
4. Bankruptcy Proceedings
5. Winding up Proceedings
6. Committal proceedings

Before deciding which enforcement order to use, lawyers usually assess which order best suits the creditor’s needs. For instance, if the creditor is a bank and the individual owes more than RM100,000, the bank may apply for a bankruptcy order. If the debtor does not respond within seven days of receiving the bankruptcy notice, it is considered an act of bankruptcy, allowing the creditor to file for bankruptcy. Consequently, the debtor’s movable and immovable assets will be taken over by the Insolvency Department, which will sell these assets to help repay the debt.

If the debtor is a company, the bank will apply for a winding-up order. A court-appointed liquidator will then sell the company’s valuable assets to repay the creditor bank.

Different Methods for Different Situations

If the creditor is an individual and the debtor is also an individual, for debt judgments less than RM100,000, and the debtor is employed with a salary, the creditor may consider applying for a garnishee order. This would arrange for the debtor’s bank to deduct a portion of their salary each month until the debt is fully repaid.

In cases where a tenant owes rent and abandons the premises, leaving behind many goods, it is advisable for the landlord to apply for a writ of seizure and sale after obtaining a rent judgment. This prevents the landlord from mistakenly taking goods that belong to suppliers or stolen goods, which could lead to severe legal consequences.

Conversely, with a court-issued writ of seizure and sale, the creditor can lead court officers to the debtor’s premises to assess the valuable items for sale. They can list items equivalent in value to the debt judgment and auction them on a court-determined date to repay the debt.

Committal proceedings typically occur when a divorced spouse continuously fails to pay alimony and child support. The delinquent spouse must repay the overdue amount immediately, or face imprisonment.

A Judgment Debtor Summons is used for debtors who fail to repay their debts. They are summoned to court to explain why they cannot repay on time. The debtor must fully report their assets to the court. If the court does not accept the debtor’s explanation, it can order the debtor to repay the debt in full or in installments. If the debtor fails to appear in court to explain their financial situation, they may be held in contempt of court and face imprisonment.

The above are just a few commonly used debt enforcement orders. Other orders include injunction orders and charging orders. Each legal method has its specific purpose.

In summary, different situations require different legal methods. If the debtor cooperates and repays the debt according to the court judgment, creditors do not need to apply for debt enforcement orders. However, if the debtor is uncooperative, creditors must remember to enforce the judgment within 12 years of obtaining it, or it will become invalid