The highly experienced team at Branch Austin McCormick have a specialised skill set when it comes to enforcing judgments. This article discusses enforcement generally and provides some recent anonymised case law examples. Much like the rest of family law, enforcement very much turns on its own facts and practical considerations are always worth carefully considering with one of our specialists.
When you need to enforce an order
With a good family law team, many people who have been through the family court system may be familiar with the happy situation of getting a final good court result or interim financial settlement. Increasingly, this may also be negotiated through mediation or directly between solicitors as part of the alternative dispute resolution process, with agreed terms being made into an order of the Court.
However, many orders go unpaid. As a practitioner I have found that an increasing proportion of my work is in enforcement. This is no doubt a sign of the current economic times. However, how and when to enforce requires some careful consideration and thought.
General position on enforcement
Enforcement is governed by Part 33 of the Family Procedure Rules 2010 (FPR) and may be made through a variety of means which include an Attachment of Earnings Order, a Third-Party Debt Order, Charging Order, Judgment Summons, Appointment of a Receiver or even Contempt of Court proceedings. An alternative Court remedy that is often overlooked by practitioners is a Hadkinson Order which can also be effective if proceedings are still ongoing.
The titles of the main different forms of order are fairly self-explanatory:
- Attachment of earnings (known as “AoE”) takes payments directly from a salary but has limits (known as the “protected earnings” threshold) to allow a debtor to pay for their basic living costs. Critically, any AoE order works through a centralised agency which can take time;
- A Third-Party Debt Order operates on a third-party account (such as a bank account) and can be made directly against the bank account, it can be a useful and powerful form of enforcement where the funds are easily traceable;
- A Charging Order is useful where there is discernible capital and/or a company which holds funds, it is a fairly common form of enforcement as well as the two methods above;
- A Judgment Summons brings a debtor to Court and enables the Court to put questions as their ability to pay, it is commonly one step on the way to further proceedings such as Contempt of Court proceedings;
- Appointment of a Receiver enables a suitably qualified independent third party (“the receiver”) to take control and distribute a debtor’s assets. In reality, this tends to be an unusual remedy when the debtor’s solvency is questionable and/or the funds of the judgment claimant are not immediately realisable.
In an extreme case where it is possible to prove that someone has disobeyed a Court Order beyond reasonable doubt (which is a criminal standard of proof) it is possible to bring Contempt of Court proceedings. This entails a public hearing where the ultimate sanction is a possible term of imprisonment. In practical reality, it is only really for the most obvious and flagrant breaches of an order where this route needs to be considered as a method of enforcement.
A Hadkinson Order is also considered a “remedy of last resort” and is an order which stops all litigation until certain debts have been paid or orders been complied with. This is an unusual method of enforcement but has been proven to be effective in cases I have dealt with over the years.
Recent experience
Having run a number of enforcement actions, the fundamental difficulty with any enforcement action lies in securing the funds and the reality is (particularly in the time of squeezed living costs and on matters involving international cases), the easiest and most direct route to enforcement is to simply have an order that costs are paid from proceeds of any house sale.
However, I have also recently run a number of cases which involve enforcing against attaching earnings and, in recent experience, I have run cases with a Third-Party Debt Order which allows for a direct payment from bank accounts (this used to be known as a “Garnishee” order). In terms of pure practicalities, it is important to bear in mind if you are the client in this particular matter, the enforcement process can be quite long and convoluted and the case study examples below provide some context.
In a recent case experience I found that enforcing a Charging Order on a simple sale of a property was a relatively straightforward process. It did take the Court a few months to list, but a sale was imminent and there was a very specific time for the sale, so it was possible to be able to have a very specific lump sum paid from the sale proceeds. Overall, the timing was a matter of months from filing.
A Third-Party Order can prove to be quite effective where you know there is a bank with a certain amount in it or a specific resource you can secure against. In cases where I have done this, my client has had to be fairly certain that we are securing against a bank account that holds sufficient funds.
Perhaps the problematic experience that I have had, has been the practical difficulty with achieving an Attachment of Earnings Order. Despite the fact that gaining an order is relatively easy and normally takes a few months, attaching earnings is a convoluted process that is delegated to the Centralised Attachment of Earnings Payments System (CAPS) based in Northampton.
My experience in dealing with this has tended to be problematic and CAPS has been somewhat difficult to deal with. They usually insist on any Court Order being transcribed into their own internal form and then an actual case number being established. There appears to be limited amounts of oversight over the CAPS system, and it has taken many months of persistence with the system in order to ensure that my clients eventually get paid from it. Therefore, as a practical tip, it takes a lot of following up and clients are advised to be patient with the process.
I am presently working on a more academic article that talks about a number of changes to reform the CAPS system, but it is recommended that if you are considering enforcing with this particular route, that you speak to us in order to obtain a realistic view on the times taken.
In a recent case we brought Contempt of Court proceedings for a litigant who had not engaged in the process throughout the entire course of financial proceedings. The notion of the Contempt of Court proceedings has been enough to encourage negotiation and there has been some direct discussion between the parties which is currently yielding some promising results for the client in question.
I recently had to consider a Hadkinson Order which was then dealt with in other aspects of the proceedings but nonetheless remains a powerful tool that the Court can order without a recourse to further hearings and can be obtained on suitable facts in one hearing.
Conclusion
In short, anyone considering enforcing needs to be patient with the system but also look at the practical realities of what assets they can enforce against and also carefully consider what stage their litigation is at. It is not a straightforward process but has yielded a series of sound results for our clients. We recommend you get in touch with the team with any orders you are considering enforcing. As is often the case, early and specialist advice remains extremely important.