The new Enforcement remedy of "money attachment" was introduced in Scotland on 23rd November 2009. This will enable a creditor holding a decree, or other enforcement document, to attach money, including foreign currency, held in business premises in the same manner as Judgment enforcement against other moveable property. Attachment of money inside a house will be excluded, along with searches against the person.
How easy is it?
The new measure will probably have a greater impact where there is a commercial debtor, trading from business premises and Sheriff Officers will be able to open a cash register themselves, without having to get the court´s prior approval.
Scottish landlords should benefit from ´money attachment´ as most leases north of border allow for ´summary diligence´. In effect, the lease, once registered, allows for immediate judgment enforcement for overdue rent, other common charges and reasonable expenses, without having to initiate court action. Landlords will have to register the lease and pass it to a Sheriff Officer who can carry out the money attachment once fourteen days after the ´charge for payment´ has been executed.
The diligence (Scottish judgement enforcement) will be applicable if the debtor has been:
- Charged, and has failed, to pay the sum due.
- Provided with a copy of a Debt Advice and Information Package no earlier than 12 weeks before executing the money attachment.
Money attachment cannot be carried out on a Sunday, a public holiday in the area in which the attachment is to be carried out or another day designated by rules of court. An attachment must not begin before 8am or after 8 pm and cannot continue after 8pm if is in progress. A Sheriff Officer can apply to the Court for authority to carry out a money attachment outside these times.
Given that under money attachment the property is removed rather than ´frozen´ it is unavailable prior to decree.
The Money Attachment Process
- Decree or document of debt authorises the attachment.
- Creditor provides a debtor with debt advice pack.
- Sheriff Officer instructed by creditor.
- Charge to pay served by Sheriff Officer, and debt not paid.
- Attachment executed and money removed by Sheriff Officer. While a Sheriff Officer is carrying out a money attachment, the officer can assume that any money found in the premises where the attachment is being carried out is owned wholly or in part by the debtor. But, before attaching any money, the officer must ask anyone present about the ownership of the money and particularly ask whether it is owned by the debtor in common with someone else.
- 'Shut and lock fast places´ by the officer will be permitted. Getting the officer to open a till should not be an issue.
After the money or other financial instruments (such as cheques) have been removed (covering the debt along with interest and expenses) they will be deposited in a special bank account by the Sheriff Officer and cheques cashed. The Officer then reports the attachment to the court within fourteen days and an application is made for a ´payment order´. The court will then give authority for the officer to pass the cash to the creditor subject to certain safeguards.
Money Attachment: The Safeguards
The debtor is able to apply to the court, before a payment order is made or a money attachment ceases, for an order releasing the money attached (or a portion of it) on the grounds that the attachment is unduly harsh to the debtor. It is for the court to decide whether the attachment is unduly harsh. However an order to release money cannot permit the release of any more than £1,000 to the debtor.
Conclusion
Money attachment should be seen as a useful tool for creditors. Whilst the Sheriff Officer´s fees will be the debtor´s responsibility, these will have to be paid by creditors should the process be unsuccessful. However with their fees ranging from between £50.20 to £73.45 for arranging and executing the attachment for cash attached up to £2,431 and therefore 10% for values greater than that, creditors should not be unduly concerned.
