{"id":21369,"date":"2018-08-31T10:12:00","date_gmt":"2018-08-31T10:12:00","guid":{"rendered":"https:\/\/legalblog.ie\/equitable-execution\/"},"modified":"2023-06-17T13:17:25","modified_gmt":"2023-06-17T13:17:25","slug":"equitable-execution","status":"publish","type":"post","link":"https:\/\/legalblog.ie\/equitable-execution\/","title":{"rendered":"Equitable Execution"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_63 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title \" >Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Procedure_for_Enforcement\" title=\"Procedure for Enforcement\">Procedure for Enforcement<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Equitable_Execution\" title=\"Equitable Execution\">Equitable Execution<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Enforcement_against_Debts_Receivable\" title=\"Enforcement against Debts Receivable\">Enforcement against Debts Receivable<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Enforcement_Against_Other_Assets\" title=\"Enforcement Against Other Assets\">Enforcement Against Other Assets<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Equitable_Execution_I\" title=\"Equitable Execution I\">Equitable Execution I<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Nature_of_Order\" title=\"Nature of Order\">Nature of Order<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Receivers\" title=\"Receivers\">Receivers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Limits\" title=\"Limits\">Limits<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Salary_and_Earnings\" title=\"Salary and Earnings\">Salary and Earnings<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/legalblog.ie\/equitable-execution\/#Partnerships\" title=\"Partnerships\">Partnerships<\/a><\/li><\/ul><\/nav><\/div>\n<h3><span class=\"ez-toc-section\" id=\"Procedure_for_Enforcement\"><\/span>Procedure for Enforcement<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>There are a number of means of enforcement against a debtor\u2019s intangible assets, which each require an application to the court. In each case, the application is for a court order directed to a third party to secure that the asset is secured for the judgment creditor. There are a number of distinct procedures, which have a broadly similar procedure.<\/p>\n<p>The application is usually made to the court by a motion. This is a short application and hearing, usually decided on the basis of written affidavits. In some cases, notice to the debtor of the motion is required and in other cases, it may be made without notice, at least initially. In some cases, the practice is to require notice, depending on their type of asset and circumstances.<\/p>\n<p>The application is based on an affidavit setting out the court order and the requirement for the order. The order prevents the debtor from receiving the property or dealing without accounting to the judgment creditor.\u00a0 The judgment creditor may be entitled to an order against third parties to compel them to pay the debt, income or assets.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Equitable_Execution\"><\/span>Equitable Execution<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>A judgment creditor who seeks equitable execution, must usually first have sought to enforce through the other methods of enforcement. Equitable execution may arise in response to the inadequacy of the common law. It may be granted over classes of assets and which may not be taken under common law execution,\u00a0 such as by way of the sheriff.<\/p>\n<p>Equitable execution is discretionary, in common with other equitable remedies. See generally the sections on equitable remedies and the principles on which relief may be granted and denied.<\/p>\n<p>Enforcement by equitable execution may be granted in the High court or in the Circuit Court. The rules of each court make provision for practice and procedure in such cases.<\/p>\n<p>It will be usually desirable to issue first, a writ by way of fieri facias to the sheriff to seize the debtor\\&#8217;s goods.\u00a0 do so, before seeking equitable execution. If no goods are available, the sheriff is required to issue a nolla bona return. \u00a0However, it is not always necessary to do so. \u00a0If legal execution is probably a waste of time, then it may be excused.<\/p>\n<p>The basis of the jurisdiction is that there is no effective remedy at (common) law.\u00a0 Prior to the fusion of common law and equity under the Judicature \u00a0Act (1877), the remedy was only available in respect of equitable interests.\u00a0 Most cases will still involve action against equitable interests, \u00a0as of their nature, legal methods are generally more effective against legal interests.<\/p>\n<p>Equitable execution is available for the purpose of execution of a judgment. It is not available for retention of assets pending judgments and\/or execution.\u00a0 Separately, a receiver may be appointed by interlocutory or pre-judgment application, in order to protect assets or in some cases to prevent unlawful use by the defendant.\u00a0 See the sections on this similar but quite separate jurisdiction.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Enforcement_against_Debts_Receivable\"><\/span>Enforcement against Debts Receivable<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>It is possible to apply to the court to enforce a court order for a monetary debt by a so-called \u201cGarnishee Order\u201d. The procedure involves intercepting money due to the defendant by a third party, to satisfy the court order. A bank account is a debt due and may be made subject to garnishee order. An order will not generally be granted against a joint account.<\/p>\n<p>A one-sided application is made and the court may examine the debtor in relation to debts owing by third parties to him. The debtor (owing money to the defendant) may be given the opportunity to appear to show cause why the debt should not be attached.<\/p>\n<p>The court has a discretion. There is no automatic right to a garnishee order. The debt may be a present or future debt. The attachment may be made in respect of present debts and not future earnings. Future earnings are not liable to attachment under this procedure. Where earnings are attached, the defendant must be left with sufficient means to maintain himself and his dependents.<\/p>\n<p>The application is made by a one-sided application where pre-emptive action is necessary to prevent the asset from being removed or dissipated. The details of the asset concerned, the basis of the applicant\u2019s knowledge, the details of the bank and the debt must be set out. The order requires that the third party pays the money he owes to the debtor, to the creditor instead.\u00a0 If the third-party fails to pay the money as directed the court may make enforcement orders.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Enforcement_Against_Other_Assets\"><\/span>Enforcement Against Other Assets<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>There are a number of flexible options for enforcement of a court order. These flexible options are known as equitable enforcement. Equitable enforcement methods are more flexible, but unlike other types of enforcement, the court does not grant them automatically as a right. The court will look at the entire circumstances in order to do what fairness and justice require.\u00a0 They require an application to the court in each case. It is a matter for the discretion of the court whether or not to grant equitable enforcement.<\/p>\n<p>So-called equitable execution is usually granted only if the other conventional means of enforcement are ineffective or have failed. It is generally necessary to first attempt to enforce through the conventional methods of enforcement.\u00a0 It is not necessary to do so if it is clearly a waste of time.<\/p>\n<p>Generally, equitable enforcement is available when there is some practical or legal obstacle to enforcement against a particular asset through the normal means of enforcement. Possible examples would be where a third party holds the assets as part of a larger fund or the debtor holds a beneficial interest in an asset concerned,\u00a0 the legal title to which is held by a nominee.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Equitable_Execution_I\"><\/span>Equitable Execution I<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Some debts owing to the debtor (receivable), which may not be the subject of legal execution may be the subject of equitable execution.\u00a0 This may arise where a debt is payable jointly with another or where the debtor is beneficiary under a trust.<\/p>\n<p>It is not clear whether equitable execution may be granted over a legal interest in property Arguments have been made that the order should be made, \u00a0where the circumstances make the legal remedy inadequate. However, a judgment mortgage may attach to a beneficial interest.<\/p>\n<p>A chose in action may be attached.\u00a0 However, a bare right to take action is not capable of validly assigned and may not be attached.<\/p>\n<p>An application for the appointment of a receiver is made by a motion on notice in the proceedings in which the relevant judgment issued.\u00a0 It may be brought before the Master or a judge.<\/p>\n<p>An ex parte (unilateral) motion may be made in appropriate cases, but it must be made to judge.\u00a0 As in other cases, it may be justifiable to proceed ex parte where there is a good reason to fear that the prior notice would lead to the removal, hiding or disposition of the asset concerned. If the court refuses to make an application ex parte the matter may proceed by motion on notice.\u00a0 Ex parte application may only be granted where there is a real danger that the asset will be disposed of, dissipated or removed.<\/p>\n<p>The court will have regard to the amount of the debt, the probable success of the receiver in making recovery and likely costs.\u00a0 It may order inquiries into the matters, before making (or refusing) an appointment.\u00a0 The inquiries may be ordered on such terms as at the court sees fit.<\/p>\n<p>The affidavit on which the application is based must show particulars of the judgment, that it is unsatisfied in whole or in part, particulars of the attempted legal execution and\/or the non-availability of \u00a0assets of the debtor\/defendant, that may be taken by other means of execution or why it is futile\u00a0 and particulars of the asset over which an appointment is sought.<\/p>\n<p>A receiver must be nominated by the creditor. A (third party) solicitor is usually be put forward. The judgment creditor\u2019s solicitor is not usually appropriate. The proposed receiver must be shown to have the requisite fitness to act as such.\u00a0 He must be shown to be fit and proper and have the requisite ability.\u00a0 The affidavit should vouch for these matters.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Nature_of_Order\"><\/span>Nature of Order<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The order gives personal rights against the judgment debtor but it does not create security rights as such.\u00a0 It effectively is an injunction for restraining the judgment debtor from receiving the proceeds.\u00a0 It does not create a charge. This is unlike the position under the statutory jurisdiction in respect of an interest in a partnership.<\/p>\n<p>The order in effect substitutes the judgment creditor or the debtor in relation to receipt of the asset money or a thing.\u00a0 He may be entitled to prevent third parties from interfering with the relevant income or receipt.\u00a0 The receiver may be given liberty by the order to take proceedings against third parties in the name of the judgment debtor to protect the assets.<\/p>\n<p>The order allows the creditor to take possession of the asset concerned notwithstanding that it does not create a charge or lien.\u00a0 However, in some cases, the order may have the effect of a charge.<\/p>\n<p>Unless a charging order, the judgment creditor is granted such right, neither he nor the receiver has a right to sell.<\/p>\n<p>The order cannot take priority effect over an equitable assignment of a debt, even one which has not been perfected by notice.\u00a0 However, the appointment restrains the judgment debtor from dealing with the assets to the prejudice of the judgment creditor.<\/p>\n<p>The receiver is generally required to give security in the same way as with other court-appointed receivers.\u00a0 The order may be ineffective if it is conditional on security which is not yet been put in place.<\/p>\n<p>A judgment creditor is not a secured creditor by reason of having an order.<\/p>\n<p>The receiver is obliged under a duty to get them the money concerned and pay them to the judgment creditor.\u00a0 The receiver must pass accounts before the Master of The High Court or a Circuit court judge or Registrar.\u00a0 Payment is made after deduction of costs.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Receivers\"><\/span>Receivers<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The most common type of equitable enforcement involves the appointment of a receiver by way of equitable execution. This type of receiver bears similarities to a court-appointed receiver by way of enforcement of security. See our chapter on court-appointed receivers. Many of the same consideration apply and the receiver\u2019s status and duties to the court are similar.<\/p>\n<p>The application to court may require to be with prior notice to the debtor, depending on the type of asset and the circumstances. The application may initially be by way of a one-sided application to court where necessary in order to preserve assets and to prevent the risk of them being dissipated pending a further application with prior notice to the judgment debtor.<\/p>\n<p>In the case of a receiver over the debtor\u2019s income (such as a pension), the court will take account of the debtor\u2019s means and ability to pay. It will not deprive the debtor of the means of sustenance for the debtor and his family.<\/p>\n<p>The courts will not appoint a receiver over all of a debtor\u2019s assets. This would be equivalent to a bankruptcy and that is the appropriate procedure. \u00a0It must be limited to particular assets. The order will not be made if it would be pointless.<\/p>\n<p>Receivers have been appointed over the following types of assets;<\/p>\n<ul>\n<li>future rights in land;<\/li>\n<li>shares of rents of jointly owned property;<\/li>\n<li>trust income;<\/li>\n<li>interest in a deceased\u2019s estate;<\/li>\n<li>income which cannot be attached by other proceedings e.g. civil service pension<\/li>\n<li>property subject to a lien;<\/li>\n<li>maintenance payments<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Limits\"><\/span>Limits<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Generally, future earnings and salary cannot be attached under the procedure. It is usually limited to money already earned. On occasions, this can be relaxed in relation to future profits and rents. A pension is based on past service and is potentially subject to the procedure. Some state pensions are not capable of being assigned by law.<\/p>\n<p>The remedy has been refused in cases which include<\/p>\n<ul>\n<li>inalienable receivables and entitlements;<\/li>\n<li>the salary of a public office not yet due;<\/li>\n<li>unliquidated damages in the pending action;<\/li>\n<li>most future payments.<\/li>\n<\/ul>\n<p>The order does not create a charge over the property but declares the judgment creditor is entitled to require payment.<\/p>\n<p>The court may exercise its discretions to how much of the debt should be the subject of the order, having regard to means of the defendant.\u00a0 There should be sufficient retained assets for the defendant to live on, to support his dependents and to exercise his business, trade or employment.<\/p>\n<p>An order may not be made over the debtor \u2019s assets generally.\u00a0 This would be equivalent to a bankruptcy for the benefit of an individual.\u00a0 In common with equitable remedies generally, the order will not be made if it would be in vain and achieve nothing.<\/p>\n<p>Equitable execution is most appropriate in respect of intangible assets.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Salary_and_Earnings\"><\/span>Salary and Earnings<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Generally, the future earnings of the debtor will not be attached through equitable execution.\u00a0 There exists other mechanisms under the Enforcement of Court Orders Act and the 2015 legislation.<\/p>\n<p>Generally, appointments will not be made out of future payments. Exceptionally, an appointment may be made over future payments where it is clear they were unconditionally due at least in the case of business profits or future rents.<\/p>\n<p>Generally, salaries and earning may not be subject of equitable execution.\u00a0 However this does not apply where the sums have been earned but have not yet been paid.<\/p>\n<p>A similar principle applies to pensions, but perhaps to a lesser extent. Pensions are payments for past service, and unlike the future employment payments, they are more potentially accessible through equitable execution. \u00a0Pension funds which are owned, such as veted PRSAs and ARFs may be subject to equitable execution.<\/p>\n<p>Some statutory pensions in public service and social welfare pensions are made inalienable and may not be the subject of execution or equitable execution.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Partnerships\"><\/span>Partnerships<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The Partnership Act provides that execution may not be undertaken against partnership property, except under a judgment against the firm. \u00a0Therefore, partnership assets are nor directly available for execution for payment the debts and obligations of partners in their personal \/ individual capacity.<\/p>\n<p>The Partnership Act provides that the \u00a0judgment creditor \u00a0of a partner may to apply to the court to charging the partnership assets of the judgment debtor, with judgment and interest.\u00a0 This in effect allows the creditor to charge the debtor partner\\&#8217;s interest in the profits of the partnership. To this extent, the judgment creditor may obtain priority over other creditors of the judgment debtor.<\/p>\n<p>The application is made by motion on notice to the respondent and the \u00a0other partners (as are within the jurisdiction_.\u00a0 It is based on an affidavit, \u00a0setting out the circumstances and the belief that the respondent has an interest in the partnership.\u00a0 A receiver must be nominated. If there is a good reason for believing that assets may be removed, spent or hidden, an ex parte application may be made for the appointment of a receiver, in the first instance.<\/p>\n<p>Every application by a judgement creditor of a partner for an order charging his interest in the partnership property and profits under the Partnership Act, and for such other orders as are thereby authorised to be made, shall be by motion served on the judgement debtor and on such other of the partners as shall be within the jurisdiction, and such service shall be good service on all the partners, and all orders made on such motion shall be similarly served.<\/p>\n<p>Every application which shall be made by any partner of the judgement debtor shall be made by motion served on the judgement creditor and judgement debtor and on such of the other partners as shall not concur in the application and as shall be within the jurisdiction, and such service shall be good service on all the partners, and all orders made on such motion shall be similarly served.<\/p>\n<p>The court may appoint a receiver over the partnership profits, present and future.\u00a0 The court may make further orders as the circumstances require.\u00a0 It may direct accounts and enquires to be made in respect of \u00a0any person interested in the assets of the partnership.\u00a0 It may make an order for the sale of assets.<\/p>\n<p>The receiver must apply or allow application of partnership monies\u00a0 towards necessary expenditures and outgoings. All other deductions to the point of the judgments debtor\u2019s profit share must be allowed including the salary, profits and other entitlements of the other partners. The judgment debtor\u2019s interest in the partnership is limited to any salary\u00a0 partner share and to his share of undistributed income and capital on a dissolution. The receiver take no more than his interest in the partnership.<\/p>\n<p>The court may grant a\u00a0further order as required to give effect to the charge.\u00a0 An application is made by the receiver to the Master of the High Court to pay the sums received. The receiver must render an account must be rendered to the courts, in accordance with the general practice of court appointed receivers.<\/p>\n<p>The partners of the debtor are entitled to redeem the interest charge and to purchase the property in the event of a sale.\u00a0 They may make appropriate applications to the court on notice to the partner and the creditor and to other partners for orders for these and like purposes in respect of their partnership interests..<\/p>\n<p>The Partnership Act allows for the appointment of a receiver over the assets of a foreign partnership which are within the jurisdiction.\u00a0 This is permissible regardless of whether the assets amount to \u00a0\u00a0a branch or establishment or are merely goods in the hands of an agent.<\/p>\n<p>&nbsp;<\/p>\n<!--themify_builder_content-->\n<div id=\"themify_builder_content-21369\" data-postid=\"21369\" class=\"themify_builder_content themify_builder_content-21369 themify_builder tf_clear\">\n    <\/div>\n<!--\/themify_builder_content-->\n","protected":false},"excerpt":{"rendered":"<p>Procedure for Enforcement There are a number of means of enforcement against a debtor\u2019s intangible assets, which each require an application to the court. In each case, the application is for a court order directed to a third party to secure that the asset is secured for the judgment creditor. There are a number of [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[326],"tags":[],"_links":{"self":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts\/21369"}],"collection":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/comments?post=21369"}],"version-history":[{"count":1,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts\/21369\/revisions"}],"predecessor-version":[{"id":21414,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts\/21369\/revisions\/21414"}],"wp:attachment":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/media?parent=21369"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/categories?post=21369"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/tags?post=21369"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}