Judgments entitling you to money are just pretty pieces of paper until you take steps to enforce it.
Those Judgments can cost a lot of legal fees to obtain and there should be no satisfaction in obtaining a Judgment that only has value of principle, rather than enforcement.
So, what are the options for enforcing a Judgment?
The easiest option is a garnishment. A garnishment of a bank account that is solely owned by the debtor can be 100% garnished. The money is paid by the bank to the Sheriff, the Sheriff waits at least 30 days to see if there are other Judgments and then distributes the money pro-rata to everyone who has a Judgment against the debtor. The exception to that is that if a government agency has a writ filed, they have a priority to be paid before other Judgment creditors.
Jobs can be garnished at the rate of 20% net income. However, if there is a Family Law garnishment (50% of wages) that garnishment has a priority over non-Family Law Judgment creditors.
Any money owed to a Judgment debtor by another person/entity can also be garnished. Think of garnishment as a game of keep away. The debtor and person who owes them money are throwing a ball. The judgment creditor jumps in the middle of the two and takes (garnishes) the ball.
Another option to enforce a Judgment is to sell property. This is only a good option if the property is solely owned in the name of the Judgment debtor and the mortgage on the property is not significant. The Judgment creditor must pay significant fees to Sheriff for this process and the proceeds are shared by all Judgment creditors.
The Sheriff can also seize and sell goods of value. This process generally has significant fees and the Sheriff is reluctant to proceed with this in many areas of Ontario, resulting in significant legal fees being incurred to sell goods.
An examination in aid of execution is a once a year opportunity for a Judgment Creditor to ask the debtor questions under oath regarding assets that can be used to satisfy the Judgment: this is a good way to get information, but often expensive. Many Judgment debtors know the game: they take steps to increase the legal fees incurred before they finally provide answers.
At our firm we have even had several Judgment debtors choose 10 days in jail instead of answering questions about assets. Of course, ultimately, they answered the questions and they
had the 10 days in jail as an added bonus.
The best way to obtain information to enforce a Judgment is to conduct a Credit Search. This can only be done with the debtor’s permission or with an agency that has the right to search credit when a Judgment is obtained. We recommend our clients include ongoing Credit Search authorizations as part of their new customer intake forms: better to be safe than sorry.
Our firm has been successfully enforcing Judgments for over 22 years. We don’t like to get paper Judgments, we like to get money for our clients.