Debt Recovery

When a Court makes a judgment in your favour for the recovery of a debt, there is a mechanism available to recover the judgment debt through a third party. This mechanism is a garnishee order.

What is a Garnishee Order?

A garnishee order is an order of the court which enforces a third party who either owes money to a debtor, or is holding money for a debtor, to make payment to the creditor of any funds held by that third party for the benefit of the debtor.

This order essentially permits a judgment creditor to ‘seize’ monies from the judgment debtor via a third party. [...]  READ MORE →

The Australian Institute of Credit Management (“AICM”) released an industry first Overdue Credit Index Report 2023 (“the Report”) which analyses levels of overdue credit across a range of financial products in the Australian market.

The Report presents a measure of overdue credit, called the ‘Overdue Credit Index’, based on aggregate data of reported repayment history for credit accounts across mortgages, credit cards and unsecured personal loans using data provided by Equifax and Illion for the period from 1 July 2019 to 1 August 2022. This index provides transparency around patterns of overdue credit and hardship requests in the Australian market and allows credit managers to express their performance and resourcing relative to a benchmark. [...]  READ MORE →

Reform to Unfair Contract Terms – What’s New?

Commencing on 9 November 2023, significant reforms were made to the Australian Consumer Law (“ACL”) concerning unfair contract terms (“UCT”) within standard form contracts. These changes will attract substantial penalties under the Competition and Consumer Act 2010, as well as the ASIC Act 2001 for both businesses and individuals. It is therefore vital that you are made aware of the reforms to the ACL and how they may affect you.

In 2010, a term in a standard form contract was deemed to be unfair if it: [...]  READ MORE →

By Eleanor Campbell-Rogers, a Law Clerk of Matthews Folbigg, in our Insolvency, Restructuring and Debt Recovery Group

‘A successful litigant is entitled to the fruits of their litigation’.

Whilst this might be true, a successful defendant can often be left with a significant legal bill despite a court ordering the plaintiff to pay their costs of the proceeding – winning the battle but losing the war.

Imagine you find yourself as a defendant in proceedings that you never saw coming and which should ultimately never have happened. The plaintiff’s claims may lack merit and have very low prospects of success, but they commenced proceedings against you anyway in a desperate attempt to recover money that they lost as a consequence of their own actions. After all of the hours of stress, sleepless nights, phone calls, meetings, and thousands of dollars of legal fees, you and your legal team emerge from litigation victorious, with the plaintiff to pay your costs of the proceeding – only to find out, the plaintiff has no money, no assets and is unable to pay your legal fees. [...]  READ MORE →

In DW Fox Tucker Pty Ltd v Morgan [2023] SASCA 11, the Supreme Court of South Australia Court of Appeal allowed an appeal by DW Fox Tucker Pty Ltd (‘the Creditor’) regarding the decision that there was no costs agreement between the Creditor and the director (‘Mr Morgan’) of TS Morgan Developments Pty Ltd (‘the Company’).

Background

The Creditor obtained judgment against Mr Morgan in relation to unpaid legal fees incurred whilst the Creditor was acting for the Company. The Company had gone into voluntary administration in March 2017. However, the judgment was set aside in February 2020. Mr Morgan then sought a declaration that there was no costs agreement between him and the Creditor, and the Court ruled in his favour. However, the Creditor challenged this decision to the Court of Appeal. [...]  READ MORE →

By Dylann Brew, Solicitor at Matthews Folbigg Lawyers in our Insolvency, Restructuring and Debt Recovery Group

Credit professionals play a crucial role in any business, ensuring that both the risks of defaulting on contractual obligations are managed, and that payment of goods or services are received in a timely manner. To achieve this, they need to consider the following relevant factors:

• consumer behaviour and monitoring any changes;
• changes to relevant legislation and regulations;
• economic trends and monitoring any changes;
• anticipated and forecasting future performance of the business.

These factors should be considered by every business to allow informed decisions to be made to mitigate risks. [...]  READ MORE →