Enforcement of a monetary decision of the Federal Circuit Court
This factsheet outlines the steps required to enforce a decision of the Federal Circuit Court (FCC) that requires a person or company to pay a fixed amount of money. It does not apply to the enforcement of orders made in family law proceedings.
In this factsheet, "enforcement creditor" means the person or company who is owed money and is taking enforcement action and "enforcement debtor" means the person or company who owes the money and is the subject of enforcement action.
For matters decided in Queensland, the FCC has adopted the Rules for the purposes of enforcing monetary decisions – see section 78 of the Federal Circuit Court Act 1999 (Cth) and rule 29.07 of the Federal Circuit Court Rules 2001. Therefore, when you lodge enforcement proceedings in the FCC against an enforcement debtor, you will need to use the forms as required by the Rules. As these forms are normally for use in the Queensland Courts, you will need to change any reference to the Queensland Courts in the forms (e.g. the title) to say ‘Federal Circuit Court of Australia’.
The steps to enforce a FCC decision are:
- write a letter to the enforcement debtor
- consider the financial situation of the enforcement debtor and, if necessary, apply for an enforcement hearing
- apply for an enforcement warrant
- 1 Time limits
- 2 Step 1 - write a letter to the enforcement debtor
- 3 Step 2 – consider the financial situation of the enforcement debtor and, if necessary, apply for an enforcement hearing
- 4 Applying for an enforcement hearing
- 5 Step 3 - apply for an enforcement warrant
- 6 Types of enforcement warrants
- 7 Applying for an enforcement warrant
- 8 Serving an enforcement warrant
You may enforce a judgment for a monetary sum at any time within six years from the date of the decision. If you do not enforce the decision within this six year time frame you may lose the right to do so. You can apply to the court for an extension of this first six year period for a further six years, however, the court may not necessarily grant the extension of time.
Step 1 - write a letter to the enforcement debtor
The first step in an enforcement process is usually to write a "letter of demand" to the enforcement debtor; advising of the date of the decision and the amount owing, and requesting that the amount be paid by a reasonable date (e.g. 14 days or 21 days etc).
You should attach a copy of the decision to the letter and provide your bank account details, or the name you wish a cheque to be made out to, so that the enforcement debtor may pay you the amount owing.
If the enforcement debtor does not pay you within the time specified, you should consider commencing enforcement proceedings.
Step 2 – consider the financial situation of the enforcement debtor and, if necessary, apply for an enforcement hearing
It will only be worthwhile pursuing enforcement proceedings if the enforcement debtor has access to money or assets (which may be sold) to be able to pay you the amount owed.
You will need to consider what you know about the enforcement debtor's financial situation. For example, you may know that the enforcement debtor owns a property, works for a particular employer or has money owing to them from a third party. If you do not know anything about the enforcement debtor's financial situation you will need to apply for an enforcement hearing to obtain this information.
Either way, you should send the enforcement debtor a letter enclosing a Statement of Financial Position (Form 71 if the enforcement debtor is an individual or Form 71A if the enforcement debtor is a company). Ask the enforcement debtor to complete this form and return it to you within 14 days.
If the enforcement debtor pays you the amount you are owed in response to this letter, you will not need to commence enforcement proceedings and the matter will be over.
If the enforcement debtor returns the Statement of Financial Position to you with sufficient information, you can then proceed to apply for an enforcement warrant. See step 3 below.
If the enforcement debtor does not respond to you within 14 days or does not provide sufficient information, then you will need to apply for an order that the enforcement debtor attend an enforcement hearing. An enforcement hearing is an oral examination by the court of the enforcement debtor about their financial position.
Applying for an enforcement hearing
To apply for an enforcement hearing, you will need to file the following three documents:
Court Form 9 - Application. This document is for you to ask the court for an order that:
- the enforcement debtor to be summoned to an enforcement hearing; and
- the enforcement debtor provide you with documents relating to their finances, e.g. documents about assets, income, bank accounts, or other documents which may demonstrate their ability to pay you the amount you are owed.
Court Form 46 - Affidavit. This document is for you to swear or affirm:
- the amount you are owed and the steps you have taken to recover this amount;
- whether you have received a completed statement of financial position;
- if you have received a complete statement of financial position, why you are not satisfied with the information in the statement; and
- an offer to pay conduct money for the enforcement debtor's attendance at the hearing (if relevant).
Court Form 70 - enforcement hearing summons. This document is for you to list what documents you want the enforcement debtor to provide at the hearing (which you should have already referred to in Form 9).
The court will set a date for the enforcement hearing and issue the summons, which you must personally serve on the enforcement debtor at least 14 days before the date of the hearing. The summons may instruct the enforcement debtor to provide you with a completed Statement of Financial Position (Form 71 if the enforcement debtor is an individual or Form 71A if the enforcement debtor is a company) before the hearing. If this is the case, you will need to serve a blank Statement of Financial Position with the summons.
Personal service means that if the enforcement debtor is an individual, you will need to arrange for a copy of the summons to be handed to that person or, if they refuse to accept them, put down in the person's presence with an explanation of what they are. If the enforcement debtor is a corporation, personal service requires you to go to the registered office of the corporation and to leave a copy of the documents with a person in the service of that corporation. The registered office of a corporation can be different from the company's principal place of business. You should obtain a current company extract from the Australian Securities and Investments Commission which will show the company's registered address. If you are not comfortable serving the summons yourself, you can ask a friend to do it or pay a fee for a bailiff or process server to serve the summons.
After the enforcement hearing summons has been served, the person who performed service should swear an affidavit of service. Once the affidavit of service is complete you will need to lodge it with the FCC.
If the enforcement debtor returns the Statement of Financial Position to you with sufficient information, you should notify the court and the enforcement debtor that you no longer require the enforcement hearing and apply for an enforcement warrant. See step 3 below.
If the enforcement debtor does not return the Statement of Financial Position to you before the hearing, the enforcement hearing will proceed. The enforcement debtor will be required to attend court to answer questions about their finances and bring along any documents listed in the enforcement hearing summons. You will also need to attend the hearing.
The enforcement hearing may prompt the enforcement debtor to negotiate payment arrangements with the enforcement creditor (you) to resolve the dispute. If the enforcement debtor does not offer to negotiate, the court may order an enforcement warrant.
If the enforcement debtor fails to attend the hearing, the court may issue a warrant for their arrest.
Step 3 - apply for an enforcement warrant
Once you have obtained information about the enforcement debtor's financial position (either through your own informal searches or through the enforcement hearing process) you can apply to the court for an enforcement warrant.
Types of enforcement warrants
The types of enforcement warrants that you can apply for are listed below:
- Enforcement warrant for redirection of earnings under rule 855. This type of warrant directs the enforcement debtor's employer to pay part of his/her wages to you whenever they get paid. To apply for this type of warrant, details of the source of the enforcement debtor's earnings, for example their employer, are required.
- Enforcement warrant for redirection of a debt under rule 840. This type of warrant directs a third party who currently owes a debt to the enforcement debtor to pay that money to you instead. To apply for this type of warrant you will need to know the details of the third party and the amount they owe the enforcement debtor.
- Enforcement warrant for regular redirections from a financial institution under rule 848. This type of warrant directs a financial institution, e.g. a bank, to redirect regular payments received by the enforcement debtor to you. To apply for this type of warrant you will need to know details of any payments regularly made and the enforcement debtor's account details.
- Enforcement warrant for seizure and sale of property under rule 828. This type of warrant directs the enforcement officer, who is the sheriff or bailiff of the court, to seize and sell property belonging to the enforcement debtor. There are limits on the type of property which may be seized and sold. To apply for this type of warrant, you will need to know details of the enforcement debtor's property which may be seized and sold.
You will need to consider which enforcement warrant is most appropriate in your case and apply for that specific warrant.
Applying for an enforcement warrant
To apply for an enforcement warrant, you will need to complete and lodge the following documents:
- Form 9 - Application. This document is for you to ask the court to issue an enforcement warrant.
- Form 74 - Statement supporting application for enforcement warrant. This document is for you to set out details about the decision you are seeking to enforce, costs incurred by you in pursuing enforcement proceedings and interest claimable. You must complete this statement no more than 2 days before you file the application; and
- Form 75 - Enforcement warrant (seizure and sale), Form 76 - Enforcement warrant (redirection of debt), Form 77 - Enforcement warrant (regular redirection) or Form 78 - Enforcement warrant (redirection of earnings). You will need to choose the correct warrant form and attach this to your application and supporting statement.
Once you have filed the documents, the registrar of the court will decide whether to issue the enforcement warrant.
Serving an enforcement warrant
If the registrar issues the enforcement warrant, the warrant will need to be served on the enforcement debtor and any person required to take action under the warrant, such as the enforcement debtor's employer (if the enforcement debtor is an individual) or financial institution.
There are different rules about how the different types of warrants must be served.
You may choose to engage an officer of court to serve the warrant. A warrant for the seizure and sale property must be executed by an officer of the court. If you engage an officer of the court, you will need to pay a deposit of money as security for any costs the officer may incur in executing the warrant. This service can be engaged by contacting the Registry.