Reduced chances of recovering debts in execution

4. 8. 2015

On 1 September 2015, an amendment to the Civil Court and Execution Code will become effective, introducing several innovations related to the seizure of movable property in execution proceedings.

The first change is mandatory video recording during seizure of movable property. The approval of the parties to the execution proceedings will not be required for audiovisual recording, and bailiffs thus fear both the responses of debtors and increase in the costs of execution proceedings.The amendment also greatly expands the list of things that are excluded from execution by selling movable property. These include medical supplies and wedding rings, as well as common household items such as stoves or refrigerators if their value clearly does not exceed that of normal household items. However, determination of the usual price of a refrigerator, washing machine, etc. will probably cause problems in practice.

The last important change is determination of a binding order of modes of carrying out the execution. First, the bailiff must block the debtor’s bank accounts, which is followed by payroll deductions, and only then may the bailiff carry out the execution by selling movable and immovable property. However, this change may also cause problems in the form of purposeful delaying of the execution by the debtors. In the event that the execution proceedings are in the “stage” of selling the movable and immovable property, and the debtor opens a new bank account, the entire process will return to the beginning, and the bailiff will probably have to re-freeze the debtor’s accounts. For the above reasons, it is good for creditors to file the execution proposal as soon as possible or, as the case may be, before the effective date of this amendment because of the greater chance of satisfying claims against debtors.

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