In an earlier Sheriffs Office article I wrote about the HCEO’s rights of entry. This article now deals with what can be taken when goods of the debtor are found.
It is the duty of the HCEO or Certificated Bailiff to seize the goods of the debtor in order to sell (normally at auction) and raise the money to clear the debt. This however is a ‘means to an end’ and in reality goods are rarely removed as this very action prompts the debtor to make the payment that is due.
Depending on the type of debt, enforcement may be via a County Court judgment transferred to the High Court for a writ of Fi-Fa or a warrant to distrain for commercial rent.
The HCEO or Certificated Bailiff can seize a wide range of goods including but not limited to:
- Vehicles, Boats and Aeroplanes
- Stock and Machinery
- Household Furniture
- Jewellery and Art
- Money, bank notes and promissory notes (cheques)
- Bonds, shares and deeds
- Livestock and animals
- Jointly owned property (i.e. goods owned by a married couple)
- Items held by the police
- Goods on finance (providing sale is agreed by the finance company)
The main areas where items cannot be seized are:
- Bedding, clothing, furniture and provisions that the debtor and their family need for a basic level of domestic life.
- Perishable goods: refrigerated foodstuffs, fresh flowers etc.
- Tools of the trade: those needed by the debtor to do their job or run their business, for example tools, books, vehicles etc.
However, these goods must be used solely by the debtor for the purposes of his or her work to fall under ‘tools of the trade’. For example, a commercial van that is also used by the debtor’s spouse is available for seizure.
Recently we removed a commercial van from an individual trading as a general builder who subsequently claimed it to be a’ tool of the trade’. It was found that the vehicle was un-taxed so therefore could not be legally used on the road. Consequently, it was sold and the sums recovered cleared the debt in full.
It is worth noting that ‘tools of the trade’ cannot be claimed by Limited companies.
However, the HCEO or Certificated Bailiff may take luxury or items of value that are needed for basic domestic life and replace them with similar goods of a lower value. This form of enforcement whereby removal and replacement takes place is extremely unusual.
Having seized goods, the HCEO or Certificated Bailiff can either take the goods away there and then or leave them on the premises for collection at a later time if necessary.
If goods are not removed the debtor is asked to sign a statement, known as a Walking Possession Agreement, confirming that neither they nor anyone else will remove or damage the goods and that they will let the enforcement officer re-enter the premises at any time to inspect or remove the goods. Again, in reality, it is payment that is sought.
If it is claimed that some of the items belong to a third party then they may make applications to the Sheriff, Landlord or Court as necessary. Interpleader proceedings may be needed resulting in a costly legal fees that can often run into many thousands negating any value of the goods seized.
If the debt is not paid in an agreed timescale, the HCEO or Certificated Bailiffs will remove and sell the goods, taking their lawful fee, costs and charges from the money raised and the balance is given to the creditor. If there is any money left over from the sale after this, this is returned to the debtor.
If the goods sold do not cover the total sums now due, the HCEO or Certificated Bailiff may return to the debtor’s property (and any others that may contain their assets) to seek further goods to seize and sell accordingly.
In a recent case, the HCEO returned 9 months after the sale of a debtor’s vehicle to find he had replaced it with another. Again, the debtor refused payment so this vehicle was also seized, removed and sold, clearing the debt in full.
There is one other area where goods cannot be seized, but we don’t come across it too often – works of art on loan from other countries to UK galleries and museums are immune from seizure!
I would just reiterate that removal of goods is very much a last resort and is avoided if at all possible. To prove this, less than 1% of our cases in the last 12 months have resulted in removal.