Germany

Displaying items by tag: European Enforcement Services

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Spain

Spain

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Published in Connexx
Tuesday, 16 April 2013 18:16

Germany

Germany

BAYH & FINGERLE Rechtsanwälte in Partnerschaft

(lawyers in civil partnership according to German law)

BAYH CM (= collection management) is the debt collection branch of BAYH & FINGERLE, a lawyer’s chambers being specialised and active in the field of debt collection since 1983.

Covering debt collection on a national level

BAYH CM is one of the nationwide leading firms in this business with commercial clients all over Germany. For years BAYH CM has served international clients, too, in recovering open claims in Germany.

Staff

The debt collection departments are situated in Stuttgart and Hamburg. There are 4 lawyers exclusively working in debt collection as well as 16 other staff members.

Debt Collection in Germany

Why do you find among all the judicial officers being members of CONNEXX law firm? In Germany there are no self employed judicial officers but only court bailiffs who are government employees. They are commissioned by the law courts and are just allowed to act in the course of forced execution according to the orders of the court. Hence debt collection is an area of activity of law firms.

Amicable Debt Collection

Usually we introduce debt collection by one up to three extra judicial reminders and – if requested – by a telephone call to the debtor. The reminders are automatically carried out in between intervals of 10 days or as accorded with the client.

In accordance with its CONNEXX partner, BAYH CM offers to their clients in case of unsuccessful amicable debt collection, costs that are limited to a lump sum of 50,00 EURO (without vat). If the client wishes supplementary inquiries the costs for these are added.

Inquiries and Solvency Researches

We recommend to our clients to have a solvency research commissioned particularly within higher claims. Different possibilities can be offered within a price range up to 8,00 EURO up to 230 EURO to obtain solid data about the debtor.

Legal Dunning Proceedings

According to the general experience in debt collection more than 90 % of all claims rest undisputed. But in case the amicable reminders remain without success we usually recommend to our clients the introduction of legal proceedings. In European-wide cross boarder collection we’d mostly refer to the European Enforcement Order where we cooperate with our CONNEX-partners. Depending on the lieu of jurisdiction, and depending on the national law to be applied to in the individual case, we intent to provide the best solution to the client.

It could also be considered to revert on the special German dunning proceeding (gerichtliches Mahnverfahren) especially when the debtor is a consumer or / and there is need of hurry and the proceedings refer to German lieu of jurisdiction. Compared to the European Payment Order-procedure it might be possible to obtain a provisionally enforceable title in Germany in a shorter lap of time.

In opposition to the European Enforcement Order dunning proceedings in Germany take place in two stages; the first step is entered with a so called court order (Mahnbescheid). This, the debtor can appeal against (Widerspruch) in between a deadline of 14 days after service. If he doesn’t do so we demand for the creditor the provisionally enforceable payment order (Vollstreckungsbescheid). The debtor still has the possibility for an opposition against the payment order in a deadline of 14 days, yet execution can be introduced. The steps we have to take for our clients are automatically processed.

The costs depend on the value of the claim. The court fees are statutorily regulated as well as those for the lawyers, each based on a sliding scale. We might give you some examples:

Disputed claim in € Court fees in € Lawyer’s fees in €
500,00 23,00 81,00
1.000,00 27,50 147,50
5.000,00 60,50 471,50
10.000,00 98,00 749,00
50.000,00 228,00 1.589,00
100.000,00 428,00 2.051,00

The lawyer’s fees don’t include VAT.

In case of an appeal against the court order the case will be disputed and transferred to the responsible law court.

It has to be highlighted that the debtor is obliged to reimburse all the costs from the creditor being based on legal fees that occurred in dunning proceedings if there is no opposition. This also applies for the lawyer’s fees.

If it was evident that the continuation of the case would be without success the client is free to end the activities. In accordance with its CONNEXX partners, BAYH CM will charge for its own service a lump sum of 50,00 EURO (without vat). In addition to this, disbursements for court fees would have to be paid for.

Legal Proceedings in Disputed Claims

As law firm BAYH & FINGERLE is naturally authorized to introduce legal proceedings in disputed cases at all the law courts in Germany, except from the Federal Law Court (Bundesgerichtshof) where only a restricted number of laywer’s are admitted who are exclusively active only there.

The lawyers of BAYH CM are all specialized in and have experience in running court proceedings also in cases with points of contact to the international private law and the international civil procedure law. Although BAYH CM is able to provide a high standard of representation in court proceedings, the main ambition is not a performance of long rows of arguments in a number of never ending court hearings but to obtain for the client a reasonable economic solution.

Here we do have to point out a particular characteristic of German court proceedings: the court is legally obliged to induct a settlement between the parties on every stage of the proceeding (e. g. par. 273 (4) of the German Civil Procedure Code). That specialty is what foreign clients have to get used to especially from Roman countries where the parties “either live or die”. But the parties are not forced to agree in a settlement if they don’t feel to do so. BAYH CM are used to weigh all pros and cons with their clients in order to achieve a economically satisfying solution.

By the way: the non-negligible number of settlements is one of the reasons why court proceedings in Germany don’t take as much time as in other countries.

Concerning the costs of the procedure here can be referred to the explanations above for the dunning proceedings. Basically the legal rules are applied. Because of the higher time and effort the costs are superior compared with those for the dunning proceedings. Her again some figures:

Disputed claim in € Court fees in € Lawyer’s fees in €
500,00 105,00 132,50 - 177,50
1.000,00 165,00 232,50 - 317,50
5.000,00 363,00 772,50 - 975,00
10.000,00 588,00 1.235,00 – 1.721,00
50.000,00 1.368,00 2.635,00 – 3.681,00
100.000,00 2.568,00 3.405,00 – 4.759,00

All prices mentioned above don’t include vat.

It is important to explain that the legal lawyers fees represent a minimum level. BAYH CM is granting the legal fees in disputed cases in general where the procedure is restricted on application and initiation of procedures and one court hearing. In case of higher efforts BAYH CM will ask their clients for an hourly rated remuneration. The costs depend on the individual case. One can calculate with an average of 220,00 EURO per hour.

Again it has to be underlined that the creditor is entitled to claim from the debtor to restore the legal fees in case he wins the case but not the exceeding costs based upon the remuneration contract.

Forced execution

We already explained above the system of forced execution in Germany. The creditors – mostly represented by their lawyers - in possession of an enforceable title do have to address the local court (Amtsgericht) responsible for the execution, the so-called Vollstreckungsgericht. Quite usually that is the court where the debtor is situated. The creditor has to ask for the kind of execution, in general beginning with the seizure.

The body competent to carry out the execution is the court bailiff.

As law firm specialised in the field of debt collection it is the ambition of BAYH CM to render to its clients a developed service in execution. An analysis of the creditor’s liquidity, earnings and asset situation can be made based on solvency checks before the introduction of the execution. Proposals will be forwarded on which way of execution could be the most effective.

The debtor is obliged to bear all expenses that occur to the creditor in course of forced execution. Although BAYH CM always intents to prevent superfluous activities and costs, the solvency of the debtor is not always guaranteed. Costs and fees in execution are again regulated legally. According to German law the debtor is obliged to compensate all legally regulated costs arising to the creditor in course of the execution.

Here too, BAYH CM offer to their clients in accordance with its CONNEXX partners in case of an unsuccessful execution the limitation of costs restricted to a lump sum of 50,00 EURO (without vat) and disbursement.

In seldom and exceptional collection cases, in case of further and costly in term of time measures (e. g. the seizure of shipping and execution levelled on real property) BAYH CM asks its clients for a reimbursement agreement based on an hourly rated fee of in general 150,00 EURO per hour.

Title monitoring

BAYH CM at last offers clients the possibility of title monitoring. A first attempt of execution might not always be successful. The claim out of a legally binding title last 30 years according to German law. If the execution reveals that a debtor – here a natural person - is not able to fulfil his duty, the creditor is entitled to demand from the debtor’s issue of an affidavit. This action has to be recorded in the debtor’s register. The registration accounts for a period of three years that a bailiff will not accomplish further executions in this time (apart that the creditor supplies him with solid information about an improvement of the debtor’s income- and asset situation.

Title monitoring implies that BAYH CM regularly takes care for a scrutiny concerning the debtor’s economic situation after the above mentioned period. Apart from special creditor requests the title monitoring stays free of costs for the creditor. The remuneration is based on a participation of 50 % after deduction of the expenses incurred.

For more information visite our website www.bayh-fingerle.de

Published in Connexx
Tuesday, 16 April 2013 18:15

Estonia

Estonia

According to the Estonian law of enforcement procedure the judicial officers, who carry out execution proceedings, are called bailiffs (in Estonian: kohtutäiturid). The bailiffs have independent and liberal status. The profession and admission to it are strictly regulated – bailiffs are operating under deontological, disciplinary, and professional rules for which they are required to take out liability insurance coverage. They are appointed by the Ministry of Justice. There are approximately 52 judicial officers, spread across the sixteen regions that make up the territory of Estonia. They are attached to a territorial jurisdiction.

There are several laws in Estonia that regulate the enforcement procedures. The most basic law that bailiff relies on in the procedures is the Code of Enforcement Procedure (hereinafter referred to as CEP). Enforcement proceedings can only be started on basis of certain enforcement instruments (for example court judgments and rulings; administrative acts; notarized agreements and so on). Full list is stated in section 2 of the CEP. With each enforcement instrument the bailiff is obliged to check, whether the enforcement instrument complies with the requirements of law. Nevertheless the bailiff does not have the right to substantively analyze the claim. Therefore one of the fundamental principles of enforcement procedures is formalization, which basically means that the bailiff is justified to give legal opinions only on the matter concerning the enforcement procedures and their compliance with law, but no more. So if any question arises about the warranty of the claim then the debtor and the claimant have to sort it out between themselves or with court’s aid.

Starting of enforcement proceedings

Enforcement proceedings are usually started on the basis of application for enforcement and the enforcement instrument. In addition to formal check of enforcement instrument it is important to verify whether the debtor (or debtor’s property) resides in bailiff’s territorial jurisdiction. In Estonia there are four territorial jurisdictions (Harju, Pärnu, Tartu, Viru).

After opening the enforcement file bailiff delivers an enforcement notice to a debtor. There are several ways of delivering the documents to the debtor including personal delivery, delivery via e-mail, internet and so on.

Term for voluntary compliance and bailiff’s fee

After the documents are delivered the debtor will always be given some time to pay the claim or voluntarily comply with the enforcement instrument with the enforcement instrument. According to CEP §25 subsection 1 the term for voluntary compliance cannot be shorter than 10 days or longer than 30 days. The term can be prolonged with the consent of a claimant.

During the term for voluntary compliance the bailiff does not usually take any additional measures and waits for the debtor to pay the debt voluntarily. When the term for voluntary compliance has passed and the debtor has not complied with the enforcement instrument, the bailiff has to move on with enforcement proceedings and take immediately all the measures permitted by law in order to enforce an enforcement instrument, collect information necessary for enforcement proceedings and explain the rights and obligations of participants in enforcement proceedings to participants (CEP §8). In Estonia it is quite beneficial for the debtor to comply with the enforcement instrument during the term for voluntary compliance because the debtor has actual financial interest in this. If the requirement is fulfilled during the term for voluntary compliance then the debtor is required to pay the bailiff’s fee only in the amount of one-half of the fee prescribed by law (hereinafter referred to as BA). The bailiff’s fee is usually paid by debtor (BA § 30). The size of bailiff’s fees are fixed by law and the law forbids the bailiff to make any other agreements on this matter – a bailiff is prohibited from entering into agreements to alter the rates of fees or the procedure for the charging of fees provided by law.

According to BA the bailiff’s fee in Estonia is divided into three parts: fee for commencement of enforcement proceedings, basic fee and additional fee. Basic fee is the one fee component that depends on the amount of claim for payment and it is calculated according to the § 35 of the BA. Value added tax (20%) is added to the bailiff’s fee

As mentioned, if the term for voluntary compliance has passed and the debtor has not complied with the enforcement instrument, the bailiff is obliged to immediately take all the measures permitted by law in order to enforce an enforcement instrument. The permitted measures are different and vary depending on different factors - enforcement instrument, the size of the claim etc.

Seizing debtor’s account

CEP provides the ground for making claim for payment on debtor’s account or in other words seizure of the debtor’s bank accounts, which results in the fact that the debtor cannot withdraw or in any other way use the money on his or her account until the claim is fulfilled. In Estonia the seizing of accounts is done mostly electronically According to CEP the debtor has the right for the minimum monthly wage (290€) not to be seized. If a debtor maintains another person or pays alimony to him or her, the amount not subject to seizure increases by one-third of the minimum monthly wages per each dependant unless a claim for support for a child is subject to compulsory execution (CEP §132). It is debtor’s responsibility and obligation to inform the bailiff about debtor’s incomes and the bank that debtor wishes to withdraw his or her monthly wage. Therefore the debtor has to make an application to the bailiff and add necessary documents to the application. The bailiff annuls the seizure of the account within three working days to the extent, which guarantees the income not subject to seizure, for the debtor per each prepaid month or informs the debtor about the necessity of presenting additional documents.

Seizing debtor’s income

This also applies in case of seizing debtor’s income. In order to make a claim for payment on a claim, a bailiff seizes the claim and obliges a third person who has obligations to a debtor to perform the obligations to the bailiff for the benefit of a claimant. The bailiff, by an instrument of seizure, prohibits the debtor from disposing of the claim, in particular from collecting the claim. Third person is obliged to comply with the seizure act. If the third person refuses without legal basis to enforce the instrument of seizure or does not enforce it as required, the bailiff has the right to make a decision for performance of obligation and a warning concerning the imposition of a penalty payment. Penalty payment is payment, which is applied if the third person fails to enforce the instrument of seizure without appropriate legal basis. The penalty payment is collected into the state budget. The amount of penalty payment, which is imposed for the first time, is not less than 192 Euros or more than 767 Euros and upon a repeated imposition the payment is not more than 1917 Euros.

Seizing of debtor’s assets

The bailiff has the right to make claim on debtor’s other assets, movables and immovables. Upon seizure, the asset is be evaluated and the price is be indicated in the instrument of seizure. Property is evaluated with the agreement of a debtor and a claimant. If the parties do not reach the agreement, then the property is going to be evaluated by bailiff or by an expert.

Selling of debtor’s assets

According to CEP the property can be sold using different methods. Public auction, for instance, can be written, oral or electronic (according to CEP § 78). The time and the place of the auction are determined by bailiff. Everybody has the right to participate and make bids. In the case of an auction of an immovable, a bailiff may determine deposit for the auction participants in the amount of up to 10 per cent of the starting price. If deposit is determined, a person who wishes to participate in the auction is obliged to pay the deposit. Best bidder wins the auction and he or she has to pay the purchase price immediately after the end of the auction. If the purchase price exceeds 12,700 Euros, the winner of an oral auction is obliged to pay one-tenth of the purchase price immediately after the end of the auction, the rest of the price shall be paid within 15 days. If a purchaser wishes to buy an asset sold at an auction by a loan granted by a credit institution, he or she has to notify a bailiff thereof immediately after his or her bid is declared to be the best. The purchaser undertakes to pay the total purchase price or ensure performance of the obligation to pay the purchase price by a credit institution within fifteen days as of the day following the date the bid is declared to be the best. A bailiff prepares a report on an auction which is signed by the bailiff and impartial observers.

Upon failure of an auction, a claimant may demand that a repeated auction be organized. In case of the repeated auction the bailiff may reduce the price of things, but not more than by 25 per cent compared to the starting price of the previous auction (CEP § 100 subsection 5). The bailiff has the right to repeatedly organize the auction until the price of the asset has been reduced up to 70 per cent compared to the starting price at the first auction.

It is also possible to sell the property in other manner – for example the debtor can find a buyer for the property and sell it under the supervision of a bailiff.

Termination of the case

Basic grounds for terminating the enforcement procedures are stated in CEP § 48 according to which the proceedings are terminated on the following basis:

1) on the basis of an application of a claimant;

2) upon submission of a written document if it is evident from the document that the claim of the claimant has been satisfied;

3) if money required for the satisfaction of a claim has been paid to the bailiff or an action indicated in the enforcement instrument is performed;

4) upon submission of a court decision by which an enforcement instrument accepted for enforcement or an obligation to immediately enforce it is revoked or compulsory enforcement is deemed to be inadmissible or termination of the compulsory enforcement is ordered;

5) upon submission of a written document if it is evident from the document that a security necessary to prevent enforcement is provided;

6) in the case of the death or termination of a claimant or debtor if the claim or obligation cannot be transferred to the successors or legal successors of the deceased;

7) upon unjustified commencement of enforcement proceedings due to failure to comply with the conditions of enforcement proceedings;

8) on another basis provided by law.

Complaints

At all stages of the enforcement procedure the debtor has the right to make a complaint about decisions and activities of bailiff. The complaint has to be made within 10 days as of the day, on which the complainant becomes or should have become aware of the decision or action of the bailiff. A bailiff shall review a complaint about the activities of a bailiff in the presence of the participants in proceedings within 15 days and make a decision within 10 days after the review. A bailiff shall inform the participants in proceedings of the time of review of a complaint. Failure of participants in proceedings to be present at the examination of the complaint shall not constitute an impediment to the review of the complaint. A bailiff makes a reasoned decision concerning a complaint and delivers it to the participants in proceedings.

It is important to note that the participant cannot file an appeal to a court without making a complaint to the bailiff beforehand. It is important mostly because it gives the bailiff the opportunity to notice a possible mistake and to correct it. Therefore the work load of courts is thus reduced. The participant may file an appeal against a decision of a bailiff made regarding a complaint to a county court in the jurisdiction of which the bailiff’s office is located within 10 days as of the delivery of the decision.

Language

The official language for communication in enforcement procedures is Estonian. The bailiff is not obliged to translate the documents, give the explanations or accept the documents in foreign languages. Complaints are accepted only in Estonian. In informal conversations some exceptions could be made, depending on the matter and the bailiff's understanding of the foreign language.

The enforcement instruments are accepted in Estonian and English. Nevertheless the bailiff has the right, if such necessity becomes evident, to demand translation of the documents to Estonian language.

Elin Vilippus

Published in Connexx