{"id":7712,"date":"2020-07-01T16:12:37","date_gmt":"2020-07-01T08:12:37","guid":{"rendered":"http:\/\/alexchanglaw.com\/?p=7712"},"modified":"2021-06-19T18:26:47","modified_gmt":"2021-06-19T10:26:47","slug":"garnishee-proceedings-nicholas-lee-heng-jin","status":"publish","type":"post","link":"https:\/\/alexchanglaw.com\/index.php\/garnishee-proceedings-nicholas-lee-heng-jin\/","title":{"rendered":"Garnishee Proceedings"},"content":{"rendered":"\n

Versi Bahasa<\/a><\/p>\n\n\n\n

\u4e2d\u6587\u7248<\/a><\/p>\n\n\n\n

  1. What are Garnishee\nProceedings?<\/strong><\/li><\/ol>\n\n\n\n

    A garnishee proceeding is\na form of judgment enforcement procedure used to pursue judgment debts, normally\nwhen a respondent fails to comply with a monetary judgment obtained by a\nclaimant. <\/p>\n\n\n\n

    The rules governing these\nproceedings are provided under Order 49 of the Rules of Court 2012.  <\/p>\n\n\n\n

    The three parties generally\ninvolved are the judgment creditor, judgment debtor and the garnishee. <\/p>\n\n\n\n

    1. The judgment creditor<\/strong> is the person to which a debt is owed. He or she has\nobtained an order for the payment of money against the judgment debtor. <\/li>
    2. The judgment debtor<\/strong> is the person against whom the judgment was made.\nHe or she is obligated to satisfy the judgment debt. <\/li>
    3. The garnishee<\/strong> is the third party who has debt due or accruing due to\nthe judgment debtor. <\/li><\/ol>\n\n\n\n

      The judgment creditor who\nhas obtained a judgment for the payment of money against a judgment debtor may\napply to the court to obtain a court order to instruct the garnishee, a third\nparty indebted to the judgment debtor, to pay the debt which is due or accruing\ndue to the judgment debtor, to the judgment creditor.<\/p>\n\n\n\n

      Lim Beng Choon J in the\nHigh Court in Kedah Kelang Papan Sdn Bhd\nv. Hansol Sdn Bhd (Teknibina Advisory Services Sdn Bhd, Garnishee)<\/em> [1988] 1\nCLJ Rep 645; [1988] 1 MLJ 434, at 437 had established that no garnishee order\ncan be made unless some person at the time when the order is made, is indebted\nto the judgment debtor. It must be shown that there is a debt, merely showing\nthat it is very probable that there soon will be a debt is insufficient. <\/p>\n\n\n\n

      The Federal Court has also\napproved the case of Binamin MJC Quarry Sdn Bhd v. Way Soon Construction Sdn\nBhd <\/em>[2001] 6 CLJ 213 HC which\nestablishes that there must be a crystallised actionable debt by the garnishee\nto the judgment debtor before an absolute garnishee order could be given. Furthermore,\nthe debt has to be distinctively or clearly identifiable and not lumped with\nthe debts of third parties so that the debt can be attached and the terms of\nthe garnishee order must also be precise, as established in Bumiputera-Commerce\nBank Bhd v. Top-A Plastic Sdn Bhd<\/em> [2008] 5 CLJ 737; [2008] 5 MLJ 34.<\/p>\n\n\n\n

      This proceeding can also\nbe used to garnish the debtor\u2019s bank account as provided for in O. 49 r. (1). The\ngarnishee application will seek a court order to direct the debtor\u2019s bank to attach\nan amount from the debtor\u2019s bank account sufficient to satisfy the judgment\ndebt owed to the judgment creditor. <\/p>\n\n\n\n

      The total amount payable by\nthe garnishee is limited to the judgment amount owing by the judgment debtor to\nthe judgment creditor and the costs of the proceedings. <\/p>\n\n\n\n

      • Application Process for a\nGarnishee Order <\/strong><\/li><\/ul>\n\n\n\n

        To commence garnishee proceedings,\nthe judgment creditor can first apply to the court for a show cause order under\nForm 97.  An application for a garnishee\norder is then made by filing an ex-parte notice of application supported by an\naffidavit in Form 98.  <\/p>\n\n\n\n

        A garnishee order functions\nto summon the garnishee to court and to show cause as to why the order should\nnot be made against him or her. This order to show cause is to be served to the\ngarnishee and the judgment debtor at least seven days before the hearing of the\napplication. <\/p>\n\n\n\n

        In the High Court case of Pernas Trading Sdn Bhd v.\nSenali Construction Works Sdn Bhd & Anor<\/em> [1991] 3 CLJ (Rep) 439, Peh\nSwee Chin J held that a garnishee has the evidential burden to show cause why\nthe garnishee order nisi should not be made absolute.<\/p>\n\n\n\n

        A garnishee may dispute\nthe application made by the judgment creditor for various reasons namely the\ngarnishee ceased to owe the judgment debtor any debt, the judgment debtor\u2019s\naccount with the garnishee bank is held on trust for a third party or that the\njudgment debtor\u2019s bank account is jointly held with another account holder. In\nthe event a garnishee fails to show cause, the court may make grant the order.<\/p>\n\n\n\n

        If the garnishee fails to\nattend court and dispute the debt due, then the court may make a garnishee\norder absolute on Form 99. However, if the garnishee does attend court and\ndisputes liability to pay the debt due, the court then has a wide discretion to\neither decide the matter summarily or fix the matter for trial, thus attaching\nless significance to the Evidence Act or full trial procedure. <\/p>\n\n\n\n

        All payments by the\ngarnishee in compliance with the garnishee order is considered a valid\ndischarge of the garnishee\u2019s liability to the judgment debtor to the extent of\nthe amount paid to the judgment creditor. After the payment is completed, the\njudgment debtor loses its right to demand payment from the garnishee again. <\/p>\n\n\n\n

        • Prohibitions <\/strong><\/li><\/ul>\n\n\n\n

          There are several\nrestrictions which prohibit certain funds from being garnished:<\/p>\n\n\n\n

          For one, according to\nSection 35 of the Government Proceedings Act 1956, garnishee proceedings cannot\nbe taken up against the government. Therefore, the judgment creditor is unable\nto compel the government to pay the debts to him or her.  <\/p>\n\n\n\n

          All payments or amounts of\ncontributions under the Employees Social Security Act 1969 cannot be attached\nto garnishee orders according to section 41 of the Act. <\/p>\n\n\n\n

          According to Section 11 of\nthe Workmen\u2019s Compensation Act 1952, no payment payable under this Act is\ncapable of being attached to a garnishee order or be passed to any person other\nthan the workman by operation of law.  <\/p>\n\n\n\n

          According to section 31 of\nthe Employment Act 1955, the court shall not authorise payment of the money\ngarnished to the secured creditor until the court shall have ascertained and\ncaused to be paid the wages of such employee. <\/p>\n\n\n\n

          In the case of Binamin MJC Quarry Sdn Bhd v. Way Soon Construction Sdn Bhd; TRS Bina Sdn Bhd (Garnishee); Hong Leong Finance Bhd (Intervener)<\/em> [2001] 6 CLJ 213; [2001] AMEJ 0202, it is established that a retention sum in a construction contract cannot be subjected to garnishee proceedings when the defect liability period has not expired. <\/p>\n\n\n\n

          Nicholas Lee Heng Jin
          The University of Sheffield<\/p>\n","protected":false},"excerpt":{"rendered":"

          Versi Bahasa \u4e2d\u6587\u7248 What are Garnishee Proceedings? A garnishee proceeding is a form of judgment enforcement procedure used to pursue judgment debts, normally when a respondent fails to comply with a monetary judgment obtained by a claimant. The rules governing these proceedings are provided under Order 49 of the Rules of Court 2012.  The three […]<\/p>\n","protected":false},"author":1805,"featured_media":7696,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[67,69],"tags":[84,106],"_links":{"self":[{"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/posts\/7712"}],"collection":[{"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/users\/1805"}],"replies":[{"embeddable":true,"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/comments?post=7712"}],"version-history":[{"count":3,"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/posts\/7712\/revisions"}],"predecessor-version":[{"id":9852,"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/posts\/7712\/revisions\/9852"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/media\/7696"}],"wp:attachment":[{"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/media?parent=7712"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/categories?post=7712"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/alexchanglaw.com\/index.php\/wp-json\/wp\/v2\/tags?post=7712"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}