Precautionary attachment is an interim measure placed on a debtor's assets before an action or enforcement proceedings, in order to secure recovery of a claim. Its purpose is not to collect the debt but to stop the debtor disposing of assets, so that the judgment finally obtained is not left worthless.
The subject is governed by Enforcement and Bankruptcy Law No. 2004. What distinguishes the measure is not its speed but the strictness of its time limits: obtaining the order is not enough — the steps listed in the law must be taken on time. Otherwise the attachment lapses of its own accord.
When is it available?
The rule is a monetary debt that is due and not secured by pledge. A creditor meeting those conditions may obtain precautionary attachment over the debtor's movable and immovable property, receivables and other rights, whether held by the debtor or by a third party.
For a debt not yet due, it is available in only two situations:
- Where the debtor has no fixed place of residence.
- Where the debtor, in order to escape their obligations, prepares to conceal or remove assets or to abscond, or does abscond; or engages in fraudulent transactions to that end which infringe the creditor's rights.
Where attachment is granted in those two situations, the debt — in the words of the statute — falls due as against that debtor alone. The maturity is, in effect, brought forward for the creditor against that debtor.
Which court, and what standard of proof?
Precautionary attachment is ordered by the court determined under the general venue rule of enforcement law. The creditor must produce evidence sufficient to satisfy the court as to the claim and, where necessary, as to the grounds for attachment.
The standard here is not full proof; it is enough that the court is satisfied. That is what makes the measure fast. For the same reason the law leaves the court free to decide whether or not to hear both parties: the order is often made without the debtor being notified.
Where the application is refused, the decision is given with reasons and an appeal lies. A party against whom attachment is ordered in their presence may also appeal. The regional court of appeal examines such applications as a priority and its decision is final.
Security
A creditor seeking precautionary attachment is liable for all loss suffered by the debtor and by third parties if the attachment proves unjustified, and as a rule must provide security.
The law lays down two exceptions:
| Basis of the claim | Security |
|---|---|
| Based on a judgment | Not required |
| Based on a document equivalent to a judgment | The court decides whether it is needed |
| In other cases | Required |
The amount of security is not fixed by the law; it is for the court. An action for damages may also be heard by the court that ordered the attachment.
After the order: the ten-day execution period
Obtaining the order does not end matters. The creditor must request execution of the order from the enforcement office within the judicial district of the ordering court within ten days of the date of the order.
The sanction is severe: otherwise the order lapses of its own accord. It remains on file but is of no effect. Complaints concerning execution are made to the enforcement court to which the executing office is attached.
The critical point: the seven-day duty to proceed or sue
A creditor who obtains precautionary attachment before bringing an action or commencing enforcement must act to make the attachment permanent. The law lays down several seven-day periods here, each running separately.
| Situation | Period runs from | What must be done |
|---|---|---|
| Attachment carried out | Execution of the attachment; if done in the debtor's absence, service of the record | Commence proceedings or bring an action within seven days |
| Debtor objects to the payment order | Service of the objection on the creditor | Seek removal of the objection or bring an action within seven days |
| Enforcement court refuses removal | Pronouncement or service of that decision | Bring an action within seven days |
| Attachment obtained during proceedings | Service of the judgment on the merits | Commence proceedings within one month |
The debtor's objection
A debtor against whom attachment has been ordered without being heard may object not to the order as a whole but to three matters listed in the law: the grounds on which the attachment rests, the court's jurisdiction, and the security.
The period is seven days. It runs from the date the attachment was carried out where the debtor was present, and otherwise from service of the record of attachment on them. Third parties whose interests are infringed may likewise object, within seven days of learning of the attachment, to the grounds or to the security.
The court examines only the grounds raised; the objecting party must attach all documents relied on to the petition. Both parties are summoned and those who attend are heard; if neither attends, the matter is decided on the papers.
How the debtor can have it lifted
The debtor has a second route: seeking removal of the attachment by providing security. The law lists what is acceptable — depositing money, a pledge accepted by the court, shares or bonds; or providing an immovable pledge or a reputable bank guarantee.
The competent authority depends on the stage: the application is made to the court initially, but once enforcement proceedings have begun that power passes to the enforcement court.
If another creditor also attaches
Where property under precautionary attachment is attached by another creditor before the precautionary attachment has become a definitive one, the holder of the precautionary attachment participates in that attachment automatically and provisionally. No separate application is needed.
The law also sets a limit: precautionary attachment confers no other right of priority. It secures a place in the ranking but gives the claim no preference. Where a precautionary or executory attachment precedes a pledge, no attachment — including one for a public claim — may participate in the attachment preceding the pledge. The costs of the precautionary attachment are taken from the sale proceeds.
Frequently asked questions
- Can I obtain attachment for a claim not yet due? Only in two situations: where the debtor has no fixed residence, or is preparing to remove assets or abscond.
- Will the debtor be notified? The law leaves the court free to decide whether to hear both parties; the order is often made without hearing the debtor.
- Must I provide security? Not where the claim is based on a judgment. Where it rests on a document equivalent to a judgment, the court decides. Otherwise security is required.
- How long do I have to execute the order? Ten days. If execution is not requested from the enforcement office within that period, the order lapses.
- The attachment has been carried out — what next? Proceedings must be commenced or an action brought within seven days.
- Does the attachment fall away if the debtor objects? Not automatically; the court examines only the grounds raised. Nor does an appeal suspend execution.
- As the debtor, how can I have it lifted? By depositing money, a pledge, shares or bonds, or by providing an immovable pledge or a reputable bank guarantee.
- Does it give me priority? It secures a place in the ranking, but the law states that precautionary attachment confers no other right of priority.
- What if another creditor attaches? You participate automatically and provisionally in an attachment made before yours becomes definitive.
How we work on these files
Before the application we assess the basis of the claim in terms of the security requirement and identify the assets over which attachment should be sought. Once the order is obtained we track the ten-day execution period and the carrying out of the attachment, and then take the seven-day step of commencing proceedings or bringing an action in time. Where the debtor objects we conduct that process; in portfolios of many files we ensure these periods are tracked file by file.