CANADA, May 1 - New legislation will make it easier for people to get money owed to them following a civil court decision.
The proposed money judgment enforcement act will streamline the process for people collecting money owed to them through the courts or tribunals such as the Residential Tenancy Branch (RTB) or Civil Resolution Tribunal. This will reduce the need for people to involve the courts in the collection process.
“When the courts or tribunals rule in your favour, you should be able to get what is owed to you,” said Niki Sharma, Attorney General. “But we know many people, including renters and landlords, are then faced with the difficult, time-consuming and often expensive task of collecting on the debt. This new legislation will lessen the burden on people who are awarded money and help ensure the timely delivery of money owed.”
Currently, people who are awarded a money judgment must make a court application for each method used to collect funds if the person ordered to pay does not voluntarily comply with the judgment. Methods to collect funds include garnishing wages, garnishing funds in bank accounts, seizing and then selling personal goods and putting liens on personal property. Currently, requesting the garnishment of wages requires a new court application every two weeks, which can be time-consuming and expensive for the person pursuing collection. Under the new act, employers will receive a single notice to garnish a percentage of wages that will remain valid indefinitely.
In 2022, the RTB awarded approximately 4,800 money judgments to landlords and renters, compared to approximately 4,100 in 2021. Feedback from those trying to recover money through the court system indicates that many people don’t pay these judgments. Because of the complicated collection process, many people give up on collection before the full amount awarded is received.
“We hear all too often that when money is awarded through an RTB decision, it can take months or even years for people to collect,” said Ravi Kahlon, Minister of Housing. “By simplifying the collection process, people can have confidence they will be able to more quickly get what is owed to them so both parties can move on with their lives.”
The proposed legislation enables money judgments to be enforced with a single enforcement instruction after a person registers in a searchable public registry. This eliminates the need to apply to the court multiple times to pursue collection. Tribunal orders will automatically be entered in the registry and enforced, instead of having to first be registered with the court.
The registry will serve as a one-stop shop for information about previous money judgments, including the current amount owing and commercial liens.
In addition, certain types of property, not contemplated in the old legislation, will be able to be seized, such as crops and co-owned property.
The legislation will also ensure collection is carried out equitably. Additional protections have been introduced to ensure that people owing money and their dependants can maintain a basic standard of living. This includes expanding the list of items exempt from seizure and moving certain details of the exemptions to regulations, to ensure exemption amounts can more easily be adjusted over time to reflect inflation.
The legislation is based on recommendations from the Uniform Law Conference of Canada and the British Columbia Law Institute. The new legislation will update and replace much of the current Court Order Enforcement Act.
Quick Facts:
- Alberta and Saskatchewan have already enacted similar legislation.
- Enactment of this legislation should make things more consistent for organizations operating throughout western Canada.
- The bill is expected to be brought into force through regulation in 2025.
Learn More:
To view the BC Law Institute Report on the Uniform Civil Enforcement of Money Judgments Act, visit: https://www.bcli.org/publication/37-report-uniform-civil-enforcement-money-judgments-act/
