Services / Enforcement and asset recovery
Seizure and auction: act before the hammer falls
Owners of seized property usually start looking for a remedy after the sale, which is the moment the law has already closed the door on the point that matters most: the price.
The time available before the sale
The second paragraph of section 331 of the Civil Procedure Code requires the execution officer, before the sale, to notify the date, time and place to all parties interested in the execution as they appear from the register or otherwise, and provides that the date must be not less than sixty days from the seizure, attachment or delivery of the property. Those sixty days are the time actually available to do something.
The right to bid, or to bring a bidder
The third paragraph of section 331 states expressly that, so the auction may be conducted fairly, a person interested in the execution has a full right to bid personally or to bring another bidder in order to obtain the price they want. This is a real tool the statute provides, but it has to be arranged in advance: finding a buyer and having funds ready is not something done on the day.
The door that closes at the hammer
The same paragraph closes by providing that once the execution officer has knocked the property down to the highest bidder, no interested party may raise the inadequacy of the price obtained as a ground for setting the sale aside. An objection on price therefore has to be made before the hammer falls, not after.
The section number has changed
A caution: objections to the price used to sit at section 309 bis, and a good deal of older material still cites it. The provision in force is section 331, which sets the rules differently. Reading the older commentary therefore gives a mistaken picture of both the steps and the timing.
What to do as soon as property is seized
First, obtain the seizure report and the execution file, to see what was seized, at what valuation, and when the sale is set. Second, check whether the property falls within the exemptions, and whether someone else owns it or has an interest in it. Third, check that the sum being enforced is correct. All three have to be dealt with inside the window before the sale.
PREPARE
What to bring
- The seizure report and the notice of sale
- Title documents for the property seized
- Evidence that someone else has an interest, if any
- An independent valuation to set against the official one
- The judgment sum and the record of payments already made
QUESTIONS
Questions this raises
It sold far below market value. Can the sale be set aside?
The third paragraph of section 331 bars an interested party from raising inadequacy of price as a ground for setting the sale aside once the hammer has fallen. An objection on price must therefore come before the sale. Grounds unrelated to price, such as an irregularity in the execution process itself, are a separate question turning on the facts.
The property seized is mine, not the debtor's.
That is a third-party claim, a separate process with its own timing. What is needed is evidence of ownership predating the seizure, and it should be acted on as soon as it is known, because once the property has been sold putting it right becomes far harder.
LAW
The legislation
- Civil Procedure Code, section 331
ENQUIRIES
