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Creditors & Debtors Law - PROCEEDINGS - Practice and procedure

Thursday, December 08, 2016 @ 7:00 PM  


Motion by the husband for the return of funds paid as security for appeal costs. In September 2015, the husband paid $15,000 as security for costs of his appeal from a matrimonial property judgment. In April 2016, the husband’s appeal was allowed in part. His equalization payment was reduced by approximately $20,000. No costs were awarded to either party. The husband sought return of the monies posted as security for costs. The wife opposed the relief sought on the basis she remained owed more than $80,000 in unpaid costs plus significant arrears of child support. In addition, the wife provided copies of issued execution orders totaling approximately $30,000. The husband submitted that no judgments were registered against him in the Personal Property Registry. The husband took the position that to the extent the execution orders attached to the security monies, the monies should remain as security for costs in pending custody and access proceedings.

HELD: Motion dismissed. The husband was a judgment debtor for the purpose of the Creditors’ Relief Act. The husband’s contention that the funds were not bound for the purpose of s. 2B of the Creditors’ Relief Act was rejected, as the registration of the judgments under the Personal Property Security Act was apparent from the issuance of the execution orders pursuant to the Civil Procedure Rules. The issuance of an execution order constituted an enforcement proceeding for the purpose of the Creditors’ Relief Act. Any individual with notice of the execution orders holding property belonging to a judgment debtor was required to pay that money to the Sheriff. There was therefore no alternative but to order the monies paid as security for costs be paid to the Sheriff in partial satisfaction of the outstanding execution orders. There was no authority for using the monies for any other purpose, particularly their transfer as security ordered in a separate proceeding.