More oversight needed in debt recovery area

More oversight on how debt is being recovered for private creditors through the courts is needed in what is an outdated, archaic area of law.

Senior policy officer with FLAC Paul Joyce believes the laws governing sheriffs and the collection of debt for banks or other private creditors need reform.

“There is no state oversight here as such, and this is not a good way of dealing with people in debt. Protection for them is not great, and this area of law has not been reformed in a long time. Even the language is archaic, and people can’t relate to it,” Mr Joyce said. “You hear of sheriffs going to houses with teams of big men, and of course they will say it’s because of the need to move the goods, but they can look intimidating. Sheriffs can appoint people to collect debt on their behalf, so it is not very transparent.”

Figures provided to the Irish Examiner reveal the extent of debt collection by sheriffs in Cork and Dublin. But enquires seeking figures from registrars around the country who carry out the same function did not yield any answers.

In 2010 a comprehensive Law Reform Commission report called for a centralised system of enforcement to be introduced in Ireland. The new system would have a dedicated enforcement office with sole responsibility for the enforcement of judgments. The work would be centralised in a head office rather than localised and the proceeds of seizure and sale would be recorded and monitored.

The county registrar role would be transferred to the enforcement office and the seizure and sale of assets would be carried out by enforcement officers, who would be staff of the office.

While the sheriffs in Dublin and Cork are paid a commission fee for seizures effected, county registrars are salaried civil servants and, therefore, are provided with no incentive to execute judgments. This remuneration system also means the enforcement functions result in considerable costs to the state.

“It is understood the above factors have led to inefficiency in the execution of judgments, and have also contributed to widespread inconsistency in enforcement practices in different counties, based on varying levels of resources and workloads among the different county registrar offices,” the commission said.

The report also outlines the “considerable powers” a sheriff has to enter the debtor’s premises for the purpose of seizing goods and highlights the constitutional and human rights implications of these powers. “The law of debt enforcement must seek to respect and protect the human dignity of debtors while vindicating the rights of creditors.

“This duty to preserve the basic dignity of the individual should also encourage the law to provide solutions for those suffering from the adverse consequences of over-indebtedness. In this context, regard must also be had to the dignity of the dependents of debtors. The law must be particularly conscious of the detrimental impact of financial difficulties on the lives of children living in over-indebted households.” In common law, the basic principle is that every man’s house is his castle. This prevented a sheriff from forcing his or her way into a debtor’s premises for the purposes of levying execution. The sheriff was, however, free to enter a premises without using force, such as by entering through an open door or window.

In 1926, this law was changed by section 12 of the Enforcement of Court Orders Act 1926 which states that no action shall lie against a sheriff for entering or breaking into a premises or for any damage to a premises, provided certain conditions are met.

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