For debts that are difficult to collect, creditors can take necessary legal measures to collect debts such as filing lawsuits with competent authorities. However, if there has been a judgment or arbitration decision on debt recovery, the creditor may also consider taking a number of actions during the judgment enforcement process to ensure effective debt recovery.
In fact, after initiating a lawsuit in a competent court or commercial arbitration or commercial conciliation, the creditor will usually receive one of the following legal documents: Court Judgment/decision, award from the Arbitral Tribunal, or a settlement agreement drawn up by the conciliator.
Once these legal documents have legal value, the creditor will have the right to request the competent state agency to implement this decision. If the debtor complies and completes the debt repayment obligation, the recovery process will be considered to have ended. On the contrary, if the debt remains unpaid, the recovery process will continue into the civil enforcement phase.
1. In case the parties agree to execute the judgment
According to the Law on Execution of Civil Judgments (2008, amended and supplemented in 2014), litigants have the right to agree on the execution of judgments, if such agreement does not violate legal prohibitions and is not contrary to social ethics. The results of judgment execution according to the agreement are recognized.
At the request of the litigant, the Enforcer is responsible for witnessing the agreement on judgment enforcement.
According to the Law, a judgment enforcement agreement must be made in writing, clearly stating the time, place, and content of the agreement, signed by the parties to the agreement or by the Enforcer assigned to handle the judgment execution (in case the civil judgment enforcement agency has issued a decision to execute the judgment). The results of judgment execution according to the agreement are recognized.
In case the parties do not voluntarily comply with the agreed content, the civil judgment enforcement agency will base on the content of the judgment, decision, application for judgment enforcement and the results of enforcement according to the agreement (if any) to make a decision to execute the judgment.
In case the involved party does not comply with the agreement, the other litigant has the right to request the civil judgment enforcement agency to perform the unfulfilled obligations according to the content of the judgment or decision.
2. In case a civil judgment enforcement agency is requested to organize judgment enforcement
- Regarding the statute of limitations for requesting judgment enforcement:
Within 5 years from the date the judgment or decision takes legal effect, enterprises have the right to request a competent civil judgment enforcement agency to issue a decision to enforce the judgment. The time when there is an objective obstacle or a force majeure event is not included in the statute of limitations for requesting judgment enforcement.
- Regarding the obligation to verify judgment enforcement conditions:
When requesting a civil judgment enforcement agency to organize judgment enforcement, enterprises have the right to verify the economic conditions and current status of assets and other information about the debtor’s ability themselves or authorize others to execute judgments. The verification results are recognized and serve as a basis for organizing the execution of the judgment unless the Executioner finds it necessary to verify again. In case of judgment enforcement according to a request, the enterprise has applied necessary measures to verify the debtor’s conditions for judgment enforcement but still has no results, the enterprise has the right to request the Enforcer to verify conditions for execution of judgment. Verification of judgment enforcement conditions at agencies, organizations, or individuals holding asset information of the debtor is considered ineffective when the enterprise or authorized person proves that they have made a direct or written request, but 1 month has passed from the date of request but has not received their written response without a legitimate reason.
- Regarding the application of measures to ensure judgment enforcement:
In order to prevent debtors from being able to disperse, destroy assets or avoid judgment enforcement, enterprises have the right to request civil judgment enforcement agencies to apply measures to ensure judgment enforcement such as: freezing accounts; temporary seizure of assets and documents; Temporarily suspension of the registration certificate, transfer, or change of current status of the debtor’s assets. Based on the content of the judgment or decision; nature, extent, and obligation to execute judgments; conditions for execution of judgments of debtors; The Enforcer will select and decide on the application of one or several appropriate judgment enforcement measures.
- Regarding enforcement of judgment:
In case the debtor has the conditions to execute the judgment but does not voluntarily execute the judgment, the civil judgment enforcement agency will apply measures such as deducting money from the account; Distraint and handling assets of debtors, etc., to enforce judgment according to the Law.
- Regarding judgment enforcement fees:
Enterprises with judgment enforcement are obliged to pay judgment enforcement fees. The enforcement fee will be calculated based on Circular 216/2016/TT-BTC, which regulates the: rates, collection, payment, management and use of civil judgment enforcement fees for each specific case.
In addition, creditors should also regularly contact the Judgment Enforcement Agency to update the handling situation and provide support and coordination with the Judgment Enforcement Agency when incidents arise.
In summary, understanding the requirements of laws and regulations related to debt collection during the judgment enforcement phase is extremely necessary, through which relevant parties need to comply to ensure enforcement. The project takes place quickly and promptly and avoids legal risks.