Third party debt order is legal document that let to enforce judgment by freezing debtor’s bank account or restrict access to the debtors’ money if the hold by organization, person or any other third party. Debtor wouldn’t have access to the money until a debt will be repaid fully.
Third party debt order for civil debts is governed by CPR 72.
Restrictions:
Bank account or money held by third party must be solely owed by the debtor. Joint bank account couldn’t be freezed unless joint owner is a debtor within the same order.
If third party debt order is issued then it will be freeze amount of money which was into account at the date of order. Any money that would come later at debtor’s account wouldn’t be a subject of order.
How to freeze a bank account?
Claimant should complete and file form N349 to that court which covers defendant’s address in case small claims and other money only claims.
Court will consider request of issue third party debt order just in case of debtors fails to pay amount after CCJ was issued or it was set up installments due under the terms of the judgment and debtors failed to pay one ore more of the installments.
Creditor need to state debtors bank details such as Bank, sort code or account number. This financial information could be requested by filing application for an order for debtor to attend a court for questioning or simply words “orders for oral examination”.
Claimant must pay a court fee for application for third party debt order which is £110 for each debtor(check court fee before applying)
Upon receipt application court will issue interim order (form N84) to freeze debtor’s account and send copy to the creditor. Debtors will get the order not earlier then within seven days after it was got by third party. Thus, debtor has no chance to transfer balance of his bank account or withdraw money.
Creditor must file certificate of service N215 at least 2 days before arranged hearing for issue final order. If creditor fails to attend hearing, judge may dismiss application.
What will bank or third party do if get court order?
If third party is a bank then they must search and identify all accounts owed by debtor and within 7 days report its details such account number, credit and debit balance to the court.
If third party is not a bank, they also must report to the court and debtors whether they have debtor’s money or not and what is the owed amount. If third party organization report that they has not keep debtors money and claimant want dispute it he need to file written evidences within 3 days to the court.
Third party or debtor may object interim order but they must file application to the court and send copy to the creditor at least 3 days before hearing.
What is hardship payment order?
Debtor may request for hardship payment order that let third party to release specified amount of money. Hardship payment order will only issued by the judge if debtor provide evidence that money is necessary for living.
Final 3rd party debt order
Court will consider any evidences and document from debtors, creditors and third party at the hearing. In case of successfully hearing judge will issue final order in from N85.
Copy of final order will be sent to all parties. Third parties will get instruction about amount and date by which debt must be paid. If third party keeps the debtor’s amount of money which is less then debt then part of debt will remain outstanding. In this case, debtor may apply for another type of enforcement of judgment, such as warrant of control or charging order against property.