Consumer Proposal


1. What creditors can do if you don't pay?

When you use credit to make purchases or pay for services and fail to make payments, your creditors may take legal actions to recover the money owed. Common types of credits are Bank Loans, Bank Account Overdraft, Lines of credit, Credit cards, Finance Agreements, Student loans, payday loans etc. A creditor has the option of suing you in civil division of provincial court (Formely known as small claims court) or The court of Queen's bench. If your debt is $25000.00 or less, your case will probably be heard in this court.

2. What if a creditor Sues you?

If you are sued, you will be served with a civil claim. The creditor (or a representative of the creditor) will serve the claim on you where you usually live. It can also be served on any adult resident in your household that is at least 16 years of age. The claim can also be sent by registered mail. The claim will tell you who is suing you, why they are suing you and how much money they are suing you for. Don't ignore the claim. If you do not take any action your creditor can get a default judgement from the court that would allow them to garnish your wages, bank account or have your property seized.

3. What is enforcement of judgements?

The court will award a judgement to a creditor if the judge decides that the creditor claim is valid. This judgement is enforceable for 10 years and it can be renewed. Interest is charged on an unpaid judgement. It is calculated from the date of the judgement. While a judgement issued in Alberta court can only be enforced in Alberta, a creditor may transfer the judgement to other provinces. So even you move to another province, a creditor can pursue you to collect a judgement debt.


Once a judgement is granted, the creditor can take several steps to get the money that you owe:

  • Register a writ of enforcement of personal property registry.
  • Garnishee your wages, bank account or account receivables.
  • Seize your property.

4. What is Garnishment?

Garnishment is a legal procedure that a creditor can take after the court awards a judgement against you. The creditor asks the court to take the money (Garnishee) you owe from number of sources like:

  • Your pay-cheque
  • Your account at a financial institution such as bank , treasury branch, trust company or credit union.
  • Accounts receivables (money owning to you by others)

The creditor delivers the garnishee summons to your employee or financial institution. The creditor can garnishee your wages or money in your bank account up-to the amount of your total judgement debt plus costs. Your employer or financial institution pays the money to the court and the court pays money to the creditors. If there is not enough money available to cover your debt on the day the garnishee summons is served the creditor will continue to garnishee your wages or accounts until your debt is paid in full.
The garnishee summons is effective for 60 days against a bank account and is effective for one year in most cases. The garnishee must be renewed at that time.
Your employer, financial institution or creditor will give you a copy of the garnishee summons within 15 days of the date it is saved.

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