Residents of New Brunswick, especially those in debt, should be made aware of recent changes to provincial legislation that changes the scope of the assets available for seizure by judgement creditors.
The Enforcement of Money Judgements Act came into force Dec 1st 2019, and with it came several significant changes. Most notably, wage garnishment is now a tool that is available for all judgement creditors.
While similar legislation already exists in other provinces across the Maritimes, previously in New Brunswick, the only creditors who were able to garnish wages were government bodies, such as Family Courts or Canada Revenue Agency. However, with this new legislation, the ability to garnish wages is now opened up to all creditors. This means that those consumers who owe money need to be aware that their creditors could obtain a court order to seize a certain percentage of their pay directly from each pay cheque. The amount that could be garnished is determined by the sheriff or bailiff based on the debtor’s financial circumstances. Garnishment most commonly happens when a debtor does not have sufficient assets worth being seized for the repayment of debts.
Other notable changes include the determination of exempt assets. Previously, provincial legislation dictated what assets were exempt from seizure by creditors. With the enactment of the new legislation, the Sheriff, hired by the creditors, will decide what amount of assets are exempt after completing an examination of the debtor’s financial circumstances. For example, if the debtor is determined to have sufficient access to public transportation, then the Sheriff could enforce a seizure of the debtor’s vehicle.
It should be noted that a debtor’s retirement funds are protected from garnishment.
- investments such as registered retirement income funds
- deferred profit sharing plans
- registered retirement savings plans and pensions.
However, note this exemption does not protect payments from a retirement fund to a debtor, so once a debtor starts to pull money from their retirement fund, that money could be eligible for seizure.
Concerned about having wages garnished or assets seized?
If you owe money to a creditor, you could be at risk of receiving a judgement to seize your assets or garnish your wages. If this is the case, seeking help from a Licensed Insolvency Trustee could be a good option for you. Licensed Insolvency Trustees are licensed by the federal government to help consumer debtors, like yourself, to file Consumer Proposals and bankruptcies. Actions from creditors, like garnishments, can often be stopped by filing a bankruptcy or proposal.
Call 1 (888) 371 – 8900, or click here to arrange a free consultation at one of our offices across New Brunswick to examine the options available to you.