Seizure after judgment with reference to statement of damages, is it possible?

After long litigation, you get a judgment. In it, the court decides that the opposing party liable is, AND your must compensate for damages. Good news, however, the judge has not yet assessed the damages themselves. For that, another trip to court is required. In the judgment, the case is in fact referred to the damage statement, as it is called. A damage state proceedings is, so to speak, the successor to the proceedings you just went through. In the damages state proceedings, the only issue is how high the damages are and whether they are the result of the other party's actions. Will you then run into another lengthy trial? And can't the opposing party then quietly start making away with its money? Lawyer collection and enforcement law Robert van Ewijk explains what you can do with a judgment in which the case has been referred to the damage state.

Has the case been referred to the damages state? Then file foreclosure!

Once you have a judgment in which a reference to the statement of damages is made, liability is established. However, the amount of the damages is then not yet established. Nevertheless, you can then levy an attachment in execution. This seizure then in fact takes on the character of a conservatory seizure, because whatever is subject to the seizure can only be paid out once it has been established exactly how much is owed. Already in 2014, the Amsterdam Court of Appeal (ECLI:NL:GHAMS:2014:2475) that foreclosure can then still take place:

“3.7. Before discussing the grievances, the court considers that it is possible to impose an execution order in the case where (as here) it concerns a claim whose monetary amount, although not yet determined, has been ordered the debtor to pay damages to be made out in state.”

Benefits of attachment after referral to claim state

An important advantage of the attachment, is that it prevents the debtor from disposing of assets. After all, after the judgment, he knows he has to pay, but not yet how much. The risk of disposing of assets may then be present. In addition, the attachment may also act as a means of pressure, making the other party willing to enter into negotiations about voluntarily making a payment. If the attachment has hit the mark, the debtor will often be only too happy to do his best to get out of the attachment. Waiting for the judgment in a damages state proceeding, will not always be the preferred option. And if a settlement is reached, the conduct of the damages state proceedings is no longer necessary.

Disadvantage of foreclosure based on a judgment of damages

The main difference between an enforceable attachment based on a judgment of damages versus a judgment that does award a sum of money is that the attachment cannot be enforced. In 2017, the District Court of Amsterdam ruled(ECLI:NL:RBAMS:2017:3636):

“4.1 (...) In a case such as this, therefore, an attachment may be levied in execution, albeit that no actual enforcement of that attachment may already be effected. This gives the enforcement attachment the character of an prejudgment attachment.”

That attachment can remain in place for a long time. To begin with, it is clear from the aforementioned judgment that the damage assessment procedure does not even have to have commenced yet in order for an attachment to be possible. It may very well be, that this is waited until the judgment in which the liability has been established, force of res judicata gets. This is the case only if no legal remedies such as appeal or cassation are more open. This can take time, sometimes several years.

Attachment has character of conservatory attachment, but garnishee does not have same protection

It is true that such an attachment has the character of a prejudgment attachment, but the garnishee does not enjoy the same as the prejudgment attachment. For example, it is possible to lifting of prejudgment attachment claim because the claim is unsound. That proposition is somewhat less tenable in the case of an executory seizure following a damages order. Because because liability is then already established, it is often also plausible that damages exist and thus that the claim for which attachment has been levied is sound. The Amsterdam District Court considered in the 2017 judgment just mentioned:

4.1 (...) [plaintiff sub 1] and [plaintiff sub 2] have therefore, for that reason, based their claim for the lifting of the garnishment on one of the grounds for the lifting of a garnishment, namely that summary proof of the unsoundness of the claim for which the garnishment has been levied (see article 705 paragraph 2 Rv). Assuming that the aforementioned ground for lifting would be applicable in this case, it is considered that (the existence, not the amount of) HSK's claim is not summarily unsound in the aforementioned sense. Indeed, the fact that the judge on the merits, in his judgment of February 8, 2017, held that [plaintiff sub 1] and [plaintiff sub 2] are liable for damages, to be further stated, implies that the possibility of damages is plausible.”

Lawyer in damages state proceedings and attachment

Do you need help or advice from a specialist in debt collection litigation and foreclosure law? Or would you like to be assisted by an expert on the damage state proceedings? Then take contact on with Lexys Lawyers.