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THE PURPOSE OF A DEFAULT HEARING
The purpose of a Default Hearing is to find out why a Debtor has not made payments required by a Payment Schedule.
RESULTS OF A DEFAULT HEARING
After hearing from a Debtor at a Default Hearing, a Judge can:
- Confirm the terms of the Payment Schedule; or
- Change the terms of the Payment Schedule; or
- Issue a Warrant to send a Debtor to jail for not more than 20 days, if the Debtor’s explanation (or lack of explanation) amounts to contempt of court.
HOW TO SCHEDULE A DEFAULT HEARING
A Default Hearing will not occur unless a Creditor requests one be held. To arrange for a Default Hearing, a Creditor must complete a Summons to a Default Hearing form.
PREPARE A SUMMONS
To complete the Summons do the following:
- Obtain a copy of the Payment Order from the Court Registry;
- Fill in the Registry file number on the Summons form as it appears on the Payment Order;
- Fill in the location of the Small Claims Court Registry;
- Fill in the name, address and telephone number of the Debtor being summoned. If the Debtor is an individual fill in that person’s name. If the Debtor is a company, then a director, officer, or employee of the company can be summoned. If you do not know the name of such a person you can do a search at the B.C. Corporate Registry Office to find out the names and addresses of the Directors of the company. A search can be done using B.C. On-line on your home computer if you have an account with BC OnLine, or at BC Government Agents’ offices located throughout BC;
- Fill in the names of the Creditor and Debtor as they are spelled on the Payment Order;
- If there are documents or records you want the Debtor to bring you should list those. You may want the Debtor to bring in recent pay stubs, tax assessment forms, bank statements; or if the Debtor is self-employed you may want the Debtor to bring recent business records. These documents might show the Debtor had an ability to pay as required by the Payment Schedule. They might help show the Debtor willfully refused to pay as required. That might be contempt of court and provide a basis for having the Debtor put in jail;
If there are no documents you want the Debtor to bring, you can leave the section blank.
- Date and sign the boxes after the words “I certify the Debtor has not obeyed the Payment Schedule.”
FILE THE SUMMONS AT THE SMALL CLAIMS COURT REGISTRY
The Summons should then be taken to the Small Claims Court Registry. The Registry staff will insert the date of the Default Hearing. The Summons should then be filed at the Registry. A fee of $100 will be charged to cover the cost of serving the Summons on the Debtor.
SERVICE OF THE SUMMONS
Once filed, the Creditor should take a copy of the Summons to the Sheriff or Court Bailiff who will serve it on the Debtor. A Creditor cannot serve the Summons.
The Summons must be served at least 7 days before the Default Hearing.
FAILURE TO ATTEND THE DEFAULT HEARING
The Debtor must attend the Default Hearing. If a Debtor does not, a Judge can issue a Warrant for the Debtor’s arrest. However, before the Warrant will be put in force to arrest the Debtor, the Registrar must first write to the Debtor and give the Debtor a Notice of Arrest. The Debtor then has seven days to arrange to attend court voluntarily. Thus, if a Debtor has not attended a Default Hearing, the Debtor should immediately telephone the Small Claims Court Registry to find out when they can be brought before a Judge or Justice of the Peace.
At the time suggested, the Debtor should go to court. The Warrant can then be cancelled and a new date set when the Debtor can appear in court for a Default Hearing. It should be noted that if the Debtor does not attend court on the new date a Warrant for the immediate arrest of the Debtor can be issued. The Sheriff or the police will then be in a position to arrest the Debtor.
THE DEFAULT HEARING – WHAT THE DEBTOR SHOULD DO
At a Default Hearing, a Debtor will be asked to explain the failure to obey the Payment Order.
A Debtor who receives a Summons to a Default Hearing should bring the documents listed in the Summons to a Default Hearing and any other documents that would help to explain why the Payment Schedule has not been obeyed.
For example, if the Debtor lost a job and is now receiving Employment Insurance or welfare, cheque stubs or other proof of income should be brought. If the Debtor has been unable to work because of bad health, a note from a doctor would be helpful.
Since a Judge can change a Payment Schedule at a Default Hearing, a Debtor should prepare a new budget (if there have been changes in income since the Payment Hearing). Click here for a Statement of Finances form which can be used for this purpose.
At the Default Hearing, the Debtor may have to swear or affirm to tell the truth. Usually the Judge will then ask the Debtor why the Debtor has failed to obey the Payment Order.
A Creditor may be allowed to ask the Debtor questions and if the Creditor has information to show that the Debtor is not telling the truth or is hiding an ability to pay, the Creditor may ask to be allowed to testify at the hearing.
As mentioned above, a Judge could confirm the Payment Schedule, change the Payment Schedule or send the Debtor to jail for up to 20 days for contempt of court for not obeying the Payment Order.
IMPRISONMENT FOR CONTEMPT
If a Judge issues a Warrant of Imprisonment a Debtor can avoid going to prison by:
- Paying the money owed to the Court Registry, in which case the Registrar of the court will cancel the Warrant of Imprisonment, or
- If the Debtor has been arrested, by paying the amount shown on the Warrant to the person who has custody of the Debtor, that is the Sheriff, Police Officer or Warden.
If a Debtor does not pay, spending time in prison will not cancel the debt.
Prepared by Glenn Gallins
Revised April 2008, links checked 2019
Funded by the PLE Program of the Legal Services Society