The New Brunswick Judgment Enforcement Act: has its time finally come?

• Author: Gleixner, Micheline A.
• Position: 1. Introduction through 4. NBJEA Administration and Enforcement Initiation 4.2.2 Creation of Enforcement Charge, p. 280-314 - University of New Brunswick Law Journal Forum: Access to Justice

1. INTRODUCTION

   Our democracy provides a legal system that enables judicial involvement in the event of a disagreement and a final determination of the rights of the parties is usually embodied in the form of a judgment. Creditors often believe that once a judgment is obtained, the judgment debtor will in turn pay the debt. The reality is far different. A judgment from the court does not guarantee that the judgment creditor will be fully, or even partially, reimbursed. Unfortunately, a money judgment rarely results in its immediate execution, thus forcing the plaintiff to undertake additional proceedings to overcome additional obstacles on the path to debt recovery. According to the British Columbia Law Institute, these legal impediments "can be as time-consuming, elaborate, and expensive as the steps required to establish liability". (2) As a result, an effective and just civil justice system must provide the process by which individuals can enforce their judgments and obtain payment of monies they are owed. (3)

   Although the mandate of the New Brunswick Department of Justice and Consumer Affairs is to promote the impartial administration of justice and to ensure protection of the public interest, (4) one questions whether these objectives are actually attained by creating a legal system to determine and recognize rights without providing adequate means to enforce those rights. (5) What is a judgment worth if one cannot enforce it? If members of the public and the business community do not have access to a fair and just legal system that includes an efficient and effective judgment enforcement component, their confidence in the system is damaged, and thus becomes a matter of public interest. (6)

   The Law Reform Commission of Nova Scotia recently emphasized the vital role of judgment enforcement law within our justice system, and its impact on the public's confidence in the civil justice system:

   An enforcement system that is unduly complicated or costly, or that simply fails to deliver results, is certain to undermine the confidence of the public and foster cynicism about the administration of justice. Put simply, it is the responsibility of the state--part and parcel of the duty to maintain and promote the rule of law--to uphold its courts' judgments with strong and effective enforcement action. (7) This declaration reflects a growing consensus in Canada on the types of reform necessary to create a "modern, efficient and balanced enforcement system". (8) This is in addition to three New Brunswick reports resulting from studies undertaken in 1976, 1985 and again in 1994, all advocating a complete overhaul of the current system of enforcement of judgments in the province via the enactment of modern judgment enforcement legislation. Kerr observed, in 1976, that our objective to strive for the pursuit of justice compels the enactment of a new judgment enforcement system which, on one hand, enables judgment creditors to recover their judicially recognized debts from recalcitrant judgment debtors while, on the other hand, protects cooperative debtors who simply do not have the means to pay. (9)

   To this end, three other provinces--Newfoundland and Labrador, (10) Alberta (11) and Saskatchewa--(12) have already enacted legislation consolidating judgment creditor remedies and modernizing their respective judgment enforcement laws. Moreover, the Uniform Law Conference of Canada ("ULCC") released a Uniform Civil Enforcement of Money Judgments Act (13) in 2004, which was endorsed, albeit with reservations, by the British Columbia Law Institute in 2005 and the Law Reform Commission of Nova Scotia in 2011. (14)

   Although a complete historical and legal analysis of judgment enforcement law is outside the scope of this study, this article aims to examine various issues within New Brunswick's current legal and administrative framework by reviewing current legislation in other provinces as well as the Uniform Act and the judgment enforcement act proposed in the province's 1994 report. The authors conclude that a new approach is fundamental to a fair, just, efficient, effective, impartial and accessible system of justice in our province and therefore recommend the enactment of the New Brunswick Judgment Enforcement Act ("NBJEA"). (15)

   1.1 The current judgment enforcement system in New Brunswick

   Since the province's last report on this issue in 1994, New Brunswick has followed the national wave of legislative reform of secured financing law. Several legal advancements became effective in 1995 with the adoption of a new legal regime governing security interests pursuant to the Personal Property Security Act (16) ("PPSA"), such as the creation of a central computerized personal property registry ("PPSA Registry") as well as the registration of judgments and elimination of the need to pursue judgment enforcement proceedings in order to assert priority as against a secured party.

   Given that a debtor often has both secured and unsecured debts, it is anomalous that legislative reform has up to now privileged one set of creditors. (17) Although complementary provisions were added to the Creditors Relief Act (18) as an interim step pending the introduction of a new judgment enforcement system, unsecured creditors must rely to this day on an assortment of new and old legislation, which dates back to the 19th century. In fact, the necessity and importance of legislative reform and consolidation of New Brunswick's current judgment enforcement laws has been advocated for more than thirty-five years and is expressed as follows by Kerr:

   From the description of the existing scheme of creditors' remedies, it is apparent that the system is a complex and poorly interrelated collection of procedures. Many of these procedures originated in the complex legal system that existed before the major legal reforms of the last century and a half. These old procedures have been substantially modified by legislation during the last century and most are now substantially regulated by statute. The reforms have proceeded on a rather haphazard basis, however, unlike the reforms in the remainder of the legal system which have endeavoured with considerable consistency to simplify and rationalize the system. (19) As a result, a person dealing with the enforcement of judgments, whether a legal expert, enforcement personnel, creditor or debtor, must consider and peruse over 10 statutes as well as the Rules of Court of New Brunswick ("Rules of Court") in order to determine their rights and obligations. (20) The current collection of statutes on this issue is not only numerous, but also comprised mostly of antiquated, fragmented, overly complex and confusing legislative provisions. According to Cuming, the Creditors Relief Act is one of the most poorly drafted Acts in the statute books. (21)

   The current enforcement system is therefore unnecessarily complex and costly for all parties involved since its long neglect has "resulted in many of its core concepts becoming encrusted with technicalities and uncertainties". (22) Attempting to enforce a judgment in New Brunswick or to advise clients on the matter can be a frustrating and unwieldy experience for most lawyers and enforcement personnel, let alone the self-represented litigant. (23) Survey research in Nova Scotia evaluating the Small Claims Court revealed that the most significant element in need of reform was the "complexity and expense of collection efforts following judgments". (24) It would be most surprising if the majority of judgment creditors in the province of New Brunswick would not express a similar complaint.

   1.2 Basic principles

   Given the objective to institute a modern, uniform, coordinated, efficient, and flexible judgment enforcement system, which will balance the interests of both creditors and debtors in a manner that is just and equitable, it is recommended that several overriding principles be endorsed and embraced by the NBJEA. (25) These principles permeate the authors' analysis as well as the resulting recommendations and judgment enforcement system proposed herein.

   1.2.1 An effective enforcement system

   Remedies are important to enable judgment creditors to overcome the repudiation of the debt by judgment debtors. (26) As postulated by the British Columbia Law Institute, a just and effective judgment enforcement system must strive to provide legal tools for judgment creditors to overcome the obstinacy of judgment debtors. (27) In order to promote fairness among creditors, universal exigibility should also be prioritized such that all a debtor's property should be subject to enforcement measures except property that is expressly exempted in the statute. (28)

   1.2.2 A consolidated single statute governing enforcement of judgments law and creditor remedies

   In 2004, the Alberta Law Reform Institute reviewed the consolidation of the judgment enforcement system enacted in 1994 and observed that: "the result has been confusion and conflicts among the various legislative instruments. The Act and the Regulation are relatively coherent, but the Rules are less integrated with the statutory scheme." (29) The Rules Project Committee concluded that "the confusion created by splitting one subject among several pieces of legislation outweighs any argument based on the case of amendment" (30) and recommended the integration of all enforcement-related matters under one legislation. Their rationale was that if the law is concentrated in one place it is more likely to be coherent and integrated, and that such consolidation would make the job of the researcher easier and therefore less expensive and uncertain. (31)

   Given the foregoing analysis, it is recommended that common law concepts and obsolete approaches to judgment enforcement should be abandoned for newer policy choices and technological advancements, culminating in a single, coherent general enforcement of judgments statute. By consolidating all...