WHAT IS AN EMOLUMENT ORDER AND HOW DOES IT AFFECT YOU?
The term “Emoluments” makes reference to salary or wages. An Emolument Attachment Order is issued in the Magistrates Court in terms of Section 65 of the Magistrates Court Act 32 of 1944 (Magistrates Court Act). The application is initiated by a creditor who has obtained judgment against a debtor.
In the event that the court grants an Emolument Attachment Order the Court Order will instruct the debtor’s employer to deduct a specific amount from their salary or wages of the debtor in the form of instalments. The deducted amount is then paid from the employer directly to the creditor in order to recover a judgment debt.
PROCEDURE FOLLOWED TO OBTAIN AN EMOLUMENT ATTACHMENT ORDER.
Prior to issuing an application for an Emolument Attachment Order the creditor must send the debtor a registered letter (or email) to the last known address of the creditor informing the debtor of the judgment granted and the amount outstanding including legal costs.
The letter needs to further state that the creditor will proceed with an application for an Emolument Attachment Order in the event that the debtor fails to make payment of the outstanding amount within ten days of the posting date of the letter.
In the event that the debtor fails to make payment to settle the outstanding amount or make payment arrangements with the creditor, the creditor will then proceed with issuing the application for an Emolument Attachment Order.
Once the application has been served it is then heard before a Magistrate in open court. Prior to granting the application in favour of the creditor the Magistrate needs to be satisfied that all provisions of Section 65 of the Magistrates Court Act have been met. The court order will state that the employer of the debtor make payment to the creditor for the amount owing by the debtor.
THE ENFORCEMENT OF A EMOLUMENT ATTACHMENT ORDER
Once the EAO is granted the order is then served on the debtor’s employers. The employers are obliged to follow the orders granted in the judgment. The failure by the employer to do so is an offence. As such the employers need to deduct the specified amount from the debtor’s salary and pay it to the creditor.
THE PROCESS FOLLOWED IN THE EVENT THAT THE DEBTOR CHANGES EMPLOYMENT
In the event that the debtor finds new employment the debtor must inform the creditor in writing. The debtor needs to state the name and address of the new employer.
The creditor then has the duty to serve a certified copy of the Emolument Attachment Order on the debtor’s new employer together with an affidavit specifying the payments received since the Emolument Attachment Order was issued, the costs incurred and the outstanding balance. The new employer will become bound to the provisions of the Emolument Attachment Order and will have to make the payment to the creditor.
Should the debtor become self-employed the provisions Emolument Attachment Order are still applicable and the debtor will still need to make the payments as per the order.
THE CANCELLATION, AMENDMENT OR SUSPENSION OF AN EMOLUMENT ATTACHMENT ORDER.
It can be extremely challenging to cancel, amend or suspend an Emolument Attachment Order. The court will only do so if the debtor shows good cause. The circumstances which would result in the court making such a decision vary based on the facts presented in court.
IMPACT OF EMOLUMENT ATTACHMENT ORDER
Once an Emoluments Attachment Order has been granted it already means that you have had civil judgement granted against you. This subsequently leads to a very impaired credit score which will have a negative impact in obtaining any future long or short-term credit. The EAO further instructs that a part of your finances are managed by a third party (i.e. your employer) subsequently limiting control over your own finances.
Another negative aspect of the Emoluments Attachment Order is that should you start employment elsewhere your new employer has knowledge of your financial situation which may lead to preconceived opinion of you as an individual and the ability to manage your finances. Although most employers run credit checks on candidates before offering them employment.
HOW TO AVOID AN EMOLUMENT ATTACHMENT ORDER
The best way to ensure that you do not reach this very dire situation is to manage your finances accordingly and ensure that you meet all financial obligations with your credit providers. In the event that you are in financial constraints it is best to communicate with the credit providers and make alternative arrangements to avoid legal action being initiated against you.