Difference between revisions of "Introduction to Debtors' Options (10:IV)"

A debtor cannot seek to avoid defending an action in court where that action takes place in another province on the grounds that the court lacks jurisdiction. An action under s 29 of the ''COEA'' to enforce an extra-provincial default judgment may proceed where the debtor was  served but chose not to offer any defence to the original statement of claim. The creditor simply registers a judgment from another province in B.C., and it becomes a B.C. judgment. Furthermore, as a result of the decisions in ''[https://www.canlii.org/en/ca/scc/doc/1990/1990canlii29/1990canlii29.html?autocompleteStr=Morguard%20Investments%20v%20De%20Savoye%2C%20%5B1990%5D%203%20SCR%201077&autocompletePos=1 Morguard Investments v De Savoye'', [1990<nowiki>]</nowiki> 3 SCR 1077] and ''[https://www.canlii.org/en/ca/scc/doc/2003/2003scc72/2003scc72.html?autocompleteStr=Beals%20v%20Saldanha%2C%20%5B2003%5D%203%20SCR%20416%2C%202003%20SCC%2072&autocompletePos=1 Beals v Saldanha'', [2003<nowiki>]</nowiki> 3 SCR 416, 2003 SCC 72], American and other international default judgments can also be enforced in B.C.  

:'''NOTE:''' There have been judgments for the creditor where the creditor pursues the debtor after the two-year timeline.  This may happen where the creditor is inexperienced or neglectful, the debtor does not defend themselves, or the period between payments is not reviewed. If the judgment has been issued by the court, it may be more cost-effective to try and settle the matter with the creditor instead of challenging it in court.

The PPSA preserves the debtor’s (but not the secured party’s) rights and remedies under other statutes that are not inconsistent with the  ''PPSA'', as well as the specific rights and remedies provided in the security agreement, ss 17, 17.1 and 56(2)(b).

Furthermore, ss 3(5) and 4(4) of the ''COEA'' describes the limits to which a debtor’s wages may be garnished. Thus, if a debtor has a low income or has  savings they depend on for the necessities of life, they can have the amount that is being garnished (or proposed to be garnished) reduced, the terms of the order varied, or the garnishment ended. A person who is subject to a Notice of Attachment under the Family Maintenance Enforcement Program can also try to have the amount that is being ‘garnished’ reduced. Additionally, a garnishing order from a civil action has to be renewed monthly, while a garnishing orderfor maintenance does not.

If the debtor receives income from a statutory benefit that is exempt from garnishment (e.g social assistance or COVID-19 benefits), they should be advised as to how to protect their money after it is paid to them. '''The right of offset allows banks to seize deposited funds from an account at that  institution to cover a loan or account in default. If funds which are exempt from garnishment are deposited into a regular account that is commingled with other funds, they will not be protected from seizure by the financial institution. Their income should be safe if it is paid by  direct deposit into an account at an institution to which they do not owe any money.''' No other deposits should ever be made into this account.  It is also helpful to speak to a branch manager so that they understand the purpose of the account. '''A debtor should be advised that they have  a right to open a personal bank account at a chartered bank, even if they do not have a job or do not have money to put in the account right away.''' However, the applicant can be refused if the bank employee suspects fraud or experiences harassment from the applicant. For further  information, see: http://www.fcac-acfc.gc.ca and navigate through the website by clicking on Consumers > Resources > Publications > Banking > Opening a personal banking account: understanding your rights.

The ''Business Practices and Consumer Protection Act'', SBC 2004, ch 2 [''BPCPA''] provides for the licensing and regulation of debt collectors, which is carried out by Consumer Protection BC. The statute provides that jurisdiction is determined by the location of the debtor. Under the statute, Consumer Protection BC has wide powers of investigation.

The collector must only contact a  debtor through writing if the debtor provides a mailing address and notifies the collector in writing that they wish to be contacted only by writing. (s 116 (4)). Be aware that ignoring written communications could result in a collector starting legal proceedings, notice of which would be sent via writing, so a debtor should always be reading the communications and carefully considering if and how they should respond.

*c) contravening a condition of a license;

*d) engaging in a pattern of conduct by the debt collector that shows that they are unfit to have a licence; or  

*e) being convicted of an offence under Canadian law for conduct that shows they are unfit to have a licence.

The ''Business Practices and Consumer Protection Act'' regulates the activities of the credit bureaus in order to minimize unfair treatment of the party seeking credit. Federal legislation, such as the ''Personal Information Protection and Electronic Documents Act'', SC 2000, c 5 [''PIPEDA''] and  the ''Privacy Act'', RSC 1985, c P-21 also outline the requirements for organizations in their use, collection, and disclosure of personal information in their business practices. Credit information that these bureaus can disclose is the most common type of personal information, and includes one’s:  

Certain information cannot be included in a credit report, e.g., criminal charges (unless the individual was convicted), convictions more than six years old, and information about race, religion or political affiliation (BPCPA, s 109(1)).

Credit reporting agencies’ records are not always accurate and up to date. The quality and accuracy of the credit information depends on the credit information provided by the credit-granting companies who sign up with the credit reporting agencies. If an individual finds incorrect information on their file, they can report the error to the agency that provided the information to have it corrected. If an individual has proof that their credit report contains an error and they are unable to resolve it with the creditor directly, the individual should contact the credit reporting agencies who are reporting the incorrect information.  

The agencies will assist them in finding a resolution. '''Any  individual who is a victim of identity theft should immediately file a police report'''. The ''BPCPA'' allows individuals to provide a 100 word explanation to the reporting agency, which is to be kept and reported with their file (s.111); this may be a useful provision if a business has reported a disputed claim regarding yourself, or if you are a victim of identity theft. Any victim of identity theft is recommended to  post a comment on their credit report. This notifies creditors of the fact that the identity theft has taken place, and prevents additional credit being granted without a thorough review by the creditor. It is an offence (punishable by a fine of up to $10,000 or imprisonment for up to 12 months) to knowingly supply false or misleading information to a reporting agency (s 112).  

:'''NOTE:''' Individuals should check their credit history regularly. Industry specialists suggest once per year. Credit reporting agencies will send a person a copy of their credit history by regular mail for free. As each agency operates in a different matter, individuals are encouraged to request their credit history from both agencies, as they will likely be different.

{{REVIEWED LSLAP | date= August 10, 2020}}