From the bench: Precautionary garnishee order: a tool to be used with caution
An efficient tool for the creditor to ensure payment is the precautionary garnishee order (mandat ta’ sekwestru kawtelatorju). This involves the garnishee/s which is typically a bank, depositing the funds of the debtor in court up to the amount claimed by the creditor.
These funds may not be withdrawn by the creditor and must remain in court until a court decides the creditor’s claim.
Such tool may be seen as too good to be true, or that anyone can simply file a precautionary garnishee order at will. While administratively this is possible, one cannot simply file precautionary warrants without caution. Indeed, if this is done, consequences will ensue upon the supposed creditor.
The Civil Court, First Hall, in a decree delivered on June 27, 2022, in the names of 'IAS Limited vs Diane Elizabeth Vella', dealt precisely with this issue.
On February 14, 2022 Vella was served with a precautionary garnishee order by IAS Limited for the amount of €60,000. The garnishee order was acceded to by the court. Then, on February 23, 2022, Bank of Valletta plc deposited the full amount of €60,000 in court.
This meant that the money was taken from Vella’s account with BOV and placed in court for...