Proceedings

Initiating legal proceedings and issuing a summons to pay

Usefulness and use of the prosecution procedure in Switzerland

Debt collection proceedings in Switzerland are an essential legal mechanism enabling creditors to recover unpaid debts.
It plays a crucial role in maintaining economic order, by ensuring that creditors have a legal and structured means of recovering what is owed to them.
Used by individuals and businesses alike, this procedure ensures a degree of financial stability by reducing the risk of non-payment.
In Switzerland, this procedure is widely used for its efficiency and transparency, providing a clear framework for debt settlement.
Its rigorous application protects the rights of creditors while providing debtors with defense mechanisms.
In addition, it helps to build trust between business partners by securing financial transactions.

Initial steps taken by the creditor to initiate proceedings

To initiate a debt collection procedure, the creditor must go to the debt collection office in the debtor’s place of residence and file a debt collection requisition, or take this step electronically.
This document, filled in precisely, must indicate the amount owed and the reason for the debt, such as an unpaid bill.
The creditor does not need to provide detailed proof at this stage, which simplifies the initial process.
On receipt of the requisition, the debt-collection office registers the request and begins the process of notifying the debtor.
The creditor must also pay an administrative fee, the amount of which depends on the sum claimed.
This first step is crucial, as it formalizes the request and triggers the legal collection process.
Once the requisition has been registered, the creditor can follow the progress of the procedure via communications from the Debt Collection Office.

Receipt of payment order by debtor

When the debtor receives the summons to pay, it is a formal notification informing him that legal proceedings are in progress against him.
This notification is made by the Debt Collection Office, either by registered mail or in person by an agent.
The summons to pay details the amount demanded, information on the creditor and the nature of the debt.
It also specifies the deadlines and actions available to the debtor.
This document marks the official start of the debt collection procedure and obliges the debtor to react quickly.
The debtor is informed that he has 20 days to pay the amount due or 10 days to lodge an objection, which would temporarily suspend the proceedings, giving him the time he needs to assess the situation and decide on the next steps to take.
Ignoring the summons to pay can have serious consequences, including seizure of assets.

Obligations and options of the debtor after receipt of a summons to pay

Upon receipt of the summons to pay, the debtor has several options.
Firstly, they can choose to pay the sum claimed within 20 days, to avoid more coercive measures.
If the debtor contests the claim, he can lodge an opposition within 10 days, which temporarily suspends the proceedings.
The opposition must be made in writing and may be partial or total, depending on the amount of the disputed debt.
The debtor does not need to provide any justification for his opposition at the time of filing, which saves him time in preparing a stronger defense if necessary.
If the debtor objects, he must be prepared to justify his reasons in court.
This may include presenting documents proving that the claim is unfounded or has already been paid.
The court will then examine the evidence provided by both parties before ruling on the validity of the opposition.
This judicial step is crucial to ensure the fairness of the process.
If the opposition is rejected, the debtor must be prepared to face the consequences of the lawsuit, including the seizure of his assets.

Opposition to the order to pay and the discharge procedure

Procedures and deadlines for objecting to a summons to pay

When a debtor receives a summons to pay, he has the option of objecting to it in order to contest the claim.
The objection must be made in writing and sent to the debt collection office within 10 days of receipt of the summons to pay.
This procedure is relatively straightforward, as the debtor does not need to justify his opposition at this stage.
All they have to do is indicate that they object to the claim.
This ease of opposition allows debtors to gain time to prepare an adequate defense without immediately being subjected to enforcement measures.
It is important to respect the 10-day time limit, as late objections will not be taken into account, and the debt collection procedure will continue uninterrupted.
What’s more, the absence of any obligation to state reasons means that administrative complications can be avoided from the outset.

Creditor’s recourse against opposition

When the debtor lodges an opposition, the creditor has three options for lifting the opposition: final discharge, provisional discharge and action in recognition of debt.
The final release is applicable when the creditor has an enforceable judgment or an authenticated deed proving the claim.
This procedure can last from a few weeks to several months, depending on the court’s workload, and can entail considerable legal costs for the creditor.
Provisional discharge can be requested when the creditor has creditor titles, such as signed IOUs.
This procedure is generally quicker, taking a few months, but also involves costs.
Finally, the IOU action is an ordinary procedure in which the creditor must prove the validity of his claim before the court.

Effects of lifting the objection

If the court accepts the request for discharge, the debtor’s opposition is lifted, and the pursuit procedure resumes its normal course.
The creditor must then request continuation of the proceedings within 20 days.
This step is essential to enable the creditor to request enforcement measures, such as seizure of the debtor’s assets.
For the debtor, the lifting of the opposition means that he must prepare for possible more coercive actions, which may include the loss of personal property or the seizure of bank accounts.
The lifting of the opposition puts an end to the temporary suspension of proceedings and marks the start of concrete measures to recover the debt.
It is crucial for the debtor to react quickly at this stage to avoid serious financial consequences.
What’s more, resumption of the procedure may result in increased costs for the debtor, linked to new enforcement measures.

Consequences of rejecting a release

If the court rejects the application for discharge, the opposition is maintained, and the legal proceedings are suspended.
For the debtor, this means temporary protection against enforcement measures.
However, the creditor can still initiate an IOU action to prove the validity of his claim.
If the creditor does not pursue this course of action, the lawsuit is closed.
For the creditor, the rejection of the discharge means additional time and costs in attempting to recover the debt by other legal means.
This situation may also prompt both parties to consider negotiation or amicable settlement to avoid protracted litigation.
Ultimately, the rejection of the application for release does not put an end to the debtor’s obligations, but offers a respite that can be used to organize a stronger defense or find alternative solutions.

Object of seizure: what assets can be seized?

Importance of the notice of seizure

When the Debt Enforcement Office decides to seize a debtor’s assets, it issues a seizure notice.
This notice informs the debtor of the assets that will be seized to cover the debt.
The content of the seizure notice includes a detailed description of the assets concerned and the total sum to be recovered.
As soon as this notice is served, the debtor is prohibited from disposing of his assets, i.e. he may not sell or transfer them, under penalty of criminal sanctions.
This prohibition is designed to ensure that assets remain available to be valued and, if necessary, sold to satisfy the debt.
Service of this notice marks a crucial stage in the legal proceedings, as it formalizes the seizure and restricts the debtor’s actions over his assets.
It is essential for the debtor to understand the implications of this prohibition in order to avoid further sanctions.
The notice of seizure also gives the debtor the opportunity to contest the seizure or negotiate with the creditor before the assets are sold.

Classification of assets: unseizable, relatively seizable and seizable.

Unseizable assets are those essential to the debtor’s daily life and work, such as clothing, basic furniture, professional tools and certain household equipment.
These assets are protected by law to ensure that the debtor can continue to live and work despite the seizure procedure.
Relatively seizable assets can be seized under certain conditions.
For example, social benefits or alimony payments can only be seized above a certain amount.
Finally, seizable assets include all other unprotected assets, such as bank accounts, vehicles, real estate and valuables.
Distinguishing between these categories is crucial, as they determine which assets can actually be seized to repay the debt.
This classification protects the debtor by ensuring that assets essential to his livelihood are not unduly taken.

Priority in the seizure of assets and right to contest

The seizure of assets and receivables follows an established order of priority to minimize disruption to the debtor’s life.
The most liquid assets, such as bank balances, are generally seized first, followed by movable property and then real estate.
This order is designed to maximize collection efficiency while preserving as far as possible the debtor’s ability to maintain a decent standard of living.
The debtor’s claims, such as wages, can also be seized, but only up to a certain percentage defined by law to ensure that the debtor maintains a minimum standard of living.
The debtor may object to the seizure of certain assets by proving that they are exempt from seizure, or by demonstrating that their seizure would cause an unfair disproportion.
Such objections must be made promptly and supported by solid evidence if they are to be taken into account by the relevant debt-collection office or court.

Determining the subsistence minimum and its effects

Calculating the subsistence minimum is crucial in determining the amounts that can be seized without depriving the debtor of his basic needs.
The subsistence minimum comprises a basic amount for living expenses, adjusted according to the debtor’s family situation and specific needs.
For example, basic amounts vary if the debtor is single, married or has dependent children.
Additional charges may be added to the basic amount to cover necessary expenses such as medical, transportation or employment-related costs.
These amounts are regularly updated to reflect current living costs.
It is essential that both debtor and creditor are aware of these amounts to avoid excessive seizures that would jeopardize the debtor’s livelihood.
The correct calculation of the subsistence minimum ensures that the debtor can continue to live a decent life while meeting his or her financial obligations.

Execution of the seizure and the default deed

Initiation of realization by the creditor

When a debtor’s assets are seized, the creditor is obliged to request their realization.
This request is sent to the debt-collection office, which then appraises and sells the assets to pay off the debt.
The creditor must make this request without delay to prevent depreciation of the assets or intervention by other creditors.
The Office des poursuites then publishes a notice of realization, detailing the assets to be sold and the terms of the sale.
This notice informs the debtor and other interested parties, giving them time to submit any objections or specific requests.
This step is crucial, as it initiates the conversion of the seized assets into cash.

Publication of notice of execution and foreclosure procedure

The notice of realization is an essential document that sets out the conditions for the sale of seized assets.
This notice is communicated to the debtor, as well as to creditors and other interested parties.
The sale may take place by public auction or by other appropriate methods to maximize the proceeds.
The time between the issuing of the notice and the actual sale varies, but should be long enough to allow the parties to prepare.
After the sale, the funds obtained are used to pay the claim, after deduction of the costs of the proceedings.
It is crucial that the sale process is transparent and fair, respecting the rights of all parties.
The creditor must follow this phase closely to ensure that the amount recovered is optimal.

Issuance of a certificate of default

A deed of default is issued when the seized assets are insufficient to cover the entire debt.
This official document confirms that the debtor no longer has seizable assets to repay the balance of the debt.
For the creditor, this deed is very useful, as it enables subsequent proceedings to be re-launched without the need to prove the claim again, thus facilitating collection if the debtor acquires new assets.
For the debtor, the deed is a sign of insolvency, which can damage his reputation and limit his ability to obtain credit or enter into contracts.
This deed remains in force for 20 years and can be renewed, giving the creditor a continuing right to the debtor’s future assets.
This situation calls for prudent financial management on the part of the debtor to avoid future problems.

Role of the Defect Deed for the creditor and implications for the debtor

The “acte de défaut de biens” offers a number of advantages for the creditor, including the possibility of reopening proceedings as soon as the debtor acquires new assets or income.
The document also has considerable probative value, simplifying future collection actions as the creditor does not need to prove the debt again.
For the debtor, receipt of a deed of default is an official recognition of insolvency, with significant legal and financial repercussions.
In addition, it can adversely affect the debtor’s reputation and limit his or her economic opportunities.
Managing this deed is therefore crucial for both parties: the creditor seeks to maximize his chances of recovery, while the debtor must minimize the negative impact on his future situation.
It is also essential for the debtor to understand his or her rights and obligations in order to better navigate this legal framework.