A warrant of seizure, known as ‘mandat ta’ qbid’ in Maltese, is a legal precautionary act ordered by the court at the request of a party. It can serve both as a precautionary and an executive warrant. Precautionary warrants of seizure apply only to moveable property, while executive warrants of seizure can apply to both moveable and immovable property.
The main purpose of a warrant of seizure is to bring the asset under court authority for potential sale by court auction. The proceeds from the sale are deposited in court, initiating a competition procedure for their distribution. It's important to note that filing for a warrant of seizure does not guarantee the aggrieved party priority in receiving the auction proceeds. The ranking of creditors is determined by law and priority. This legal mechanism ensures that creditors' rights are protected and that the distribution of assets is handled fairly and transparently.
This warrant allows for the physical seizure of the debtor’s moveable property, placing it under court authority. Such a warrant cannot lead to a judicial sale unless there is an executive title or prior judicial acknowledgment. The court registrar is ordered to seize specific items from the debtor, and an official consignee is appointed to handle the items.
An executive warrant of seizure involves a court executing officer seizing the debtor’s possessions and placing them under court authority. In the case of Vella vs Borg Berquist (Court of Appeal, 2007), the court clarified that the objective is to protect the creditor's rights by seizing the debtor's assets. The executing officer can use necessary force to execute the warrant, including breaking open doors or containers.
In Car Care Products Limited vs Buġeja Et. (Civil Court, First Hall, 2010), the court emphasized that items under a warrant of seizure must be removed from the debtor’s possession immediately. The warrant includes orders for the seizure, transportation, and storage of the articles.
A warrant of seizure of immovable property functions solely as an executive act. According to Article 305(1) of Chapter 12 of the Laws of Malta, an application must detail the property for auction, including its acquisition mode, burdens, and a site plan. This also applies to ships or vessels over ten meters long.
In No Name Ltd v. Fountain (First Hall Civil Court, 2011), the court stated that the warrant application must specify the property details for the sale. The court decree ordering the warrant includes appointing experts for appraisal, setting a judicial sale date, and notifying the Public Registry and other relevant authorities.
Under Article 838B (2), a precautionary warrant can become an executive warrant once the cause becomes res judicata or meets specific legal criteria. The creditor must file a note within fifteen days to extend or reduce the warrant's effects according to the judgement, which is then served to the debtor and interested third parties.
For more information or assistance, please contact Dr Robert Tufigno and Dr Delilah Vella.