Attachment of property proceedings

Many people in our country, as a result of a debt and a related court decision, see their property seized. However, this brings with it the appearance of a large number of doubts. How is it actually carried out? As expert lawyers in civil law, we would like to explain it to you in detail so that you can understand it better in case you have to face one.

What is meant by attachment of property?

The first thing to do is to define the concept of seizure. Specifically, it is a process whereby the Public Administration takes possession of the property of an individual in order to force him or her to settle debts that he or she has incurred and has not paid. 

These debts can be caused, for example, by the non-payment of child support after a separation, monthly social security contributions or annual personal income tax payments. In these types of cases, the Administration can seize, in addition to your real estate, your salary, your current account, your car or any other property. 

Everything related to the seizure of real estate and other property is set out in article 75 of the General Collection Regulations. 

What types of attachments are there?

Current legislation provides for three different types of attachment. These are:

Sobre bienes muebles

This occurs, for example, when the administration acts against the property of an individual for the purpose of settling the debt incurred by a natural person. Movable property is understood to be objects that can be easily moved from one place to another, such as computers, cars or household appliances. In this respect, it has the power to arrange for their deposit in the manner specified in the aforementioned regulation.

On immovable property

This is a more complicated point as immovable property refers, for example, to a house or business premises. The seizure can be carried out in whole or in part. In the case of companies, this point is covered by Article 42 of the Commercial Code.

On industry, commerce and business

This is the type of seizure by which the Public Administration disposes of the rights and assets of a company whenever it foresees that its directors compromise its solvency and the payment of its tax obligations. In addition, in these cases, the competent body appoints an official as administrator of the business.

The attachment procedure

In order to proceed with a seizure, it is essential that sufficient time has passed for the debt incurred by the person concerned to be subject to this type of procedure. When the time comes, the Public Administration notifies the debtor, by means of a formal notice, that it is going to proceed. It will have to do the same for third parties who are holders, depositaries or possessors of the assets concerned. The same applies to the taxable spouse, if there is one. 

In the event that the property is registrable in the Land Registry, the competent Public Administration will make a preventive annotation of the seizure and request the certificate of encumbrances of the property. The registrar will carry out the procedure, clearly stating the date. 

Is it possible to oppose the attachment procedure?

The answer is yes. However, the debtor has to invoke one of the following grounds for doing so:

1. The debt is extinguished. 
2. The right to demand payment is time-barred. 
3. There has been no notification in respect of the diligencia or the ordenencia de apremio. 
4. The recovery procedure has been suspended. 
5. The rules governing seizure, as specified in the legislation in force, have not been complied with.

The appeal for reconsideration against the diligencia

Once it is clear to the debtor that one of the grounds for opposition has arisen, he has the right to lodge an appeal for reconsideration against the attachment order. Similarly, he can also file an economic-administrative claim. This second procedure is not compatible with the first one and can only be lodged independently or, failing that, once the appeal has been resolved.

Lodging and processing of the appeal for reversal of the judgment

Once the seizure has been notified by means of a writ of summons, the alleged debtor has a period of one month, starting on the following day, to lodge an appeal for reversal. The same applies to the day after the day on which the effects of the administrative silence come into effect. 

It should also be borne in mind that in the case of debts with collective notification and periodic maturity, the period for lodging the appeal will start to run from the day following the end of the voluntary payment period. The allegations must be made during the same filing period. 

How can the embargo be released?

There are only two alternatives. The first is through the success of the appeal or the economic-administrative claim. The other is by extinguishing the tax debt. In this case, the debtor will also have to pay the costs of the levy procedure.

What happens to the seized assets?

In the event that the seizure procedure reaches your property without the debtor having been able to settle the debt owed to the public administration, the assets disposed of will be sold by tender, auction or direct award. This is done with the aim of settling the debt in full or at least in part.

This seizure procedure may also lead to the assets becoming the property of the tax authorities. This is not a common occurrence, as the legislation only contemplates that it can do so when they could be of interest for the development of its activity. 

In the event that the Public Administration reaches an agreement for the direct award of the asset, this must always be for the exact amount of the debt pursued.

It should also be noted that the Administration does not have the right to proceed with the sale of the seized assets and other seized rights specified in the enforcement procedure until such time as the act of liquidation of the tax debt incurred by the debtor becomes final. This is so unless there is a case of force majeure or, failing that, the seized assets are of a perishable nature. The same applies when there are reports that consider that the property is subject to an imminent loss of value or even when it is the debtor himself who certifies his express wish for the procedure to be carried out.

In short, the repossession process is complicated, but we hope we have helped you to better understand what it consists of, what its stages are and what consequences it has, please contact us for any further questions.