DEBTORS ACT 1957

Debtors LAWS OF MALAYSIA REPRINT Act 256 DEBTORS ACT 1957 Incorporating all amendments up to 1 January 2006 PUBLISHED BY THE COMMISSIONER OF LAW REVISION, MALAYSIA UNDER THE AUTHORITY OF THE REVISION OF LAWS ACT 1968 IN COLLABORATION WITH PERCETAKAN NASIONAL MALAYSIA BHD 2006 1 2 DEBTORS ACT 1957 First enacted ... ... ... … … 1957 (Ordinance No. 71 of 1957) Revised … … ... … … 1981 (Act 256 w.e.f. 26 November 1981) PREVIOUS REPRINT First Reprint ... ... ... ... ... 2001 3 LAWS OF MALAYSIA Act 256 DEBTORS ACT 1957 (Revised—1981) ARRANGEMENT OF SECTIONS PART I PRELIMINARY Section 1. Short title 2. Interpretation PART II EXECUTION IN RESPECT OF JUDGMENT DEBTS 3. Execution in respect of judgment debts. PART III ARREST, EXAMINATION AND IMPRISONMENT OF JUDGMENT DEBTORS 4. Judgment debtor summons 5. Power of court to order discharge of debtor 6. Arrest of judgment debtor 7. Interim order for protection of debtor’s property 8. An order for payment by instalments not to be a bar to execution 9. Rules of court may be made as to deposit to be furnished by judgment creditor 10. Arrest or commitment to be dependent on deposit of expenses 11. Expenses to be added to judgment debt 12. Commitment of defaulting trustee, etc. 4 Laws of Malaysia ACT 256 Section 13. Discharge or suspension of order 14. Imprisonment not to operate as satisfaction PART IV ARREST BEFORE JUDGMENT 15. Where defendant may be required to furnish security for appearance 16. Procedure on application by surety to be discharged 17. Procedure where defendant fails to furnish security or find fresh security 18. Application by defendant PART V ATTACHMENT OF PROPERTY BEFORE JUDGMENT 19. Seizure of property before judgment 20. Court may release property 21. Order for sale of perishable goods 22. Property liable to execution PART VI DAMAGES FOR IMPROPER ARREST OR ATTACHMENT 23. Compensation for improper arrest or attachment PART VII REPEAL 24. Repeal Debtors 5 LAWS OF MALAYSIA Act 256 DEBTORS ACT 1957 An Act relating to debtors. [Peninsular Malaysia—1 April 1958, L.N. 72/1958; Sabah and Sarawak—1 June 1981, P.U. (B) 302/1981] PART I PRELIMINARY Short title 1. This Act may be cited as the Debtors Act 1957. Interpretation 2. In this Act, unless the context otherwise requires— “appropriate officer” means in respect of any court the officer authorized by law to execute any judgment of such court; “court” means the court in which the original proceedings were commenced; being the High Court, a Sessions Court or a Magistrates’ Court; “Federal officer” means any officer employed or deemed to be employed by the Government of Malaysia; “judgment” includes any decree, order or decision for the payment of money; “Peninsular Malaysia” has the meaning assigned thereto in section 3 of the Interpretation Acts 1948 and 1967 [Act 388], and includes the *Federal Territory. *NOTE—“Federal Territory” refers to the Federal Territories of Kuala Lumpur and Labuan–see P.U. (A) 220/1985. 6 Laws of Malaysia ACT 256 “State officer” means any officer employed by a State Government whose conditions of employment do not render him liable for service outside that State; “the State”, in subsection 6(1), paragraph 15(1)(a), (b) and (c) and paragraph 19(1)(a), means— (a) Sabah; (b) Sarawak; or (c) Peninsular Malaysia, as the case may be, where the court is situated; PART II EXECUTION IN RESPECT OF JUDGMENT DEBTS Execution in respect of judgment debts 3. (1) Subject to and in accordance with any rules of court any sum of money payable under the judgment of a court may be recovered in case of default or failure of payment thereof forthwith or at the time or times, or in the manner thereby directed by execution whether legal or equitable against the property movable or immovable of the party against whom the judgment was obtained: Provided that the following shall not be liable to attachment, seizure or sale in such execution, namely: (a) the wearing apparel, cooking vessels, beds or bedding of the judgment debtor, his wife and children, and the tools and implements of his trade to the value of two hundred ringgit in all, which to that extent shall be protected from execution; (b) the tools of artisans or, where the judgment debtor is an agriculturalist, his implements of husbandry and such cattle and seed-grain or produce as may in the opinion of the court be necessary to enable him to earn his livelihood as such; (c) houses and other buildings (with the materials and the sites thereof and the land immediately appurtenant thereto and necessary for their enjoyment) belonging to an agriculturalist and occupied by him; Debtors 7 (d) books of account; (e) any pension, gratuity or allowance granted by the Government of Malaysia or the Government of any State or by such other public body as the Yang di-Pertuan Agong may by notification in the Gazette designate; (f) wages or salary of the judgment debtor: Provided that where such wages or salary exceed two hundred ringgit a month the court may authorize execution to be levied in such manner as may be prescribed by rules of court in respect of such excess or part thereof as the court may think just; (g) where the judgment debtor is a person liable for the payment of land revenue, any movable property which under any law applicable to him is exempt from sale for the recovery of an arrear of such revenue; and (h) any share of a judgment debtor in a partnership as to which the judgment debtor is entitled to proceed to obtain a charge under any written law relating to partnerships. (2) Nothing in this section shall be deemed to exempt houses or other buildings or the materials or sites thereof or the land immediately appurtenant thereto or necessary for their enjoyment from attachment or sale in execution of judgments for the payment of rent of any such house, building, site or land. PART III ARREST, EXAMINATION AND IMPRISONMENT OF JUDGMENT DEBTORS Judgment debtor summons 4. (1) Where the judgment of a court is for the recovery or payment of money whether by instalments or otherwise the party entitled to enforce it (hereinafter called the judgment creditor) may, subject to and in accordance with any rules of court, summon the judgment debtor, or if the judgment debtor is a corporation an officer of that corporation, to be orally examined before the court respecting the judgment debtor’s ability to pay or satisfy the judgment debt, and for the discovery of property applicable to such payment and to the disposal that the judgment debtor has made of such property. 8 Laws of Malaysia ACT 256 (2) The judgment debtor, or, where the judgment debtor is a corporation, the officer thereof who has been summoned, shall, when called upon, produce all books, papers or documents in his possession or power relating to such property. (3) The judgment creditor may subpoena as a witness any person whom he considers likely to be able to supply information respecting the judgment debtor’s ability to pay the judgment debt or respecting his property. (4) Whether the judgment debtor, or, where the judgment debtor is a corporation, the officer thereof, appears or not the judgment creditor and other witnesses may be examined on oath respecting the matters aforesaid. (5) If the judgment debtor, or, where the judgment debtor is a corporation, the officer thereof having been duly served does not appear, the court may— (a) order him to be arrested and brought before the court to be examined; or (b) make an order against the judgment debtor ex-parte. (6) Upon such examination or non-appearance as aforesaid the court may order the judgment debtor to pay the judgment debt either— (a) in one sum whether forthwith or within such period as the court may fix; or (b) by such instalments payable at such times as the court may fix. (7) If the judgment debtor makes default in payment according to any such order, a notice in the form prescribed by rules of court may be issued, on the request of the judgment creditor, calling upon the judgment debtor to attend before the court at a time therein stated and show cause why he should not be committed to prison for such default. (8) Any such notice shall be personally served upon the judgment debtor; and if, on the day so named, or on any subsequent day to which the matter may be adjourned, no sufficient cause is shown by the judgment debtor, the court may commit him to the civil prison for a term which may extend to six weeks or until earlier payment of any instalment or instalments or other sum due. Debtors 9 (9) A debtor shall not be committed to prison under this section unless it appears that, since the date of the order directing payment, whether forthwith, or within a specified period or by instalments, he has had sufficient means to comply with the order. Power of court to order discharge of debtor 5. (1) If at any time it appears to the satisfaction of a court that any debtor arrested or confined in prison by order of the court is unable from any cause to pay any sum recovered against him (whether by way of satisfaction of a claim or counterclaim or by way of costs or otherwise), or any instalment thereof, and ought to be discharged, the court may order his discharge upon such terms (including liability to re-arrest if the terms are not complied with) as the court thinks fit. (2) Where an order of commitment issued by one court has been sent to another court for execution, that other court shall have the same power as the court in which the order of commitment was made of ordering the discharge of the debtor under this section. Arrest of judgment debtor 6. (1) Where a judgment for the payment of money remains wholly or in part unsatisfied, whether a writ of execution has been issued or not, the court may order the debtor to be arrested and brought before the court forthwith for examination in accordance with subsection 4(1), if it appears to the court that there is probable reason for believing, having regard to his conduct, or the state of his affairs, or otherwise, that he is likely to leave the State with a view of avoiding payment of such money or of avoiding examination in respect of his affairs. (2) If the examination is adjourned, the court may order the debtor to be committed to prison until the adjourned hearing, or until such time as he furnishes security in an amount to be named in the order for his appearance at the adjourned hearing. (3) In any proceedings under this section the court may exercise all or any of the powers conferred upon it by section 4 subject to subsection (9) of that section. 10 Laws of Malaysia ACT 256 Interim order for protection of debtor’s property 7. The court may, upon an examination under this Part, make any interim order which it may deem expedient for the protection of any property appearing likely to be available for the discharge of the judgment debt. An order for payment by instalments not to be a bar to execution 8. Subject to any rules of court, an order for the payment of instalments of a judgment debt under this Part shall not be a bar to proceedings in execution unless and except to the extent that the court shall so direct. Rules of court may be made as to deposit to be furnished by judgment creditor 9. Rules of court may be made for the following purposes: (a) for requiring the deposit by the person at whose instance any order for arrest or imprisonment is issued, of a sum of money to provide for— (i) the expense of bringing the debtor before the court; and (ii) the subsistence of the debtor while in prison; and (b) for regulating any matter incidental to such deposit. Arrest or commitment to be dependent on deposit of expenses 10. (1) Where under any rules of court the judgment creditor is required to deposit money to provide for the expense of bringing the debtor before the court, the debtor shall not be arrested until such deposit has been made;