Attachment of Assets: What Is It, How Does It Work, and What Are the Types?

What is attachment of assets?

Attachment is a powerful legal instrument that allows you, as a creditor, to temporarily secure a debtor's assets or receivables. The primary objective is to prevent the debtor from concealing or selling their property before you can recover your debt. By placing an attachment, you create a legal blockade ensuring that those specific assets remain available for future payment.

This article is the first in a four-part series on attachment. In upcoming installments, we will cover conservatory attachment and its lifting, attachment of real estate and other capital assets, and finally, the risks of wrongful attachment and how to defend yourself against it.

What types of attachment are there?

Dutch procedural law distinguishes primarily between two main forms of attachment. These forms are categorized based on the stage of the legal proceedings and the specific goal you aim to achieve. Understanding the distinction between these two is essential for every business owner.

Additionally, there are various objects upon which an attachment can be placed, such as bank accounts, salary, inventory, or real estate. The choice of the correct instrument depends on your specific situation and the nature of the claim you hold against your debtor.

What is conservatory attachment?

Conservatory attachment is a protective measure implemented while awaiting a final judgment in court proceedings. You file this attachment to prevent the debtor from diminishing their assets while the legal dispute is ongoing. It is a provisional measure used to safeguard your future debt collection possibilities.

Because this attachment can significantly affect the debtor's business operations before a judge has made a final ruling, strict conditions apply. You must seek permission from the court to place this attachment and provide evidence to show that your claim is well-founded.

What is executive attachment?

Executive attachment is the subsequent step in the process, which can only occur after you have obtained an enforcement title. Such a title is typically a court judgment or a notarized deed in which the claim is formally documented. With this document, you are authorized to proceed with the actual collection of the debt.

With executive attachment, the goal is no longer merely to preserve assets, but to realize the claim. The seized assets are sold, or the seized receivables are collected, and the proceeds are then used to satisfy your claim.

What is third-party attachment?

Third-party attachment is a specific form of seizure where you attach assets or receivables that a third party holds on behalf of your debtor. Examples include the debtor's bank account (where the bank is the third party) or salary that an employer owes to the debtor.

This attachment obligates the third party to pay the funds they would normally pay to the debtor directly to you or the bailiff. This is often a highly effective method, as it directly impacts the debtor's liquidity and frequently leads to a swift payment arrangement.

Key points at a glance

• Always verify that the claim is due and payable before initiating an attachment.
• Ensure the attachment is executed correctly by hiring a licensed bailiff.
• Be aware that with conservatory attachment, you must initiate substantive court proceedings within a strict legal timeframe.
• Keep in mind that costs for the bailiff and legal counsel are initially at your own expense.
• Maintain proportionality; do not attach assets for excessive amounts compared to the actual claim.
• Be prepared for a defense or a petition to lift the conservatory attachment from the debtor.
• Ensure you have sufficient evidence to substantiate the claim.
• Check which assets can be seized and whether they represent sufficient value.

What should you do now?

Attachment is a complex legal exercise where errors can lead to major financial consequences, such as damage claims from the debtor in cases of wrongful seizure. It is crucial to properly map out your position in advance and determine the right procedural strategy. Therefore, always engage a specialized procedural law attorney at an early stage to protect your interests and mitigate risks.