Law on Enforcement Procedings (1999)

LAW OF GEORGIA

ON ENFORCEMENT PROCEEDINGS

CHAPTER I

GENERAL PROVISIONS

Article 1. The Scope of the Law

This Law shall regulate the procedure and conditions of the enforcement of the acts of the courts of general jurisdiction, of the administrative bodies (officials) and private arbitrage.

Article 2. Acts subject to enforcement

1. An administrative act of an authorised administrative body (an official) on an administrative misdemeanours and the following court acts (hereinafter judgements) shall be subject to the enforcement in accordance with the procedure, established by the Law:

a) An enacted court judgement, writ and ruling on a Private Law case;

b) An enacted court sentence, writ and ruling on a Criminal Law case concerning the property recovery;

c) An enacted court sentence on a Criminal Law case, concerning the imposition of a fine upon an individual as an punitive measure;

d) An enacted court writ on an administrative misdemeanours concerning the property recovery and on the imposition of a fine as a punitive measure;

e) Order of payment;

f) Private arbitration awards;

g) A Judgement, provided by Article 268 of the Civil Procedure Law of Georgia, subject to a forthwith enforcement;

h) Award of an arbitrage, the enforcement of which is provided for by the International Treaties of Georgia;

i) Judgements of foreign courts, the enforcement of which is provided for by the Georgian legislation.

Article 21. Property Limitation

Property under Article 4 of the Law of Georgia on the Privatisation of the State Property, as well as the generation units, power distribution grid and local gas networks, owned by the State or the enterprises, not less than 50% of the shares of the subscribed capital of which is owned by the State shall not be subject to (coercive) enforcement, compulsory auction, seizure and sequestration (14.02.2002 N 1284).

CHAPTER II

ENFORCEMENT AGENCIES

Article 3. Enforcement Agencies

1. Enforcement agencies are: territorial bodies of the Ministry of Justice of Georgia and the Ministries of Justice of Abkhazia and Adjzra Autonomous Republics the Enforcement Bureaus.

2. The system of the Enforcement Bureaus is elaborated by the Minister of Justice of Georgia, while in Abkhazia and Adjara the Ministers of Justice of Abkhazia and Adjzra Autonomous Republics.

Article 4. Enforcement Department

1. Enforcement Department shall be a structural subdivision of the Ministry of Justice.

2. The Chairman of the Department, who is appointed and dismissed by the Minister of Justice of Georgia, shall head Enforcement Department.

3. The Minister of Justice of Georgia shall approve the Statute of the Enforcement Department.

4. The activities of the Enforcement Departments and enforcement agencies of Abkhazia and Adjzra Autonomous Republics shall be regulated by this Law.

Article 5. Enforcement Bureau

1. Bailiffs, whose office shall be an Enforcement Bureau, shall enforce the judgements under this Law.

2. An Enforcement Bureau shall be headed by a Chief bailiff the Head of the Bureau, who shall be appointed to the post from the staff of the Bailiffs, provided by this Law and relieved of the post by the Minister of Justice of Georgia under the submission of the Chairman of the Enforcement Department.

3. In its activities the Enforcement Bureau shall be guided by this Law, the legal acts of Georgia and the Statute of the Enforcement Bureau.

4. The Minister of Justice of Georgia upon the submission of the Enforcement Department shall approve the Statute, personnel and the estimation.

5. Ministers of Justice of the Autonomous Republics shall set up and revoke the Enforcement Bureaus of the Autonomous Republics, appoint and dismiss the Chief Bailiffs pursuant to the procedure prescribed by this Law.

6. Expanses related with the securing of the logistics of the Enforcement Bureaus shall be covered from the State Budget and other revenues established by this Law.

7. An Enforcement Bureau shall have its own seal depicting the state symbol and inscription Territorial Agency for the Enforcement Department of the Ministry of Justice of Georgia - Enforcement Bureau. The Enforcement Bureau shall have its deposit account.

CHAPTER III

BAILIFFS

Article 6. Conditions for the appointment to the post of a Bailiff

Any citizen of Georgia, with higher education, may fill the office of the bailiff.

Article 7. Appointment of the Bailiffs

1. A bailiff shall be appointed to the post and dismissed by the Minister of Justice of Georgia under the submission of the Head of the Enforcement Department. Upon the appointment a bailiff shall receive an official identification card and be assigned the territory of activity.

2. The Bailiffs shall have a seal depicting the State Symbol. The seal shall also bear the full name of a bailiff and the location of the Enforcement Bureau, as well as the identification number, conferred upon the former by the Minister of Justice of Georgia.

3. The maximum age for the occupation of the office of a bailiff shall be equal to that of a civil servant. The Minister of Justice of Georgia shall be entitled to prolong the term of office of a bailiff for not more than 5 years under the submission of the Head of the Enforcement Department.

4. The Ministers of the Autonomous Republics shall appoint the Bailiffs of the Autonomous Republics.

Article 8. Taking the office of a bailiff

A bailiff shall take his/her office within 10 days after his/her appointment. Before taking the office he/she shall be obliged to submit the seal, the sample of the signature and the certificate of bank account to the Enforcement Department.

Article 9. Professional restrictions on the activity of a bailiff

A bailiff shall not be entitled to hold any established post at a public office.

Article 10. Expenses related with the enforcement, enforcement fee and the remuneration of a bailiff

1. The mount of expanses related with the enforcement shall be established on the grounds of the calculations of a bailiff, which may be amended during the enforcement process.

2. The amount of an enforcement fee shall be established pursuant to the Law of Georgia on Enforcement Fees.

3. The duty of payment of the enforcement fee shall rest with a debtor and it shall be collected together with the demand subject to the enforcement. Percentage amount of the enforcement fee, to be deposited on the special account of the ministry of Justice of Georgia shall be established under the Ordinance of the President of Georgia.

4. 15% of the sum, collected through the enforcement of the court judgments and the acts of administrative bodies (officials) in favour of the State or local budget shall be transferred from the deposit account of the Enforcement Bureau to the special account of the Ministry of Justice of Georgia, opened with the Treasury. This sum shall be exploited for the organisational arrangement of the enforcement of a court judgement and material maintenance of the Bailiffs and the Ministry of Justice servants.

5. The order of disbursement and utilization of the sum, deposited to the special account of the Ministry of Justice shall be established by the Minister of Justice of Georgia.

6. The labour of the Bailiffs shall be remunerated from the State budget and the revenues under this Article.

Article 11. Enforcement of urgent judgements by the bailiffs of judgements

The bailiffs shall enforce the urgent judgements listed in Article 268, Para. 1 (a) (d) of the Civil Procedure Code of Georgia by means of the funds allocated from the State Budget or the interest accrued to an account of an Enforcement Bureau by a banking institution.

Article 12. Grounds for the dismissal of a bailiff

1. The law of Georgia on civil service shall stipulate the grounds for the dismissal of a bailiff.

2. The additional grounds for the dismissal of a bailiff can be:

a) An official offence, envisaged by a bylaw resulting in the disciplinary liability, which is subject to the approval of The Minister of Justice of Georgia;

b) Other disclosed circumstances, which prevent him/her from holding the office of a bailiff.

Article 13. Paid leave and pensions of a bailiff

1. Annual paid leave of a bailiff shall make 30 calendar days.

2. A bailiff shall be entitled to the pension for the years served, in accordance with the order, provided by the Georgian legislation.

3. The Ministry of Justice of Georgia shall regulate the sequence granting annual paid leaves and the preparation of the required documents for awarding the pension

4. (deleted)

Article 14. Other social security services

1. A bailiff is supported by special uniform, paid for by the state.

2. The law shall establish the procedure of applying the defensive means and official weapons by a bailiff.

3. In case of the death of a bailiff during the performance of his/her professional duties a lump sum aid in amount of 10 years wages shall be granted to his/her family from the State Budget. The government shall cover the funeral expenses.

4. A bailiff, who was wounded or injured when performing his professional duties shall be entitled to the compensation from the budget in amount of wages for 1 to 5 year, according to the gravity of their injury.

CHAPTER III1

ENFORCEMENT POLICE

Article 141. Enforcement Police Administration

1. Enforcement Police Administration (hereinafter Administration) is a structural subdivision of the Enforcement Department.

2. The Administration shall be headed by the Head of the Administration who shall be appointed to the office and dismissed by the Minister of Justice of Georgia under the submission of the Chairman of the Enforcement Department.

3. In its activities the Administration shall be guided by this Law and other legal acts of Georgia.

4. Organisational structure and the activities procedures of the Administration shall be established by the Statute of the Administration, subject to the approval of the Minister of Justice of Georgia.

5. Legal grounds for serving in the Administration shall be the following: the Laws of Georgia on the Enforcement procedures, on Special State Ranks and on civil Service, as well as the Statute of the Administration and other legal acts.

Article 142. Enforcement Policeman

1. An enforcement policeman shall be a civil servant, who shall be appointed to the office and dismissed by the Minister of Justice of Georgia under the submission of the Chairman of the Enforcement Department.

2. When exercising his official duties, an enforcement policeman shall be a representative of the State power and his every demand related with the official duty shall be legally binding.

3. Non-fulfilment of a legal demand of an enforcement policeman shall entail the liability in accordance with the established order.

4. When exercising his official duties, an enforcement policeman shall be entitled to store, bear, and used firearms and special means in accordance with the procedures, established by the Georgian legislation.

5. When exercising his official duties, an enforcement policeman shall wear the official uniform, the symbols of which are subject to approval of the Minister of Justice of Georgia. An enforcement policeman shall be issued a identification card of the type, approved by the Minister of Justice of Georgia.

Article 143. Rights and Duties of an Enforcement Policeman

1. An enforcement policeman shall be liable:

a) To assist the bailiff in the enforcement of the court judgments;

b) To safeguard the public order during an enforcement action;

c) To safeguard the bailiffs and other persons against unlawful assault during an enforcement action;

2. An enforcement policeman shall be entitled to the following upon the execution of the obligations imposed upon him

a) To demand the protection of public order upon the duration of an enforcement;

b) To prevent the unlawful action of parties to an enforcement procedure;

c) To take a motor-vehicle belonging to a debtor into custody on the grounds of a written demand of a bailiff and take it to the bailiff;

d) To apply to physical constraint, special means and firearms in cases, envisaged by the Law.

Article 144. Application of physical constraint, special means and firearms

1. Upon the execution of his duties and enforcement policemen shall be entitled to apply to physical constraint, including special means of combat with a view of securing the personal safety and that of the persons participating in the enforcement procedure, provided he will not be able to secure the statutory obligations without applying to forceful measures.

2. Upon the execution of his duties an enforcement policeman shall be entitled to use the following special means:

a) Handcuffs and other means of tying against an individual who offers or may offer resistance;

b) Rubber truncheon against an individual, who attacks a person participating in the enforcement process.

3. Upon the execution of his duties an enforcement policeman shall be entitled to use a firearm as an ultimate resort:

a) With a view of protection of the persons participating in the enforcement process and himself against such an assault, that may jeopardy their lives or health, also against the attack of dangerous animals,

b) With a view of prevention the attempt of seizing a firearm,

c) With a view of giving an alarm signal.

4. It shall be prohibited to apply to the physical constraint, special means and firearms against the persons, bearing apparent vestiges of a pregnant woman, minor, disability and old age, apart from the cases, when they are engaged in armed or group assault, or offer armed resistance to the enforcement police, what jeopardises the life and health of the persons, participating in the enforcement process, unless such an assault could be opposed in any other way or through other means.

5. In the case of application of physical constraint, special means and firearms, an enforcement policeman shall be liable to de his best to secure the safety o other persons and to render urgent medical assistance to an injured person.

6. An enforcement policeman shall be liable to report to his immediate superior officer and the Prosecutor about the application of a firearm.

CHAPTER IV

ORGANIZATION OF THE ENFORCEMENT

Article 15. Grounds for challenging a bailiff; Challenge procedure and self-challenge

1. The challenge of a bailiff shall be admissible on the grounds envisaged by Article 31 of the Civil Procedure Code of Georgia.

2. The Head of the Enforcement Bureau shall consider the issue of challenge or a self-challenge of a bailiff within territory of jurisdiction and subsequently notify his decision to an applicant.

3. Decisions of the Head of the Bureau concerning the challenge or a self-challenge of a bailiff shall be subject to appeal with a court.

Article 16. Organization of the enforcement the Enforcement Bureau

1. Territorial bodies of the Ministry the Enforcement Bureaus shall be set up in accordance with the procedure, established by this Law and other legal acts

2. The Enforcement Bureau shall be headed by the Head of the Bureau, who:

a) Shall receive the enforcement writs of envisaged by this Law and allocate them to the bailiffs according to their jurisdiction;

b) Shall exercise control over the enforcement process and in case of necessity assigns additional bailiffs for rendering assistance;

c) Shall make decisions on the replacement of the challenged bailiffs with the other bailiffs;

d) Shall report the Enforcement Department of the Ministry of Justice of Georgia on a periodical basis on the development and current stage of the enforcement of judgements within the territory of its jurisdiction;

e) Shall perform the administrative and logistic functions;

f) If during the enforcement process, a judgement debtors moves to the territory falling within the jurisdiction of another Enforcement Bureau, the Head of the Enforcement Bureau shall duly notify the relevant Head of the Enforcement Bureau. The above shall as well be notified to the debtor and the Enforcement Department.

3. Official disputes related with the enforcement of judgements shall be considered by the Enforcement Department of the Ministry of Justice of Georgia.

Article 17. The rights and obligations of the bailiffs

1. Any demand of a bailiff made by the during performance of his professional duties, shall be legally binding for every legal or natural person, regardless of their subordination and legal and organizational status.

2. In his activities a bailiff shall be guided by thus Law, the Directions regarding the Enforcement process, approved by the Minister of Justice of Georgia and other legal acts.

3. Upon the execution of enforcement actions a bailiff shall be entitled to enter the apartment of a debtor, to inspect every storage facility and the property of a debtor. The inspection shall be conducted in the presence of at least two witnesses of legal capacity and shall be documented through drawing out a special report. The witnesses, a debtor and a bailiff himself shall sign the report.

4. In the case of coercive enforcement a bailiff shall be entitled to conduct:

a.Recovery:

a.a. From the property of a debtor by means of laying and attachment on it or the sale of property. In the case the State property is concerned, a bailiff shall duly notify the local agencies of the State property management;

a.b. From the wages, pension, scholarship and other incomes of a debtor;

a.c. From funds and property of a debtor that are maintained by the , as well as from the bank accounts of a debtor on the grounds of a collection order ;

b.Seizure of the items from a debtor, which should be transferred to a creditor pursuant to the judgement;

c.Any other measure referred to in the judgement pursuant to the Law.

5. A bailiff shall be liable to take all statutory measures for timely and actual enforcement of judgements, explain their rights and obligations to the parties and assist them in protecting their rights and legal interests.

6. If a debtor does not admit a bailiff to exercise his statutory duties, the latter shall be entitled to apply to the enforcement policeman.

7. In the case of offering resistance to a bailiff, or in the case neither a debtor nor a full-age member of his family is present during an enforcement action to be performed in the apartment of a debtor, a bailiff shall draw out a special report in the present of witnesses and shall proceed with performing an enforcement action in the presence of two witnesses, a representative of local self-government and government bodies.

8. During the enforcement process a bailiff shall be liable to summon a debtor to the Bureaus for Enforcement to get familiarised with the enforcement instruments, to receive any oral or written notice and information, provided it is necessary for performing an enforcement action.

9. During the enforcement proceedings falling within his jurisdiction, a bailiff shall be entitled to perform the enforcement actions on the territory of another Enforcement Bureau.

Article 171. Enforcement of cases in favour of the State Budget or the enforcement of cases of particular importance

1. With a view of enforcement of cases in favour of the State Budget or the enforcement of cases of particular importance, the Minister of Justice of Georgia may order a special group to be set up, comprising of the bailiffs and enforcement policemen, which shall be entitled to enforce the court judgments throughout the territory of whole Georgia.

2. Decisions regarding the assignment of the a case to the category of cases of special importance and the subordination of the enforcement of a court judgement in favour of the State Budget to the jurisdiction of the special group shall be adopted by the Chairman of the Enforcement Department.

Article 18. Authority of a creditor and a debtor

1. A creditor and a debtor shall be entitled to attend the enforcement procedure, familiarise themselves with the enforcement materials, receive the necessary information regarding the enforcement of judgement, to mediate, to agree upon the ownership of the property and its value, to appeal against the activity of a bailiff. The duration of the time frames shall be calculated from that moment, when the party became aware or should have become aware of the violation of his rights.

2. In case of reaching an amicable agreement (in the process of enforcement) a creditor and a debtor shall furnish a bailiff with the written document concerning the agreement, who shall transfer it to the court within a period of three days for the approval of the agreement made between the parties.

3. A creditor and a debtor shall be entitled to submit the private complaints on the postponement or conditions as to the time frames of the enforcement of judgements, or on any activity related to it.

Article 181. The Representation of the Parties in the Enforcement Procedure

1. The representation of the parties in the enforcement procedure is provided by the Civil Procedure Code of Georgia.

2. In case the decision is delivered in favour of the State Budget, the State shall be represented by the Enforcement Bureau and the latter shall bear the rights and responsibilities of an enforcement creditor.

Article 19. Familiarization with the enforcement instrument and transfer of their copies

Any person who participates in the enforcement proceedings shall be entitled to familiarise himself with the enforcement instrument and receive their copies.

CHAPTER V

ENFORCEMENT OF JUDGMENTS

Article 20. An enforcement writ

1. No enforcement of judgements shall be allowed without am enforcement writ.

2. An enforcement writ shall be issued with regard of a decision, which is subject to the enforcement pursuant to this law.

Article 21. An enforcement writ and an enforcement inscription

1. Judgements shall be subjected to the enforcement on the basis of the enforcement inscription made on the enforcement writ. The enforcement inscription shall have the following reading:

"This writ is issued to (name/title of the party) with a view of coercive enforcement of the judgement". The enforcement writ shall be supplemented with the signature of the Head of the Bureau, date and seal upon its receipt with a view of enforcement and its restitution to the creditor.

2. The agency delivering a judgement shall transfer an enforcement writ of to creditor after the enactment of the judgement, except for the cases of urgent enforcement of judgements envisaged by the Civil Procedure Code of Georgia, when an enforcement writ is issued upon delivery of a judgement.

3. The following shall be indicated in an enforcement writ:

a. The title of the court or an agency issuing the writ, which delivered a decision on the enforcement;

b. The case, the writ has been issued for;

c. The date of the delivery of the judgement;

d. The resolution part of the judgement;

e. The date of issue of the writ;

f. The name/title and all requisites on the creditor and the debtor.

4. An enforcement writ shall be endorsed by the signature and the seal of the person delivering a decision.

Article 22. Issuance of several enforcement writs with regard to one judgement

If the judgement is to be enforced in several places, or it was passed in favour of several plaintiffs or against several defendants, the courts shall be entitled to issue several enforcement writs indicating the precise place of the enforcement and the part of the judgement that is to be enforced on the grounds of this very writ.

Article 23. Issuance of the duplicates of an enforcement writ

In case of the loss of an enforcement writ, the court, which issued the first copy shall be entitled to issue the duplicates the enforcement writ.

Article 24. The issuance of an enforcement writ in favour of a legal successor or against a legal successor of a debtor

An enforcement writ may be issued in favour of a legal successor of a creditor indicated in the judgement or against a legal successor of a debtor, provided the succession is expressly manifested or documented by the relevant authorised agency or certified by a notary. If the succession cannot be proved by a document drawn out by the relevant agency or certified by a notary, a creditor or his legal successor should file a lawsuit with the court delivering the decisions on for the issuance of an enforcement writ.

Article 25. Commencement of the enforcement of judgements

1. The enforcement of judgements could be commenced only in case the individuals, against or in favour of whom the judgement is to be enforced, are expressly named in the enforcement writ and the court provides a creditor with the enforcement writ. Whenever the enforcement is to be effected in favour of State or/and local budget, the court shall forward the enforcement writ to the Enforcement Bureau according to the domicile of the debtor.

2. The bailiff shall serve the notice on the enforcement of judgements to a debtor, a creditor and the other parties.

3. The notice shall be served in accordance with the Civil Procedure Code of Georgia.

4. An enforcement writ is to be submitted to the Enforcement Bureau according to the domicile of a creditor or his property.

Article 26. Commencement of the enforcement action

A bailiff shall commence the enforcement action on the grounds of a written application of a creditor and an enforcement writ. A bailiff shall be entitled to refuse the enforcement of a judgement in case of non-payment of preliminary expenses, provided by the Law, on the part of the creditor.

Article 27. Interpretation of the judgement subject to the enforced

Judgments, subject to the enforcement shall be interpreted on the grounds of the application of the parties or the solicitation of a bailiff.

Article 28. Proposal on the voluntary enforcement of a judgement

1. Upon the commencement of the enforcement of a judgement, a bailiff shall submit a proposal to a judgement debtor offering the voluntarily enforcement of the judgement within a period of five days. The proposals shall be served according to the procedure, provided by the Civil Procedure Code of Georgia. When recovering money or property a bailiff, along with serving the proposal, shall forthwith commence the inventory of the property of a debtor or laying attachment on it pursuant to the procedures provided by this Law.

2. If a judgement is subject to urgent enforcement, a proposal shall be served to a debtor regarding the forthwith and voluntary enforcement of a judgement.

3. Upon serving a proposal a bailiff shall warn a debtor, that the failure to voluntarily enforce the judgement within the fixed terms shall result in the coercive enforcement. A debtor shall pay the expenses for the enforcement.

4. If there are grounds to believe, that a debtor may squander or hide away the property, a bailiff shall be obliged to distrain and lay the attachment on the property along with serving the proposal regarding the voluntary enforcement.

5. Upon the receipt of the application of a creditor regarding the enforcement of a judgement at the expanse of the State budget, a bailiff shall submit a proposal to a debtor a State body and the ministry of Finances of Georgia regarding the voluntary enforcement of a judgement at the expanse of the Enforcement fund.

6. Provided the enforcement funds are not sufficient for meeting the demand of a creditor within a period of one year, the President of Georgia shall apply to the Parliament of Georgia for additional assignments to the enforcement fund.

Article 29. A Report

1. A shall draw up a report with regard to every enforcement action performed.

2. A report should include:

a) Place and time of drawing up;

b) The name of a bailiff, drawing up a report, as well as the names of those individuals, who were present during the performance of an enforcement action;

c) The title of the instrument, on the basis of which an enforcement is performed;

d) Names (titles) of a creditors and a judgement debtor;

e) The subject matter of the performance of an enforcement action.

3. A bailiff, a creditor, a debtor and the witnesses shall sign a report. If any of those individuals refuse to sign the protocols, it shall be indicated therein. Copies of the protocol shall be transferred to a judgement debtor.

CHAPTER VI

JURISDICTION OF THE COURTS

Article 30. Search for a judgement debtor

A judge shall deliver a ruling on the search of a debtor through police authorities in the cases involving the recovery of alimony, indemnification of damages for bodily injures or other damages caused to ones health, as well as for the death of a bread-winner,

Article 31. Protection of the interests of a debtor during the coercive enforcement of judgements

1. In exceptional cases, whenever the enforcement is inconsistent with general principles and norms of moral (illness or decease of a debtor or a member of his family), a court, based on the application of a debtor may fully or partly revoke an enforcement measure, prohibit or temporarily suspend any measure for a period not exceeding two months.

2. The Court shall be entitled to revoke or change their ruling on the enforcement of a judgement on the basis of a creditors application, provided there is a major change in actual circumstances.

3. In cases, envisaged by this Article, the applications shall be considered pursuant to the procedure, established by the Civil Procedure Code of Georgia.

Article 32. A lawsuit of a third party on the ownership right with regard to the property distrainment for the other parties' debts

1. If a third party claims his right over the subject matter of an enforcement of judgement, he shall be entitled to file a lawsuit with the court, within the jurisdiction of which the enforcement of a judgement falls. The court shall consider such lawsuit according to the procedure for the litigation based upon a lawsuit (lawsuit on the lifting an attachment).

2. A lawsuit on lifting an attachment shall be filed against a debtor and a creditor.

3. Provided the property under the attachment is already disposed, the lawsuits shall also be filed against those individuals, to whom the property was transferred. In case of the satisfaction of a lawsuit on the recovery of the realized property, the dispute between a purchaser of the property, a creditor and a debtor shall be considered by the court. .

CHAPTER VII

POSTPONEMENT, TERMINATION AND SUSPENSION OF THE ENFORCEMENT PROCEDURE, RETURN OF THE INSTRUMENT, SUBJECT TO ENFORCEMENT

Article 33. Postponement of an enforcement activity

A bailiff, except for the cases provided by Article 34 and 35 shall not be entitled to suspend, terminate or postpone the enforcement procedure, return the enforcement instrument to a judgement creditor to postpone the enforcement action, to strike out the seized property from the inventory without a written application of a creditor. A bailiff shall be entitled to perform such actions on the grounds of a court ruling.

Article 34. Termination of the enforcement procedure

1. An enforcement procedure shall be terminated, if:

a) A creditor abandoned the recovery;

b) A creditors and a debtor came to an agreement;

c) The claims or obligations under the judgement cannot be transposed onto a legal successor after the death of a creditor or a debtor;

d) A judgement, on basis of which an enforcement writ was issued, is revoked,

e) Limitation period has expired.

2. In case of termination of the enforcement proceedings an enforcement instrument shall be returned to a creditor. All the measures undertaken view a view of enforcement shall be revoked.

Article 35. Return of the enforcement instrument

1. An enforcement document, which did not result in recovery, or resulted in partial recovery, shall be returned to a creditor:

a) On the grounds of a creditors application;

b) If a debtor does not own any property or income, which could be subjected to recovery;

c) If a debtor does not reside at the address, indicated by a creditor or his property is not located therein, except for the cases when a debtor is searched by the police authorities;

d) If following the expiration of a period of one month after a creditor being warned by a bailiff regarding the possible return of the enforcement instrument, the creditor fails to exercise his rights and obligations, by reason of which the enforcement of a judgement deems impossible.

Article 36. Suspension of the enforcement, its terms

1. Enforcement proceedings shall be suspended:

a. In case of the decease of a debtor or winding-up of a debtor a legal person until the identification of his/its legal successor, provided the legal relations, established by the court allow for the legal succession;

b. During the period when a debtors enlisted for a military service;

c. In case of incapacitation of a debtor until the appointment of his representative;

d. In case of filing for a litigation against the enforcement writ by a debtor, on the grounds of a claim procedure until the settlement of a dispute;

e. In case of filing a lawsuit against the actions of an authority (an official) authorised to examine an administrative misdemeanour until the delivery of a decision with respect to the part of the enforcement concerning the disputed property and until the delivery of a relevant decision;

f. In other cases provided by the Georgia legislation.

Article 37. Courts decision

If the reasonability of the termination of the enforcement procedure or the return of an enforcement instrument is doubted, a court shall take a decision on the grounds of an application filed by a bailiff, a creditor or a debtor.

CHAPTER VIII

THE EXPENSES OF THE ENFORCEMENT PROCEDURE

Article 38. A debtors liability to cover the expenses

1. The enforcement expenses shall be born by a debtor. They shell be covered together with the complaint to be enforced.

2. The expenses born by a debtor shall be indemnified to the latter in accordance with the procedure, provided by the Georgian legislations pursuant to the procedures provided by Georgian laws, in case pf revocation of an enforcement instrument.

Article 39. Expenses related with the enforcement procedure

1. Funds are to be recovered to cover the following:

a) Funds to be paid to the individuals, whose invitation turned out to be inevitable for unlocking the doors or storing facilities;

b) The costs of storage of the articles;

c) The expenses related with making a public announcements;

d) The expenses resulting from the detention of a debtor;

e) The expenses related with an auction.

2. The Minister of Justice of Georgia may provide for other expenses as well.

CHAPTER IX

THE ENFORCEMENT OF JUDGEMENTS DUE TO FINANCIAL CLAIMS FOR PERSONAL PROPERTY

Article 40. Laying an attachment on a personal property

1. Laying an attachment on a personal property shall mean the inventory of the debtors property, declaration of the prohibition of disposal of the property in any way through the alienation, pledge, making a pledge or rent agreement with respect thereof or/and transfer of the property for storage. A bailiff shall list the seized articles in a report on distrainment.

Article 41. Preferential satisfaction of a lawsuit

1. A third party shall be entitled to claim the preferential satisfaction from the proceeds by means of filing a lawsuit, irrespective whether his claim is subject to enforcement or not.

2. A lawsuit shall be filed with a court.

3. If a lawsuit is filed against a creditor or a debtor, they shall be considered as co-participants of the proceedings.

4. If the pretension is proved, the court may rule the deposition of the proceeds.

Article 42. Verification of the property status of a debtor

1. If the enforcement did not result in the full satisfaction of a creditor, a bailiff shall summon a debtor on the basis of a creditors application and draw up a document regarding the property status of the latter.

2. A bailiff shall be entitled to obligate a debtor to produce a list of the property own by him. In such a list a debtor should indicate the grounds for his claim against a third party and relevant evidences as well. The list of property shall also include the property, which is due to him from the other individuals.

3. A debtor shall provide a written guarantee all the information required from him was submitted accurately and completely at the best of his knowledge.

4. If a debtor fails to submit a list of property or refuses to provide a written guarantee, or deliberately submits the inaccurate information, he shall be subjected to the liability in accordance with the procedure, provided by the Georgian legislation.

5. A bailiff shall verify the accuracy and completeness of the information provided by a debtor.

6. A debtors who provides a written guarantee shall be obliged to submit a repeated guarantee within three years after the provision of the original guarantee only in case it was proved that a debtor received the property later on or entered into new labour relations.

Article 43. Laying attachment

1. Money, securities and valuable articles shall be taken by a bailiff and stored in a special cell. The same goes true with the seized items, provided there is a danger that the seized items might be damaged. If the seized items are retained with a debtor, the seizure shall be effecter though the attachment of a seal. Any type of disposal of the seized property by a debtor shall result in criminal liability, provided by the law.

2. The yield, which is not yet detached from the soil, may be subjected to laying an attachment prior to the performance of an enforcement procedure with regard to the real property. Attachment shell not be laid later than one month prior to the harvest of yield.

3. If third parties claim their right to the property upon laying an attachment on a debtors property, it shall still be entered into the inventory list together with a due comment. Meanwhile a bailiff shall explain to such a person his rights to apply to the court for lifting an attachment from the property.

Article 44. Subjects of seizure

1. Every item of a debtor shall be subject to laying an attachment except for the property listed in Article 45 of this law (It is believed that every article found with a debtors belong to the former).

2. In case of necessity a bailiff may seal the inventory items at the request of a creditor and make a relevant entry into a inventory report.

Article 45. The property, which shall not be subject to recovery

1. The following items shall not be subject to recovery:

a) Personal effects or household appliances, as far as those are necessary for a debtor for his professional activity, as well as for living and housekeeping;

b) Food, fuel and lighting means required for a debtor, his family members and individuals living with him for a period of four weeks, or if such a supply is not available for that period of time and it cannot be purchased in any other way, the funds required for its purchase;

c) Small cattle in a restricted quantity, as well as one milk cow, or two pigs, sheep or goats, as preferred by a debtor, if those animals are necessary for the maintenance of a debtor, his family members and the individuals living with him; also supply of fodder and oat for three months, or if such supply is not available for the moment and it cannot be purchased in any other way, the funds required for its purchase;

d) For the individuals engaged in farming and agriculture - the inventory and devices required for farming and agriculture, livestock, fertilizers and also the agriculture products, to the extent they are necessary for the maintenance of a debtor, his family members and the workers hired by them, as well as the same or similar products for subsequent practicing of farming and agriculture till the subsequent harvest;

e) For the individuals, who earn their income through physical or intellectual activity or other activity - the articles required for such an activity.

2. The amount of subsistence minimum, required for natural necessities, shall be established in accordance with the procedure envisaged by the Georgian legislations.

3. The amount less than the subsistence minimum shall not be seized on the grounds of the above-mentioned basis.

4. The dispute on the exemption of the property from recovery shall be considered by the court.

Article 46. Temporary suspension of a sale

1. On the basis of a debtors application and under the consent of a creditor a bailiff may suspend the sale of the seized items through the postponement of the payment, provided it is considered expedient for to debtors personality and his economic standing and is not against the interests of a creditor.

2. Such orders can be issued several times, but the sale shall not be postponed for more than three months after laying an attachment.

Article 47. Assessment

1. A bailiff shall evaluate the seized items according to their usual market value. A bailiff may assign the conduct of an assessment to an expert or an auditor.

2. The market value of each seized item shall be indicated in the report on laying attachment on the property. The assessment of the property shall be effected not later than a two months period and shall be notified to the parties.

Article 48. A report on the inventory of the property

1. The following shall be entered into a report on the inventory (seizure) of the property:

a. Time and place of drawing up a report;

b. Title of the Enforcement bureau, within the territorial jurisdiction on which a judgement is being enforced, also the full name of a bailiff and the individuals who present upon drawing up a report;

c. Title of the court and the judgement, which is being enforced, or the title of other enforcement instrument and the agency, which issued it;

d. Name/title of a creditor and a debtor;

e. Denomination of each of the items entered into the report and the characteristic features (weight, area in square meters, wear and tear, etc.);

f. Individual evaluation of each of the items entered in the report and the value of the whole property;

g. Provided the items or/and storage-places were sealed, the list of the items and/or storage places which were sealed and the number of the seals;

h. Name/title and address of the person the property was transferred to for custody, unless the responsibility of keeping the property in custody has not been imposed on a debtor;

i. Term, after expiration of which, the property shall be given out for sale;

j. That a debtor and other individuals have been explained the procedure of appeal against the actions of a bailiff; that a debtor or a custodian have been explained their responsibility for the custody of the property, as well as its squandering, alienation or hiding away;

k. Comments and declarations of a creditor, a debtor and the individuals attending the inventory procedure; the orders of a bailiff on these comments and declarations.

2. Along with the seizure of the property the report on the inventory of should list the items which as per Para. 2 of Art. 45 of this Law, have been retained with a debtor, as well as other property of a debtor, which is jointly owned with the other individuals and which have not been seized, with due indication of their value.

3. The report on laying an attachment shall be signed by a bailiff, a custodian of the property, as well as by a creditor, a debtor and other individuals present during laying an attachment on the property.

Article 49. Sale

1. The court shall transfer the funds seized or voluntarily paid by a debtor to a creditor, exclusive of the enforcement expenses.

2. A bailiff shall sell the other seized items through an auction.

3. The seized articles could be sold at a price, which constitutes at least half of their value.

4. The court shall be entitled to give an opportunity to a debtor to realize the property under the supervision of a bailiff within a certain period prior to the auction, but at a price, than is not less than the one indicated in report on the seizure.

Article 50. Sale of the seized personal property through an auction

1. A bailiff shall be entitled to appoint an auction for the sale of this property in two weeks time after laying attachment on the personal property.

2. The seized personal property shall be sold at an auction pursuant to the procedures of the sale of the real property through an auction provided by this Law.

Article 51. Termination of an auction

An auction shall be terminated if the proceeds are sufficient for the satisfaction of a creditor and covering the enforcement expenses.

Article 52. Securities

The rules of laying attachment on and the sale of the items of personal property shall be applicable with regard to the securities as well.

Article 53. Other types of disposal

In case an agreement is reached between a creditor and a debtor, a court may rule on the grounds of their application, that a seized item should be disposed in some other was, different from the one, provided by this law. At the same time the interest of a creditor should be safeguarded.

Article 54. Repeated seizure

1. An item could be seized for a number of creditors at the same time. An already seized item could be placed under another attachment for the other (subsequent) creditor. To this end a bailiff shall make an entry to the report on the seizure, stating that he laying an attachment on an item for other creditor. If a, attachment was originally laid by another bailiff, he shall be served with a copy of the report.

2. A debtor shall be notified of the repeated seizure.

CHAPTER X

ENFORCEMENT OF CLAIMS

Article 55. The principle of laying attachment

1. A seizure may be placed on the claim of a debtor unless the legislation restricts its transfer or seizure.

2. A seizure may be placed on claims to be paid in the future provided their clear determination is available.

Article 56. The order on laying attachment

1. If a seizure is to be placed on the claim, a bailiff shall issue an order on laying attachment on the basis of a creditors application. The order shall indicate the grounds for creditors pretensions, the claims to be fulfilled by him and against whom the debtors claim is made (person under obligation). Laying attachment shall be accompanied with the issuance of the order on the payment to a creditor.

2. The order on seizure shall be sent to a person under obligation (a person, at whose place the defendants property under custody is subjected to coercive distrainment). The order shall be transferred to the creditor and debtor. Upon transferring the order to a person under obligation, the seizure becomes valid within the framework of the creditors claim. The debtor shall not be entitled to dispose claims whereas the person under obligation shall not be entitled to perform an action, which constitutes the essence of the claim. He shall pay the seized amount to the creditor. Other action, which constitutes the essence of the obligation, shall be performed by the bailiff.

3. Order on laying attachment issued for satisfying the claim concerned, may at the same time affect the part of the creditors claim that will become subject to enforcement in the future.

4. Order on laying attachment, regarding the claims on the salary or debtors claims involving similar regular income made against the person under obligation, shall also apply to the amounts which are subject to payment after laying attachment.

Article 57. Consequences of laying attachment

1. Under the order on laying attachment the creditor shall be entitled to require the third party to perform an action in his favour, which he should have performed towards his debtor.

2. Order on laying attachment shall be valid, even if it is unrightfully issued in favour of the person under obligation, against the debtor unless it is revoked and this revocation becomes known to the person under obligation.

3. A debtor shall be obliged to provide creditor with necessary information on making the pretension and the existing documents thereof. A creditor shall have the right to achieve access thereof by measures of coercive enforcement.

4. On the basis of the order on laying attachment the creditor shall have the right to lodge a claim in the court against the person under obligation.

Article 58. The submission of a person under obligation

1. Within two weeks after receiving the order on laying attachment a person under obligation shall report to the bailiff and creditor about:

a. Whether or not he acknowledges the claim and if so to what extent he is ready for making the payment;

b. Whether or not other persons will make pretensions on the claim and if so for which pretension;

c. Whether or not the seizure has been placed on the debtors claim and if yes for which pretension.

2. The application by a person under obligation can be made towards the bailiff upon transferring of the order on laying attachment or within the time frame provided for by Paragraph 1 of this article.

Article 59. Multiple seizure; Objection of the seized claim

1. Upon placing a multiple seizure on the claim the creditors claims shall be satisfied according to the sequence under which the third person - person under obligation - was provided with the order on laying attachment. Upon simultaneously submitting the application on laying attachment on the claim the creditors shall be satisfied in proportion with their claims.

2. Upon placing of multiple seizure the person under obligation shall make payment through the bailiff who distributes the recovered amount under the rule provided for by this article.

3. A creditor shall have the right to object the claims made by means of the order on laying attachment so that their rights given in the enforcement instruments are not violated. In the case of the objection the application is transferred to the bailiff. The application shall also be transferred to the person under obligation.

Article 60. Laying attachment on vindication

1. In the case of claims on transfer of the thing, the order on laying attachment shall stipulate that the person under obligation shall transfer the thing to the bailiff. Forced action against the person under obligation may be performed only if the creditor obtains the enforcement instrument regarding the transfer of the thing against the person under obligation.

2. In the case of transfer of a movable thing, their sale shall be performed according to the rule on the sale of the seized movable things.

3. In the case of transfer of an immovable thing, their sale shall be performed according to the rule on the enforcement of judgment with respect to the real property.

CHAPTER XI

ENFORCEMENT OF JUDGEMENTS ON REAL PROPERTY

Article 61. Scope

Land plots, buildings and constructions as well as the shares of common ownership on the real property recorded in a public register shall be subject to the enforcement of judgement with respect to the real property.

Article 62. Implementation of the enforcement

1. Enforcement of judgements shall be implemented by the Bureau for the Enforcement of Judgements, which has authority over the territory where a real property is located.

2. If a real property is located on the territory of different Bureau for the Enforcement of Judgements, Head of the Department for the Enforcement of Judgements shall be entitled to assign the bailiff of one of the Bureau to enforce the judgement.

Article 63. Types of the enforcement

1. The enforcement of judgements with respect to real property shall be performed by means of the registration of coercive mortgage, coercive auction or sequestration (coercive management of property).

2. A creditor shall choose one of these enforcement measures. He shall not require changing of one type of coercive enforcement with the other.

Article 631. Laying attachment on real property

1. Laying attachment on real property shall mean the stocktaking of the property and prohibition of its disposal alienation under any form, burdening by mortgage, usufruct, servitude or right to construction conclusion of a contract on lend, rent and/or lease thereof. Laying attachment on real property shall be performed under the rule stipulated for laying attachment on movable property. The copy of the report on laying attachment shall be sent to the public register.

2. All transactions envisaged by paragraph 1 of this Article after placing the seizure on the seized real property shall be null and void.

CHAPTER XII

COERCIVE MORTGAGE

Article 64. Application of a coercive mortgage

1. A coercive mortgage shall be recorded in the register on the basis of the creditors' application. A coercive mortgage shall start with registration. A real property also constitutes a guarantee for registration costs imposed on the debtor.

2. If several real properties of the debtor are burdened with coercive mortgage the debtors, the amount of the claim shall be distributed among relevant real property. The creditor shall determine the extent of distribution.

Article 65. Enforcement of a coercive mortgage

A creditor may file an application on a coercive mortgage at the coercive auction or sequestration, so that submission of a new enforcement instrument shall not be required.

Article 66. Coercive mortgage by the owner

1. If the judgement subject to enforcement annuls the enforcement instrument or the enforcement is declared unlawful, the coercive mortgage shall be transferred to the owner of the land plot. The same shall apply to the cases when a debtor satisfies a creditor.

CHAPTER XIII

COERCIVE AUCTION

Article 67. /deleted/

Article 68. The application

1. An application for a coercive auction based upon an enforcement instrument may be submitted to the bailiff by one or more creditors.

2. The application shall indicate the real property, owner, claim and enforcement instrument.

Article 69. Terms of coercive auction

A bailiff shall issue the order on coercive auction if a debtor is registered as an owner of the real property.

Article 70. Cancellation and temporary suspension of the auction

1. The auction shall be cancelled if a creditor withdraws the application on the auction.

2. If after the commencement of the auction a debtor or person under obligation, who is obliged to satisfy the creditor, makes payment of the necessary amount for satisfying him and covering all other expenses, the auction shall be terminated.

3. The auction may be temporarily suspended, however for no longer than twelve months, if the creditor agrees on its suspension.

4. If bankruptcy proceedings is opened on the debtors' property, the coercive auction shall be temporarily suspended on the basis of the application of a bankruptcy trustee, if relevant realization of the mass of bankruptcy through auction becomes substantially complicated or a proposal on the agreement between the debtor and creditors approved by the court is submitted.

Article 71. Determination of the time and place of the auction

1. The bailiff shall determine the time and place of the auction about which special announcement shall be made seven days prior to the commencement of the auction. The announcement shall include the following:

a. Name and address of the real property owner;

b. Full name of the bailiff;

c. Place and time of the auction;

d. Initial price of the real property which is the price indicated in the report on laying attachment on the property concerned;

e. Location and a brief description of the real property;

f. An announcement stating that all other parties, which possess rights on the real property, shall submit evidences on proving these rights prior to the commencement of the auction.

g. Terms of the auction

2. The time and place of the auction shall be announced publicly, either by announcement displayed on the notice board of the court or by mass media. If the property is of low price, the court may issue a ruling on not making the announcement.

3. A bailiff shall notify the parties of the time and place of the auction by sending a subpoena.

Article 72. Procedures of conducting the auction

1. Auction shall be conducted by a bailiff. He shall announce the auction opened and offer the initial price.

2. Before conducting the auction the bailiff shall determine who shall enjoy the advantageous right out of the rights registered in the register compared to the pretension of the creditor for whom the enforcement is carried out.

3. At the auction the bailiff shall announce:

a) that the advantageous rights registered in the register compared to the claim of the creditor for whom the enforcement is carried out, shall remain valid and not be satisfied by payment;

b) what is the value of the transitional rights (compared to the creditors claim, advantageous rights or rights which will accompany the thing after its realization under the procedure of the auction);

c) that the price of transitional rights shall be deducted from the prices offered at the auction and the rest shall be paid in cash.

Article 73. Explanation of the procedures of the auction

1. The bailiff may explain the terms of the auction to the parties before the process of the auction commences.

Article 74. Final offer of the price

1. The auction shall lasts until another offer is made. The bailiff shall announce the final offer of the price and the end of the auction. The last offered price at the first auction shall not be less than 70% of the things value and shall cover the value of transitional rights and expenses of the auction.

2. The final offer of the price shall be announced three times and loudly.

3. An individual making the offer of the maximum price at the auction shall provide the guarantee in the amount of one tenth of the offered price. The bailiff shall solve the admissibility of the guarantee. Unless the guarantee is immediately provided, the offer shall become invalid and the auction shall be continued.

Article 75. Acquisition of the right on the property purchased at the auction

1. An individual having authority on the property purchased at the auction shall be provided with an appropriate order of the bailiff indicating the purchased property, purchaser of the property at the auction, the offered price and terms of the auction.

2. Purchaser of the property at the auction shall deposit the part of the offered price to be paid in the deposit account of the Bureau for the Enforcement of Judgements within two weeks.

3. The order shall be announced during or after the auction. The period between the auction and the announcement shall not exceed one week.

4. The order shall take effect upon the announcement. After the order takes effect, the purchaser of the property at the auction may exercise his legal right on this property only after the price is fully paid.

5. If the coercive enforcement is carried out by the mortgagee, any mortgage and right in rem with which the thing was burdened and which are registered after the mortgage of the creditor carrying out the coercive enforcement shall be cancelled as a result of transfer of the property. Earlier registered rights in rem shall remain unchanged. If the coercive enforcement is carried out not by mortgagee, despite the transfer of the property, the rights registered in the public register shall remain unchanged.

6. The new owner of the thing sold at the auction shall take the place of the former owner and become the participant of the legal rights related with the thing existing at the moment of transferring the property. By transferring of the property to the new purchaser the owner of the real property shall be deemed as a lessee and shall pay the rent in accordance with market conditions.

Article 76. Revocation of the transfer of the right on the property purchased at the auction

1. Unless the amount to paid in cash by the purchaser of the property at the auction is transferred on the deposit account of the Enforcement Bureau within the time frame stipulated by the terms of the auction, the court on the basis of its ruling shall repeal the order on the transfer of the right on the property purchased at the auction.

2. By the ruling on the repeal, the court shall impose a tax on the purchaser of the property at the auction in the amount of 3% of the value of the property, as well as the costs of trial, proceedings and other expenses.

Article 77. Repeated auctions

1. Unless respective offer was made at the first auction, the bailiff shall appoint a repeated auction. The period between the first and second auctions shall be at least two weeks and not more than six months.

2. The repeated auction shall be announced in the same manner as the first one.

3. During the repeated auction the lowest price shall at least cover the expenses of the auction, value of transitional rights and creditors claims.

4. If this fails, the auction shall not be conducted. The expenses of the auction shall be imposed on the debtor.

Article 771. Transfer of the thing in kind

1. Unless the thing is realized neither at the repeated auction, the thing shall be transferred in kind to the creditor on the basis of the creditors written submission.

2. While transferring of the thing in kind its price shall be determined in the process of enforcement according to the market value of the thing concerned.

CHAPTER XIV

SEQUESTRATION (COERCIVE MANAGEMENT)

Article 78. Sequestration

1. Article 310 of the Civil Code shall be applied for sequestration.

2. Mortgagee as well as other creditors may file an application on sequestration on the basis of the enforcement instrument.

3. Accordingly shall apply the rules on coercive auction to the extent that applications and complaints concern the activity of the manager and failure of performing duties by him.

Article 79. Manager

1. The court shall be entitled to appoint manager of the real property.

2. The bailiff, creditor, decision-maker member of the court or close relatives of these individuals shall not be the managers.

3. After hearing the creditor and debtor, the court shall give the necessary instructions to the manager, determine his due reimbursement and supervise his work. It may dismiss the manager for substantial cause.

Article 80. Expenses

Expenses related with the property management and customary economic use of land plot shall be covered by the manager namely from the incomes.

Article 81. Managers liability, reporting

Manager shall be liable for all duties he has towards every participant. He shall submit a report every six months and upon the completion of management. The report shall be submitted to the bailiff, who shall provide it to the creditor and debtor.

Article 82. Debtor acting as manager

1. In the case of sequestration of agricultural, forestry and horticultural lands the court shall appoint a debtor as a manager. His appointment shall be prohibited only if proper conduction of management is not expected from him.

2. The court shall appoint a supervisor for a debtor appointed as a manager and determine the reimbursement of the latter. If the debtor violates his as well as managers duties, the supervisor shall immediately notify the court thereof.

3. Debtor, who acts as a manager, shall not be reimbursed. If necessary, the court after hearing the supervisor, shall determine whether to what the extent a debtor may use the income and profit received from the land plot in order to meet his and his family members' necessary requirements.

CHAPTER XIV1

DISTRIBUTION OF RECOVERED AMOUNTS AMONG CREDITORS

Article 821. Giving of recovered amounts to the creditors

1. The amount recovered from the debtor (received from the sale of his property) by the bailiff shall first of all cover the enforcement fee, expenses incurred in the process of enforcement and trial cost whereas the remained amount shall be given for meeting the creditors claims. After satisfying all claims the remained amount shall be returned to the debtor.

2. The amount recovered from the debtor by the bailiff shall be deposited and/or transferred on the deposit account of the Bureau for Enforcement of Judgements and only after shall be given or transferred under the established rule.

Article 822. The priority list for meeting the creditors claims

1. Unless the amount recovered from the debtor is sufficient for meeting all the claims of the creditors, this amount shall be distributed among creditors according to the priority list established by Article 823 of this law.

2. The claims of each next priority shall be satisfied after fully meeting the claims of the previous priority.

3. Unless the amount to be distributed is sufficient for fully meeting all the claims of one priority, these claims shall be met in proportion with the amount granted to each creditor.

Article 823. Requirements of first, second and third priority

1. The amount received from the realization of the mortgaged property shall first of all satisfy the claims secured by the mortgage;

2. Out of the amount indicated in the first paragraph of this article as a second priority and out of other amounts as a first priority the following claims shall be met:

a) On payment of alimony;

b) Arising from labour relations;

c) On compensation of damage caused by disfigure or other health injury as well as lose of breadwinner;

d) On compensation of damage caused by crime or administrative offence;

e) On payment of sums in the state (local) budget and non-budgetary funds;

f) Claims arising on the basis of cheque and promissory note.

3. Out of the amount indicated in the first paragraph of this article as a third priority and out of other amounts as a second priority all other claims shall be met.

Article 824. Drawing up of calculations by the bailiff

1. In the case of many creditors, if the recovered amount from the debtor is not sufficient for meeting all claims, the bailiff shall draw up calculations of the distribution of money among creditors and issue this amount according to the calculations.

2. If any of the creditors gives pretension regarding the drawn up calculations, the bailiff shall submit the calculations to the court for approval.

3. A private claim may be lodged with regard to the court ruling on the approval or modification of the calculations drawn up by the bailiff.

CHAPTER XV

ENFORCEMENT FOR THE PURPOSE OF TRANSFER OF THINGS AND PERFORMANCE OF ACTION

Article 83. Transfer of movable things

1. If debtor is to transfer movable thing or a certain number of movable things, the bailiff shall take these things from away debtor and hand it to the creditor.

2. If the thing to be transferred can not be found, debtor shall notify the bailiff about the location of the thing. If a debtor declares that he is unable to do so, he shall indicate in the enforcement protocol in the form of written guarantee that he does not possess the thing.

3. If a debtor does not perform duties imposed on him, the bailiff shall penalize him with the monetary fine amounting to 50 GEL.

4. A debtor, who does not perform his duties despite penalizing with monetary fine, shall be liable under the procedures provided for by the law.

Article 84. Transfer of real property

1. If a debtor is to transfer to a creditor or vacate a land plot, the bailiff shall transfer this property in the ownership of the creditor.

2. Movable things, which are not subject to the enforcement, shall be transferred to a debtor by the bailiff and if he is absent, to the authorized person of the debtors or member of his family.

3. If neither debtor nor persons named in Par. 2 of this Article, the bailiff shall store the things at the expense of the debtor.

4. If a debtor fails to withdraw the things within one month after the warning, the bailiff has the right to sell the things at the auction and deposit the received income, excluding the expenses, on the deposit account.

5. The time frame for vacating the storehouse can be extended or reduced if a relevant application is filed in the court of appeals or cassation. The relevant court shall deliver the judgment.

Article 85. Storage by third parties

If a transferable thing is stored with the third party and if he refuses to transfer it voluntarily, the bailiff on the basis of creditors submission shall issue an order on laying attachment.

Article 86. Actions that can be performed by other persons

1. If a debtor does not perform the duties that can be performed by third parties, the court shall permit the creditor, on the basis of his own application, to perform this action himself at the debtors expenses.

Article 87. Actions that shall not be performed by other parties

1. If an action shall not be performed by a third party for it depends only on the debtors will, the court shall take measures to compel the debtor to perform the action, namely, impose monetary fine on him. In case these requirements fail to be performed he shall be charged with criminal liability as provided for by the Georgian legislation.

2. Establishment of fines and law-defined liability shall be preceded by the appropriate order. If this order is not included in the court judgment on obliging the debtor, it shall be issued by the courts on the basis of the creditors application.

3. Monetary fines shall be paid in accordance with the rules envisaged for the enforcement of pecuniary claims.

4. Paragraph 1 of this article shall not be applied to the judgments which are made on matrimonial relations and rendering services on the basis of labour contract.

CHAPTER XVI

RULES OF THE ENFORCEMENT ON CERTAIN CATEGORIES OF CASES

Article 88. Enforcement of the judgement on transfer of a child

1. In the case regarding the transfer of a child the bailiff shall perform his action with the participation of representatives of the agencies of guardianship and custody.

2. If a liable person resists to the enforcement of the judgement, administrative measures shall be applied against them.

3. If necessary the bailiff may raise an issue before the agencies of guardianship and custody about the temporary placement of a child in a nursery.

Article 89. The enforcement of judgement on the payment of alimony

If the amount to be paid upon the enforcement of the judgement regarding the payment of alimony, which shall be recovered by the debtor on the monthly basis as agreed, is lower than minimum amount established by the law, in case of delay in the payment of alimony, recovery can be made from the debtors property, according to the established order.

Article 90. The enforcement of judgement on eviction from the premises

1. Individuals shall be evicted from the premises indicated in the enforcement document together with their property.

2. A debtor is provided with the time appropriate for the voluntary enforcement of the judgement, but not more than one month after the bailiff warns him in a written form. This time frame may be extended only by the courts judgment.

3. If an individual to be evicted does not obey the instructions of the bailiff the latter may apply to the local self-government and government bodies or the enforcement police for assistance.

4. The bailiff shall draw up a protocol on the coercive eviction, which as well shall be signed by two witnesses with legal capacity.

5. If a debtor does not remove his own property from the premises, the bailiff shall be entitled to perform this action independently. If a debtor is absent at thee moment of eviction the bailiff shall take stock of the property and transfer it to the creditor for custody on the basis of a relevant act.

6. Expenses related with the coercive eviction shall be imposed on the debtor.

Article 91. The enforcement of judgements of foreign states

1. Pursuant to international private law and treaties concluded between the countries on mutual legal assistance, the judgment acknowledged under the rule established by the legislation on the territory of Georgia and the enforcement writ issued by the competent Georgian court through the Ministry of Justice shall be sent according to the location of the debtor of Enforcement Bureau.

2. The judgment referred in the first paragraph of this article shall be enforced under the rule established by this law.

CHAPTER XVII

THE ENFORCEMENT WITH REGARD TO LEGAL ENTITIES OF PUBLIC LAW

Article 92. The enforcement with regard to legal entities of public law

Coercive enforcement with regard to legal entities of public law shall be commenced only four weeks after the moment a creditor declares about his intention to raise the enforcement case to the debtor or his appointed representative.

Article 921. The enforcement with regard to budgetary institutions

1. Coercive enforcement towards budgetary institutions with regard to recovery of sum shall be commenced three months after making a proposal on voluntary enforcement of judgement or after the Georgian Parliament refuses to allocate additional allocations in the enforcement fund envisaged by the state budget during the budgetary year for the purpose of enforcement of the judgment.

2. The Ministry of Finances of Georgia shall issue the sums to the debtors in a sequence as were made the proposals on the voluntary enforcement of judgements.

CHAPTER XVIII

THE ENFORCEMENT OF JUDGEMENTS FOR THE IMPOSITION OF ADMINISTRATIVE PENALTY

Article 93. The enforcement of judgment on the imposition of administrative penalty

1. Judgements on imposition of administrative penalties shall be implemented throughout the whole territory of Georgia.

2. The following judgements shall be subject to enforcement on:

a. Warning;

b. Fining;

c. Deprivation of special right;

d. Administrative imprisonment;

e. Expulsion of foreign nationals out of the territory of Georgia.

Article 94. Compulsory nature of judgement on the imposition of administrative penalty

Judgements on the imposition of administrative penalties shall be binding for any natural or legal persons.

Article 95. Initiation of enforcement of the judgement and the procedures of its enforcement

1. Enforcement of the judgment on imposition of administrative penalty shall be initiated by the body (official) making the judgment.

2. Judgement on the imposition of administrative penalty shall be enforced within three months after its entry into force, except for the judgement on application of warning as penalty.

3. If several judgements on the imposition of administrative penalties are issued towards one person, each of the judgements shall be enforced independently.

4. Judgement on the imposition of administrative penalty shall be enforced by duly authorized person in accordance with this law unless otherwise provided by Georgian legislation.

Article 96. Limitation period of the enforcement of judgement on the imposition of administrative penalty

In case of the circumstances, due to which it is impossible to enforce a judgement on the imposition of administrative penalty in the form of administrative imprisonment or fine within the law-prescribed time frame, the enforcement shall be suspended by the body (official) reviewing the case until the obstructing circumstances are removed, but no longer than one year after the judgement enters into force.

Article 97. Termination of the enforcement of judgement on the imposition of administrative penalty

The body (official) issuing a judgement on the imposition of administrative penalty shall terminate the enforcement if:

a. the act establishing administrative liability for relevant violations is revoked;

b. the judgement is revoked on the basis of claim ;

c. the individuals towards whom the judgement was delivered dies.

Article 98. Organization and control of the issues related with the enforcement of judgement

1. The body (official) issuing the judgement on the imposition of administrative penalty shall be liable for the organization of the enforcement of the judgement and control over their enforcement.

Article 99. Procedures of the enforcement of judgement on warning

1. Judgement on the imposition of administrative penalty in the form of a warning shall be enforced through public announcement of the judgement by the judgement-making body (official) upon completion of the consideration of the case.

2. If judgement on the imposition of administrative penalty in the form of a warning is delivered in absentia of the violator, a copy of the judgement shall be delivered to the violator according to the procedures provided for by the Code of Georgia on Administrative Misdemeanours.

Article 100. Time frame and procedures of the enforcement of judgement on the imposition of fines

1. A violator shall pay the fine within 30 days after delivery of the copy of the judgement on the imposition of the fine, whereas in case imposing a fine on site within 30 days after the deliver of the invoice. In case of an appeal against the judgement, fine shall be paid not later than fifteen days after the receipt of the notification of the rejection of the appeal.

2. Unless otherwise prescribed by the Georgian legislation, the fine imposed for administrative misdemeanours shall be deposited in a banking institution to be transferred to the State Budget.

3. Recovery of fine on behalf of an official may be imposed on the legal entity where this official is employed.

Article 101. Coercive enforcement of judgement on the imposition of fine

1. If the violator fails to pay a fine, the judgement on the imposition of a fine shall be sent to his work place for coercive deduction of the amount of fine from his salary or other income.

2. If a fined person is unemployed or if the recovery of fines from violators salary or other income or in any other form is impossible, on the basis of the order of the body (official) the bailiff shall recover a fine from violators private property, as well as from his share in common property. If this is also impossible, fine shall be replaced by other penalties, pursuant to the procedures provided for by the Code of Georgia on Administrative Misdemeanours.

3. Fine shall not be recovered from the property, which, according to the Georgian legislation, is not subject to such under enforcement documents.

4. In case of payment of fine onsite of misdemeanour the violator shall be given the invoice of a particular sample, which constitutes a document of strict financial account.

Article 102. Completion of the process of enforcement of judgement on the imposition of fine

The invoice on the payment of a fine shall be returned to the judgment-making body (official). The enforcement of judgement shall be deemed completed upon full payment of the fine.

Article 103. Bodies enforcing the judgements on the deprivation of special right

1. A judgement on the deprivation of driving right shall be enforced by the officials of the bodies of internal affairs.

2. A judgement on the deprivation of the right to navigate small-sized ships shall be enforced by the bodies of maritime administration.

Article 104. Procedures of the enforcement of judgement on the deprivation of driving license

1. A judgement on the deprivation of driving right shall be enforced by depriving of driving license.

2. If a driver, who is deprived of driving rights, avoids to hand over his driving licenses, the bailiff shall deprive him of the license under duress.

Article 105. Time frame for the enforcement of judgement on the deprivation of driving right

The enforcement of judgement on the deprivation of driving right shall be commenced upon deprivation of driving license. Common time frame for the deprivation of driving rights shall be stipulated by the Code of Georgia on Administrative Misdemeanours.

Article 106. Calculation of the time frame for the deprivation of special right

1. An individual shall be deemed as being deprived of special right upon actual deprivation of this right.

2. When the time frame for the deprivation of special right expires or is reduced, the deprived documents shall be returned, under the prescribed procedure, to the individual who was sentenced to this measure of administrative penalty.

Article 107. Enforcement of judgement on administrative imprisonment

A judgement on administrative imprisonment shall be enforced upon its issuance.

Article 108. Procedures for serving the administrative imprisonment

1. An individual, who was sentenced to administrative imprisonment, shall serve his penalty on a particularly determined place.

2. The term of administrative detention shall be included in the term of administrative imprisonment.

3. Administrative imprisonment shall be served pursuant to the procedures provided for by the Georgian legislation.

Article 109. Making use of the labour of the individuals under administrative imprisonment

1. An individual under administrative imprisonment shall be employed for non-skilled works.

2. Local government and self-government bodies shall be responsible on the organization of the use of labour of the individual under administrative imprisonment.

3. An individual under administrative imprisonment shall not be paid his salary at his permanent place of work during the period of imprisonment, but his position shall be retained.

CHAPTER XIX

ENFORCEMENT OF THE JUDGEMENT WITH REGARD TO COMPENSATION OF PROPERTY DAMAGE

Article 110. Procedures and time frame for the enforcement of judgement with regard to compensation of property damage

1. The judgement passed on administrative misdemeanour with regard to compensation of property damage shall be enforced under the procedures provided for by this law and shall be deemed as enforcement instrument.

2. A violator shall compensate property damage within no later than thirty days after handing over the judgement to him, whereas in case of appeal against this judgement within no later than fifteen days after the receipt of a notification on the rejection of the appeal.

Article 111. Consequences of non-fulfilment of judgement with regard to compensation of property damage

In case of a non-fulfilment of the judgement with regard to compensation of property damage within the time frame stipulated by Para. 2 of article 110 of this law, this document shall be deemed as grounds for coercive enforcement of damage.

CHAPTER XX

ENFORCEMENT OF JUDGEMENT OT PERTAINING TO THE DEPRIVATION OF LIBERTY

Article 112. Enforcement of judgement on fine

1. The judgment on the imposition of fine in the form penalty shall be enforced by the bailiff according to the place of residence of the sentenced person.

2. A sentenced person shall pay the fine within thirty days upon the entry into force of the judgment.

3. In case of non-payment of the fine, the bailiff shall recover the fines pursuant to the procedures provided for by this law.

4. If payment of fine is impossible, the bailiff shall send a submission on replacing the fine by other forms of punishment to the judgment-issuing court, pursuant to the procedures provided for by the Criminal Code.

CHAPTER XXI

TRANSITIONAL PROVISIONS

Article 113. The measures related with the enactment of this law

1. A judgement issued before the entry into force of this law shall be enforced only under the procedures provided for by this law.

2. Enforcement inscriptions of notary agencies existing before the entry into force of this law shall be enforced pursuant to the procedures provided for by this law.

3. Training and passing of qualification examinations of the bailiffs stipulated by this law shall be carried out prior to September 1,1999.

4. The normative acts stipulated by this law shall be adopted prior to May 15, 1999.

5. The Ministry of justice of Georgia shall ensure the establishment of the enforcement agencies and the organization of training of bailiffs upon enactment of this law.

6. Enforcement Bureaus shall be located in Raion (City) Courts.

Article 1131. The enforcement fee

1. Before adoption of the law of Georgia on enforcement fee the fee on recovery of sum shall be established and its amount shall be 7% of the recovered sum. The creditor shall pay the fee after the recovery of the sum. Enforcement fee shall not be collected for judgments subject to urgent enforcement under Article 11 of this law.

2. Prior to entry into force of this law the contracts concluded between the enforcement bureau and creditor with regard to payment of the sum stipulated for the organizational maintenance of enforcement procedure and material maintenance of bailiffs shall be null and void.

Article 1132. Wind up of enforcement agencies

Upon the adoption of this law the Ministry of Justice of Georgia shall ensure implementation of organizational measures necessary for winding up of enforcement agencies and adoption of the bylaw normative acts stipulated by this law.

Article 114. Enactment of the law

This law shall enter into force from May 15, 1999.