- Introduction:
Judicial sale exists in every Jurisdiction globally. It is a forced sale conducted under the authority of a Court judgment or Court order1; this legal concept is applicable in almost every field of law. While there are many purposes for Judicial Sale in law, the most common is Debt Recovery. How this works is, if Mr. A owes Mr. B $5,000 and Mr. B has refused to pay, Mr. A can apply to the Court to sell a piece of land owned by Mr. B and the proceeds thereof used to satisfy the outstanding sum or part of the $5,000.
- Types of Judicial Sale:
Judicial sales are ordered by way of an interlocutory order or executory judgment, either during Litigation or upon completion of the Matter when Judgement is given. When done pendente lite (during Litigation), it simply means that a Claimant/Plaintiff has made an Application for the sale of the Res before the Court makes its final decision in the Debt recovery suit. Otherwise, the Claimant may decide to be patient so that this Judicial Sale Order is made alongside the final determination of the debt recovery suit.
- Judicial Sale Suo Motu:
This form of Judicial sale, although uncommon, is done without an application of the Claimant/Applicant, although still done pendente lite. The Court can during the pendency of the Litigation unilaterally order that the Res be sold as a Judicial Sale even though the Claimant/Applicant has not specifically applied for same. The power to order a Judicial Sale suo motu, is usually exercised where the Res is fast deteriorating or where the fact and circumstance warrants it.
- What Next?
Where an Order for sale has been made, the next step is for the Res to be appraised, before being sold pursuant to the Order of Judicial Sale. Appraisement is the official valuation of the Res by a court appointed valuer so as to prevent the Res from being sold at too low a price. The Res would not be allowed to be sold for less than the appraised value without an order from the court.
- Time Frame:
The time frame for judicial sale varies due to different reasons. One of such depends on the Judge and their schedule. The time frame could also vary based on the strategy and tactic of Counsel for and against the judicial sale application. The time frame for Judicial Sale action in Nigeria is between three to five (3 – 5) years.
- Maritime Law:
In Maritime Law specifically, judicial sale is the most effective type of debt recovery. It is suitable for when the Debtor has no funds or has hidden funds or absconded with the Creditor's money2.
Footnotes
1. Lord Simmonds: Halsbury's Law of England 3rd Edn Vol 34, Pg. 13
2. This aspect of Maritime Law shall be delved into later in our series on judicial sale.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.