Challenging enforcement against exempt property

As explained in point 1 of Interpretative Ruling No. 2/2013 of the Bulgarian Supreme Court of Cassation, the debtor’s assets comprise things and claims. For non-consumable things, exemption from enforcement prohibits their realisation. Attachment of movable property or a restraint on immovable property is nevertheless permissible: it keeps the property in the debtor’s estate. Such a measure is compatible with the exemption and does not, in itself, infringe it. An inventory of non-consumable things is also permissible as part of the attachment where it identifies the items individually for the first time. What is prohibited is their conversion into money. Enforcement is directed against a specific asset by attaching it or placing it under restraint. The attachment or restraint as an enforcement act is not itself open to appeal. What can be appealed is the decision to direct enforcement against exempt property.

The debtor may appeal to the competent regional court on the ground that the attached or restrained property is wholly or partly exempt from enforcement of the particular monetary claim. The court must determine whether that asset is available to satisfy that claim. The appeal may seek to set aside particular measures: attachment, restraint, inventory, valuation, appointment of a custodian, scheduling a sale or other steps. The court rules on such requests only insofar as the individual steps are incompatible with, and thus infringe, the exemption. They cannot be appealed separately on this basis. If the court finds the property exempt, it sets aside every enforcement step incompatible with the exemption, even without an express request. The debtor may challenge enforcement against property they consider exempt even before receiving notice of the attachment or restraint. An early appeal, filed before the time limit starts running, is admissible. The starting point of the time limit varies with the type of asset. For enforcement against a thing, time runs from service of notice that the sale has been scheduled. Missing that deadline does not prevent the debtor from asking the enforcement officer to discontinue a sale already under way before the award order is issued (the officer cannot withdraw that order), or to return the sale proceeds to the debtor before the creditor receives them. The officer may prefer to compensate the bidders who participated in the public sale rather than continue causing loss to the debtor.

This article is not a legal opinion or advice concerning a particular situation or person. For assistance with a case, consult a civil lawyer who specialises in enforcement proceedings.