When Minister Carmelo Mifsud Bonnici introduced the amendment in the law so that if you file a garnishee order against me, the banks will have thirty days to reply to the court and provide him with the information, we were happy.
We were happy because we thought that we no longer had to go through the cumbersome procedure of having to file a letter in court asking the banks to provide such information and depositing the monies held in court.
But when clients have proved that the banks are not divulging to the court all the information about the person who owes them money, then you become convinced that the banks are breaking the law. They are breaking the law because they have taken the law in their own hands in deciding what information they give to the courts.
I say that they have assumed the role of the courts because they have ex officio decided that if they do not file any letter in court stating the information, you are to assume that there is no money in the account of the person who owes you money.
This does not come from the law but it is a practice that the banks have adopted, and the consumer gets to know about this practice not because he is informed but because he takes the pains of asking each bank why no information was submitted to the court.
But the greatest contempt that the banks are doing to our Courts is that they have decided not to divulge to the courts any fixed deposits held in the name of the person who owes you money. Strange but true, and had it not been for a client who showed me black on white bank statements of her husband stating that he has fixed deposits in his name, I would not have believed that this is happening.
When I enquired with the bank, I was told that the banks have taken the stand that once those fixed deposits have not matured, they are not monies that can be deposited in court and so by implication the banks have no deposits to declare to the court. This is a flagrant abuse of the law because when the banks received the garnishee order (sekwestru), the order tells them to seize outright the monies that they have in the name of your debtor up to the amount owed and to deposit the same in court.
The conclusion reached by our banks that fixed deposits are not deposits that can be put in court because they have not matured is a spit in the face of our courts because the court order is to declare all the deposits that they have, and if they are not in a position to deposit them in court they must be honest with the courts and explain the reason why such monies have not been deposited.
The banks must stop taking us for a ride, especially that poor creditor who is owed money and who blindly believes the banks when they inform the court that they hold only such monies.
In the circumstances it is important for the Minister of Justice and the Registrar of Courts to intervene in order to make it mandatory for the banks to inform the courts, even when no monies are at their end, and secondly, to inform the courts about any other monies held in the name of the creditors even though at that moment they cannot be physically deposited in court.
I am writing about this so that you do not stop when you get notification from the banks about the monies they have at their disposal but to ask the banks to give information about any other investments or fixed deposits as well. This has to be done as long as the banks continue to break the law and pick and choose what they want to divulge to the courts.
The Malta Financial Services Authority must delve into this as well and should not wait for the Minister of Justice to intervene. As the regulator it ought to instruct the banks that they are to inform the court about all assets pertaining to the debtor, obviously up to the amount of the claim.
On another note but connected to it, we tend to summon the main four commercial banks when we have a claim against somebody who owes us money forgetting that according to the Malta Financial Services Authority, in Malta there are 75 financial intermediaries and 17 banks. This means that the full picture of any garnishee order is to summon them all, meaning that you have to pay more for a garnishee order.
This makes sense mostly in the separation cases as the present situation has rendered the community of acquests a farce limited to property and to pots and pans. Nowadays the spouses know that if they want to hide money from the other spouse all they have to do is to go to a financial intermediary, or set up a trust and no signature of the other party is needed. This is causing undue hardship to the families because we know of cases of children and the other parent being fed bread and butter when they can live on caviar and champagne but that other parent is helpless as it cannot trace this money.
I cannot understand why the legislator is procrastinating in amending the law so that any spouse can have access to the other spouse’s money without having to seek the authorization of the courts. Nor can I understand how the signature of both spouses is still not needed by law in deposits or transfers which are substantial. We boast that we have the families at heart but at the same time we do not practice what we breach and allow this flagrant abuse of the family coffers.
The Family Court is overloaded with work but they are partly to blame for this situation. First of all, they must automatically decree that there is no bank or any other secret between spouses and everybody is to provide the information about the assets/liabilities of the other spouse. Secondly, if they want to reduce the number of separation cases and encourage consensual separation, they ought to give this exemption in the mediation stage as well.
As things stand at present, the Family Court is rejecting such requests telling us that we have to institute a court case for this exemption to be provided as mediation is not contestation and the court is legally right. And just as the legal notice 397/2003 introducing mediation provides for redress regarding maintenance and access of the children, the regulations must also provide for access to assets pertaining the community of acquests.
In this way, we will not have to institute a court case, await the information to be provided by the banks in the court case, and then try to settle.
However, if such information is provided to the other spouse automatically, even when separation is not on their agenda, many of the issues and conflicts in the family court will be avoided.
But it seems that the legislator wants to secure more work for us lawyers, and the only way is to continue to allow others to flout the law; the hitch is that most clients cannot afford to spend money on challenging these practices.