Maintaining unpaid debts can not only lead to a low credit rating, it can also lead to various legal problems that prevent the use of money that is available.
The legislation of Ecuador does not establish as such prison for debt to citizens who have not covered their obligations.
However, there are various actions that allow the collection of a credit. Lawyer Belkys Torrealba states that coercive action is exercised by public institutions against citizens who have debts.
“It is important to keep in mind that in Ecuador there is a legal reality that is based on concentrating legal actions in the Judicial function through the Judicial Council, but the coercive trial is the exception since its processing is carried out in the institutions and the judges are the highest authority or their delegate”, he indicated.
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The Organic Administrative Code (COA), in article 262, states that the coercive procedure will be exercised in any public instrument that proves the existence of an obligation and that it cannot be initiated without a collection order.
Precisely article 273 establishes that whoever issues the collection order can grant payment facilities to the debtor who requests it in case the competence is not attributed to a different body.
“Once summoned, it can be defended based on the regulations of each public institution on the exercise of coercive jurisdiction; This protection is only guaranteed before the coercive judge, in my opinion; because at the time of initiating the trial of exceptions the right to defense is violated, since to defend oneself the total value of the debt must be consigned”, added Torrealba.
Although there are restrictions to grant payment facilities. Article 281 says that precautionary measures can be ordered after non-compliance with the payment, among which are the kidnapping, the retention or the prohibition of disposing of assets.
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If the seizure is from the debtor’s money and this is enough to cancel the capital, interest and costs, the coercive execution will be terminated if it will not continue for the difference.
Torrealba specifies that the salaries of civil servants and public employees, nor the remuneration of workers, montepíos, remunerative pensions and forced alimony, according to the Civil Code, among others, are not subject to seizure. He also said that the embargo should be given in the following order:
- Of the money owned by the debtor;
- Of the mortgaged, pledged or encumbered assets with another real guarantee;
- Of the assets on which preventive order was issued;
- Of the other assets indicated by the creditor, who will determine them by accompanying proof of ownership of the same.
The retention of the embargo should not be confused, in the case of the first, they are not delivered until there is a court order. The garnishment provides that the creditor be paid.
The specialist points out that in a coercive trial there must be prior notification to the debtor. “In addition, you can be summoned in person, summoned by ballots, summoned through one of the media, summoned Ecuadorians abroad, summoned heirs, summoned indigenous communities, Afro-Ecuadorians, Montubias and peasant women not organized as a legal person, summons to state agencies or institutions, summons to diplomatic agents. Once you do, you must record the reason, if this formality is not complied with, it can lead to an annulment, ”she said.
In the case of retirement pensions, article 17 of the Law of the Elderly establishes that these are unattachable, except for the payment of food pensions. However, in 2021, the Constitutional Court clarified that the withholding and seizure of retirement pensions does proceed when the one pursued is the Ecuadorian Social Security Institute (IESS) or Biess. For bank and commercial debts it does not apply. (YO)