Realization of Attached Property and the Debtor’s Role
The Law of Georgia on Enforcement Proceedings sets the general rule for the realization of attached property: other attached items are sold by the National Bureau of Enforcement publicly at auction, and the amount received from realization, or the amount paid by the debtor, less the fee and the enforcement costs, is transferred by the Bureau to the creditor. Yet the law also gives the debtor an active position: it is precisely the debtor’s initiative and agreement with the creditor that can become the channel through which the property is sold in a format more favourable to the debtor than a public auction. Using these opportunities properly requires exact knowledge of the deadlines and conditions.
It is important to understand that realization is a single process: it is preceded by the description and appraisal of the property, and the sale stage follows. The debtor’s legal interest is protected at each step of this process — from the accuracy of the appraisal to the choice of the sale format. Missing one stage can foreclose the options available at the next, which is why early legal assessment of the file matters.
Appraisal of the Property and the Expert Conclusion
At the time of the description of the property, where it is possible to determine its market value, that value is recorded in the act of description and attachment. If determining the price at the description is impossible, the property is appraised after the registration of the attachment by the National Bureau of Enforcement or, on the Bureau’s instruction, by another competent person.
A party to the enforcement proceedings has the right, at the start of the proceedings or before the Bureau appraises the property, to submit an expert conclusion on the market value, under which the property was appraised within the 6 months preceding the start of the proceedings. The Bureau is authorized to rely on the conclusion submitted by a party; where conclusions have been submitted by both parties, the Bureau relies on one of them, and it decides for itself the expediency of admitting the submitted conclusion. In addition, in the context of the collection of tax arrears, where the property was appraised within 1 year before the start of the enforcement proceedings, repeated appraisal is not mandatory. This means that the debtor must begin preparing for a valuation dispute already at the appraisal stage.