Lianhe Zaobao: Bigger loss if lines are crossed in debt collection

Lianhe Zaobao 15 August 2021

About the Law

Creating mischiefs at debtors’ house, wearing mourning clothes, donning outfits printed with debtors’ photos and parading them on the streets….

New tactics of debt collection are frequently reported in the news, and some practices are blatantly “crossing the line”, causing the police to step in to investigate.

What should we do to protect our debt collection rights when lending money to someone around us?

What may happen if a collector is hired or civil action is pursued to recover a debt?

Joining us in this issue of About the Law, are Mr Nicolas Tang, managing director of Farallon Law Corporation, and Mr Jeremy Cheong, partner of I.R.B Law LLP. They will talk about the legal ways to collect debts and also the relevant do’s and don’ts.

Debt collectors don’t have any special privileges. They have to follow the law just like others. In recent years, staffs of debt recovering agencies have continuously come out with new tricks to collect debts. The lawyers interviewed believe that the formulation of new laws can help tackle illegal debt collection tactics.

In a written reply to questions from members of Parliament in April, the Minister for Home Affairs and Law, K Shanmugam revealed that the Ministry of Home Affairs was considering drafting new legislation to regulate debt collection agencies and their staffs and would announce the details in due course.

Mr Shanmugam said there are already laws in place to protect debtors from unreasonable or illegal acts such as harassment and intimidation by debt collectors.

For example, debt collectors may face criminal punishment under the Penal Code if they are involved in wounding or threatening acts. The Protection from Harassment Act also provides for criminal punishments and civil remedies over harassment acts.

If the borrowing party encounters such behaviours, he/she should report them to the police for investigation, or may consider applying for a writ of protection under the Protection from Harassment Act to stop the collector’s harassment acts.

New laws should indeed be devised to curb illegal debt collection.

Some collection agencies and their employees may harass debtors with many “creative” tactics, and under the existing legal framework it is difficult to get every perpetrator sued in court. Therefore, new laws should be formulated to curb illegal collection methods, says Mr Tang.

With the ever-widening spread of websites and apps, he points out, collection agencies can easily hide their identities as they harass debtors.

In one of the cases he knows, the debt collector created a fake female account on a dating app. After being paired with a man, “she” invited him to come to “her” house, the reason cited was that “she” wanted to spend time with him.

When the man arrived at the said address, it was not “her” house but instead, it was the house of a debtor who borrowed from the debt collector. The “woman” did not open the door so the man knocked on it. The “woman” claimed that she could not hear the knock on the door and asked the man to keep on knocking, who did so until the debtor could not bear the disturbance and reported it to the security of the apartment as well as called the police to arrest the clueless man.

According to Mr Cheong, sometimes even when these collection agencies have overstepped the legal boundaries, it can be misleading as some people may believe such agencies have the right to do so. “The law would help clarify and define exactly what collection agencies can and cannot do.”

Generally speaking, personal debt collection is a civil matter and the police will not get involved. Touching on the legal way to recover debt, Mr Tang says, creditors can consider hiring a lawyer to issue a letter of demand to the other party, and obtain a ruling from the court, followed by a ruling on the debtor’s assets.

The risk of hiring collectors, he points out, is that they might harass debtors and violate the law in the process.

Illegal means of debt collection can be reported to the police.

In 2015, a group of debt collectors created mischiefs at a “Lao Huo Tang” stall in the food court of Funan DigitaLife Mall (now known as Funan) by turning off the lights to drive away customers, preventing the stall from doing business and intending to take away money from the cash register.

As we reported earlier, six collectors placed a banner in front of the stall bearing the words “debt collection under way”. In the process, the rice pot, cash register and other equipment at the stall were pushed off onto the ground, and the display board in front of the stall was smashed. The case attracted widespread attention and all six collectors were subsequently sentenced to jail.

Mr Tang cited that other illegal debt-collection methods includes swearing, locking up doors, vandalising or even cutting off electricity. In such cases, the debtor can call the police or file a lawsuit against the harassment.

Mr Cheong also cited the above case to demonstrate that debt collectors should always abide by the law and should not threaten or harass the debtors or their family members even if the debtors do not pay back the money.

If debtors can no longer bear the harassing and calls the police, the debt collectors can currently be charged for a range of offences, including harassment, unlawful assembly, being a nuisance, criminal violence or criminal intimidation, says Mr Tang.

He adds, “the applicable laws are the Protection from Harassment Act, the Vandalism Act and the Penal Code, and depending on the specific act of a perpetrator, some of the offences are arrestable.”

The Credit Collection Association of Singapore, which was formed in late 2013, has published a code of professional conduct on its website that sets out the principles that debt collectors should follow in different situations.

These include rules that its members should not use coercion to collect debt, that they should not force debtors to sell their properties or borrow further for financing, and that they should contact debtors within a reasonable time period.

The Statutory limitation for civil debt collection is six years. During the COVID-19 pandemic, creditors can consider negotiating via mediation with debtors to reach an agreement on repayment of debts in installments. In the case where a civil action is pursued to recover the debt, it should be noted that the statutory limitation period is six years.

As for the civil remedies available to creditors, Mr Tang points out that although some debtors are unable to pay off their debts immediately during the pandemic, they are willing to enter into amortisation agreements with their creditors, with both parties possibly carrying these out as small-claims business mediations.

In addition, according to the statute of limitations in the civil law, creditors of civil debts will lose the right to recover the debts if they have not taken any civil action to do so within six years of the default.

Creditors should also note that delays in taking legal action generally work against themselves, as it gives debtors time to wind up their business, sell assets or move them out of Singapore, Mr Tang reminded.

Lawyer advises that loan terms should be drafted by a professional to protect the lender’s rights and interests.

Even if the amount involved is quite small, the small claims tribunal will not handle the case if it is a purely personal loan. The court may handle the case if the amount is owed through provision of service or selling of goods.

Mr Cheong also adds that such claims could still be handled by a magistrate’s court.

Regarding how to protect the rights of debt collection of in the event of lending money to relatives or friends, Mr Cheong suggests that ideally all loan terms should be drafted and recorded by a professional and witnessed by an independent third party. “This helps to prove the terms of the loan, but in order to improve the chances of actually recovering the money, some form of loan guarantee is necessary.”

As for the IOU, he points out that while such written evidence is not a must-have, it is better to have one. The content should include information such as the amount of the loan, the terms of repayment and the identities of both parties.

Written evidence improves the chances of recovering the money.

In such court cases, Mr Tang adds, the burden of proof is on the claimant. So having written evidence always helps. In addition to this manner of agreement, this sort of written evidence can be letters, emails, text messages or WhatsApp communications.

In some cases, the party who borrows money may also claim that he has never received the money. In view of this, cheques, records of deductions in bank statements, as well as PayNow or transfer records, can also be helpful evidence to show that money has been transferred from the creditor’s account to the debtor’s.

Source：https://www.zaobao.com.sg/news/singapore/story20210815-1182235

说法识法

上门捣乱、披麻戴孝、穿着印有追债对象照片的衣服游街……

追债新招数屡见报端，一些做法公然“踩过界”，得由警方介入调查。

在借钱给身边人时，应留意哪些事项，以保障追讨权利？

若要聘请追债员或循民事途径追回欠款，又可能出现哪些情况？

本期《说法识法》邀请合盛律师事务所（Farallon Law Corporation）董事经理董智豪律师，

以及I.R.B.律师事务所合伙人张永文律师，讲解合法追债途径及相关注意事项。

追债员不享有任何特权，他们一样得奉公守法。这些年来持续有追债公司职员使出收账新花样，受访律师认为，拟定新法律有助对付非法追债招数。

内政部长兼律政部长尚穆根今年4月书面答复议员的国会询问时，透露内政部正考虑制定新的法律管制追债公司及其职员，并在适当的时候公布详情。

尚穆根说，目前已有法律保护债务人免受追债人的骚扰和恐吓等不合理或非法举动。

比方说，追债人若涉及伤人或威胁行为，可依照《刑事法典》面对刑事制裁。防止骚扰法令也为骚扰行径提供刑事制裁和民事补救。

如果向别人借钱的一方遇到这类行为，应报警并由警方展开调查，或者可考虑在防止骚扰法令下申请保护令，阻止追债人的骚扰行为。

确实应制定新法律
阻遏不合法追债行为

董智豪律师说，一些追债公司及其职员可能会使出许多“创意”招数骚扰债务人，现有法律框架难以将这些肇事者一一提控上庭，因此应制定新法律，阻遏不合法的追债方式。

他说，随着各类网站和应用日益普及，追债公司能够轻易隐藏身份骚扰债务人。

在他所知的一起案件中，追债人在交友应用上创建了一个假的女性账号。在与一名男子配对后，“她”以想要与该名男子共处为由，让对方去住家找“她”。

男子根据地址找上门时，债务人并未开门回应。该名“女子”声称听不见敲门声，要求男子持续敲门，直至债务人不堪其扰向公寓保安通报，也报警，让警察上门逮捕该名不明就里的男子。

张永文律师认为，有时候这些追债公司即使逾越了法律界限，也可能引人混淆，让一些人误以为这类公司是有权这么做的。“该法律有助厘清和界定哪些是追债公司具体能做的，哪些是它们不能做的。”

一般而言，个人债务追讨属于民事案件，警方不会介入。针对合法追债途径，董智豪说，债权人可考虑聘请律师向对方发出索偿信（letter of demand），并且入禀法庭取得裁决，再对债务人的资产执行裁决。

他指出，聘请追债员的风险是他们可能对债务人构成骚扰，并且在过程中触法。

遭遇非法手段追债可报警

2015年，一群追债员到福南数码生活广场（现称“福南”）食阁的一个“老火汤”摊位捣乱，关灯赶走顾客、阻止摊位做生意，并且要取走收银机的钱。

本报早年报道，当时六名追债员把带来的横幅置放在摊位前，横幅上有“追债进行中”的字眼。过程中，饭锅和收银机及摊口的器具都被推倒在地，摊位前的展示牌也被砸坏。这起案件引起广泛关注，六名追债员事后都被判坐牢。

董智豪举例说，其他非法追债手段包括爆粗口、锁门、破坏公物甚至是切断电源等，债务人可因此报警或提出骚扰告诉。

张永文同样引上述案例说明，追债的一方应确保时刻遵守法律，即使有人借钱不还，也不应威胁或骚扰债务人，或是对方的家人。

若债务人不堪其扰而报警，董智豪说，追债人目前可因一系列罪行被治罪，包括骚扰、非法集会、滋扰、刑事暴力或刑事恐吓等。

他说：“有关法律是防止骚扰法令、破坏公物法令和刑事法典，取决于肇事者的具体行为，当中一些罪名是可逮捕（arrestable）的。”

2013年底成立的新加坡信贷收账协会（Credit Collection Association of Singapore）曾在网站上发表一套专业操守准则，说明收账业者在不同情况下应依循的原则。

这包括规定会员在收账时不得使用压迫手段、不应对债务人施加压力，逼迫他们卖掉房地产或进一步借贷融资，也应在合理时间内联系债务人。

民事追债时效期限为六年。冠病疫情期间，债权人可考虑通过调解与债务人协商分期还债事宜，若是要开展民事诉讼追讨债务，则应注意六年的时效期限。

针对债权人可采取哪些民事补救，董智豪解释说，疫情期间一些债务人虽然无法立即还清债务，但愿意与债权人达成分期偿还协议，双方可通过小额商务调解这么做。

此外，根据民事法中的诉讼时效法令，在民事债务中，债权人若没有在对方拖欠债务的六年内，采取任何民事诉讼程序追讨债务，将失去追讨债务的权利。

董智豪提醒，债权人也应注意延迟采取法律行动一般对己方不利，因为这给了债务人时间来结束生意、售卖资产或把资产移出新加坡。

律师建议专业人士草拟借贷条款保障权益

即使涉及款额比较小，若纯粹是个人借贷，小额索偿庭不会受理。若这笔款项是透过提供服务或售卖商品欠下的，则有可能受理。

张永文也补充说，这类索偿事宜仍可由推事庭审理。

针对借钱给亲人或朋友时该如何保障追讨权益，张永文建议，理想的是所有借贷条款能经由专业人士草拟和记录，并且有独立第三方见证。“这有助于证明借贷条款，但为了提高实际追回钱款的机会，须有一定形式的贷款担保。”

至于欠条（IOU），他指出虽然未必一定需要这样的书面证据，但有的话更好，内容应包含贷款数额、还债条款和双方的身份等信息。

书面证据提高追回钱款机会

董智豪也补充说，在这类官司中，举证责任（burden of proof）在于索偿方，因此能有书面证据总是有利的。除了以协议形式，这类书面证据也可以是信件、电邮、短信或WhatsApp上的沟通。

在一些案件中，向别人借钱的一方也可能声称从未收到过款项。有鉴于此，支票、银行结单上的扣款记录，以及PayNow或转账记录等也会是有利证明，以显示钱款已从债权人的账户转至债务人那里。

原文：https://www.zaobao.com.sg/news/singapore/story20210815-1182235