Arrestment is, at present, predominantly a common law process. It is an action by a creditor to arrest or freeze funds or goods belonging to a debtor in the hands of a third party.
Arrestable funds or goods include:
- Funds held in bank or building society accounts.
- Goods owned by a debtor but in the hands of a third party, for example, goods in a warehouse or in storage.
- 'Incorporeal' property such as rights under a trust, for damages or due under life assurance policies.
Currently arrested funds or goods cannot be taken into a creditor's possession or sold without an action of furthcoming.
Section 10 of the 2007 Act inserts Part 3A into the Debtors (Scotland) Act 1987 and will make significant changes to arrestment and actions of furthcoming.
Section 10, will not, in the main, be commenced until the end of 2008.
However, section 10 is commenced from 1 April 2008 only insofar as it is necessary for a creditor pursuing debt through the summary warrant process, to serve a charge for payment prior to executing an arrestment.