Garnishee Order
A garnishee order is a legal order issued by a court to a third party who owes money or holds property of a debtor. The order requires the third party, called the garnishee, to pay the money or deliver the property to the creditor, who has obtained a judgment or decree against the debtor. A garnishee order is a way of enforcing a debt and satisfying the claim of the creditor.
There are two types of garnishee orders: attachment of debts and attachment of earnings. Attachment of debts is when the garnishee order is served on a bank, financial institution, or any other person who owes money to the debtor. The garnishee is then obliged to pay the amount of the debt or a part of it to the creditor or the court. Attachment of earnings is when the garnishee order is served on the employer of the debtor. The employer is then required to deduct a certain amount from the debtor’s salary or wages and pay it to the creditor or the court.
A garnishee order can be challenged by the debtor or the garnishee on various grounds, such as lack of jurisdiction, improper service, invalidity of the order, hardship, or dispute over the debt. The debtor or the garnishee can file an objection or a motion to set aside the order in the court that issued it. The court will then hear the matter and decide whether to uphold, modify, or cancel the order.
Order Nisi and Order Absolute
Order nisi and order absolute are two types of court orders that are used in different contexts.
Order Nisi is a provisional order that will become final unless a certain condition is met or an objection is raised. For example, in a divorce proceeding, a decree nisi is a document that states that the court is satisfied that the marriage has broken down irretrievably and that the divorce can be granted. However, the divorce is not finalised until a decree absolute is issued, which usually happens after six weeks and one day from the date of the decree nisi.
Order absolute is a final and binding order that does not depend on any condition or objection. For example, in a garnishee proceeding, an order absolute is a document that directs a third party who owes money or holds property of a debtor to pay or deliver it to the creditor who has obtained a judgment against the debtor. An order absolute is issued after an order nisi, which gives the debtor and the third party an opportunity to show cause why the order should not be made.
Rule in Clayton's case
The rule in Clayton’s case is a legal principle that applies to the appropriation of payments in a running account, such as a bank account. It states that, in the absence of any contrary intention, payments are presumed to be appropriated to the debts in the order in which they are incurred. This means that the first payment made by the debtor is applied to the first debt owed to the creditor, and so on. This rule was established in the case of Devaynes v Noble (1816) 35 ER 781, also known as Clayton’s case. The rule aims to provide certainty and fairness in the allocation of payments and liabilities in a continuous business relationship. However, the rule may be modified or excluded by the express or implied agreement of the parties, or by the circumstances of the case.
Important Financial Ratios
Balance sheet ratios are financial metrics that compare different elements of a company’s balance sheet, such as assets, liabilities, and equity. They are used to evaluate a company’s liquidity, solvency, efficiency, and profitability. Some common balance sheet ratios are:
- Current ratio: This ratio measures a company’s ability to pay its short-term obligations with its current assets. It is calculated by dividing current assets by current liabilities. A higher current ratio indicates better liquidity.
- Quick ratio: This ratio measures a company’s ability to pay its short-term obligations with its most liquid assets, such as cash, marketable securities, and accounts receivable. It is calculated by subtracting inventory from current assets and dividing by current liabilities. A higher quick ratio indicates better liquidity.
- Debt-to-equity ratio: This ratio measures a company’s financial leverage, or how much debt it uses to finance its operations compared to its equity. It is calculated by dividing total liabilities by total equity. A higher debt-to-equity ratio indicates higher financial risk.
- Solvency ratio: This ratio measures a company’s ability to meet its long-term obligations and interest payments. It is calculated by dividing net income plus depreciation by total liabilities. A higher solvency ratio indicates better financial stability.
- Return on equity: This ratio measures a company’s profitability, or how much income it generates for its shareholders. It is calculated by dividing net income by total equity. A higher return on equity indicates higher profitability.