Attachment of Income Order Scheme - Notes for Maintenance Payers

Introduction

If you, being a maintenance payer, default in maintenance payment without reasonable excuse, the maintenance payee ("payee") may apply to the court for an order to attach your income (i.e. to deduct from your income and pay the money deducted to the payee) to recover the arrears of maintenance and future maintenance payments.

2. The purpose of this booklet is to explain to you in simple terms the "Attachment of Income Order" ("AIO"), a measure through which maintenance payments can be collected. Though in this booklet we strive to give a precise explanation of the relevant laws and court procedures, the booklet itself has no legal effect. Should you have any queries, you should consult your solicitor or seek free legal advice from the Free Legal Advice Service of the Duty Lawyer Scheme.

3. Although you may defend an AIO application without instructing a solicitor, the professional knowledge and experience of a solicitor may help you to promptly and accurately go through the required procedures and present relevant facts for consideration by the court.

4. In case you are in financial difficulties and cannot afford to instruct a solicitor, you may apply for legal aid at the Legal Aid Department. They will appoint a solicitor to act for you in the court proceedings and help you in defending the application, provided you pass the means and merit tests.

5. Should you need any legal assistance and legal advice, you may contact the following department or organization for enquiries:

Legal Aid Department

Legal Aid Department
Address : 24/F Queensway Government Offices, 66 Queensway, Hong Kong
Telephone No. : 2537 7677

Free Legal Advice of the Duty Lawyer Scheme
Appointment can be made at any District Office
Telephone No.: 2526 5969

What is an Attachment of Income Order?

6. An "Attachment of Income Order" ( "AIO" ) can be made by the court under the Guardianship of Minors Ordinance (Cap 13), the Separation and Maintenance Orders Ordinance (Cap 16) and the Matrimonial Proceedings and Property Ordinance (Cap 192).

7. An AIO will enable the payee to receive maintenance payment direct from your income source without contacting you. Your "income source" (such as employer, tenants, etc.) shall deduct from your income the amount specified in the AIO when each payment of income is due and pay the amount to the payee direct.

8. The amount to be attached, period of attachment and payment method are specified in an AIO. The amount to be attached is not confined to arrears of maintenance payment, but may also include future maintenance payments. Moreover, there are no legal restrictions on the payment methods. The court may order your income source to pay by bank transfer, cheque, cash or other methods of payment.

In what circumstances will the court issue an AIO?

9. The law provides that the court may issue an AIO where :

1. you have failed, without reasonable excuse, to make any payment in compliance with a maintenance order; AND
   
   
2. you have any income capable of being attached ("attachable income").
   

10. In order to determine whether you have failed to make maintenance payment "without reasonable excuse", the court has to consider the reason of your default. Generally speaking, you would be presumed to have defaulted "without reasonable excuse" if you are able to pay but give no explanation for your non-compliance with the maintenance order. The court has to consider the evidence given by you and the payee, and where necessary , the evidence provided by other people (such as your employer) before it can decide whether you have failed, "without reasonable excuse", to make the payments.

11. The word "income" is very broad in meaning. Apart from salary and wages, it may also include rental receipts, company dividends, directors' emoluments and various kinds of income. Therefore, "income source" includes people like your employer and tenants, as well as companies of which you are a shareholder or a director.

12. "Attachable income" has not been defined in law. Generally speaking, an "attachable income" should have an identifiable income source, e.g. a person, company or institution. Otherwise, the court will be unable to issue an AIO.

13. For example, if you are a property owner, the rental receipts may be treated as "attachable income" and the court may issue an AIO to the tenant. If you are a shareholder, then the dividends from the company may be treated as "attachable income" and the court may issue an AIO to the company. If you are a director of the company then the court may treat your emoluments as "attachable income" and the court may issue an AIO to the company.

What is the application procedure of an AIO?

14. The payee should make the application by summons or originating summons. When an application is made, the payee would serve on you a sealed copy of the summons (or originating summons), copy of the affidavit and a form of statement of means by one of the following means :

1. serving the documents on you personallyNote1 ; or
   
   
2. sending the documents to your last known address by post or registered post.

15. Under the law, where the documents are served on you by means of (b), the documents shall be deemed to have been served on the seventh day after the documents were sent.

16. You must forward to the court and the payee a copy of "statement of means", within 14 days of the service of the application documents, setting out the details of all your income and income sources. Subsequently, the court will send the statement of means to the relevant income sources and order them to verify the contents.

17. If you do not submit the statement of means within 14 days after the date of service of the application for an AIO, the payee may make an ex parte application to the court, requesting the court to order you to submit the statement. A person who fails to submit the statement in compliance with the court order commits an offence and is liable to a fine and imprisonment

What information is required in the statement of means?

18. The information required is already stated in the form of statement of means. All you have to do is to fill in the form honestly. If you have more than one income source (for example, you are an employee and you own property which has been let out), then you should use a separate annex to give details of each of your income.

19. You must honestly fill in the statement of means. A person who knowingly makes a false statement commits an offence and is liable to a fine and imprisonment.

20. Upon receipt of the statement of means, the court will order the relevant income source to verify the contents of the annex of the statement of means. The court would only send the relevant annex to the income source concerned in order to protect your privacy. Information of your other income sources will not be disclosed.

Hearing of an AIO application and the issue of an AIO

21. Both you and the payee must appear at the hearing of the AIO application, during which you may make representations in response to the points raised by the payee. If the income source wishes to address the court on any issue relating to the statement of means or the statement of verification, he may also seek permission from the court to attend the hearing.

22. The court will take into account the information submitted by all parties in order to decide whether you have failed to make payment without reasonable excuse, whether your income is attachable and whether an AIO should be issued. The court will make an AIO(s) where it is satisfied that it is appropriate to attach the money from one or more of your incomes.

How am I going to receive my income when an AIO is issued?

23. The payee has to serve the order on you and the income source(s) concerned either by personal service or by registered post. The order shall take effect on the commencement date specified in the order or 14 days after the date of service, whichever is later. Before the commencement date of the order, you can still receive the whole of your income as usual.

24. When an AIO becomes effective, the income source shall comply with the order and pay to the payee the amount specified in the AIO. His liability towards you are discharged by his paying you the remaining amount. For example, your income is $8,000 while the amount to be attached as specified in an AIO is $3,500. Then, before the income is paid to you, the income source has to deduct $3,500 and pay it directly to the payee. The income source is liable to pay you the remaining $4,500 only.

25. However, it may happen, at some later stage, that the income source cannot pay you any income at all. This may happen in the following circumstances :

1. when your income has dropped to such a level that it is insufficient to cover the amount specified in the AIO; or
   
   
2. when your income source is your employer who, according to section 32 of the Employment Ordinance (Cap. 57), is allowed to make deductions from your wages (such as recovering the cost of meals or accommodation provided for you by your employer) and the balance after deduction is insufficient to pay the specified amount.

26. In the case of (a), your income source shall pay the reduced income in full to the payee. For example, if your income is $8,000 while the amount specified in an AIO is $4,500, and if your income later drops to $4,000, the income source shall deduct the reduced income, i.e. $4,000, in full and pay it to the payee.

27. In the case of (b), your income source (i.e. your employer) shall pay to the payee the balance of your wages after making the deduction so authorized under the Employment Ordinance. For example, your income is $8,000, while the amount to be attached as specified in an AIO is $4,500, and the amount your employer may deduct under the Employment Ordinance is $4,000. Then, the income source may first deduct the $4,000 he is entitled to and pay the remaining sum of $4,000 in full to the payee. By doing so, he will be regarded to have complied with the AIO.

28. In the case of either (a) or (b), your income source is not required to pay any amount to you. Nevertheless, you remain liable to pay the outstanding balance to the payee (i.e. the amount of maintenance minus the amount the payee received from the income source). The income source shall inform you and the payee of the reasons why he cannot pay the amount specified in the AIO and of the actual amount that has already been paid to the payee. Of course, if the reduction in your income is going to last for some time it may be grounds for you applying to vary the maintenance order and AIO. See paragraph 30.

Do I have to pay maintenance after an AIO is issued?

29. The purpose of making an AIO is to provide the payee with a reliable means of collecting maintenance payments. In normal circumstances, an income source shall comply with the order and pay the payee the amount as specified in the AIO. In that case, you do not have to make any other arrangement to pay the maintenance payee. However, if the specified amount in the AIO(s) is less than the amount specified in the related maintenance order :

1. you are liable to pay the payee the balance; and
   
   
2. you must notify the payee in writing of any increase in your income or particulars of any new income source within seven days of the changes. A person who fails without reasonable excuse to comply with the requirement or who knowingly makes a false statement commits an offence and is liable to a fine and imprisonment.

How to vary or discharge an AIO?

30. The court may, upon application either by you or the payee, vary an AIO. In the following circumstances, the court may consider making an order to discharge an AIO :

1. upon the application by you or the payee;
   
   
2. upon receipt of notification to the effect that an income source ceases to be your income source;
   
   
3. upon the discharge or lapse of the related maintenance order; or
   
   
4. when another AIO is made.

31. An application for the variation or discharge of an AIO shall be made by way of a summons and filing of an affidavit stating:

1. your name and correspondence address;
   
   
2. the name and last known address of the payee;
   
   
3. particulars of the maintenance order;
   
   
4. the case number of the previous proceedings under which the maintenance order was made;
   
   
5. the case number of any judgment summons already issued and particulars of any other execution proceedings already instituted to enforce the maintenance order;
   
   
6. the case number of the AIO which the application seeks to vary or discharge; and
   
   
7. the grounds for the application.

What happen if I refuse to cooperate with the court?

32. You commit an offence and are liable to a fine and imprisonment if you fail, without reasonable excuse, to comply with an order of the court, or knowingly provide false information to the court.