Amendment to Code of Civil Procedure Regarding Issuance of Payment Orders Passed

Amendment to the Code of Civil Procedure Passed its third reading at the Legislative Yuan on June 15, 2015, setting forth that a creditor shall first produce evidence to provide preliminary showing to prove his/her claim before filing a motion for a payment order, and that a payment order no longer has the same binding effect as a final judgment. 

Issuance of a payment order was supposed to facilitate a creditor to seek a convenient and quick resolution of dispute over claims, but it is now used as a means by people committing fraud on victims who with scraps of legal knowledge unknowingly turn into debtors.  In such case, most victims fail to file an objection to the payment order within the statutory 20-day period, and the payment order will have the same effect as a final judgment and those committing fraud may start proceedings of compulsory execution against these victims.  Even though these victims may initiate a rehearing action as a remedy, only a few of them can actually be relieved from their unknown debts because of the strict requirements for initiating a rehearing action. 

To prevent the above-mentioned circumstance, the amendment provides that a payment order will only be enforceable but will not have the binding effect of a final judgment.  Where a debtor fails to file an objection to the payment order within a statutory deadline, the creditor can file a motion for compulsory execution in accordance with the payment order and a certificate issued by the court.  Further, if the debtor fails to file an objection to the payment order within 20 days upon receipt of the payment order and asserts that the right of claims stated in the payment order does not exist, the debtor may file a lawsuit disputing the existence of the debt recorded in the said payment order to seek a declaratory judgment confirming the non-existence of the alleged credit, and the court may, on the debtor’s motion, stay the compulsory execution proceedings after the debtor has provided an appropriate security.  (June 2015)
/CCS