Objection to the default notice - central element in the legal dunning procedure

The legal dunning procedure consists of several stages. The debtor may file the objection to a default notice at any given time, if he rejects and does not accept the receivable asserted against him. However, the objection to a default notice should not be taken lightly. The following text will clarify what exactly an objection to a default notice is and when to file it.


Legal dunning procedure - if it comes to that

If a receivable cannot be dealt with by commercial dunning or through the out-of-court procedure of a collection service provider, a creditor has no choice but to pursue a legal dunning procedure. For this, he can obtain help from a service provider in the debt collection sector. For the debtor, legal proceedings are inconvenient and may result in his being visited by the bailiff. Therefore it would definitely be of advantage, if the debtor can avoid a legal dunning procedure.


Objection to default notice in the legal dunning procedure

As soon as the debtor is in default, theoretically the legal dunning procedure can be initiated without further deadlines. If possible, a lengthy civil process should be evaded with the simplified procedure. The legal dunning procedure consists of a number of defined stages.  Firstly, the creditor or service provider appointed by him will apply for the default notice. Here he lists the principal claim as well as any ancillary claims. These are roughly the costs he incurred with the default and collection process. As soon as the court costs have been paid, the court will examine the application not for factual accuracy, but only for formal correctness and plausibility ("simplified conclusiveness test").

For this reason, the legal dunning procedure grants the debtor the opportunity to file an objection to the default notice and the creditor's receivable. At this time, the court does not examine factual accuracy, i.e. the question of whether the claim is justified and how it can be proven. The legal dunning procedure is a shortened process for cases in which facts are beyond dispute.

Once formal correctness is confirmed, a default notice is issued shortly after the application at the responsible central debt collection court. Now the debtor has the right to file an objection.  He has at least two weeks to do so. Formally, the debtor can file an objection to the default notice as long as he has not received an enforcement order. A simple letter to the district court is sufficient to object to the default notice - a printed form for this is enclosed to the default notice.

If no objection is filed against the default notice, the receivable is considered to be indisputable. Thus, the court assumes that the debtor accepts that he owes the creditor the sum claimed. In this case, the enforcement order follows shortly after. The debtor can also file an objection against this, albeit under different conditions to those of the objection to the default notice.

With the enforcement order, the creditor has acquired an enforceable title. This means that the bailiff can henceforth wait outside the door if the debtor still does not pay. Moreover, the title remains valid for 30 years. Even if temporary insolvency and the submission of an asset disclosure statement is the case, the creditor does not have to loose hope of getting his due. The costs of proceedings are ultimately borne by the debtor.


Objection to default notice - the consequences

An objection interrupts the simple dunning procedure. When applying for a default notice, the creditor can already specify the request to implement dispute proceedings in the event of an objection. In the event of objection to the default notice, the case will be passed on to the responsible trial court as a normal legal case. This court will inform the creditor or his representative. He can now formally make a claim and thus request that the debtor be sentenced to pay the principal and ancillary claims. He must now objectively justify this payment request. The applicant generally has two weeks for this justification. This raises new court costs, which are added to the total claim during the procedure.


Objection to default notice - pros and cons

If a receivable is justified, it will be better for the debtor not to object to the default notice. Otherwise court litigation proceedings will ensue, which will increase the total debt by court costs and further default. However, if the debtor is of the opinion that the receivable was made up out of thin air, he must file an objection to the default notice. Otherwise he will have a title against him. Whether an objection to the default notice is pertinent is dependant on the eligibility of the receivable.