An extract from The Asset Tracing and Recovery Review, 8th Edition
Seizure and evidencei Securing assets and proceedsProvisional relief from the court
To maintain the status quo regarding tortfeasor or debtor assets, a claimant can apply for either or both of the following: a provisional attachment order, and a provisional prohibition order from disposing of assets or a provisional injunction. The creditor may apply for these reliefs ex parte. A provisional attachment order is invoked by creditors that have monetary claims against the debtor, and it covers personal property as well as real property. Provisional attachments are effective even if the assets are disposed to third parties. The creditor must identify in its application specific assets owned or possessed by the debtor. After the claimant wins the lawsuit on merit, he or she can enforce his or her right under the court's auction.
A creditor who has a claim other than a monetary claim may apply for a provisional prohibition order from disposing of assets to obtain delivery of personal property, transfer of accounts receivable or bank accounts, or registration of real property. The order prevents the owner or holder of the property from transferring legal title, delivering possession, or assigning or granting encumbrance of the property to a third party. Like a provisional attachment order, a provisional prohibition order from disposing of assets is effective against third parties.
A creditor seeking to prohibit specific actions may seek a provisional injunction. The court usually reviews the petition and supporting evidence without witness testimony, and has discretion as to the issuance of the order and the size of the undertaking necessary to protect the interests of the defendant.
In an involuntary bankruptcy context, creditors may seek a comprehensive injunction prohibiting the debtor from transferring any assets of the debtor or payment to any creditors. This is to prevent the debtor from dissipating assets between the time the involuntary bankruptcy petition is filed by the creditors and the time the court officially commences the proceeding. Once the bankruptcy proceeding commences, the right to dispose of the debtor's assets belongs to the court-appointed trustee, and the trustee's disposition of assets is subject to court approval or a creditor's supervision, or both.Provisional relief from an arbitral tribunal
Generally, courts may not interfere with matters subject to arbitration. However, after an arbitral tribunal has been constituted, parties may file a petition for provisional relief with the tribunal or directly with the court. Parties may request provisional relief from the court even before the arbitral tribunal is constituted pursuant to the arbitration agreement.
An arbitral tribunal cannot issue provisional relief with respect to a third party that is not participating in the arbitration proceedings. Unlike provisional orders of the court, the application for provisional relief under the arbitration proceedings cannot be made ex parte.ii Obtaining evidence
The Korean Civil Procedure Act does not provide for the broad discovery that can be found in certain common law jurisdictions, such as the United States. A party in civil litigation may only obtain evidence from the other party through the court. The court may, by request of the parties, examine evidence prior to the commencement of civil proceedings (i.e., the service of the complaint upon the defendant). The court may grant the party's request for pretrial examination of evidence if the court finds that there may be undue hardship in examining evidence later in the trial. The pretrial examination in such a case may be witness testimony, production of documents or inspection of the actual site of controversy.
The Criminal Procedure Act provides for similar proceedings to obtain evidence prior to indictment. The prosecutor or the accused may ask the court to seize, search or inspect evidence; interrogate witnesses; or appraise the asset value if undue hardship is expected in examining evidence later in the trial.
Once the trial begins, a party may ask for a court order mandating the production of documents held by the opposing party or third party. If the party fails to comply with the production order, the court may deem that the contents of the requested documents are as asserted in the party's petition for production.
Korean law treats a judgment creditor as an unsecured creditor whose priority is lower than that of security interest holders in civil execution proceedings as well as in insolvency proceedings.
A judgment creditor has the right to request that a debtor, including individuals as well as corporations, disclose his or her assets. The court may order the debtor to submit a schedule of assets. If the debtor fails to do so, the court may sanction the debtor or representative directors with up to 20 days of imprisonment. The court, by request of the creditors, may also enlist the debtor into the register of delinquent debtors. The register is delivered into the county office and would be disclosed to the public, and oftentimes is used by financial institutions. The judgment creditor facing an evasive debtor may also obtain a court order to investigate the debtor's finances through financial institutions or other third parties.