Yellowknife (Mar 26/03) - So you take the guy who owes you money to court and win. Now you just hold out your hand and collect what's due, right? Not necessarily.

Jim Wilson says debt collection isn't a bad business to be in, but it could be better with a few minor changes. - Darren Stewart/NNSL photo

Jim Wilson, operator of Aurora Collections, said a few small changes could take away major headaches for people who make their living collecting debts in the territory.

"The rules in the territory are stacked against the creditor," he said.

According to Wilson, he was the only collections agent in town when he moved to Yellowknife in 2000. Before that he worked for a collections firm in Edmonton for 10 years.

He's requested a meeting with Justice Minister Roger Allen several times, but has been ignored.

"I know it takes a lot of time and energy to change legislation, but I don't know when the last time they looked at it was," he said. "It's time the rules were looked at again."

Wilson said the biggest headache for him and his clients are the rules around garnishing wages in the NWT.

In Alberta, a garnishee order is good for 12 months and is served on the individual's bank or employer. In the NWT, the order is only good for 10 days, and has to be served on the individual as well as the bank or employer.

That means if you're collecting a large sum in several increments you have to serve a new notice on the individual every 10 days, which can be a huge hassle and carry large administrative fees.

"It's even more expensive to do from one of the smaller communities," he said.

"And imagine if the individual you're serving works in a camp -- six weeks in, six weeks out. You can't go up to the camp every time you need to serve him."

Wilson also said the limit for what one can claim in NWT small claims court should be raised from its current limit of $5,000.

Alberta's limit is $25,000 and most jurisdictions in Canada go up to $10,000 or higher.

For example, Wilson said, a client trying to recover a debt of $7,000 will likely just settle for the $5,000 maximum they are allowed in small claims, rather than pay a lawyer to take them through the Supreme Court system.

"For simple debt matters there should be no reason to have to bring a lawyer into it," he said.

Government response

Glen Rutland, policy advisor for the territorial justice department, said the relatively low limit for small claims is something that the justice department will look at as part of an internal review over the next one to three years.

"That has been identified as part of the work plan for court services division," he said. "We don't have a time frame but it would involve amendments to the Territorial Court Act so it would have to go through the legislative assembly."

Wilson said that of the 177 small claims cases filed in the NWT last year, his company was involved in over half.

"We either get involved at the beginning or the end," he said.

Some clients approach them before they get involved in the court system but many come to them after a judgement. He said about 80 per cent of small claims judgments aren't immediately collected.

"The court isn't there to hold your hand after a judgment, you have to go out and find a way to get people to comply," he said. "That's when many people come to us."

He said 12 per cent of the money Aurora recovers is through garnisheeing individuals, which quickly adds up to a significant chunk of cash.

In 2002, Aurora Collections recovered a total of $600,000 in debt for individuals and businesses in the territory.

Most of this money was recovered without resorting to wage garnishment.

Wilson said wage garnishing is considered a last resort -- even in his line of work.

"Most of the time we find a way to settle the debt without resorting to that step."

He said debt collection is not a bad business to enter in a community like Yellowknife. Unlike his work in Edmonton, he sees the people his work affects on the street every day.

"I run into people in restaurants or the grocery store and it's fine," he said.

"We treat people with respect, we don't attach moral values to having debts," he said. "Everybody at some point in their life is going to find themselves in a debt and that's fine."