After successfully obtaining a judgment, whether it be after a trial or through an agreement and something called a Confession of Judgment, many may assume that collecting the owed money is an effortless task. However, it’s not that simple. Simply having a judgment does not guarantee payment; enforcing that judgment is necessary to receive any money.
What is Judgement Enforcement?
Judgment enforcement is the process of locating and recovering assets that can be used to satisfy the judgment. Assets may include real property, personal belongings, wages, and income streams, subject to certain exemptions for each category. It’s the judgment-creditor’s responsibility to enforce the judgment since the courts won’t do it for them. Many judgment-debtors won’t voluntarily pay, making it necessary to uncover information about their finances and resources.
Information and Enforcement Devices
To begin the enforcement process, the judgment-debtor should receive a restraining notice and information subpoena. The information subpoena contains questions that request information about the judgment-debtor’s assets and other forms of income that may help satisfy the judgment. The restraining notice prohibits the judgment-debtor from disposing, transferring, or tampering with any property that can be used to satisfy the judgment. At a later stage in the collection process, the judgment-creditor may wish to take the judgment-debtor’s deposition (a process of questioning a person under oath) if their collection efforts advance that far.
The information that the judgment-creditor already has concerning the debtor’s assets should also be reviewed. If the debtor has previously paid the creditor with a check or wire from a bank, the creditor may want to issue a subpoena to that bank to learn more about the debtor’s assets. The creditor can even send a restraining notice to that bank that will freeze twice the amount of the judgment owed, assuming the debtor has those funds in their accounts.
How Are Debts Collected?
If the judgment-debtor is employed, their wages may be garnished. Wage garnishment is a legal procedure in which a person’s earnings are required by court order to be withheld by an employer for the payment of a judgment or debt.
If the debtor owns significant personal property, that too may be subject to collection. If the judgment-debtor rents or leases real property to others, that income stream can also be used to pay the judgment. There are other ways to leverage or “attach” real property to satisfy a judgment, subject to certain exemptions, prior liens, and issues concerning whether the property is the debtor’s primary residence and whether the debtor owns the property with others.
Conclusion
Enforcing judgments has numerous strategic and legal implications to consider. It is best to consult with an attorney experienced in judgment collection to help navigate these issues and determine the best course of action.
