Judgments: How to Collect
Congratulations, you’ve won the lawsuit! You went through the entire process which may have taken over a year… you endured the depositions and even went through a trial. The court finally awarded you a judgment. So now what?
One of the more frustrating parts of the legal system for clients is collecting on what is owed to them. The judgment that is awarded by the court is the first step in the collections process. While it is the most important step, the fact that the court awarded you money does not mean that the debtor will automatically pay. There are several things that you can do in order to collect the judgment:
Locate Assets. Finding the judgment debtor’s assets is critical in the collections process. The most common way to locate assets is to search public records. However, to verify assets and to locate assets such as bank accounts, a Judgment Debtor Examination (where the judgment debtor is deposed in the courthouse and is forced to provide details of his/her/its finances) is a useful tool and may lead to money or property which can be used to pay the judgment.
Lien Assets. In specific cases, liens can be placed on the person’s real estate before a lawsuit is filed (for example, a mechanic’s lien). However, every type of judgment can be recorded, which is a process by which the judgment is filed with the county clerk where the judgment debtor owns property and with the California Secretary of State’s office. This puts any potential buyers or lenders on notice that the judgment debtor owes you money and may prevent the sale or refinancing of the property (without paying you first). It will also negatively affect the judgment debtor’s credit rating.
Bank Levy. If the debtor has a bank account or a safe deposit box, the judgment can be used to take the money from the account or take the contents of the safe deposit box.
Garnish Wages. If the debtor is employed, the judgment can be used to obtain an “Earnings Withholding Order”, or wage garnishment. Only a certain percentage of the debtor’s paycheck can be used to satisfy the debt, but this is always a good option in order to start getting you paid on the judgment.
The attorneys at Vogt, Resnick & Sherak, LLP have experience in both locating assets and collecting on judgments and can assist you in recovering what is rightfully yours!