Collection: Winning your case in court is often only 10% of the problem in recovering your money. Many people, even after losing in court and being ordered to pay another person some money, still do not pay. The judgment, or the judge's order to pay, is often useless unless you can find the property belonging to the defendant and attach it, or force a sale of these items and a distribution of the proceeds to you in satisfaction of your judgment.
Winning at Trial and Obtaining a Judgment: Assuming the case is over and you are the winner, the first thing you must realize is that it is up to the winner to make all of the efforts to collect the money owed. If you lose, this information can still help you avoid paying the winner. You become the person entitled to a judgment. A judgment is really nothing more than a court order to a Defendant(s) to pay some amount to the Plaintiff. However, this is very significant. A judgment means a court has ordered a person to pay a sum of money, and this sum will be specified in the judge's order.
If the loser does not pay after court, and refuses to pay or to take phone calls after court, you or your attorney, if he/she is still being retained, should write a stern but not threatening letter requesting payment. This usually will not work, but it must be done in most cases anyway.
Check the court rules to see how long you must wait after the judgment is entered by the court, before you can begin to collect the money by means other than phone calls and letters. Also, the court rules will state which methods you can legally use to collect your money.
For example, in many states you cannot garnish a person's wages. Garnish means to force the employer, by court order, to withhold a portion of a person's paycheck (usually up to 25%, although many states have a large number of exemptions which may limit the amount you can garnish.)
If you do not wish to undertake this collection process yourself, you can hire an attorney to collect this fee, or you might call a collection agency, but these agencies often take up to 50% of the money they collect as their fee. Or if you pay them by the hour, the hourly fees may cost substantially more than the judgment.
If you wish to collect your winnings and if you know where the loser banks, you can use your judgment to levy on his/her bank account. If you wish to levy on a bank account, you must usually use the sheriff or marshal, and they charge a fee. Also, you must make certain that your judgment exactly matches the name on the bank account, or the bank may refuse to withhold the money or levy the account. You are responsible for finding the bank accounts, at your cost. The marshal or the sheriff will usually only levy once the accounts are located.
Also, you can search for other assets of a loser, such as motor vehicles with equity, receipts of a business, or real property, although there are many restrictions by state on attaching real property in which the defendant resides.
Levying on a loser's wages or a pension requires that you obtain a document from the court sometimes known as a Writ of Execution or Notice to Judgment Debtor. You need to check the law of the state in which the judgment was entered to find this document and obtain it. This is the document used to alert the Marshal, Constable, Sheriff or other officer of law that you intend to garnish a person's wages, pension or other assets, such as a bank account(s).
If you locate personal property owned by the defendant, or even if you suspect that he/she owns personal property, you can obtain a document which can be completed and filed with the local county recorder's office. This is sometimes called an Abstract of Judgment. This document precludes the sale of property owned by the loser until your judgment is paid. Again, this is an oversimplification of the process, but it may be available to you. Of course, you have to wait until the property is sold or transferred, but it is often one of the best ways to be sure you are paid.
Finally, if the only assets a person has is an operating business, you might be able to force the business to operate under a receivership, until you are paid. If this is necessary, you should contact your Plan Attorney. Now you can see why winning is often only 10% of the battle.
Collection of Default Judgment: First, as a recap remember what happens when a Defendant has been sued, properly served and does not appear at trial for their court date? Usually, although not every time, a judge will enter a default judgment in favor of Plaintiff and against any Defendant not appearing. The amount of the judgment is usually for the entire amount requested by the Plaintiff, whether it is owed to the Plaintiff or not. This is why lawyers advise their clients in their original Petition or Complaint to ask for the maximum amount of damages allowable by law. If a Plaintiff has not asked for the maximum amount, the judge may only award the amount the Plaintiff asks for, or proves by the evidence in the Plaintiff's case.
The question is, "Why as a Plaintiff should I ask for more than I am entitled? This does not seem fair." Remember that you are asking for as much as you can because the judge may believe you are entitled to more than you may think you are. Also, a judgment for a larger amount of money can help settle your case and get you paid faster. For example, if you were to be owed $500 by a defendant and you received a judgment for $2,500, imagine the scrambling around the Defendant is going to do when he finds out from his employer that you have garnished his wages, and he will not receive part of his paycheck. You would be surprised at how many offers to settle are made when garnishments or attachments are received.
Avoiding Collection of a Judgment: If you are the Defendant and you cannot afford to pay the entire sum at once, you should tell the judge immediately and ask for a payment schedule. Judges will usually give a liberal payment schedule to the Defendant. The Plaintiff may be allowed to speak again, on this point only, to tell the judge why such a payment schedule is not fair.
If a Defendant leaves court and discovers that he/she cannot pay, he must call the court clerk and attempt to appear before the judge again to ask for a payment schedule. Be sure to do this if you are the Defendant, because failure to pay or ignoring the judgment will allow the Plaintiff to pursue other remedies, which will be discussed next.
If the person pays the full amount, the Plaintiff [or whoever the winner is] may be required to file a document, sometimes called a Satisfaction of Judgment, indicating to the world that the judgment has already been paid. Be sure as a Defendant, before you actually pay, that you receive such a document. At least be sure you receive a written promise signed by the person to whom you are paying the money that they will file a Satisfaction of Judgment. It is the responsibility of the party paying the money to make sure such a document is entered on the court records, or to insist the plaintiff comply. If this document is not entered, your credit rating may be affected or it could show up as unpaid on your credit report years later.
In the event the plaintiff, or winner, will not file this document, you should call the clerk of the court and request an appearance before the judge to see if the court will enter the judgment. You might take all of your written documents concerning your repeated requests of the plaintiff to enter a Satisfaction of Judgment and show the court how these requests were ignored. Some states will not allow this procedure.
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