CAUTION STATE LAW VARIANCES
Judgment enforcement law is notoriously non-uniform between the various states.
Post-Judgment Written Discovery To Debtor
Most states allow creditors to serve document requests and interrogatories on debtors in post-judgment proceedings. These are substantially identical to those same discovery devices in pre-judgment litigation, with one glaring exception: In pre-judgment litigation, there are a variety of remedies available to the trial judge to enforce the discovery, from monetary sanctions to striking pleadings to striking evidence and even to "terminating sanctions" which end the case. Post-judgment, however, there is usually just one remedy, and that is to hold the debtor in contempt for failing to respond.
Post-judgment written discovery is also see by creditors as a cheap way to stay in the debtor's life, and to cause the debtor's attorney to run the meter organizing documents and drafting responses to the discovery.
Scope of Post-Judgment Discovery
Whereas pre-judgment discovery is limited to things that might cast light on the underlying case, post-judgment discovery is much broader, and basically encompasses anything that might lead to the discovery of the debtor's assets. Moreover, a debtor responding to such discovery has few objections post-judgment that carry any weight, and judges are often quite sympathetic to the creditor's argument that "if the debtor doesn't want to provide such-and-such information, then the debtor should pay the judgment."
Post-Judgment Document Requests
One of the easiest ways for a creditor to search for assets is to require the debtor to produce all sorts of documents, including deeds to property, bank account statements, credit card statements, stock ledgers, partnership agreements, operating agreements, utility deposits, trust documents, wills, and you-name-it. The debtor is then required to round up all this information, to the extent that the debtor is able, and turn the documents over to the creditor. Usually, these document requests are served sufficiently in advance of the debtor's exam such that the debtor will have provided the documents before the exam and can be questioned about them.
Some jurisdictions allow for interrogatories to be served on the debtor post-judgment, which allows the creditor to obtain basic information about the creditor's affairs and get the debtor on the record about whether certain categories of assets exist or not, and if there has been any transfers of assets within the limitations period for a fraudulent transfer action (usually four years).
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MAJOR SECTIONS OF WEBSITE
ABOUT JUDGMENTS - Overview of judgments as they relate to judgment enforcement.
Collecting Default Judgments - Special considerations for default judgments.
Form of Judgment for Collection - Getting the form of judgment right can make collection easier, and getting it wrong more difficult.
Judgments On Appeal - Is a judgment enforceable when it is being appealed? Maybe. Appeal bonds a/k/a supercedeas bonds also discussed.
JUDGMENT ENFORCEMENT DISCOVERY - It's difficult to collect against the debtor's assets unless you find them, and it can be difficult to find them.
Private Investigation - Non-judicial methods of investigating the debtor's assets and affairs, including database searches and the use of private investigators.
Written Discovery - Some states allow for written discovery to be propounded to a debtor, which is a good way to start accumulating information from the debtor, or at least what the debtor claims is his assets.
Debtor Examinations - The traditional way of obtaining information from a debtor, which is to haul them into court, sit them down at a table, and ask questions point-blank about assets and income.
Third-Party Examinations - Means of obtaining discovery from third-parties about the debtor's assets and affairs.
JUDGMENT ENFORCEMENT REMEDIES - The primary methods for taking assets and income away from the debtor.
Judgment Liens and Abstracts of Judgment - Ways of freezing assets so that they cannot be easily transferred away pending execution.
Writ of Execution - This document authorizes the Sheriff to make collections on behalf of the debtor, and some other stuff.
Writ of Garnishment - Used to collect wages and against income streams in some states.
Federal Wage Garnishment Law (FWGL) - 15 U.S.C. sec. 1671 provides nationwide wage exemption.
Writ of Levy - The remedy that allows the Sheriff to grab the asset and auction it off on the courthouse steps.
Charging Orders - The "exclusive" remedy against a debtor/member's interest in a partnership, limited partnership, or limited liability company.
Assignment Orders - An order used to intercept income streams, such as advertising revenues, royalty payments, etc.
Creditor Suits - Actions taken against a third-party who has possession of an asset that is still titled in the name of a debtor, or who has violated some other enforcement process.
Receivers - Often the end-game strategy to take a difficult debtor down, by having the court appoint a neutral with all the powers of the debtor, such as to sell season football tickets, or dissolve corporations.
OTHER JUDGMENT ENFORCEMENT THEORIES - While technically not "remedies", these bodies of law are often used in judgment enforcement proceedings.
Alter Ego and Veil Piercing - Cutting through corporations, trusts, and LLCs which are simply the debtor himself in another form.
Voidable Transactions (was Fraudulent Transfer and Fraudulent Conveyances) - Used where title has been transferred to a third-party.
OPINIONS -- Interesting opinions in creditor-debtor law.
Kyne v. Eustice, 215 Cal.App.2d 627, 30 Cal.Rptr. 391 (1963).
In re Foster, 556 B.R. 233 (Bk.E.D.Va., 2016).
Church Joint Venture, L.P. v. Blasingame, 2020 WL 284527 (6th Cir., Jan. 21, 2020).
LAGNIAPPE - A potpourri of stuff.
OTHER INFORMATIONAL WEBSITES
BY JAY ADKISSON
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