Show Me the Money! Helping Your Clients Get Paid Through Judgment Enforcement

Utilize Discovery in Aid of Execution

The first step in executing on a judgment is to find out what assets exist on which you can recover. Most states permit a judgment creditor to propound document requests and interrogatories on the judgment debtor, to issue subpoenas, and to take depositions in aid of execution. Discovery in aid of execution is an under-utilized tool in judgment enforcement, and is often a good place to start judgment enforcement because it can help you ascertain: (1) whether the defendant has any assets; (2) whether any fraudulent transfers have occurred; and (3) the location of assets. This discovery can be particularly effective when the judgment debtor is an individual, as the failure to respond to discovery requests can result in the imposition of sanctions or the issuance of a contempt order.

Do Your Research

Now that almost everyone has a Facebook and LinkedIn profile, a simple Google search can reveal of wealth of information about a judgment debtor, such as employment information or the location of a vacation home. Additionally, if your judgment is against an entity, a simple public records search may reveal the existence of related entities that could be subject to successor liability, an action to pierce the corporate veil, or a claim under the Uniform Fraudulent Transfer Act.

Don’t Be Afraid to Get Your Hands Dirty

The nice thing about judgment enforcement is that it often affords you an opportunity to get out of the office and learn about interesting things. I once had a client who had a lien on a several pieces of heavy equipment that were to be sold at an auction and wanted me to attend the auction to learn the sale price of the equipment. That required me to spend the better part of a Saturday in a field in rural Pennsylvania, where I learned a great deal about cranes and bulldozers, but I also learned that executing on judgments sometimes requires you to venture into unfamiliar territory. Unfortunately, my shoes got so muddy that I had to throw them away when I got home.

Know the Applicable Law

Each state has its own laws protecting certain assets of a judgment debtor from execution and permitting execution on other assets. For example, some states permit a judgment creditor to garnish wages, while others only permit wage garnishment in limited situations. Knowing what is and is not permitted before you discuss a judgment enforcement strategy with your client will go a long way toward managing your client’s expectations during the process.

Don’t Give Up

While clients sometimes decide to cut their losses instead of incurring significant attorney fees to enforce a judgment, it is often true that the harder a judgment debtor fights, the more she has to lose. If you have a client who is willing to pay you to doggedly pursue a judgment, be thorough, follow your gut, and don’t give up. Even if your client doesn’t want to spend a lot of money on judgment enforcement, it is almost always worth it to record the judgment as a lien against real estate owned by the judgment debtor.