Collecting Judgments: Why Is There So Much Conflicting Info?

Run a quick Google search on collecting judgments and you are likely to see articles relating to judgment rules in your state. Exclude your state and you will get an entirely different set of pages to look at. What’s more, you’ll find plenty of conflicting information if you look at enough pages. So what’s the deal?

It is hard to pin down any absolutes when it comes to collecting judgments. Yet there is nothing nefarious at work here. There is a simple explanation that covers both state laws and collection policies and procedures.

Judgments Are Court Decisions

The starting point for all of this is the fact that judgments are court decisions. In criminal court, juries reach verdicts. In civil court, judges or juries render decisions known as judgments. A judgment does not establish guilt or innocence. It establishes liability.

A court decision is legally considered a judgment whether an exchange of money is involved. Yet when we talk about judgment collection, what we are really talking about is collecting a monetary award attached to a judgment. In a personal injury case, the court may find the defendant liable for the plaintiff’s injuries. As part of the judgment, the court awards the plaintiff a certain amount of money.

A Matter of State Law

The vast majority of monetary judgments are rendered in state courts. That means they are subject to state laws rather than federal statutes. Now, here’s the kicker: each of the states has the authority to regulate civil proceedings as they see fit. Thus, the many differences in collection law among the states.

Wage garnishment is a perfect example. According to Salt Lake City-based Judgment Collectors, garnishment is a tool that judgment creditors can use to collect outstanding awards. But states treat garnishment differently. Some states do not allow garnishment of any kind. Others allow bank account garnishment but not wage garnishment. Still others allow creditors to garnish debtor wages, bank accounts, and third-party debts.

States also differ in the way they look at personal property. In one state, a judgment creditor might be able to obtain a writ of execution that allows seizing all sorts of personal property – with the exception of a debtor’s primary residence. But in a neighboring state, a debtor’s home might be up for grabs.

Court Actions Differ, Too

If all of this sounds like it could be frustrating to judgment creditors, know that it is. But also note that it gets worse. There are differences among the states in terms of court involvement. Some state courts barely get involved beyond rendering a judgment and filing it with the court clerk. Courts in other states can remain involved after the fact, issuing warrants compelling debtors to appear in court to answer questions about income and assets.

Different court actions result in different procedures for judgment creditors and their attorneys. For a collection agency like Judgment Collectors, this presents additional challenges related to collecting judgments in different jurisdictions. Judgment Collectors operates in eleven states. They need to know the rules, policies, and procedures in each one of those states.

The Bottom Line

The bottom line in all of this is that the conflicting information is due to the fact that civil lawsuits are mainly the purview of state courts. And given that state laws are so different in nearly every area, it’s not possible to provide a standard set of rules that would apply to collecting unpaid judgments in every state.

And now you know. If you are involved in civil litigation yourself, here’s hoping the answer is useful to you.