Getting a judgment against a defendant is often only half the battle. The second half is often just as difficult, if not more so, than getting the judgment: enforcing it.
A judgment may only be worth the piece of paper it is written on. The challenge is collecting on a judgment. There are many ways to evaluate the assets of a judgment debtor (or person who you won against in court) and many more ways to attempt to collect on a judgment. Remember, you cannot get blood from a stone.
Once you or your business gets a final order or judgment, it is important to record the judgment as a lien with the State of New Jersey. A lien is a security interest which can be recorded to secure your interest in a piece of property owned by the judgment debtor, such as a house. You may even be able to record it as a lien in other states and seek collection in those states, especially when the individual or business owns real or personal property in another state. However, it must be conformed in another state before you can seek to enforce it in that state. Here are a few things to remember to do when you are a judgment creditor:
1. Record the judgment as a lien. By doing this, you stake a claim on any real property owned by the judgment debtor (or person you won against) in the State of New Jersey.
2. Perform a judgment or asset search. Try to determine what assets and liabilities the judgment debtor has. In many cases, there may be other liens (or claims) against the property and assets of the person who owes you. There are many services available to determine whether the judgment debtor has open judgments, liens, mortgages, motor vehicles owned and current addresses including private investigators and companies who perform skip traces on individuals or asset searches
3. Send the judgment debtor an information subpoena. An information subpoena is a form of questions regarding the judgment debtor’s assets and liabilities. You can get the form by going here. The information subpoena contains comprehensive questions for both individual and business judgment debtors. Failure to respond within 14 days can result in an order for contempt of court. New information subpoenas can be sent to the judgment debtor once every six months.
4. Ask for a Supplemental Proceedings Deposition. Consider subpoenaing the judgment debtor for what is called a “supplemental proceedings deposition”. This allows your attorney to question the judgment debtor about all of his or her (or the business) assets and liabilities. Your attorney can also demand that the judgment debtor bring bank and account statements, credit card statement, brokerage account statements and various other documents.
5. Garnishment of the wages of the judgment debtor. Garnishments or wage executions allow you to receive a distribution from the judgment debtor’s wages each time they are paid by an employer. Judgment creditors can seek 10% of the judgment debtor’s gross salary when it equals or exceeds $154.50 or 25% of the judgment debtor’s disposable earnings.
6. Execute on assets belonging to the judgment debtor. Various assets of the judgment debtor can be levied upon (seizing or attaching property as a result of a judgment or court order). These assets include cash, bank accounts, personal property (tools, equipment, electronics) automobiles and any other personal property belonging to the judgment debtor. In order to do this, a writ of execution needs to be filed with the court. The writ of execution is provided to the Sheriff in the county where property is located and the Sheriff levies on the property of the judgment debtor. For example, if you know a bank and account number where the judgment debtor has an account, the Sheriff can levy upon that account and a motion to turnover the funds can be made with the court. Certain assets cannot be executed upon; this includes retirement accounts and public assistance monies. In addition, real property cannot be levied on and sold until after you have exhausted execution on all personal property of the judgment debtor.
7. File a motion to enforce your rights. If the judgment debtor does not comply with your lawful demands, you can file a motion with the court to enforce your rights. The court can compel the judgment debtor to provide information or turnover assets. Failure to do so may result in an order for contempt of court and in limited circumstances, a warrant for the arrest of the judgment debtor.
8. You can collect post-judgment interest on your judgment. The interest rate is set by the court. In certain circumstances, you may also be able to collect attorneys’ fees from the judgment debtor.
It is important to remember that a judgment can be enforced for 20 years. That means that you must initiate your efforts to collect from a judgment debtor in that 20 year time period and the lien on real property is only effective for 20 years. The judgment can be revived for an additional 20 years if a motion is made with the court before the judgment expires.
Collection on a judgment can be a daunting task. It is wise to consult with an attorney who has experience with collection procedures. The New Jersey Courts website offers valuable information for self-represented litigants and the information can be found here. Once you get a judgment, do not wait before taking steps to collect. Consult with an attorney to find out what you or your attorney can do to collect on a judgment.