Winning a monetary judgment in civil court can make a person feel fully exonerated and justified. But the positive feelings of winning are often short-lived. Why? Because not long after winning, collection efforts begin in earnest. And judgment debtors sometimes fail to cooperate until certain enforcement mechanisms are brought to bear against them.
Enforcement mechanisms are more or less legally recognized tools judgment creditors have at their disposal. Below are five examples, compliments of Judgment Collectors out of Salt Lake City, Utah. Judgment Collectors is quick to point out that enforcement mechanisms are governed differently by each of the states. What is allowed in one state might not be allowed in another.
Mechanism #1: Restraining Notices
The first enforcement mechanism is known as the restraining notice. It is a court order that freezes the debtor’s bank account. If a debtor has multiple accounts, a restraining notice can cover all of them. How does this help?
In states where bank account garnishment is legal, a restraining notice can be accompanied by a court order that compels the bank to seize the debtor’s money and forward it to the creditor. In states where bank account garnishment is not allowed, freezing a debtor’s accounts so that his money is inaccessible to him is one way to encourage him to agree to payment.
Mechanism #2: Wage Garnishment
Wage garnishment is an enforcement mechanism available in most states. Only a small handful of states do not allow it. Also known as income execution, wage garnishment is an order that compels the debtor’s employer to withhold a certain amount of pay and forward it to the creditor.
Nearly all of the states that allow wage garnishment only allow taking a certain portion of the debtor’s disposable income. Disposable income is that income not needed to pay for life’s necessities. It is income that would otherwise be spent on things like entertainment and leisure.
Mechanism #3: Property Liens
Next up is the tried-and-true property lien. A property lien establishes a legal and financial interest in the attached property. As an example, the bank that loaned you the money to buy your home has placed a lien on it. That lien represents the bank’s financial interest in your home. The lien will remain until your mortgage is fully paid off.
Property liens filed as a way of recovering payment in a money judgment case work the exact same way. The debtor is not allowed to sell or otherwise dispose of the property without paying what is owed.
Mechanism #4: Property Executions
The fourth enforcement mechanism is arguably the most drastic: property execution. ‘Property execution’ is just another way to say asset seizure and sale. It is an unpleasant experience to say the least.
If necessary, a judgment creditor can request a writ of execution from the county court. With writ in hand, a creditor can utilize the services of the local sheriff to seize a piece of property and sell it at auction.
Mechanism #5: Garnishing Debts
Finally, judgment creditors in many states can garnish debts owed to the debtor. Let us say the debtor is a small business owner. His outstanding invoices can be garnished for payment. Any debts owed to the business are up for grabs.
Being familiar with enforcement mechanisms certainly makes judgment collection easier. The more mechanisms a creditor has at his disposal, the more opportunities he needs to collect. Ideally, one would hope that none of them would be necessary. Instead, the debtor would simply pay up with either a lump sum payment or through an amenable payment plan.
