The issue of collecting payment after you’ve obtained a judgment or verdict has two main forks in the road – the first of which is an insurance issue. In auto accidents, for example, the defendant will have an insurance policy that will pay out some, if not all, of your judgment. Often, we have had to chase even the insurance companies to collect many months after settlment, verdict or judgment.
Even when a judgment is collected, however, doctors, hospitals and other medical providers such as X-Ray and MRI companies may have what are known as “liens” on the money collected. Liens essentially “freeze” the money from being disbursed to anyone until they can be negotiated and released. Sometimes Medicare, for example, will have a lien (actually called the “Super Lien” as no written notice is even required!) and Medicare may take 6 months to maybe 1.5 years or more to resolve!
On the other hand, when a defendant either has no insurance or has a staggeringly low insurance policy, or a claim that is “outside the scope of insurance,” (for instance, where you would sue someone for assault and battery, an employment-related dispute, or something else in an area that traditionally falls outside most insurance coverage), a successful plaintiff will have to seek to recover judgment from the defendant individually, which becomes a tricky subject.
Most people don’t simply have, say, $50,000 sitting around for a rainy day for the far-out possibility that they may one day lose a lawsuit. What happens, then, if the defendant simply refuses to pay? Debtor’s prison was abolished, we believe, over one hundred years ago and a judge will not send someone to jail for failing to participate in a lawsuit, and similiarly, a judge will not throw someone in jail for failing to pay on a judgment.
In instances like these, your lawyer must dig a little deeper and bring the court back into the mix. Some of the main options to attempt collection of a judgment (although there are certainly other options) are to bring a motion forcing the defendant to disclose all of his personal assets — as a means to bring to light that perhaps he can really pay the judgment. This is generally known as a “Citation to Discover Assets.” Next, a plaintiff could bring a motion for the court to garnish the defendant’s wages — this essentially sets up a payment plan where the defendant can keep enough money each month to live on, but must pay you in regular installments. Further, a plaintiff could freeze certain assets such as a bank account — basically, this option prevents the defendant from making any money transfers.
Unfortunately, an attorney cannot guarantee that a defendant will pay the money they owe and even if collection efforts are made, a defendant could always declare bankruptcy and then the plaintiff will usually receive very little or nothing. Stated simply, a judgment debt is a big deal — it can ruin someone’s credit rating, it can collect interest at a rate of about 9% per year, and a good attorney can even get it registered with the Recorder of Deeds where it will come up (interest included) every time the defendant attempts to borrow money, purchase a house, or conduct business that involves taking out a personal loan. The point of the matter is that a good attorney will exhaust every possible option to obtain their client’s rightful reward.
You can contact us here 24/7/365 (and we really mean that as we will answer our phone) if you have any questions and to learn how we may be able to help you ensure that your judgment and verdict will be pursued or how, as a defendant, we may be able to help you resolve these issues (yes — we actually help both plaintiffs and defendants). Most importantly, you will find that we listen, take your phone calls and e-mails (and even text messages!). We would be honored to help you with your matters – large or small.