What Do We Do Now that We Have a Judgment?
by Subvet D. West
Your journey to a judgment has been long and arduous.You have worked your case from start to finish, presented it to the fact-finder and, now, you wait anxiously for the judgment. The judgment comes in—it is in your client’s favor! What do you do now? A judgment is only as good as your ability to enforce it, so a working knowledge of post-judgment enforcement and collection is important.
Judgment Lien. As a matter of routine practice, first prepare or obtain from the court an abstract of judgment and promptly record the abstract in all counties where the judgment debtor may own or is expected to acquire real property. The abstract of judgment places a lien on any nonexempt real property such as a house, land, or other building that the debtor owns in each county where the abstract of judgment is recorded. Note, however, that properly abstracted judgment liens do not attach to a homestead while that property remains a homestead.
Writ of Execution. Another option for judgment recovery is the writ of execution. Thirty days after the signing of a final judgment, apply to the clerk of the court for issuance of a writ of execution. A writ of execution enables any sheriff or constable in Texas to seize the judgment debtor’s nonexempt real and personal property, including cash, located in the officer’s jurisdiction to satisfy the judgment. The writ of execution must comply with the requirements of Rule 629 of the Texas Rules of Civil Procedure.
For non-cash assets, the officer will seize the property, sell it at auction, and the proceeds will be used to pay the judgment. In this case, a written “authorization of responsibility” is required from the judgment creditor, which provides that the judgment creditor agrees to be responsible for moving and storage costs. The property is usually held and stored for a brief period to allow the judgment debtor to file a claim of exemption before the sale occurs. If there is reason to believe that the judgment debtor is about to remove personal property from the county or is about to transfer or secret the property to defraud creditors, file an affidavit with the court stating such, and the clerk may issue the writ sooner than the 30th day.
Writ of Garnishment. Perhaps the most appealing post-judgment collection method is garnishment because bank accounts can be garnished when the debtor does not have sufficient non-exempt property in Texas to satisfy the judgment, and because the writ may be issued immediately after the judgment is signed. Garnishment is a statutory remedy that allows the judgment creditor to obtain a judgment debtor’s property while it is in possession of third parties such as banks and credit unions. In this context, the property subject to garnishment includes funds in bank accounts, stocks, bonds, as well as contents of safe deposit boxes.
For purposes of post-judgment collection, a judgment remains active for 10 years. To obtain a post-judgment writ of garnishment, the judgment creditor applies to the clerk of the court or justice of the peace by submitting an active judgment along with an affidavit stating that, with the judgment creditor’s knowledge, the judgment debtor does not possess property in Texas subject to execution sufficient to satisfy the judgment. As with a writ of execution, the writ of garnishment is delivered to a sheriff or constable who then serves the writ on the garnishee.
Post-judgment Discovery. Post-judgment discovery is another tool you may use in your quest to satisfy the judgment. Post-judgment discovery is probably most effective after attempts to collect under a writ of execution have failed. Post-judgment discovery may be useful to obtain information from the judgment debtor about the location and identity of nonexempt assets. The Texas Rules of Civil Procedure allow for the post-judgment use of the same discovery methods available during the pre-judgment discovery phase, and the same types of penalties and sanctions are available to compel compliance.
Turnover Orders. A turnover order is a statutorily created post-judgment remedy in which the creditor applies to the court for its assistance in collecting the judgment. Under the turnover statute, the court may order the judgment debtor to turn over nonexempt property to apply towards satisfaction of the judgment, or appoint a receiver to take possession and liquidate the property to satisfy the judgment. The turnover order is available when the judgment debtor’s non-exempt property cannot be readily attached or levied on by ordinary legal process.
Subvet D. West is a commercial and civil litigation attorney at Shackelford, Melton & McKinley, LLP. She can be reached at email@example.com.