You’ve worked hard, provided the best quality goods and services for your client and they refuse to pay you. You get a lawyer involved bring a collections law suit, waited for months, and take time out of your busy life to go to court and prove your case at trial. After all this that you get a judgment in your favor! Finally, it’s all over and you can sit back and collect your money, right? Not so fast.
In Connecticut when a judgment is awarded against an individual debtor (that is not a business) the court will order what is called a “nominal order of payments.” The current nominal order is $35 per week. Conn. Gen. Stat. § 52-356d. As long as an individual judgment debtor pays this amount creditors are prohibited from garnishing their wages. So what can a judgment creditor do in this situation?
Major Methods of Post Judgment Collections
There are three main ways for judgment creditors to attempt to secure payment in the face of a nominal order. The first is to file a judgement lien on any real property owned by the debtor. The second is to file for a bank execution against the debtor and attempt to seize non-exempt bank funds. (We will cover what funds are exempt from execution in our next post.) The third is to conduct an examination of judgment debtor where the debtor is subpoenaed into court, placed under oath, and testifies as to their income and assets.
Each of these methods has advantages and drawbacks. A judgment lien on real property is great because it secures the judgment creditor’s position in vis-à-vis other potential creditors. Its shortcoming is that unless you foreclose on the lien it can take years before the judgment debtor either sells or re-finances the real property so the judgment creditor may have to wait a long time before seeing any money. Bank executions can be effective when the judgment debtor has a large balance in their account. This balance can be quickly seized and transferred to the judgment creditor. The issue with bank executions is that there are a number of protected types of money and once an account is seized judgment debtors usually stop any voluntary payments.
Examination of Judgment Debtor
An examination of judgment debtor (EJD) is an excellent opportunity to get a sense of the judgment debtor’s real ability to pay. Is this a person just getting by on a meager income or is it a big shot doctor who is just thumbing his nose at his creditors? EJD’s also have the added benefit of showing a judgment debtor that you are serious about collecting and can often elicit payment offers you would not have seen otherwise. On the other hand EJD’s are expensive and if the judgment debtor ends up being collection proof may not be worth the investment.
Conclusion
The best thing to do with your hard won judgment in a collections action is to consult an attorney well-versed in post-judgment collection procedure. There are many other do’s and don’ts in this area of law and having an attorney who is familiar with how Connecticut courts handle post-judgment procedure (which can vary from district to district) can mean the difference between a judgment being white paper or green.