Lets assume you went to small claims court against a client who failed to pay for services provided, and the judge has awarded you a judgment in the amount of $10,000. If he does not pay immediately pay the $10,000, what do you do?

In the scenario where the client does not step forward and pay the judgment, there are some techniques you can use that will increase the probability of receiving payment.  Of course, the first step should be to attempt to contact the client and see if you can work out an arrangement for payment.  If that is not successful, the most common technique is to file post-judgment interrogatories in an attempt to determine if and where the client has assets.  These are filed with the court that entered the judgment and the client has a responsibility to provide truthful answers, or run the risk of being thrown in jail.  Of course, if you already have information where the client’s assets are being held, or if the client is employed, you may not need to file post-judgment interrogatories.

Assuming you file and receive answers to post-judgment interrogatories, the most likely next step is to proceed with a garnishment action.  A garnishment action is a court action where you ask a third party (ex. client’s employer, client’s bank) to withhold some of your client’s assets for your benefit and to send those assets to the court for disbursement to you.  The nice thing about garnishment actions is that it puts an affirmative duty on the third party to set aside your client’s money for your benefit.  For example, if your client’s employer is served with the garnishment paperwork and then refuses to pay money into the court, you are entitled to pursue a cause of action against the employer.

Unfortunately, even with the threat of being held in contempt and facing the possibility of being placed in jail, there are many times where the client will not answer post-judgment interrogatories.  Accordingly, one technique I advise my clients to use is to try to find information at the outset of the client relationship.  Ask where the client works, if applicable, or if you have received a previous payment from the client, take note of where the payment came from.

With the amount of individuals and companies struggling today, there is an increased likelihood that some are going to fail to pay for services provided.  As a result, if you can find out information at the outset of the relationship that would be helpful in collecting on a judgment, it will save you a great deal of time and aggravation.

Michael Weinstein is an attorney with MBW Law, LLC in midtown Atlanta. He specializes in litigation, insurance coverage, landlord/tenant and employment law.  Contact Mike at (404) 228-2629 or mike.weinstein@mbwlaw.net.

January 28, 2015

I Received a Money Judgment; Now What?

Lets assume you went to small claims court against a client who failed to pay for services provided, and the judge has awarded you a judgment in the amount of $10,000. If he does not pay immediately pay the $10,000, what do you do? In the scenario where the client does not step forward and pay the judgment, there are some techniques you can use that will increase the probability of receiving payment.  Of course, the first step should be to attempt to contact the client and see if you can work out an arrangement for payment.  If that is […]