What is Judgment Recovery and Enforcement?

Enforcement of judgment (also called recovery of judgment) : The processes by which the orders of a court may be enforced. Orders for the payment of money may be enforced by a variety of methods, including a writ of fieri facias (in the county court, a warrant of execution), garnishee proceedings, charging orders, the appointment of a receiver, a writ of sequestration, seizure and liquidation of assets, and (rarely) an order of committal.

Client Debt Management Tips for Your Business

Do you have a deadbeat client? You don’t have to lose sleep or money.

Here are some tips for client debt management reduction so you can collect what’s rightfully yours.

You need a client debt management reduction plan to deal with those instances when a customer keeps giving excuses or refuses to pay you.

When you’re not sure if your client doesn’t intend to pay you, try the first following ideas. Perhaps there is a misunderstanding or your debtor may be going through rough times and you could loose a potential good client. As your invoices become more past due, you can use more pressure. Here are some helpful procedures to follow:

• You should call the customer directly, instead of sending him/her e-mails, invoices, etc. and create a sense of urgency.

• Be precise with your client. You must give him/her a definite deadline for payment in full.

• You may want to offer your client a payment option: cash or check.

• Also, you could use a third party as an excuse. Tell your client that you need the money to pay one of your suppliers or service providers.

In case these tips to collect your client debt don’t work, then go to the next level:

• Become a nuisance to your client. Send frequent e-mails, letters, faxes, calls, etc., and let him/her know you’re not going to give up easily. This annoyance may be incentive enough to pay you.

Client Debt Management Reduction Services

• After you have exhausted all these resources, you can hire a collection agency (they charge between 35-50% of the amount owed to you but that’s better than nothing) or file a claim in court to get a court judgment against them. At that point you can hire a judgment recovery firm (they do not charge you anything but work on a 50% basis, meaning they will earn 50% of what's recovered, which is also better than nothing and judgments have many more options and are more likely to be recovered than collections).

• Remind your client that the BBB tracks late payments through collection agencies, and this will affect his/her credit.

• When the dollar amount is not too large, small claims court is a great option. You need to file a small claims action for a small fee and the court will set a date to hear your case. Sometimes just filing the case will urge payment. Remember when you file a claim, all legal fees can be recovered - you just add it to the overall total of monies owed.

Now that we’ve covered some ideas to collect client debt, here are some other ones to prevent this from happening:

• Your first step is to do a credit check on your prospective client by calling the accounting office and ask for a list of his/her regular vendors. When this is not possible, ask your client to complete a credit application form.

• Then, you may request a 50% deposit in advance and the balance due upon delivery.

• You can use a check guarantee service. Telecredit charges a small percentage for each check and although they have a monthly minimum, you don’t have to process all your checks through their service.

• You may include a delinquent interest on overdue accounts as part of your payment agreement. This is legal if you include it in your written agreement or credit application.

• When you have doubts about a prospective client, request full payment in advance.

• If you have a client in-take or new client form, ask clients to provide their SSN # (or EIN # if a business), current physical address if different than their mailing address, and a copy of their driver's license or business license. These items will come in handy should you need to proceed with collection or judgment efforts.



Hopefully you won’t have to use any of these methods to collect money from negligent clients. Remember, your best protection is prevention. However when the client can’t or won’t pay, you deserve to collect what is rightfully yours.

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State Amendments on Court Fees Would Hurt Large Debt Collection Law Firms

Proposed amendments to a Massachusetts economic development bill would increase the limit on small claims and court costs for filing lawsuits there.

One observer says the bill would impact large collection agencies and the attorneys who have made a business out of taking debtors to court, while leveling the playing field for small collection agencies. But another ARM legal expert says the proposal also will hurt small businesses and consumers.

The amendments in Senate Bill 2345 increases the maximum amount for a small claim from $2000 to $7000 and ties court costs to the number of claims filed in a year by one party or firm. Specifically, filing fees will increase from a maximum of $40 to $75 per case for the first five cases any party has filed during a calendar year. One hundred fifty dollars will be charged any person or firm that has previously filed 10 claims during the year, and $240 will be charged to plaintiffs that have previously filed 100 or more cases.

The Massachusetts Senate has already unanimously approved the bill known as the Economic Development Reorganization Act, which is designed to stimulate the state’s economy by streamlining government processes. The Senate’s proposed state budget also reflects the changes, though the final budget may not if the House doesn’t approve the bill, said Kara Keefe, spokeswoman for the Senate Ways and Means Committee.

Keefe said the House Ways and Means Committee has yet to unveil its version, but is expected to take up the before the session ends July 31.

Martin Ervin, of Hull, Mass.-based ARM firm Ervin Family Investment, favors the proposal because he believes smaller agencies like his stand to benefit if a volume-based court fee system is adopted. He said fewer small claim cases would be filed in court and small businesses will opt to place more of their delinquent accounts with debt collection agencies earlier.

“They will place an account a lot sooner with agencies that have the time to handle their account, rather than with agencies that score the accounts and only work those accounts that will benefit them,” Ervin said.

Ervin said that a lot of accounts being litigated nowadays are less than 60 days old. He said more creditors who can’t collect themselves are going directly to attorneys or law firm-affiliated collection agencies that file suit after a few attempts to reach the debtor. But he said that is not helping clients because “a lot of judgments can’t be enforced because people don’t have the money.

“I think that’s more so now because people don’t have the money to pay,” he said.

Ervin said more effort should be put into trying to reach consumers, find out why they can’t pay, and negotiate some agreement or payment they can afford.

“I’ve talked to clients who told me that they never got a call or that the (collection) agency never got back to them. If (some agencies) didn’t have such a sweat shop mentality, they’d potentially work with people. We forget that the people we are collecting from are no different than we are.”

Kenneth Wilson, president of the Massachusetts Creditors Bar Association, agreed that every attempt must be made to reach and negotiate payment terms with consumers. And he said more accounts are going to court pre-charge off. But he said consumers’ refusal to communicate with creditors, formally or informally, is the reason more cases are litigated.

“If a person doesn’t respond sometimes we’re left with no choice but to file a legal action to try and collect,” Wilson said. “Sometimes the first time we actually get to talk to (a debtor) is at the court house.”

The proposed volume-based court fee structure is not the solution for less legal action. He said the Massachusetts Creditors Bar Association is trying to educate state lawmakers about what the industry does and its impact the economy.

Wilson said his firm, Lustig, Glaser, & Wilson PC of Needham, files between 35,000 and 40,000 cases each year. But it won’t be greatly impacted by the proposals because only about 10 percent of those cases are small claims. He said his firm will move some cases to civil court where filing costs are similar and clients won’t forfeit their right to appeal.

However, he said small businesses will lose revenue they can’t afford to recoup costs through the courts and debt collection firms that litigate the bulk of their cases in small claims court would suffer, too.

“Some firms are 90 percent small claims,” Wilson said. “They would have big problems.”

So would consumers because Massachusetts law charges court costs to the losing party and most consumers lose their small claims by default for not showing up to court or not providing sufficient evidence to refute the claim.

“It’s not fair to the consumer that was sued later to end up with a larger judgment (because of court costs),” Wilson said.

Even if the House and Senate don’t agree on a version of the bill before the legislative session ends July 31, Wilson said some version of the tiered court cost filing structure is likely to be introduced during the next session.

“More than one legislator has proposed it so it’s unlikely to go away,” he noted. “They will reintroduce it. This is an ongoing fight.”

by Cynthia Wilson / insideARM.com /June 17, 2010

How Judgment Enforcement Services Work

For plaintiffs in a court case who’ve been awarded damages or have received a settlement, there is nothing more frustrating than finding themselves unable to collect on their claim. Deadbeat defendants can find a number of ways to avoid paying what they owe. Often they’ll hide their assets in secret bank accounts or real-estate holdings that the court is not aware of and claim bankruptcy when it comes time to pay. When someone is faced with an uncooperative defendant, often their only option is to turn to a judgment recovery specialist.

These men and women in the judgment recovery business are able to help those with little legal recourse to claim the money they are owed. There are a number of ways to claim the money owed through a civil judgment. In many ways, judgment enforcement agents are like private detectives. They will search through a business or individual’s assets to discover any hidden caches of wealth that should have been disclosed and paid after the trial.

Judgment enforcement services work through a national database and are all properly certified for their jobs. By being a part of these agencies, they have access to special databases that provide pertinent information that can be used to help render services for their client. By using these tools in addition to a little legwork, some of the best judgment enforcement services are able to quickly and efficiently recover unpaid civil judgments.

Sometimes, a client might need their money immediately. The circumstances that required the civil suit in the first place have taken a toll on their finances and they are in desperate need of relief. In instances such as these, many judgment enforcement services will offer to purchase the sum of the settlement for a price that is slightly less than original payment. However, clients will have this money immediately to do with what they wish and never have to worry about the slow trickle of garnished wages or wait for necessary legal action to take place.

Be aware that judgment enforcement services often have their hands tied by a statute of limitations. These vary from state to state, but all have a length of several years. Plaintiffs who have been waiting an unreasonable amount of time should immediately contact a judgment enforcement service so that they don’t miss out on the opportunity to ever collect on their judgment.

Once a plaintiff is in contact with a judgment recovery service, payment will depend on the particular company they do business with. Some may take a percentage of the total amount of the judgment recovered while others might charge a flat fee. Whatever option the client chooses, they’ll be sure to find themselves significantly richer themselves due to the hard working individuals at the judgment enforcement agency.

Article Source: Al-Rakeesh Alexander from EzineArticles.com