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Posts tagged "judgment"

Alter Ego and the Jugdment Debtor

Collecting on a Judgment

What Happens When a Debtor Stops Making Payments?

Future Creditors and Asset Protection

In the world of post-judgment collection, creditors frequently encounter a debtor who in an effort to shield his/her assets transfers those assets to a trust for "asset protection." While creditor's counsel can generally enforce the judgment against the revocable trust assets as a fraudulent transfer when the transfer of the assets occurred after the clear existence of the debt whether pre or post-judgment, what happens when the debtor transfers those assets to the revocable trust before the creditors claim arose or the debtor even knew of the creditor's potential claim?

Asset Protection Strategies Gone Awry

Asset protection is a set of legal techniques and a body of statutory and common law dealing with lawfully protecting assets of individuals and business entities from civil money judgments. The goal of all lawful asset protection planning is to lawfully insulate as much as possible assets from claims of creditors without concealment or tax evasion. If you have run up against this issue in your attempt to collect a judgment, your next steps must be strategic and carefully thought out.

The Phantom Discharge in Bankruptcy

While the Phantom of the Opera was a work of fiction, the phantom discharge is the real deal. If you are collecting a judgment in California, generally all property that is acquired during the course of a marriage belongs jointly to both spouses, even if only one spouse is on the title. This property is called "community property," and it is owned by both spouses as tenants in the entirety. In California, even if only one spouse signed the paperwork for a debt, most debts that arise during the course of the marriage are owed by the community (that is by both spouses). Read more about debt collection and community property here.

What is an Affirmative Defense in a Collections Matter?

An affirmative defense is an allegation for justification for the defendant have acted or not acted as is alleged in the complaint. The defendant is simply arguing that he has a good reason for having done what is alleged in the complaint, and therefore should be entirely or partially excused from all criminal liability. Defendants in commercial collections cases often try to use these types of justifications as to why he/she should not have to pay the money alleged in the complaint.

The Specifics of a Power of Attorney

When it comes to dealing with a power of attorney, it is important to note that the terminology used by the parties isn't controlling. In other words, for the debtor to simply state that a power is coupled with an interest in the power of attorney doesn't make it so. 3 Am. Jur. 2d Agency § 62; 28 A.L.R.2d 1243 § 2[c].

Irrevocable Powers of Attorney

The lengths to which a judgment debtor will go to avoid collection is shocking to some, but not to an experienced commercial collections attorney. One tool not often used by the debtor, and challenging in its intricacies, is the irrevocable power of attorney, particularly when coupled with a charge of attacking the instrument as unenforceable. Irrevocable Powers of Attorney are a rare bird, and there are a few hurdles to get through in order to have a Court deem them unenforceable.

The Right to Attach: Collecting a Judgment

We recently discussed the right to attach, a provisional remedy that enables creditors to preserve the value of potential judgments after a court action is filed but before it has been concluded. The attachment remedy allows commercial creditors holding unsecured claims (or claims secured only by personal property) to create judicial liens on debtors' property before final adjudication of the claims sued upon. Creditors must strictly follow statutory guidelines in applying for attachments and establish prima facie claims.

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Contact our commercial collections lawyers at our firm to discuss your and your clients' business, commercial collections and enforcement of judgements' issues. The skilled and experienced team of attorneys at our downtown Los Angeles law offices offers hourly and blended fees (discounted hourly plus partial contingent fee) to our clients.

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