When a civil court case ends in favor of the plaintiff, a judgment is entered against the defendant. Given that judgments are usually monetary awards, the two parties are also known as judgment creditors (plaintiffs) and judgment debtors (defendants). Following the court case, it is expected that the debtor will furnish information about assets. But what if he doesn’t?
A failure to voluntarily provide asset information is not uncommon. Some debtors just fail to respond on their own. Others are encouraged to not respond by their attorneys. Not willingly supplying asset information only further frustrates creditors who simply want to be paid.
Though every state has its own rules for judgments and the enforcement thereof, gathering information from the debtor is generally a three-step process:
Step #1: General Inquiry
The first step is to make a general inquiry. This is where the creditor contacts the debtor and asks that information be supplied. This can be done via phone call, written letter, or some other means. General inquiries work in some cases, but not in every case.
A creditor may send a letter of inquiry to the debtor’s home. The debtor gets the letter but is very slow to respond. He may provide only one piece of information, requiring the creditor to send yet another inquiry to get more information. The less cooperative the debtor is, the more likely the creditor will have to move to the next step.
Step #2: The Hearing of Examination
In cases where debtors do not respond to general inquiries, many states allow for a hearing of examination. Judgment Collectors, a specialized judgment collection agency based in Salt Lake City, UT, says the hearing of examination may achieve better results than a general inquiry. But again, there are no guarantees.
A hearing of examination is essentially a court hearing the debtor is expected to attend. The court may issue an order to appear on a date 30 to 60 days down the road. On the scheduled date, both parties appear in court where the debtor will furnish the required information. Debtors are usually told beforehand what information to bring with them.
Step #3: The Contempt Hearing
The third and final step is the most drastic of all. If general inquiries and the hearing examination do not succeed in gaining the debtor’s cooperation, most states allow for a contempt of court judgment followed by a contempt hearing.
In such a case, a court would issue a contempt order which would then give the local sheriff authority to arrest the debtor and forcibly bring him to court. During the contempt hearing the debtor can be compelled to furnish the necessary information.
It is obviously not in the best interests of the debtor to let things go this far. Being charged with contempt and facing arrest adds a criminal charge to the debtor’s record. What started as a civil matter becomes a criminal matter with greater consequences.
Things Don’t Always Go as Planned
Our legal system offers the successive steps for gathering information simply because things don’t always go as planned. The law seeks to give creditors every opportunity to enforce judgments entered in their favor. Unfortunately, debtors have a habit of resisting as much as they can.
The ideal post-judgment scenario would have creditor and debtor meeting out in the courthouse lobby and pleasantly exchanging information immediately after their court case has concluded. But since that scenario almost never happens, the law provides ways for creditors to get asset information from debtors. Succeeding is not always easy, but at least the legal avenue is there.