Judgements are just paper
After winning a lawsuit, you must actually collect on your judgement. While a judgement is an order that says that the defendant owes you money, many defendants don’t voluntarily make good on their debt. That leaves the prevailing plaintiff to pursue collection efforts.
One strong tool that a judgement creditor can take advantage of is a “judgement lien.” Any judgement creditor can record their abstract of judgement with the county recorder. This acts as a lien against all real property owned by the judgement debtor in that county at the time the lien is recorded. Interestingly, if the debtor acquires real property in that county after the abstract is recorded, the judgement lien will attach to that property by operation of law.
Liens on real property are very strong collection tools. Once recorded, a judgement lien can only be removed by satisfying the debt or through certain types of bankruptcy proceedings. As a prevailing plaintiff, I strongly recommend that you immediately record your judgement in the relevant county in order to preserve your right to collect down the road.
While a judgement lien recorded against real property might not result in money coming into your pocket immediately, it does give you a secured interest in real property that exists. This security lets you pursue other collection activity such as garnishments or levies.
What about personal property?
Recording abstracts of judgment only creates secured interests in real property. You can do the same for personal property, such as boats, airplanes or other assets by going through a similar process with the Secretary of State.
Take action quickly
I strongly recommend that a judgement creditor take fast action to collect on their recently-acquired judgement, even if collection activity doesn’t seem immediately likely to result in a recovery. You never know what can happen in life. The defendant may be out of business or insolvent today, but could hit the lottery or come into a large inheritance tomorrow.
Don’t leave any of your collection tools on the table. Judgement liens will preserve your right to be paid and are especially powerful collection tools when the defendant owns real property in the state.
If you have questions about California civil judgements, please call my office at (916) 333-2222.