How to Collect on a Judgment Against an Individual Debtor
Although you may have won your civil case against one or more parties, the next step involves actually collecting the money that you were awarded by the trial court. In South Carolina, the following strategies can help ensure that you receive full payment on your judgment.
Demand Payment
Of course, you may be able to have your judgment satisfied by asking the defendant to simply pay the money they’ve been ordered to pay. Unpaid judgments can show up on credit reports, so the debtor has an interest in satisfying the judgment. If the debtor cannot afford to pay the full amount, you may also consider settling for a lesser amount than the full balance owed to avoid the time and expense of undertaking collection efforts for the full balance of the judgment.
Undertake Collection Efforts
In South Carolina, if a judgment debtor refuses to voluntarily pay the money they owe on a judgment, you will need to undertake collection efforts against the debtor’s assets. This means first identifying what assets the debtor owns and where they are located. If assets are located in other states, you may have to domesticate your judgment in those states to try to collect against the assets located there.
You can find assets owned by a judgment debtor either by hiring an investigator to identify assets, or you can file a petition for post-judgment supplemental proceedings against the debtor allowing a hearing where the debtor can be placed under oath and questioned about their assets in front of a judge. You may also want information about transfers of assets the debtor made leading up to and following the judgment in your case to determine if any of these transfers can be set aside.
You can also satisfy your judgment against physical assets, such as real estate, vehicles, or business inventory. These assets must be sold off by the local sheriff by executing the judgement, or a receiver appointed by the court following a supplemental proceedings hearing, to generate cash that you can then use to satisfy your judgment. However, South Carolina law exempts certain assets from judgment collection as outlined in South Carolina Code Section 15-41-30.
Preserve Your Rights
If you won a case in South Carolina, you may immediately begin efforts to collect on the judgment. However, if you want to undertake collection efforts in South Carolina on a judgment obtained in another state or another country, you will need to first “domesticate” your judgment by filing an action in South Carolina court.
To collect what you’re owed, it is crucial to be aware of what assets might be available to you and how you can obtain them. Funds in a bank account can be seized after obtaining a charging order from the court in a post-judgment legal proceeding. While a lien automatically exists on property in the county where the court that originally issued the judgment sits, the judgment will need to be transcribed into other counties to pursue assets located in those counties. When a lien has been placed on an asset, title or ownership of the asset cannot clearly pass without first satisfying or removing the lien.
Complete Collection on Your Judgment
A judgment does not last forever. Under South Carolina law, a judgment only continues in effect for ten (10) years from the date of entry. Any collections actions must be completed before that ten (10) year deadline passes. Once ten (10) years has expired, you cannot continue to pursue legal action to collect on the judgment.
Following the entry of judgment and during your collection efforts, interest will continue to accrue on any unpaid portion of your filed judgment. This post-judgment interest rate is set by the South Carolina Supreme Court each January. Post-judgment interest in South Carolina compounds annually.
File the Satisfaction of Judgment Once You’ve Been Fully Paid
Once you’ve received full payment of your judgment (or as much payment as you reasonably hope to get), you must file a satisfaction of judgment with the court, which lets the court know to close your case. Also make sure to release any liens you may have placed on the debtor’s property.
If you have questions about how you can collect a judgment that you’ve obtained against a defendant, contact us today for a consultation to discuss your legal rights and options.
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