Collection is a common part of court proceedings where the winning party has the right to collect the judgment awarded. The court allows for debt collection by issuing the judgment in a plaintiff’s favor. In easy words, a judgment is a court decision that resolves the dispute between the two parties. However, winning a judgment doesn’t guarantee the payment, whether the defender is an individual or a commercial entity.
Commercial judgment collection becomes especially challenging as defendant companies often have intricate financial structures and sophisticated evasion tactics. Additionally, it requires significant time, resources, and a thorough understanding of relevant legal laws.
For example, you took a matter in court, and the court awarded the judgment in your favor. Now, the defendant company is legally entitled to pay you the judgment. However, they may be reluctant to pay. This is where professional judgment attorneys can be a possible solution. These professionals work with you to enforce the judgment and collect your money from a defaulter.
Let’s understand commercial judgment collection in detail.
How Commercial Judgment Collection Works?
For businesses, maintaining a steady cash flow is a must for success. Negative financial situations like unpaid debt can affect the revenue and profits of a company. Additionally, if a company fails to collect the judgment for a prolonged period, it can tarnish its reputation, further complicating future efforts.
In such a situation, collecting the debt becomes necessary. However, the judgment collection process requires a thorough understanding of the relevant legal laws. Understanding these laws is particularly important to protect your rights and avoid legal pitfalls that could impact judgment recovery. One of the best methods of commercial judgment is judgment enforcement, where the debtor’s assets are seized to recover the judgment amount. If a creditor still struggles to collect the debt, they can hire a judgment collection agency.
How is Judgment Enforced in Commercial Collection?
There are a variety of enforcement methods used in commercial judgment collection, each with its unique benefits. By understanding different methods of judgment enforcement, you can effectively enforce your judgment and collect your money.
Writ of Execution
Writ of execution is an effective method of business collection. It allows law enforcement officers to seize the debtor’s property to obtain the judgment amount. The types of assets that may be seized include personal property, real estate property, and bank accounts. To obtain a writ of execution, a creditor is required to file a request in the court. The court reviews the application and if deemed appropriate, it issues the writ. However, creditors should be aware of the debtor’s assets before applying for the writ. Otherwise, it may be ineffective, failing judgment enforcement. Also, if the debtors hold the property in more than one place, the creditor may be required to issue a separate writ for each location.
Levy
Levy is a powerful enforcement tool in commercial judgment collection. The process of obtaining requires filing a writ of execution in the court. Once a writ of execution is issued, law enforcement officers can seize the debtor’s property, such as real estate, personal, vehicles, and wages. A successful levy requires the identification of the debtor’s assets. Creditors can seek assistance from collection agencies that leverage their expertise to find the different types of assets the debtor holds. Levy is a strong legal action that can have serious consequences for both debtor and creditor. Hence, it’s important to understand its legal framework and take expert guidance to ensure the process is done smoothly.
Lien
A judgment lien is another powerful tool for creditors to recover their owed money. In this method of enforcement, creditors can claim an interest on the debtor’s property to secure the judgment amount. A judgment lien can be placed on both real estate and personal property. Once a lien is placed on the property, the creditor has the right to seize and sell the property to satisfy the judgment amount. The process begins with filing a lien in the relevant government court where the debtor’s property is located. The lien will include the case details, amount of judgment, and other details of the debtor’s property. Once a lien is placed on a property, the lien holder is entitled to recover the debt amount from the proceeds of the sale of the property.
Conclusion
Business debt collection becomes crucial to maintain a steady cash flow and smoother business process. The challenges and legal proceedings involved in this process may seem daunting, but with careful planning, you can effectively handle them. There are no hard and fast rules in commercial collection, but the success of judgment recovery depends on the customer’s history of paying overdue debt. If you have exhausted all methods to collect the debt without success, it’s time to get assistance from a judgment collection agency. These agencies specialize in managing the commercial collection on the creditor’s behalf. They will use the most suitable approach of judgment collection to ensure a speedy recovery of your debt. If you are looking for a professional judgment attorney in Florida, you can contact Public Loss Adjusters. Our expertise will help you navigate the complexities of judgment collection, maximizing the chances of successful recovery of your debt.
