California Judgment Enforcement

August 9, 2023

I am a judgment broker, not a lawyer. This is my opinion and a summary of what I have learned and observed. If you need legal advice, contact a lawyer (See our National Lawyer State Bar List).

As this is a summary of how to enforce a judgment in California, let me start with a link for some basic information: smallclaims/collect.htm

A judgment is a final order of the court, signed by a judge or a commissioner that specifies a cash amount owed. The courts have no way to help you enforce a judgment. You must recover it yourself, or get help to enforce your judgment.

Currently, the interest rate in California is 10%, this is simple (non-compounded) annual interest. Postjudgment interest is not compounded until the judgment is renewed. When a judgment is renewed, whatever interest has accrued on the original judgment is added, and becomes part of the principal amount of the judgment.

Anyone who enforces a judgment must keep track of interest accrued, credits (when the debtor pays you), and debits (what you had to spend). This is not as easy as it sounds, because payments must be applied to interest first, then the principal owed. Interest stops accruing on any money that partially satisfies the judgment. One shortcut to use is to divide the amount owed by 3,650 to compute the daily interest at 10%. Never collect more than is required to satisfy the current amount owed on the judgment, otherwise you will be penalized.

California judgments may be enforced for ten years. A judgment may be renewed for another ten years, but only after it is five years old. Then it can be renewed indefinitely if consistently renewed.

Judgments can be enforced (collected) in a variety of ways. One of the old-school ways is (was?) to record an Abstract of Judgment with the County Recorder in a County where the debtor has or will own real estate. If the debtor sells (and the property is not underwater) or refinances, you might get paid.

You may be able to record a lien and get paid if a debtor is a plaintiff in a different lawsuit, or a beneficiary in a dead person’s estate proceeding.

If the debtor has a job (old-school, unfortunately) you may be able to garnish up to 25% of their wages. The debtor may be able to claim an exemption. There are many exemptions the debtor can claim, generally beginning with the California Code of Civil Procedures (CCPs) Section 703.010. Also if there is already another garnishment in progress, yours will not work, until the previous debts have been paid.

If the debtor has a savings or checking bank account, or a safe deposit box, you may be able to garnish that to get paid. Other income streams such as non-standard income can be attached by an assignment order.

If the debtor is a business, you can record a UCC (Uniform Common Code) lien with the Secretary of State. If the business wants a loan, the lender may want them to pay off all the UCC liens and then you get paid. The UCC lien may make you a secured creditor if the debtor goes bankrupt. That may or may not get you paid. Generally when a debtor goes bankrupt, it is over, you will never get paid.

A debtor examination may be used to obtain information about the judgment debtor’s assets or employment status. This requires you to have a process server personally serve a Court order on the debtor, requiring the debtor to appear in Court on a specific date. You must appear on that date to conduct the examination. In California, a judgment debtor exam creates a one-year “silent lien” on all their personal property, which might make you a secured creditor if they later file for bankruptcy protection. Liens usually last 5 years and can be renewed.

At the examination, the debtor must respond “under oath” to the judgment creditor’s questions about their assets. Rarely, when the defendant does not appear, some courts may issue an arrest warrant (bench warrant). Note that you must pay for a bench warrant, and in many Counties, the Sheriff will not pick up the debtor, as they are busy with other important matters such as trying to rid their County of the hemp plant. Some judgment professionals do not ask for bench warrants because when debtors are arrested on bench warrants they often trash enforcer’s good name on the web.

All regular (and approved) costs of enforcing the judgment can be claimed and added to the judgment with a Memorandum Of Costs (MC-12) form. Regular costs are checks to process servers, courts, and Sheriffs. Postage, coffee, and parking meters are not allowed costs. Make sure to claim your costs within two years.

If and when you enforce your judgment in full, you must file a notarized “Acknowledgement Of Satisfaction of Judgment” with the Court. The law ignores the real world possibility of bounced checks and bankruptcy, and requires you to file the Satisfaction within 14 days. In California, if there are many names, one would use a EJ-100 form and type the words “Item X, See Attachment 1”, and use an MC-025 form to list each recorded Abstract.

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