Debtor Testimony Changes

August 13, 2023

When a judgment debtor examination is conducted outside the courtroom; for example in a library, a lawyer’s office, a court hallway or cafeteria, perhaps with a certified stenographer; is the debtor entitled to change their testimony at a later time?

One of many judgment-related articles: I am not a lawyer, and this article is my opinion based on my experience, please consult with a lawyer if you need legal advice.

Of course, your judgment debtor can change their testimony, later at a future court hearing or a debtor examination. Can you then impeach that debtor? Or, can your debtor change their testimony, without any threat of impeachment?

In theory, a judgment debtor giving testimony at an examination may not be entitled to change their testimony about a fact (usually about an asset that exists during both denial and admission of the asset) at a later time; unlike in a pre-trial deposition situation, where they may be able to change their testimony several times.

Judgment debtors do not change their testimony often, however when they do, they may be subject to impeachment when a creditor compares their new statements to their prior recorded testimony in front of the judge in court.

In California, one odd part of the laws are the post-judgment judgment laws about debtor examinations. There is case law stating that a judgment debtor’s examination, is a public proceeding. See Nebel vs Sulak 73 Cal.App.4th 1363).

Most people believe a debtor exam is, technically, a court proceeding, and not just a deposition; and the transcript is the transcript. There is no need to sign it.

However, some think this is not so clear-cut. While a debtor examination (sometimes called OEX or ORAP) is conducted as or similar to, a court hearing; an argument can be made that it is also a form of discovery. California’s CCP 2016.070 lists what discovery methods permitted.

And, unlike a trial or hearing when you have a judge, opposition, and maybe a jury; the situation of hearing the debtor’s testimony changes, and becomes more like a deposition.

When a deposition ends, the reporter prepares the transcript, and the deponents get notice that the transcript is ready; and the deponents have a certain amount of time to review the transcript, make corrections, and then sign the transcript.

However, attorneys or enforcement experts can make comments about the differences in the “facts” within the transcripts, and use those changes as possible arguments for impeachment. What counts most is the debtor’s testimony changes being properly recorded by a court reporter.

In different parts of California, transcripts may be handled differently. In Southern California, they are usually released to the deponents and nothing gets signed.

In Northern California, the court reporters often refuse to let deponent(s) view the transcript(s) until they first get permission from the office of the court reporter. The result is that in Northern California, signing transcripts is much rarer, than in Southern California.

I think California’s CCP 2016.070 is relatively clear. Perhaps, you or the debtor can make arguments referencing CCP 2016.070. However in my opinion, that CCP conflicts with CCPs 708.010-030.

A situation where a motion to compel, might be an argument with a judge, not the debtor. Often, a debtor examination is conducted in the jury room before a CSR (a member of the Court Reporters Board) while the judge attends to other matters in the courtroom. Usually besides calling the case, watching the debtor get sworn in by the clerk, and sending the deponents off to the jury room, the judge usually does not hear the conversations between the debtor and their creditor at the debtor examination.

If the debtor starts playing games, often the examination is suspended; and the creditor may bring a motion to have the examination conducted before the court; so objections could be ruled upon and the debtor could be directed to answer where appropriate under penalty of contempt. Sometimes judges initially scoff at this kind of request, and will suggest instead that you get a copy of the transcript, and file a motion to compel.

If this happens you can say something like “Your Honor, could you please direct me to the statute that governs a motion to compel in the context of a post-judgment examination proceeding?”. The judge might say something like “Well, you would do it in the same manner as a deposition, wouldn’t you?”.

You could respond with something like “I don’t believe that is the case, your Honor. CCP 2016.070 specifically excludes post-judgment proceedings from the civil discovery act, except for written interrogatories, covered by Article 1. However, CCP 708.130(a) directs that witnesses are to be examined, in the same manner as upon trial of an issue”.

If you argue correctly and politely, some judges may grant your request to conduct the examination before the court. and admonish the debtor to respond, and then the questioning can proceed in a straightforward manner. The only practical options are either for the court to appoint a referee to conduct the examination, or for the court to conduct the examination itself.

Debtor examinations are similar to discovery, so you might refer to a 708.205 in an order providing that examination-discovered property be applied to the satisfaction of a debt, with a turnover order. Note that turnover orders at debtor examinations are somewhat different from a turnover order per CCP 699.040.

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