Judgment Renews And Debtors Going BK

August 13, 2023

What if you have an old judgment that needs to be renewed soon, however you checked on Pacer (a federal web site to check if someone went bankrupt) that your debtor filed for bankruptcy protection, and you were not listed as a creditor; and you renewed the judgment while the debtor was going through a Chapter 13 bankruptcy? Do you have to worry about any bankruptcy sanctions (punishments) related to that bankruptcy?

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

Bankruptcy is very serious, so in such a case, was the renewal of the judgment a violation of the debtor’s BK stay? My non-lawyer opinion is, that if you were not listed as creditor in their bankruptcy petition, and only renewed the judgment and did nothing else; you probably do not need to worry about bankruptcy court sanctions.

Most judgment debtors do not keep the courts informed of their current addresses. So, there is a relatively small risk of the debtor responding to move to vacate your renewal, if the creditor properly served notice on them. California’s CCP 683.160 does not require one to send notices to an address you do not know about (which presumes one used reasonable due diligence).

Whether or not the judgment debtor actually gets notice of the judgment renewal is relatively irrelevant. However, by filing your application for judgment renewal, you commenced and maintained an enforcement action, which probably violated the debtor’s automatic BK stay. Renewing the judgment technically violated their BK stay. However, one may argue that the violation was not willful. Bankruptcy judges consider both sides, and if there was a violation, was it willful? There are usually no punitive consequences for un-willful or inadvertent or harmless BK stay violations.

It is a not easy or cheap, however one could proactively file with the debtor’s bankruptcy court; to reopen the BK case and move for a relief from stay to renew your judgment. I would guess the chances for your success is probably less than 50/50.

Although there is no time limit for serving a judgment debtor with the notice that your judgment has been renewed; one should not try to enforce the renewed judgment until 30 days after the debtor has been served notice. Of course, if there is still time left on the original un-expired judgment, it can still attempt to be enforced.

In California, with the “Notice of Renewal of Judgment”, you also need to attach an “Application for and Renewal of Judgment”. The evidence of this being done is the proof of service being filed at the court. Once 30 days has passed, the judgment is ready to try to recover.

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