Loose Judgment Assignments

August 12, 2023


It is important to keep track of who owns your judgment. Whoever is the original judgment owner, or the assignee of record for a judgment, has the right to try to recover it themselves or to choose another recovery solution. When a judgment debtor has assets, an unrecorded assignment of judgment should not be left dangling.

If your judgment debtor has successfully discharged your judgment with a bankruptcy, or has died, or moved out of the country, or is terminally poor with no chance of inheriting anything; then it probably does not matter if there is a dangling assignment of judgment. However, what if your judgment debtor has, or might come into some assets in the future?

A worst case scenario might begin if you notarized and mailed an assignment of judgment to a judgment enforcer who then flaked. For example, they closed their PO box, disconnected their phone, and never filed your assignment to them with a court.

Later, you decided to either try to recover your judgment yourself, have someone else try to recover your judgment, or assign your judgment to another person. There is a small chance that the previously flaky judgment enforcer, could decide to file your old assignment at the court; and then that flaky enforcer would then own it, and be the only one that could recover money on your judgment.

The chances of the above scenario happening are small. However, the larger your judgment is, and the larger the assets your judgment debtor earns, wins, or inherits, the bigger chance that a dangling assignment of judgment could suddenly be filed. This article is my opinion, and not legal advice. I am a judgment broker, and am not a lawyer. If you ever need any legal advice or a strategy to use, please contact a lawyer.

Dangling assignments can be a headache for a judgment enforcer too. If you are a judgment enforcer and assign a judgment back to the original judgment creditor, do not just mail it to them and ask the original judgment creditor to file the assignment at the court. Always file the assignment back of the judgment at the court yourself, and make a copy of your copy, and mail the court copy to the original judgment creditor, that way you will certain that you no longer own that judgment.

If you are an original judgment creditor, if you have this kind of situation; where you previously assigned your judgment, and that assignment was never filed at the court. How could you clean this up? One easy way is to assign your judgment to someone else, because the first assignment recorded at the court wins. Another simple way, if you can find the previously flaky enforcer, is to get the original copy of your notarized assignment, back from them.

What if you cannot get your past assignment of judgment back, and do not want to again assign your judgment? It gets trickier then, because as far as I know, there is no such thing as a “declaration to never let my judgment be assigned” that one could file at a court. One solution is to get your judgment recovered (by yourself, with a lawyer, or another recovery solution) as soon as possible, perhaps settling with your judgment debtor. Once a judgment has been satisfied, it does not matter who owns the satisfied judgment.

Courts do a lot of things right, and occasionally get things wrong. I have seen some courts take assignments that were not notarized, which is not right. Notarizing an assignment gives it additional status. There can be several assignees for a judgment, however there can only be one assignee of record at a time.

In California, civil code of procedure (CCP), section 673 specifies an assignee of record must file with the court, an acknowledgment of assignment of the judgment. This acknowledgment must be made in the manner of an acknowledgment of a conveyance of real property, which means that the acknowledgment of assignment of judgment must be signed in the presence of a notary public, with a California all-purpose acknowledgment or the equivalent.

California Civil Code sections 945 and 945.5, define how such assignments occur, and other statutes indicate the “first in time, first in right” principle. The filing of an acknowledgment of assignment is not required in order to make a valid transfer of the interest in the judgment. However, the filing of an acknowledgment of assignment of judgment gives the person who first files it, priority over any other potential assignees.

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