I am not a lawyer, I am a judgment broker. This article is my opinion, and not legal advice, based on my experience in California. If you ever need any legal advice or a strategy to use, please contact a lawyer.
When getting into the judgment recovery business, most people do not think about returning any judgments. Returning judgments is as important of a topic as any other topic in judgment recovery.
Here are the most common reasons one might consider returning a judgment:
1) The Original Judgment Creditor (OJC) is a pain in your rear end. I have witnessed many times, OJCs being or becoming unreasonable, and contacting Judgment Enforcers (JEs) way too often and/or trying to micro-manage them.
After an OJC assigns their judgment to a JE, they are, or at least they should be, out of the picture. Some OJCs, even with tiny judgments, ask JEs for daily status reports, and/or tell JEs how they should enforce the judgment. When the OJC is a pain, think twice about whether you want to keep that judgment.
2) The judgment debtor is broke, and does not seem to have any current, or any projected future assets available.
3) The judgment debtor has filed for bankruptcy protection. If the judgment debtor successfully discharged the judgment with a bankruptcy, it may not matter whether you return the judgment or not. However, it is generally a good policy to assign the judgment back, to prevent any (occasional and potential) future hassles.
4) The judgment debtor moves to another state or country. Unless the judgment and debtor assets are large, it is usually not worth hiring a lawyer to recover judgments in other states. In this case, after returning the judgment, consider making money referring the OJC to a judgment broker.
5) If the judgment debtor gets really sick, or dies; with no money in their estate.
6) When the judgment debtor successfully vacates or appeals the judgment. In this case, it does not matter whether you return the judgment or not, because the judgment you were assigned no longer exists.
7) You have recovered “enough”. Sometimes after a wage garnishment, bank levy, or a Sheriff sale, you recover most, however not all, of the amount owed on the judgment. Usually, it is not cost effective trying to recover the last few dollars.
8) You are leaving the judgment business, and doing the right thing and returning your judgments.
When you return a judgment, if you collect some judgment money, be sure to pay the original judgment pay the OJC their share when you return it. In recovering the judgment, what if you spent money trying to recover the judgment, can you ask to be repaid for that before returning the judgment?
My advice is to politely ask to be compensated for anything with residual value, for example recording liens, affidavits of identity, judgment renewals, having a judgment debtor examination served in states where this creates a lien, etc. Unless your purchase contract specifies you will be repaid for costs, I would not strongly insist on being repaid, especially for other costs that do not give the OJC a residual value.
Of course, every judgment, situation, OJC, and enforcer is different. If you spent money trying to recover the judgment, try asking to be reimbursed. Consider compromising.
To return a judgment, the concept and procedure is exactly the same as when you were assigned the judgment. The assignment paperwork is the same, and your information and the OJC’s information are swapped. You still get your signature notarized, and the assignment still must be stamped and filed by the court.
Here is an example of the wordings for a re-assignment of a judgment, where a JE named Mr. Arnold Assignee had been assigned a judgment before, and is now assigning it back to Mr. Paul Plaintiff, the OJC:
100 Fake Avenue
San Jose, CA 95112
IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA
IN AND FOR THE COUNTY OF SANTA CLARA
Paul Plaintiff (Plaintiff) V. Dan Debtor (Defendant)
CASE NUMBER: 11-04-CV-999999
ACKNOWLEDGEMENT OF ASSIGNMENT OF JUDGMENT AND NOTICE OF ACKNOWLEDGMENT OF ASSIGNMENT OF JUDGMENT (CCP §673)
COMES NOW Arnold Assignee, and my address is 100 Fake Avenue, Milpitas, CA 95035, Assignee Of Record in this matter, and hereby provides the following in support of an ASSIGNMENT OF JUDGMENT:
1) THAT this original Judgment was awarded by this court on 03/29/2015.
2) THAT Plaintiff was awarded $25,000.00, and Court approved Costs of $500.00 (which totals as $25,500.00) on 03/29/16, against Defendant: Dan Debtor.
3) THAT there have been no renewals since the entry of said Judgment by this Court and that Plaintiff has already received $0.00 payment on this Judgment from the Defendant.
4) THAT Arnold Assignee of 100 Fake Avenue, Milpitas, CA 95035, is the current Assignee Of Record.
5) THAT the last address of record for the Judgment Debtor(s) are: Dan Debtor, 444 Cheaters Lane, San Jose, CA 95122.
6) THAT I, Arnold Assignee hereby transfer, and assign all title, rights, ownership, and interest in this Judgment to the following person: Paul Plaintiff of 100 Fake Avenue San Jose, CA 95112
Signed this 32nd day of February 32, 2016 in the City of: Milpitas, California
Arnold Assignee – Assignee of Record
State of CALIFORNIA, County of SANTA CLARA, before me, (Print Notary Officer Name, and Title)
The Signator personally appeared who proved to me on the basis of satisfactory evidence to be the person whose name is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity, and that by his/her/their signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal.
Signature – Notary Public in and for said County and State