I'll Find It

Last week, I sent out a "discussion" about what happens after you get your judgment. So, what about the other side of that coin. What if you are the person against whom a judgment is entered? You own some investment property with a couple of partners, Partner A loses her job and, all of a sudden, you guys can't make your mortgage payments. You get together and decide to let the property lapse into default and then foreclosure. Like so many other people I know and have met in the course of my day to day practice, you think the bank will take the property and call it a wash.

Those days, my friends, are over. Property prices have fallen, people have stopped buying and banks do not want to incur the costs of ownership (property taxes, maintenance, garbage collection, etc.). In case you've been living in a cave for the last year and a half, the banking business is looking for the same thing you are- money.

So, before you let that property go or end with any judgment against you for any reason, you should know that the entry of a money judgment against you allows for the person who sued you access to all of your financial information. You heard right. Once a judgment is entered, the plaintiff gets to ask (and you have to disclose) the whereabouts of your assets, your bank accounts, your investments, your future earnings.

This is invasive and it is meant to be. Once you turn over this information, the plaintiff then gets to send the "sheriff" (Miami-Dade County has an office of the sheriff but no real sheriff to speak of) and seize your assets, sell them at public sale and keep the money it generates.

You also get to fill out a Court-approved form that asks you identify all of your assets. If you don't, the Court can compel you to do it. The Court can then make these assets subject to seizure, as well.

This is a tough situation for anyone to be in. There is an entire practice of law devoted to the protection of assets against the potential exposure to and seizure of assets. Of course, if you find yourself already in litigation, it's too late. The time to protect your assets is before there is trouble. If you do it after litigation starts, it can been deemed a fraud on your creditor.