What if you are an executor, who was assigned a $2,000 judgment? What happens if your debtor refuses to pay, and then plans to use your deed of execution to settle a lien on your debtor’s vehicle, which you think is worth $3,000?
One of many articles of judgment: I am not a lawyer, and this article is my opinion based on my experience, consult a lawyer if you need legal advice.
Anyone planning to repossess your judgment debtor’s vehicle should know if it is leased or the status of the lien and/or loan. All vehicle transactions are dependent on prior loans and liens, so let’s assume the debtor’s vehicle is paid off.
What happens if you make an offer to your debtor (or they make an offer to you) to take your vehicle as full compensation for (and satisfaction of) your judgment? if you are given title to your vehicle.
A deal like this is different than if you had the sheriff impound your vehicle and sell it at auction, because at a sheriff’s sale; you would have to return the money left over from the amount of the judgment debt to your debtor.
With the car settlement, could you pay your Original Judgment Creditor (OJC) $1,000 (based on your 50/50 split contract), sell the car for $3,000, and make an additional $1,000 profit?
Yes, sentencing enforcers often cut good deals. You can do anything (that is legal) you want. If your debtor is willing to give you his car, that’s fine. Your only obligation to your OJC is what you both agreed to in your purchase agreement.
If you accept the vehicle as full payment of the $2,000 judgment, the OJC would be entitled to your $1,000 and you would have to file a satisfaction of judgment with the court. If you later sell your vehicle, you will have honored your agreements with both the OJC and the debtor. Hopefully, you will make a big profit.
However, if the market for vehicles goes down and you can only sell the vehicle for $1,500, you must still file debtor’s satisfaction and pay OJC your $1,000. You decided the vehicle was worth $3,000, and it’s not the OJC’s fault that they only received $1,500, and you will only earn $500.
In short, it’s your vehicle, so you win or lose on the final date of sale. The date of sale has nothing to do with your agreement with your debtor, or your agreement with the OJC. These are three separate and distinct transactions.