It’s not necessarily a second job - this is about Marshals( who are different from the City Sheriff) in my city (not in Florida).
Marshals collect fees, which are set by statute, from the private litigants whose judgments they enforce, and they also retain five percent of any money they collect on judgments. Marshals must pay an annual assessment to the City consisting of $1,500 plus 4.5% of their gross income.
They technically aren’t city employees, but they are appointed by the mayor
If you have never been involved in collections, you might be surprised at the lengths many folk go to (often successfully) to render themselves judgment proof. It can be far easier to obtain a judgment against someone, than to collect on that judgment. It only took a couple of instances to lose my surprise over the fact that scummy, wealthy business owners didn’t actually “own” much… 
An astute creditor examines the likelihood of being able to collect before going through the expense and hassle of litigating. A tremendous amount of law/corporate/insurance effort goes into protecting specific people/entities from potential liability, as well as shifting liability onto someone else.
It varies wildly by State and I’ll gloss over much. So, if we remove insurance from this, it generally goes like this:
Plaintiff wins the case and gets a Judgment that entitles them to $5million from Defendant. It’s on the Plaintiff to enforce that Judgment. The Judgement itself doesn’t do anything, just allows the Plaintiff (not the Court) to get money from Defendant.
You ask the Defendant to pay, but they don’t pay anything, or pays only partial amount. Now a whole other case/process plays out.
Plaintiff takes the Judgment to the Sheriff. The sheriff can enforce the Judgment. The sheriffs go to the Defendant’s home and seizes personal property. Or the Plaintiff can bring the Judgment to a Judge and get the Judge to order garnishment of the Defendant’s wages. You can also file the Judgment as a lien on real property. You would do this until the $5million is repaid.
It’s way more complicated than that, and I’m using the word “Judgment” for many different documents, but that is essentially how it would go.
However, that rarely happens because many things are legally protected from those kinds of Judgments. For example, many State laws say: you cannot put a lien on a person’s only home (just their 2nd or 3rd, etc.); you cannot seize their only car (just their 2nd or 3rd, etc.); you cannot garner partial wages unless x, y, z requirements are met; you cannot seize certain personal property like their clothes, etc. On and on. Most normal people fall into these exceptions and you’ll hear them called “judgment proof” - meaning you can’t enforce a judgment against them due to the legal protections and it’s a waste of time to even try.
Don’t forget - if you go through the whole process and look ready to collect, the debtor declares bankruptcy and you find your claim unsecured!
(In my THANKFULLY BRIEF time doing collections/bankruptcy, I was quickly convinced that the bankruptcy courts and ALL practitioners - lawyers, trustees, judges - were the worst example of an insular “club” within the US legal system. What a bunch of vultures!)
Yes, in the vast majority of the cases, the plaintiff will get the insurance available (sometimes only $25,000) and is out of luck for the balance. A judgment against a normal plaintiff is essentially worthless, and can be discharged in bankruptcy.
One thing we try to do is make an offer to the insurance company before trial asking them to tender their policy limits. If they refuse and expose their insured to the substantial risk of a large excess judgment, an argument can be that they’re acting in bad faith. The defendant is then hit with a $5M judgment and has a cause of action against their insurer. They then assign that to the plaintiff, who sues the insurer on behalf of the original defendant for the amount of the excess judgment. It’s a lot of work, and there are hurdles along the way, but if your client is a quadriplegic, you have to try everything.
Is bankruptcy an option?
Yes, the defendant can claim bankruptcy, but any assets they own can be sold to generate money for restitution.
yes, but if the defendant was drunk when they caused the accident, the debt cannot be discharged in bankruptcy.
Good, because some people don’t have any assets to sell. Even if one has a car, it won’t be sold as an asset if it is beyond a certain age.
IAAL, in Florida, even. A plaintiff lawyer will not pursue a case again a judgment proof defendant. They will look for insurance. If there’s no insurance they will do an asset check. Florida has strong homestead protections but second homes and person property is not protected.
Just curious… but:
As I understood it, the first step as the courts finding a person liable, and that creates a debt.
How you collect on that debt is the same as any other debt -
-ask first
-if that doesn’t work, go for assets, cash first and saleable assets next. That requires a separate order from the judge, saying you may take X, and Y, garnish, etc. I assume that goes for bank accounts as well as cars, etc.
I remember a comment from someone who ran a business, that they would fire anyone who had a garnish order rather than deal with the paperwork.
There was a comment about the judgement against Rudi Giuliani, that he could not escape the debt by bankruptcy because it was a deliberate offense (malicious?) not an accident or mistake. But notice how that played out, they got maybe a few million fom his possessions, rather than the full amount.
Also, if the person declares bankruptcy, then I assume half the fun is finding their assets. If you are the primary debt-holder, then you get to try and find the assets they may be hiding. the court is not going full metal jacket to find everything. If you are lucky(?) they have other debtors. Otherwise, it’s your bill paying for the investigators. I assume this is why the people Giuliani owed settled for a few million rather than spend years in court arguing who owned what and when…
Arrangements made in anticipation of bankruptcy can be reversed by the court (“I’m gonna go broke, so let me pay you the full debt before I file, so Bob gets almost nothing…”)
Yeah. I did collections when I was bottom man on the totem pole at the firm I was working at. Collections were not in my plans when I started law school, but as the lowest associate at the firm, I got them because nobody else wanted them.
I well remember the matter where the creditor had a judgment against the debtor. We had a writ, and we could enforce against assets. The debtor was a farmer, who looked to have some great assets—combine harvesters, tractors, trucks—that would easily satisfy the debt.
Until we found out that he actually owned no equipment at all—it was all owned by a leasing company in Toronto.
Here in Alberta, that is known as a fradulent preference, and it is governed by statute law. There is a window prior to declaring bankruptcy(*) during which the creditor selling any large assets for nominal amounts (e.g. “I’ll sell my wife my part of our house for $10 so the house is entirely in her name, and I’ll sell my car to her too, also for $10, and she’ll give them back once this mess is over”) means that the sale can be reversed, and the sold assets revert to the debtor so they can be seized.
(*) It need not be bankruptcy; it could be any debt collection where large expensive assets could be seized to satisfy the debt.
Depends. Is the restitution order part of a criminal judgement or a civil judgement? Restitution in a criminal case is a non-dischargeable debt, and declaring bankruptcy will not make the debt go away.
Not usually “any assets”. As others have mentioned, there are exemptions that keep some assets out of the bankruptcy proceedings.
Doesn’t even have to be fraudulent. the case I recall as an example was a carpet store going bankrupt. One supplier had discovered they were in dire straits a few months before, and had demanded return of all their stock. Then they made an arrangement where any stock in the store was actually owner by that supplier, not the store.
The store soon went bankrupt. The supplier asked for “their” property back, The bankruptcy court said no, any arrangement made in anticipation of bankruptcy, up to 6 months prior, is by law subject to reversal if it was deliberately intended to escape the anticipation of bankruptcy. So the merchandise in the store was effecively part of the assets to be sold off at auction. I suppose part of the problem was that the deal was explicit and mentioned impending bankruptcy.
So if Bob’s store is going broke, and he specifically (unusually) pays all his outstanding debt to Ted, in preference to all other creditors, then declares bankruptcy - the court can ask Ted to give it all back into the pot for all the creditors.
Presumably he also hid the ownership of the holding company? If he owns shares in the holding company, they would be subject to seizure? To drag in another thread, what if it’s a trust?
He had no interest, financial or otherwise, in the leasing company; at least, not as far as we could tell. (And you’d be surprised at how much lawyers can find out stuff like this in collection matters.)
We did dig into what you suggest, but we found that all the leasing company was, was a privately-held corporation (in which the debtor held no shares or any other interests, financial or otherwise) occupying an office in downtown Toronto, that bought agricultural equipment in western Canada, and through a network of agents, leased it to farmers. The leasing company gets money, the agent gets a cut, and the farmer or harvester gets use of the equipment until the lease ends, hoping that the proceeds from the harvest will outweigh the costs. This is a common practice here on the prairies—harvest equipment is quite expensive (used combine harvesters tend to start at about $500,000 on a sale; new will cost much more), so most farmers and harvesting companies will lease equipment for the once- or twice-a-year harvest.
Back when I was in sales, a lot of our sales went to leasing companies. Our equipment would go into large systems and the customers couldn’t afford to purchase everything outright or it made more sense to lease.
Many years ago, we did some training for a US based client. If I remember correctly, it was about 3-4 days of work plus expenses. They screwed us around for about 9 months before we finally got paid and then they declared bankruptcy about 2 months later.
Some months later, we received a demand letter that we return the funds alleging improper preference. After discussions with our lawyer, we responded that we don’t attorn to their jurisdiction and they can file in Canada if they want the money. That was the last we heard of them.
Learned a new word today.