As Part 1 in the third party judgment collections “series” mentioned- the Los Angeles judgment collection case against the preacher was some time ago- but more recently, in a Santa Barbara County judgment enforcement case against a similar debtor- Third party wage garnishments and levies came in very handy.
This judgment was against another preacher, who was hiding behind a church. He had a judgment against him from an out of state business deal gone bad, and we domesticated here into CA. We served wage garnishments on his church, which were an annoyance to him no doubt, but he could of course control how much he made and manipulate the numbers. We also pursued his wife, and did a bunch of other things which don’t matter that much to the story. The Debtor was threatening bankruptcy and offering to settle for pittances, and it wasn’t clear how we were going to pierce through the protection of the church.
One of the things we did was serve a levy on the Church, for general intangibles owed to Debtor, pursuant to Code of Civil Procedure Section 700.170.
“General intangibles” have a legal definition which can be found here but for those of us who don’t want to wade through the Cal Commercial Code lets just say that any monies owed and payable to a debtor that is NOT wages under the wage garnishment law, is an “intangible”.
The Church came back and stated that it owed the debtor a significant six figure amount in unpaid book royalties, but that the board had elected not to pay on the debt due to hard financial times. Well guess what? Now that we levied upon the intangible payment that the church owed to the debtor- the church now owes that money to us, not the debtor- and we don’t accept ‘hard times’ as an excuse and we don’t care if the board wants to pay us or not! We told the church we would simply get a judgment against them for all that money if they didn’t pay.
In settlement discussions, we reminded the parties that a levy creates an execution lien for 2 years and makes us secured creditors for purposes of a bankruptcy, and that technically the third party owes us money at this point, so the BK would affect us less. ** (Major asterisk here, this is NOT legal advice; and is especially not bankruptcy advice; bankruptcy is deep waters and always affects things, consult a bk attorney if you have any sort of bk situation).
Because we got a third party on the hook for the judgment- once again, we got a healthy mid six figure settlement on a judgment which may have otherwise been unenforceable.
Bottom line? If a third party owes your debtor money- then there is probably a way to make it so that they owe you the money instead. Levies, garnishments, creditors suits, third party turnovers, and other remedies are something that the Evanns Collection Law Firm has a wealth of experience with. We do Los Angeles County Collections work, Orange County Collections, Ventura county, and, if the case is right- we have been known to jump on planes to handle judgment enforcements anywhere in California. If you have a judgment collection, you should call us- no charge to talk, no risk to you.