You went to court and got a judgment that says you're entitled to money from the party you sued, now called a "judgment debtor." What comes next? How can you—the judgment creditor—collect the money you're due? That's the focus of this article.
One way to collect is by putting judgment liens on the judgment debtor's Delaware property. After a quick review of how judgment liens differ from judgments, we'll turn our attention to the specifics of Delaware law. In particular, we cover:
If you want some background information, here's more about how court judgments are collected.
A judgment is a court order that says a judgment creditor is legally entitled to a sum of money from a judgment debtor. But a judgment, standing alone, isn't self-enforcing. That is, you can't take a judgment to your county sheriff's office and demand that the judgment debtor's real estate be sold to pay you.
If you want to seize and sell the judgment debtor's property, you first have to attach your judgment to specific items of property. That's what a judgment lien does. As we discuss later, when your judgment is recorded by the superior court clerk, it becomes a lien against the judgment debtor's real estate in that county. Once that's done, you can look for ways to turn your judgment into cold, hard cash.
In Delaware, you can attach judgment liens only to real estate, meaning land, buildings, and other improvements. A properly recorded judgment attaches a lien to real estate the judgment debtor:
You can't put judgment liens on Delaware personal property—cars, artwork, antiques, electronics, household furnishings, and the like. But that doesn't mean a judgment debtor always gets to keep their autos, boats, and other big ticket items. Even without judgment liens, there's a way to have the sheriff seize personal property.
If you're considering this step, speak to a Delaware collection lawyer first. They can tell you whether it's worth your time and expense to go after the judgment debtor's personal property—and there's a good chance it won't be. If it's likely to be worthwhile, they'll guide you through the process.
A Delaware superior court judgment automatically attaches a lien to the judgment debtor's real estate in the county where the judgment was entered. To attach a lien to real estate in a different Delaware county, follow these steps.
Unless it's extended as allowed by law, a Delaware judgment lien expires 10 years from the date judgment was entered. Before it expires, you can extend a judgment lien by:
Most often, the judgment debtor won't voluntarily agree to an extension, so you'll have to file a motion asking the court to extend your lien. The judgment debtor must show the court why an extension is improper. An extended lien is effective for 10 years from the date of the court's order.
A Delaware judgment becomes dormant five years from the later of:
To renew a judgment, you file a motion to refresh with the court that first issued it. The court will hold a hearing. Once the court renews your judgment, you can take steps to execute on it (collect it) for another five years.
In general, there are three ways you can try to collect on a Delaware judgment lien:
If you want payment sooner rather than later, this is likely your best choice. No, you won't get all the money you're entitled to, but that's the nature of a settlement. You'll collect faster—and more inexpensively—than via the other two options.
Most often, a buyer or lender will insist on clear title, free of all judgment liens. To sell or refinance, the judgment debtor will have to approach you to make a deal. Only now, you've got more negotiating leverage. As long as you're willing to sit tight and wait, this too is a low-cost, low-stress way to collect.
Executing on your lien means having the sheriff sell the judgment debtor's property at auction. This might seem like a tempting option. But before you head down this path, check with a local attorney to find out about the legwork and costs involved. In addition, see who's ahead of you in payment priority, or you might discover—too late—that the sale proceeds aren't enough to pay you in full (or at all).
Lastly, be aware that this step might be just the push the judgment debtor needs to declare bankruptcy. Should that happen, you're likely to be standing in a long, very unhappy line of creditors with little chance of getting paid.
We've covered Delaware judgment lien basics, but of course, the devil's in the details. Now that you're familiar with Delaware law, you might decide that your best option is to get help collecting your judgment. An experienced Delaware creditor's rights or collection attorney can answer your questions and help you chart a collection path that gives you the best chance to maximize your recovery.