Collecting a Judgement?

rk2z asks: "I did some independent contractor work about 6 months ago. I delivered the software as specified in my contract and turned in the hours that it took. I then sent the company an invoice for $1400 which was based upon my contracted hourly work rate. They had paid me in the past so I didnâ(TM)t do anything like withhold source code until payment. To make a long story short, they refused to pay me and I ended up taking them to Small Claims court in the state of Nebraska. I won a judgment for the above amount. The problem is, Iâ(TM)m not really sure how to go about collecting my judgment. The amount is relatively small so I donâ(TM)t want to consult a lawyer, because it not really worth blowing the entire judgment before I even get it. But it's big enough that I donâ(TM)t want to give up on it."

"I looked a couple of law websites like here and here, but their suggestion were fairly broad.

Does anyone have any experience in going after debtors (without a lawyer if possible)? Is it better to go to a collection agency and blow half the settlement up front? If so does any one know a good collection agency?

Things to keep in mind: [the customer] is a small company (less than 7 employees). They have some property like computers and such, but how do I find out what they own vs. what is leased. Owned property can be seized by the Sheriff and sold at auction. I have tried to contact them about a monthly/weekly payment plan, but have been blown off every time I try to make some progress on the issue. Thanks in advance."

Comments

Re:Sell the debt.

[sribe]

IANAL! And you probably need one. But I will say first that I found the post from cpt kangarooski to be quite good. A few comments:

But make sure that you don't pick out things that are exempt by law; you may need to do some research on Nebraska law to figure this out.

In Colorado you can basically take it all, and they have 10 days to file with the court to recover exempt equipment. Also in CO "essential" equipment can be exempt. IOW, they have 10 computers, the sheriff takes them all, the court will give them back the 1 with their QuickBooks file. Also make sure you know how much the stuff goes for on eBay, both so that you know how much to take and so you can show up at the sheriff's auction and bid up to that amount, if needed in order to prevent a bargain hunter from buying it all for $10. Be prepared for them to throw a fit, stand your ground, and don't wind up taking only enough stuff to cover 1/4 of the debt (ahem, speaking from experience here). Don't count on this of course, but the sheriff's department told my attorney that it's not uncommon for a company to send someone to the bank, accompanied by the deputy, to get a cashier's check rather than have their property seized.

It's harsh, and it's cruel, and I think personally I would struggle with the morality of it

WTF??? Companies know how much money they have in the bank, how much coming in, and what their expenses are. They knew they didn't have the money to pay this guy and let him keep working because they wanted, in effect, to steal his work. Yes, they were probably hoping that enough new sales would close that they'd be able to pay their bills, but they had to know there was a chance they'd wind up screwing him. Now on what plane of reality is there any possibility of a moral issue with collecting the debt?

I don't know if you have such a mechanism in your state, but if you do a (real) threat to terminate the company is a much bigger stick than garnishing the account - it may be empty, they may just change banks etc.

Yeah, I'm involved in a long-running attempt to collect from a company that has gone to great lengths to avoid paying their debts (transfer of assets to a sister company in another country, leaving the original US company defunct with all the debts, and forming a new US company with the same executives and employees to continue the development work on behalf of the foreign company). There's no direct way to shut them down, but soon enough they'll find themselves on the receiving end of an action that will force them to pay or guarantee that they'll never be able to sell their product in the US nor get another dollar from investors. The most ridiculous thing is that I've told them exactly what I'm doing, and they're just ignoring me. I guess they think I'm bluffing...

Telco Story

[rlp]

I recall reading some years ago, that a guy in San Francisco was owed money by the local telco (at the time Pac Bell). He won in small claims court, but Pac Bell still ignored him. To make a long story short, the sheriff filed the paper work to sell one of Pac Bell's downtown buildings in order to collect the money. No one else showed, so the the guy ending up buying it for $1. At that point, he got Pac Bell's attention. He ended up selling them back their building for the amount owed plus court costs.