Show Your Clients the Money: Enforcing Judgments in Minnesota

Show Your Clients the Money:
Enforcing Judgments in Minnesota
Thursday, January 29, 2015
2.0 CLE credits applied for.
MBCLE Event Code: 201019 PENDING
AGENDA
2:00-400 PM
• Docketing the Judgment
• Transcribing the Judgment
• Satisfaction of the Judgment
• How Long Does a Judgment Last?
• Lien on Real Estate
• Homestead Exemption
• Discovering/Locating Assets of the Judgment Debtor
• Post-Judgment Discovery
• Writ of Execution – Minn. Stat. §550.135
• Execution Sale by Sheriff
• Garnishment of Earnings – Minn. Stat. §571.71, et seq.
• Garnishment Upon Financial Institution – Minn. Stat. §571.71, et seq.
• Contempt of Court Motion
• Small Money Judgment Levy
• Receiverships – Minn. Stat.§576.25
• Pre-Litigation Attachment – Minn. Stat.§570.01
• Pre-Judgment Interest
• Post-Judgment Interest – Minn. Stat. §549.09
• Fair Debt Collection Practices Act (FDCPA)
Featuring: Caryn Boisen, Partner, Larson King and Joseph F. Kueppers, Chancellor
for Civil Affairs, Archdiocese of Saint Paul and Minneapolis
Faculty
Caryn A. Boisen, a partner with Larson • King, focuses her practice in the areas of
construction, products liability, commercial litigation, and business litigation. She provides
advice to clients regarding business planning and avoiding disputes. She also has significant
experience in all aspects of defensive and offensive litigation including jury trials, bench trials,
arbitrations, and mediations.
Caryn volunteers for the Tubman – Chrysalis Center’s Safety Project, where she provides pro
bono legal representation to low income domestic violence victims who are seeking Orders for
Protection. She serves as a mentor to law students through a local law school’s formal
mentoring program. Caryn also has served and continues to serve on several trade association,
non-profit, and for-profit advisory boards.
Caryn obtained her undergraduate degree from the University of St. Thomas in St. Paul, and her
law degree from Hamline University School of Law in St. Paul, graduating magna cum laude.
Prior to joining Larson • King, Caryn worked for a large Washington, D.C. law firm.
Joseph Kueppers currently serves as Chancellor for Civil Affairs for the Archdiocese of St.
Paul and Minneapolis. In this position he serves as the chief legal officer for the Archdiocese.
Prior to be appointed Chancellor he was a shareholder and president of Kueppers,
Kronschnabel & Daly, P.A. working in the areas of civil litigation, business law and estate
planning.
Joe also served as a Judge in Small Claims Court (Conciliation Court) in Ramsey County.
Joe has been on the Board of Directors of many non-profit organizations in the Twin City area
and has served as the President of five non-profits.
Joe received his undergraduate degree from the University of Minnesota and his law degree
from Hamline University School of Law.
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Show Your Clients The Money:
Enforcing Judgments in Minnesota
Caryn A. Boisen
Larson King, LLP
and
Joseph F. Kueppers
Archdiocese of Saint Paul and Minneapolis
Enforcing a judgment requires a
working knowledge of:
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 Select Minnesota Statutes
 The Rules of Civil Procedure
 How and when to use specific postjudgment creditor’s remedies
 Procedures in sheriffs’ offices
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Docketing the Judgment
 After the judgment is entered by the Court, the
judgment creditor should “docket” the judgment.
 Docketing starts the process the judgment creditor
uses to try to collect payment of the judgment.
 Occurs when the winning party in a case files an
Affidavit of Identification of Judgment Debtor form
with the Court.
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Transcribing the Judgment
 This process is used for judgments obtained in
Conciliation Court.
 Must request that Conciliation Court transcribe the
judgment to District Court.
 After the transcript is prepared, all the paperwork
will be sent to District Court, and you will receive a
new file number from District Court.
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Satisfaction of the Judgment
 Once the judgment is paid in full, or is paid to the
judgment creditor's satisfaction, the next step is to
notify the Court that the judgment has been paid.
 To do this, the judgment creditor completes a
Satisfaction of Judgment form and files it with the
Court.
 If the creditor does not cooperate with completing
the Satisfaction of Judgment form, the judgment
debtor can file a Motion to Satisfy Judgment with
the Court, which will also update the Court records
to show that the judgment has been paid.
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How Long Does a Judgment Last?
 A judgment can be enforced for 10 years from the
date it was entered.
 It can also be "renewed" if not satisfied (paid)
within the 10 years.
 Multiple renewals are permitted. See Dahlin v.
Kroening, 796 N.W.2d 503 (Minn. 2011).
 To enforce a judgment that was not paid during the
10 year timeframe, you have to start a new lawsuit
before the end of the 10 year period, based on a
claim for failure to pay a judgment.
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Lien on Real Estate
 A judgment is a lien on all real estate in the county
where it is docketed – Minn. Stat. §548.09.
 The judgment lien on real estate is automatic with
respect to abstract property.
 With respect to Torrens property, the Transcript of
Judgment must be memorialized on the Certificate
of Title to be a lien on the property – Minn.
Stat.§508.63.
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Homestead Exemption
 The first $390,000 of equity in a homestead
property is exempt from a judgment lien.
 The first $975,000 of equity in a homestead
used for agricultural purposes is exempt
from a judgment lien.
 Minn. Stat. §510.02.
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Discovering/Locating
Assets of the
Judgment Debtor
 Asset search firms.
 Order for Disclosure – Minn. Stat.
§550.011.
 Financial Disclosure Form – Minn.
Stat.§491A.02.
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Post-Judgment
Discovery
 Post judgment interrogatories – Minn. R. Civ. P.
69 and 33.
 Post judgment depositions – Minn. R. Civ. P. 69.
 Court Order in supplementary proceedings –
Minn. Stat §575.01.
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Writ of Execution
Minn. Stat. §550.135
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Money.
Personal property.
Real estate.
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Execution Sale by Sheriff
 Notice of Sale – Minn. Stat.§550.18.
 Service on Judgment Debtor – Minn.
Stat.§550.19.
 Time and Manner of Sale – Minn. Stat.§550.20.
 Exempt Property – Minn. Stat.§550.37.
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Garnishment of Earnings
Minn. Stat. §571.71, et seq.
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 The judgment creditor must serve the judgment debtor with a
Garnishment Exception Notice and Notice of Intent to Garnish
Earnings. Format and content set forth in Minn.
Stat.§571.925.
 Must serve personally or by mail at least 10 days before
attempting to garnish wages.
 The Notice is valid for one year.
 If no statement of exemption is received,
the judgment creditor may proceed with the garnishment.
Garnishment of Earnings
(continued)
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 The Notice informs the judgment debtor that:
 His/her wages may be garnished, without any further
notice, after 10 days.
 He/she has a right to a hearing if the garnishment by
the employer is incorrect.
 There are some types of assistance he/she may receive
that are exempt from garnishment.
 If he or she wants to claim an exemption, he/she must
fill out a form and send it to the judgment creditor
and the employer.
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Garnishment of Earnings
(continued)
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 To proceed with the garnishment, the judgment creditor must
serve the judgment debtor’s employer with a Garnishment
Summons and Disclosure Form. Format and content set forth
in Minn. Stat.§571.74 and§571.75
 The Garnishment Summons directs the employer to serve upon
the judgment creditor a completed Earnings Garnishment
Disclosure Form.
 The Garnishment Summons also directs the employer to retain
earnings subject to garnishment, not to exceed 110% of the
judgment creditor’s claim, until the judgment creditor causes
a writ of execution to be served on the employer.
Garnishment of Earnings
(continued)
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 The judgment creditor must mail a copy of the Garnishment
Summons and Earnings Garnishment Form to the judgment
debtor within 5 days of service on the employer.
 The judgment creditor must also serve the judgment debtor
with a Notice to Debtor. Format and content set forth in
Minn. Stat.§571.74.
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Garnishment Upon
Financial Institution
Minn. Stat. §571.71, et seq.
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 To proceed with the garnishment of funds in a bank or other financial
institution, the judgment creditor must serve the bank or financial
institution with a Garnishment Summons and Disclosure Form. Format
and content set forth in Minn. Stat.§571.74 and§571.75.
 The bank or other financial institution must retain the debtor’s funds.
 The judgment creditor must mail a copy of the Garnishment Summons
and Disclosure Form to the judgment debtor within 5 days of service
on the bank or other financial institution.
 The judgment creditor must also serve the judgment debtor with a
Notice to Debtor. Format and content set forth in Minn.
Stat.§571.74.
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Contempt of Court Motion
 Minn. Stat. §558 and Minn. R. Civ. P. 45.07 and 69.
 The District Court may hold the judgment debtor in
contempt of court for failure to obey a subpoena or a
court order in supplementary proceedings.
 Contempt of court motion documents must be served
personally on the person failing to obey the prior
subpoena or court order in supplementary proceedings.
 No substituted service of process is allowed.
 Sanctions on the judgment debtor that may be imposed
by the court include incarceration and/or fine.
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Small Money Judgment Levy
 Minn. Stat.§551.01, et. seq. permits attorneys to
levy on money, personal property, and earnings
using a quick alternative to a formal Writ of
Execution.
 Notice of Execution Levy on third-parties holding
money of the debtor is served by certified mail,
along with two copies of an Exemption Notice if
debtor is an individual.
 The maximum amount that can be levied upon in
the possession of a particular third-party is
$10,000.
Small Money Judgment Levy
(continued)
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 There is an affirmative duty imposed by Minn. Stat.
§551.04 on a third-party holding money to immediately
remit funds to the attorney who served the Notice of
Execution levy, if the debtor is a corporation, or 15 days
after the third-party mails to exemption notice to the
debtor.
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Receiverships – Minn. Stat.§576.25
 Receiverships are used by lenders to protect the value
of property in foreclosure.
 The judgment creditor must file a motion with the court
to appoint a receiver.
 Appointment of a receiver is a matter of discretion with
the trial court.
 A receiver may be appointed on allegation and proof of
waste or threatened waste of the property due to either
misuse or non-use. Examples:
 Leaving the property vacant to its detriment.
 Failing to pay taxes and insurance.
 Neglecting to make necessary repairs.
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Pre-Litigation Attachment – Minn. Stat.§570.01
 An order of attachment may be issued by the court in
connection with a civil action for the recovery of
money.
 The claimant may have the property of the respondent
attached as security for the satisfaction of any
judgment the claimant may recover.
 Only a judge of the court in the county in which the
civil action is pending may issue the order for
attachment.
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Pre-Litigation Attachment – Continued
 The claimant must show that the respondent has:
 Assigned, secreted, or disposed of, or is about to assign, secrete, or
dispose of, any non-exempt property, with intent to delay or
defraud the respondent's creditors;
 Removed, or is about to remove, any non-exempt property from
this state, with intent to delay or defraud the respondent's
creditors;
 Converted or is about to convert any non-exempt property into
money or credits, for the purpose of placing the property beyond
the reach of the respondent's creditors;
 Committed an intentional fraud giving rise to the claim upon which
the civil action is brought;
 Committed any act or omission for which the respondent has been
convicted of a felony, giving rise to the claim upon which the civil
action is brought; or
 Violated the law of this state respecting unfair, discriminatory, and
other unlawful practices in business, commerce, or trade.
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Pre-Judgment Interest
 The pre-judgment interest rate is governed
by Minn. Stat. §549.09.
 Interest accrues on pecuniary damages from
the earlier of:
 The time of the commencement of the action;
or
 The time of a written notice of the claim.
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Pre-Judgment Interest
(continued)
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 Pre-judgment interest accrues even if the damages are not
“readily ascertainable,” such as consequential damages or
pain and suffering.
 Pre-judgment interest does not accrue for certain
enumerated items such as:
 Future damages,
 Cost and disbursements,
 Punitive or non-compensatory damages, and
 Workers compensation awards.
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Post-Judgment Interest – Minn. Stat. §549.09
 Post-judgment interest accrues on the unpaid balance of
judgments from final entry of judgment until satisfaction
of the judgment.
 Prior to 2009, the rate for all post-judgment interest was
computed annually and remained steady at about 4 percent
for many years.
 In 2009, the Minnesota Legislature amended §549.09,
setting the interest rate for judgments over $50,000 at 10
percent.
 This does not include judgments against a governmental
body.
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Fair Debt Collection Practices Act (FDCPA)
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 Establishes ethical guidelines for the collection of consumer debts.
 Prohibits a debt collector from using “any false, deceptive, or
misleading representation or means in connection with the collection
of any debt.” 15 U.S.C. §1692e.
 Broadly defines a debt collector as "any person who uses any
instrumentality of interstate commerce or the mails in any business
the principal purpose of which is the collection of any debts, or who
regularly collects or attempts to collect, directly or indirectly, debts
owed or due or asserted to be owed or due another.” 15 U.S.C.
§1692a.
 In their first communication with the consumer, debt collectors are
required to notify debtors about their ability to challenge the validity
of a debt and to provide other basic information.
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Scenario One
 The judgment debtor has several judgments
against him.
 The judgment debtor is avoiding service.
 The judgment debtor’s assets are unable to be
identified easily.
How should you proceed?
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Scenario Two
 You have a judgment against the judgment debtor
in Ramsey County.
 When you obtained the judgment in 2012, the
judgment debtor lived in Ramsey County.
 The judgment debtor has since moved to Polk
County, Wisconsin.
How should you proceed?
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Scenario Three
 The judgment debtor has a bank account with U.S.
Bank that has substantial funds in it.
 Two other judgment creditors recently obtained
judgments and are proceeding against the U.S.
Bank funds.
How should you proceed?
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Questions?
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Thank You!
Caryn A. Boisen
Larson King, LLP
(651) 312-6529
and
Joseph F. Kueppers
Archdiocese of Saint Paul and Minneapolis
(651) 291-4405
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