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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Business Law
Satisfied Customers: 91941
Experience:  All corporate law, including non-profits and charitable fraternal organizations.
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Have judgement against my company which was closed before judgment

Customer Question

Have judgement against my company which was closed before judgment granted. Did not go to court because the hearing was in another state. They hired local attorney to collect who subsequently obtained a local court judgment, requested an order of contempt, and is now requesting the court for sanctions. What are sanctions exactly? I offered a payment arrangement via mail and even sent a good-faith payment to the attorney. I do not want to show in court. Can I fax a letter to the circuit court? I have no attorney because I cannot afford one at present time. With the economy like it is, we are living on one income, have poor transportation and do not own any real assets. How can I avoid having my meager assets seized?
Submitted: 5 years ago.
Category: Business Law
Expert:  Law Educator, Esq. replied 5 years ago.
Sanctions can be in the form of fines and attorney's fees for forcing them to go to court to get payment. You are going to have to show up in court unless you can contact the attorney and reach a stipulated settlement agreement that will have to be filed with the court. If they get the judgement and sanctions, they will then move to seize any of your income and bank accounts in your name. One option you have is you can file bankruptcy. If you cannot afford an attorney, then you need to contact legal aid for assistance and also call the state bar and ask about the pro bono attorneys in your area for assistance.

Also, if the judgment was against your company and not you, then you would place the company into bankruptcy and your only liability would be any assets they can prove you took from the company when you closed it, unless you signed as a personal guarantor of the debt.


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Customer: replied 5 years ago.
This is a debt to a vendor who was never given my social security number, etc. I really have no income so I am not worried about seizing bank accounts but I have 2 beater cars, one I had given my mom for her transportation, one for my kid who is in college, and then I have a car that is financed that I am upside down on. So, I have no assets really. The house is in my husbands name and it is our primary residence which cannot be taken in Florida. I do not want to show up in court. I have recently filed for disability due to a heart condition and I cannot endure the stress from a court appearance. Just thinking about it shoots my rate up. How can I get the judge to hear my side? If their attorney can appear by phone, why cant I? Can I request a delay or continuance?
Expert:  Law Educator, Esq. replied 5 years ago.
If the judgment is against the company and not you, then as I said, the best thing to do is place the closed company into bankruptcy and it will extinguish the debt, since as a corporate entity you are not liable as the owner except for any money they prove you took out of the company upon dissolving it. You should call at least to request a continuance and you should do that today and not wait for the hearing. Then you really should get with legal aid and call the state bar to find a pro bono attorney who can place your business into bankruptcy and then file the suggestion of bankruptcy in response to their motion to enforce the judgment.
Customer: replied 5 years ago.

Hi,

they pierced the corporate veil. We formed a corporation then closed it within the year. Never filed paperwork or anything

Expert:  Law Educator, Esq. replied 5 years ago.
Ouch, that changes things. You really need to consider personal bankruptcy, since you have nothing to lose at this point, it would put an end to this complaint.
Customer: replied 5 years ago.
We really do not have any assets though. What can they take? There is no proof that I have employment and I did offer them $200 monthly to pay the debt off. the house is not in my name, its in my husbands name. I dont have bank accounts either.
Expert:  Law Educator, Esq. replied 5 years ago.
I understand all of that, the problem is that the judgment can linger for years and can even be renewed so that if you ever get any assets they will be seized. The best way to be done with this quickly and no longer worry about it is through the bankruptcy process.
Customer: replied 5 years ago.
should we file as a couple? We do have some debt that could also be erased.
Expert:  Law Educator, Esq. replied 5 years ago.
That is a personal choice for you to make. Since FL is not a community property state they cannot attack him for your personal debts, but if the business was a jointly formed business, then they can. As far as the other debts, if you have nothing right now, then now would be a good time to consider filing bankruptcy together.
Customer: replied 5 years ago.

Its a real odd situation. we formed the corp in 2002 in my husbands name but my signature was on all checks and the vendor delt with me. we never filed any documentation with the corp and it was subsequently closed by the state it was opened in by 2004.

Expert:  Law Educator, Esq. replied 5 years ago.
In this case, you should both file bankruptcy, even though neither of you have any real assets you are pretty much judgment proof, having a judgment hanging over you is more stress and bankruptcy will eliminate all of your debts and get you a fresh start without the worries.
Customer: replied 5 years ago.
I like the idea of bankruptcy but I was told we would have to sell our house. Is this so? I did tell them in the letter that I was going to file bankruptcy if they do not agree to my payment arrangement. If we file bankruptcy can you recommend an attorney in North florida, panhandle area? Or do you do florida bankruptcy? also will i be able to buy a new house after filing bankruptcy? can I get a car and how long do I have to wait on this?
Expert:  Law Educator, Esq. replied 5 years ago.
You do not have to sell your house. A homestead in FL is protected under the bankruptcy laws. Bankruptcy would affect your credit score for up to 7 years, but this doesn't mean you will not qualify for credit. See: http://www.bankruptcyinformation.com/FL_exemp.htm

As far as an attorney, we cannot recommend any as the terms of this service prohibit that, but the best place to find one in your area is DANGEROUS URL REMOVED and if you cannot find one you can afford, then go to legal aid and also call the state bar and ask about the pro bono attorneys in your area who can assist.
Customer: replied 5 years ago.
thanks for your help. we did not want to file bankruptcy because the things on my husbands credit should be falling off in the next year to 18 months. However, you are right about the stress, I physically cannot handle anymore. I did file for disability this month and that was the last thing I wanted to do but I am unable to function. I am waiting now to go for my evaluation. I put that in my letter to their attorney as well. Basically they hired an attorney locally in order to put more pressure on me and to attach my income and assets. The attorney that they hired specializes in business credit/debt recovery, skip traces, etc. and owns an asset recovery service. I do not want to go to court tomorrow. I was not served a notice to appear. I simply received a letter stating that they would be appearing by phone during the hearing to request sanctions. They have already had a hearing to file motion of contempt and I am not sure how that turned out as I was not served with a warrant and am not sure how to find out if there is a warrant. I did not fill out the financial paperwork that the court had ordered for discovery. Why bother helping them take what stuff I do have.
Expert:  Law Educator, Esq. replied 5 years ago.
You need to call the court for permission to appear by phone as well. Call them today. You need to also argue that you have never been served by them with the motion for contempt and were not notified until after they had the hearing.
Customer: replied 5 years ago.
Thanks. I had called the court after I received the motion for order of contempt and the assistant had no idea what I was talking about and said she had never heard of such a thing for a civil judgement. I am thinking if I could fax them a copy of my proposal to the plaintiffs attorney along with copies of the money order stubbs that they would allow that into consideration. It is a rural community and everyone is closing their businesses. We are talking about a debt to another corporation, not a secured creditor from 2004 that secured a judgement in 2007. However, the amount is over $20,000 after the addition of interest and I have paid them about $1700 towards it since starting negotiation with their attorney. They are not serving me through process server or Sherriff deputy either, they are using regular mail and stating that this serves as notification. I will call the circuit court and fax this documentation to them along with a motion to reschedule to a later date or either a motion for continuation. Not sure if those are the right terms. Do I also have to fax this to the plaintiffs attorney? Thanks
Expert:  Law Educator, Esq. replied 5 years ago.
They can serve you through regular mail as long as you are getting the notices that is considered proper service for everything but the initial complaint/summons.

You should fax everything you send to the court to the other attorney as well, if not it could be considered ex parte communication.

I would just do the motion for continuance and not send them anything else.
Customer: replied 5 years ago.
so file a motion for continuance and not send the judge my notes to the attorney? Where can I find such a form? and will they accept a fax copy for this on the day before the court date? Thanks so much for your help. I could bend your ear all day but this is my last question I promise Sealed
Expert:  Law Educator, Esq. replied 5 years ago.
Call the clerk of court,since the hearing is tomrrow and ask the clerk for an oral continuance, if not they can send you a copy of the motion to file.

Do not send them your notes yet.
Law Educator, Esq., Attorney
Category: Business Law
Satisfied Customers: 91941
Experience: All corporate law, including non-profits and charitable fraternal organizations.
Law Educator, Esq. and 2 other Business Law Specialists are ready to help you
Customer: replied 5 years ago.
I did have one more thing to ask. Is it legal to get a judgement for the same thing in two different states? They first sought and won in Virginia now have gotten same judgement in Florida. I did not think that was possible.
Expert:  Law Educator, Esq. replied 5 years ago.
It is not a new judgment, they took the judgment in VA and filed it in FL under the recognition of foreign judgments law and the FL court issues a judgment to enforce the VA judgment.
Customer: replied 5 years ago.

Okay. It just seemed like they went through the same process in Florida so I had assumed it was a duplicate.

 

We are going to file bankruptcy. Chapter 7?

 

How long does it take once they get the order for sanctions before they actually start trying to take our things? And if I never gave them my social security number can they get that information without my consent?

 

The courthouse does nothing by phone, online or fax. I am not in town so I am unable to appear. Plus I was never served notice to appear. So, it will be several days before the judge gets my request for continuance. I should have done it sooner.

 

How do they get your bank account information? My kid has an account that is in my name because she is not yet 18. Will they take her money? Will the bank notify here before they attempt to freeze her account? Can they take her car? Its only worth about $500. What about my husbands bank account that also has my name on it? His paycheck goes into it and it is our sole source of income plus we are putting a kid through school and are totally strapped. Do I have time to cancel direct deposit and should I?

Expert:  Law Educator, Esq. replied 5 years ago.
They should at least allow you to appear tomorrow by phone, just as the other attorney is and ask for a continuance at that time.

They can obtain your SSN and bank account information in several ways, such as credit reports, service of subpoenas on all of the local banks or finally discovery requests to you. As far as the account in your name for your child, yes they could seize that unless it is in her name with you as custodian.

Once they get the order for sanctions it can take 2 weeks to a month before they get orders for garnishment/seizure.

His paycheck should go into an account with just his name on it for now until you get the bankruptcy filed.
Customer: replied 5 years ago.
How can they get my credit report? I have not authorized it. It is not that kind of debt. The debt is to another corp who provided services to our former company prior to our downfall. There was no credit information filled out nor were forms signed. They sent discovery requests and I did not fill them out...thus the order of contempt. Due to hubbys bad credit he is unable to get a bank account in his own name, plus most of the bad credit/judgements minus this one are all his. So he cant get a bank account and we just started the direct deposit a few months ago and I meantioned changing it and he was a bit resistant. Maybe I will call the bank and see if I can take my name off his account and put his name on my daughters account instead of mine. that will at least stop them from taking his paycheck until further notice. I called the courthouse back and the lady I spoke with said everything had to be in writing, all requests etc had to be original signed documents with the court date/time stamp on them. this is a really small area, very rural, minimal stuff online. They do not have their outstanding warrant database online yet. I am not allowed to call in either without notification to the other party by the court and she said there was not time. So that option is out. I am hoping that the other people will not call due to my letter and promise to pay as well as my actual payment to them. There has been ample time for them to return the payment I sent and reply in writing as I sent it a week or so ago and we can get mail from them usually the next day. I did tell them in my letter that if they did not agree to the arrangement that I would file bankruptcy and I found a place online that would actually file it for me within 24 business hours of my completion of the documents which would be within the time frame specified earlier for them to get the writ of garnishment. I found two companies, one that has an online software and another that has full-service filing. I assume I should go with full service since I have never done anything like this before. I am a total spaz right now because the stress of the bill collecting process is creating health problems. Can they get the address from the bank that I have my statements mailed to? One would hope that the bank would not share that type of information nor would they share my social security number with them as the court will only compel the bank to say if they have an account or not and seize it, not give out any personal information about me. Thanks again for all your help. I really appreciate your continuing to reply to me today. It is really helping ease my anxiety. :)
Expert:  Law Educator, Esq. replied 5 years ago.
Today, with the information available on the internet, they can access credit reports, property records and millions of other forms of data without your permission or consent and this is something that is done frequently. You may want to go to the court because if not the other attorney can say anything you want without anyone there to contradict him.

Full service filing would be good for the bankruptcy because any mistakes would delay the process. Whatever company you choose make sure you check them with the BBB.

The bank would share the information if served with a subpoena for the information, but there is little you can do about that, other than change your daughter's account and put just her name on it with your husband as guardian.

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