If you lose a civil case and owe money on it, and your main income stream is your own real estate that you own and collect rents on, can the plaintiff make you sell the real estate to pay them funds, or is there a formula that is typically used based on your income tax returns?
Country relating to Question: United States
State (if USA): New York
Dear JACUSTOMER - There is no formula for debt collection unless you seek protection under the bankruptcy laws. Once the creditor has a judgment they have the ability to attach any assets with a lien or garnishment etc. In the case of real estate, if the property is mortgaged it is unlikely that the creditor would foreclose and force you to sell since they probably would get nothing from the sale. They would have alien on the property by virtue of their judgment so if you wanted to sell or refinance the property you would first have to pay the judgment. The first thing creditors typically go after are liquid assets such as bank accounts where there is ready cash available. Having to sell assets is painstaking and often results in low returns for the money spent in collecting. Once there is a judgment the court is basically out of the process other than to issue orders for attachments or debtors exams etc. The only formulas that are ever used are in the cases where the debtor files for bankruptcy protection and the court uses a formula to determine which creditors get paid how much based on priority and security etc.
The plaintiff is The US Government. Would this make a differrence in your answer? I saw a criminal case whereby the defendant said he would pay back his restitution. They had a formula to calculate the amount of payment he was to pay monthly based on his job.
In a civil case, with the US Government, would this apply as well and would this be tied to income tax return if self employed??
I know of no formula that is used unless you can obtain a settlement. If this is the IRS they have certain formulas used to set up payment plans based on income and expenses and the forms are available at IRS.gov. I have no way of providing that type of information. If it is a court suit and there is a judgment then you would have to work out a settlement arrangement or payment plan based on your ability to pay. They still have the right to file the judgment and create the liens whether they actually force the sale of the property or not. Criminal law is entirely different and none of this would be based on what is done in the criminal court system.
one last question Dave, and I thank you thus far! If the civil suit is against a "C" corp AND its president, how does one get the president OFF the case or how does the "C" corp. protect its officers personally??
The officer would have to defend based on the fact that the debt is only for the corporation and not individual. An individual is permitted to represent them self but a corporation needs to be represented by an attorney so the officer can only file an answer for him or herself and ask that the case be dismissed due to the liability being only for the corporation. If the officer guaranteed the corporate debt then the officer is also liable, other wise the plaintiff has "pierce the corporate veil" by showing how the officer is somehow individually liable for the debt.
So the President of a "C" corp. is sued, along with his company for some monitary damages by the DOD/US Govt. for allegedly doing something that somehow cause some kind of a cost to them, or imagined cost savings to the "C" corp. . Govt sues both to try and collect money because the "C" corp. has nothing to offer. What would be the best way to get the President off the suit?
The president should file a motion to dismiss due to protection or immunity from the corporation. I can't prepare legal documents from this website or represent clients but my suggestion is for the president to file a motion to dismiss. The president has to defend based on the immunity provided by the corporation being a separate entity.
Thank you for your answers. I appreciate them. I may have many more questions going forward.
You can keep the thread open for as long as you like even after you accept the answer. I'm not on line 24/7 so please be patient if you have a follow up.
when would you file a "motion to dismiss", as soon as served with suit or?? and what are the chances of being dismissed from the suit?? Should the Corporate books be updated (if not up to date) asap as well?
Yes, you would file the motion to dismiss for failure to state a claim upon which relief can be granted as to the president. The corporate books should always be up to date to keep the integrity of the corporation intact. One of the common reasons the corporate veil is "pierced" is because a corporation fails to operate as a corporation.
If DOD/US Govt has a claim against the President, in some fashion and the corporation, tied into their suit, can a motion still be filed to dismiss the President from the suit? This suit is Civil and they are trying to recoupe money they spent on the Criminal side, which involved an employee of the company.
You can always file a motion to dismiss. It doesn't mean it will be granted but it's a place to start. If the motion is denied it doesn't mean you lose the suit, you just have to continue to defend on the basis that the corporation, not the president is liable. I can't predict the outcome of any court case.
25 years experience in general law, including real estate, criminal, traffic, and domestic relations
is anyone there to ask a question to?
What do you want to know?
In a civil case, where there is named a corporation and an individual, if there is a monitary judgement given at the end of the case, is the judgement typically divided between the two entites and if so, based on what?
Are there lawyers who ONLY write motions? Yesterday you were saying that the first thing to do to try to get the individual off the case is to write a motion asking for this to happen.
also, I am not sure that I am using this site properly. Yesterday was my first time on. Is there anything that you can tell me that I might do or have forgotten to do??
Unless judgment specifies that it is split in a certain way the judgment would be against both defendants with what is called "joint and several" liability". That means they both owe and the creditor can collect from either or both but not double the amount. Once the total is paid then the judgment is satisfied. As for lawyers who file motions I have no idea whether someone in your area would do that but unless the lawyer is hired to be on the case I seriously doubt he or she would just prepare a motion. Our site is for general information and we cannot represent clients or prepare documents for our customers. You are permitted to prepare and file your own motions but not for another entity such as a corporation.
If the corporation has NO assets (only a shell), and the suit comes through naming the corporation and individual, should the money be spent ONLY defending the indivudiual and ignore the corporation defense?
Who would determine how the judgement might be divided up (or is the begining of the case/suit labled "joint and several" ? And if so, would an attorney try to get this divided from the start in the Motion?
When I was asking about Lawyers who "specialize" in motions, I was wondering if there were attnys who have this speciality?
Also, have you ever seen a suit go directly to "negotiations" instead of defending it and spending money when it could have been negotiatied from the get go? Is this something that should be discussed in the beginning???
There is no point in defending a corporation that has no assets. I doubt that the judgment would be divided in a case like this and it would be joint and several liability. I have never heard of any lawyer who specializes in filing motions. A case is always open to negotiation but if a suit is filed a response has to be filed as well. Either party can try to set up negotiations at any time as it is simply part of the litigation process.
Dave, I guess what I was thinking on an judgement, should one be given, would it be weighed based on the negligence, should it be determined that there was neglience, a percentage to each of the entities?
In your experience, should you have ever had a case where the suit named and C corp and Individual, and you have tried to knock off the individual, what would you say was the sucess rate of accomplishing this goal?
I doubt it would be "weighed" in this case but I have no way of predicting what a court might do based on the facts. My experience is that it depends on whether there is a good reason to break the corporate "veil" of protection from liability. If there is then the individual will likely lose and if there isn't the individual will not owe the debt. There are no "odds" I can quote since it simply is based on the facts of the individual case.
I was looking at this False Claims Act... and it seems like it is set up to catch "intensional fraudulatant actions". Would you agree? If there is NO intent to defraud for a gain of any type, and there is not pot of gold from anything unintensionally done, is there other purposes this FCA would be used as a basis for a plaintiff to sue on?
I have no way to research all the cases based on this act so I can't tell you that there are no other causes of actions. It is the plaintiff's duty to prove the claims made. They can't simply allege something and have it be true.
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