Under California law, A creditor who holds a judgment for damages against a debtor can place a lien on the debtor's property as a means of enforcing his judgment The lien acts as an encumbrance on the title and must be dissolved by the debtor before the property can be sold or transferred. California, like other states, has established a statute of limitations period for the enforcements of judgments. Once the limitations period expires, the lien is extinguished and has no legal effect.
Consequences of Judgment
A plaintiff who prevails in his court case against a defendant will be issued a judgment by the court for the amount of damages awarded. After the judgment is obtained, the plaintiff is characterized as a judgment creditor and the defendant, the judgment debtor. Under California law, the judgment creditor can seek to obtain satisfaction for his judgment by initiating various collection procedures authorized by law. These include garnishing the judgment debtor's wages, attaching his assets, and placing a lien against his real property.
California Limitations Period
Pursuant to California Code of Civil Procedure 683.020, a judgment creditor has a 10-year period within which to enforce his judgment for damages against a judgment debtor. The limitations period begins on the date the judgment was issued by the court.
Renewal
Under California Code of Civil Procedure 683.110-683.220, a judgment creditor is permitted to renew his judgment for an additional 10 years by filing an application for renewal in the court that issued the original judgment. The application for renewal must be filed prior to the expiration of the 10-year period of the original judgment. Successive 10-year renewal periods are allowed. However, once a judgment has been initially renewed, it cannot be renewed again until five years later. If the judgment creditor fails to renew his judgment in accordance with the statutory procedures, the lien against the debtor's property is automatically dissolved.
Significance
A lien grants the judgment creditor the right to levy against the property of the debtor. Since in most cases, first and second mortgage holders already have preexisting liens on the property, the lien of a judgment creditor comes after those of the other lien holders who have priority status. However, since under California law, a judgment lien can be renewed for multiple 10-year periods, a lien against real property could last for as long as the term of the debtor's mortgage(s).
Effects
A judgment creditor, who is patient, will likely be able to obtain satisfaction for his judgment by levying against the property once the debtor has paid down the mortgage(s) or acquired sufficient equity. The debtor cannot transfer or sell the property unless he pays off the judgment creditor because the judgment lien acts as a cloud on the title.
0 comments:
Post a Comment