Pre-Judgment Remedies

Pre-Judgment Remedies

To be sure, many obligors and debtors simply refuse to respond to any creditor or attorney demands and opportunities to resolve delinquent accounts without the creditor resorting to litigation.  Our law office handles all phases of commercial collection litigation against delinquent debtors.

Each case is different, however all of our legal services are designed to initiate payment as promptly and economically as possible to our creditor clients.  Some pre-judgment litigation tools and procedures accelerate collection efforts.   These procedures include pursuit of pre-judgment remedies such as:

• Pre-Judgment Right to Attach Order (RTAO).  A right to attach order (“RTAO”) is an order issued by a court upon our creditor client’s application at the time of filing suit which grants the creditor the right to levy and place a pre-judgment judicial lien on certain debtor assets prior to final judgment.  Where an RTAO is issued it often result in immediately “coming to terms” that the obligation must be paid with priority prompting resolution of the account balance and enforcement costs incurred

A RTAO is available against corporations, partnerships, and against individuals for claims arising out of their trade, business, or profession. The creditor must establish the claim arises from a contract and the probably validity of the payment obligation in a stated or readily ascertainable amount. 

The application can be made on an expedited basis and without hearing upon a showing that delay in attachment would result in great or irreparable injury to the creditor.  Importantly a RTAO prohibits the transfer, concealment or impairment of the value of the asset absent violation of the Court’s order.  These assets so levied are available to satisfy the ultimate judgment entered.

• Pre-Judgment Writ of Possession (“Claim & Delivery”):  Where the debt obligation arises from a business finance agreement, equipment finance lease, or other secured loan obligation, generally the equipment and often other collateral serves as security for the debt.  Where there is a default, the creditor may seek to foreclose and obtain voluntary repossession of the equipment pursuant to the contracts at issue and the Commercial Code. 

However where the debtor refuses, or repossession would result in a breach of the peace, the creditor may apply to Court prior to obtaining judgment to require immediate possession of the tangible personal property being wrongfully withheld by the debtor or third-parties be “turned over” to local law enforcement.  Once a Writ of Possession is issued, the debtor may recognize that loss of the equipment or collateral will have a significant impact on their business operations, as well as the mounting legal costs and obligations and greatly incentivized to promptly resolve the delinquent account by full pay-off through other means or entering into a stipulated judgment.