Using Out-Of-State Assets To Satisfy A Delaware Judgment
As a Delaware Business attorney, once I’ve obtained a money judgment in Delaware on behalf of my client, the next step is to locate the debtor’s assets. In a previous article, I discussed the process for collecting on a Delaware judgment. But what if we learn that the defendant doesn't have assets in Delaware?
If the debtor owns significant assets in another state, or is working in another state, the usual procedure is to register the Delaware judgment in that other state. Let’s say, for example, the debtor owns real estate in Maryland. The courts in Maryland look at the Delaware judgment as a foreign judgment (a judgment from another state). Maryland, like many other states including Delaware, has adopted the Uniform Enforcement of Foreign Judgments Act. Under that Act, I can register with the court in Maryland an exemplified copy of the Delaware judgment, and it will have the same effect as if I had originally obtained the judgment in the Maryland courts.
Using the same example, once the Delaware judgment is registered in Maryland, the procedures available in Maryland for collecting on a judgment can be used. This includes “attachment” and “garnishment.” Attachment means that we ask the Sheriff’s office to levy on the debtor’s business equipment and real estate and to sell them at a public sale. Garnishment involves the Court seizing the debtor’s bank accounts, or requiring the debtor’s employer to deduct money from the debtor’s pay check. It also includes taking control of the debtor’s accounts receivable.
Collecting a judgment in another state is not always easy, but it can be done. Although we sometimes have to schedule a sale of the defendant's assets, it's not unusual for the debtor to come up with the money just before the sale.
