Getting Intimate

Discovering information about a debtor’s assets is the crucial first step in collecting the proceeds of a money judgment.*

Prior to recovering what is owed - ideally, prior to even bringing a claim - the collectability of a debt must be assessed. Skilled research regarding the assets and employment status of the debtor, be it a person or business, reveals the most salient information: the full name and address of the debtor business or person, resident agent, and current employer, if any; the debtor’s social security number and bank or financial account information (excluding the debtor’s full account number); and finally, information regarding any fixed assets such as automobiles, boats, and precious stones/jewelry. The Financial Modernization Act of 1999, commonly known as the Graham-Leach-Bliley Act, protects the privacy of all consumers by prohibiting financial institutions from disclosing to third parties certain financial information, such as the existence and details of a personal checking or investment account. The Act does, however, permit disclosure of limited information to an attorney to aid execution of a court judgment. For this reason, a competent collections attorney must employ secure IT to protect debtors’ private information, must never disseminate such information, and must seek and retain only such limited debtor information as permitted under the law and as necessary to collect.

To satisfy the notice requirement enshrined in the due process clause of 5th and 14th Amendments to the U.S. Constitution, a recorded judgment must state the name and address of the real party in interest, i.e., the solvent debtor, precisely, free from any spelling and semantic errors. A motion to amend pleadings (Md. Rule 3-341) or other papers (Rule 3-342) may be filed to correct a debtor’s name or other identifying information prior to entry of a judgment. A motion to alter or amend judgment (Rule 3-534) must be filed within 10 days after entry of a judgment. Anytime thereafter during the life of the judgment, a motion to revise judgment (Rule 3-535) may be filed to correct mistakes as to the identity of the debtor.

Following entry of a judgment, crucial information concerning a debtor’s income, assets, and employment must be obtained independently and through legal proceedings. A search of the debtor’s name, business(es), address(es), etc. should be conducted for free using Google, LinkedIn, Facebook, Instagram, and other social media platforms. Exploiting the benefits of the big data revolution, the Law Office of Robert Lipman strategically deploys several proprietary third-party investigative tools, each providing distinct and nuanced data points. The degree of evasiveness exhibited by a debtor as well as their asset trail ( to the extent already established) dictate which investigative tools to use. Vastly more important than what tools are used, however, is the skill of the craftsman in wielding those tools. Thanks to the creativity and acumen of Mr. Lipman as well as our firm’s secret sauce, the 42 years of collections law experience of our informal legal partner, Attorney Herbert A. Thaler, Jr.,** the Law Office distinguishes itself where it matters most.

Formal legal methods for obtaining information about a debtor, though time consuming, very often reveal key information. For reasons discussed above, the name and address of a business’ resident agent - the self-appointed party upon whom to serve legal papers - must be accurately recited on any legal paper submitted by the creditor. A creditor may employ one or more of the following formal legal methods to find information about a debtor:

• Issue a Judgment Debtor Information Sheet (“JDIS”) (Form CC-DC-CV-114) no earlier than 10 days after entry of the judgment.

• Serve upon the debtor by first-class mail Written Interrogatories or Oral Examination in Aid of Execution (Rule 3-633), provided: 1) the debtor has not returned answers to a JDIS; 2) more than one year has passed since entry of the judgment; or 3) the court has granted leave to do so.

  • Written interrogatories may consist of up to 15 written questions regarding the debtor’s income and assets.

    • If a debtor fails to provide an answer within 15 days after receiving interrogatories, a creditor may file with the court a Motion to Compel Answer to Interrogatories in Aid of Execution (form CC-DC-CV-030), which, upon being signed by a judge, allots a debtor 15 additional days to respond.

  • A Request for Order Directing Judgment Debtor or Other Person to Appear for Examination in Aid of Enforcement of Judgment (form CC-DC-CV-032) may be requested of the court no earlier than 30 days after entry of the judgment. The creditor must serve upon the debtor the court’s ensuing order to appear within 30 days after receiving it.

    • Where a debtor fails to either appear at an oral exam or timely respond to a motion to compel answer to interrogatories, a creditor may file a Request for Show Cause Order for Contempt (form CC-DC-CV-033).

    • As a matter of last resort, a creditor may file a Request to Issue a Body Attachment (form CC-DC-108), accompanied by proof that the debtor was either properly served an order to appear or show cause order or affidavit attesting to the debtor’s willful evasion of service. The willingness of a given court to grant a request for body attachment has decreased in recent years but remains good law.

As illustrated above, recovering the money owed by a judgment debtor requires a unique blend of legal knowledge, technological savvy, and insight borne of experience. A single piece of information is often the difference between a creditor collecting what is owed by court order and a debtor evading their lawful responsibility. The Law Office of Robert George Lipman has made the post-judgment collection of debt its core mission.

Our next blog post will cover the basic mechanisms available for collecting a debt in Maryland.

*The citations herein closely mirror those for the Circuit Court, codified in Title 2 of the Maryland Rules.

**The Law Office of Robert Lipman and the Law Office of Herbert A. Thaler, Jr. serve as co-counsel in many cases. In still other matters, our firms consult with one another, subject to confidentiality, the work product doctrine, and other provisions of Maryland Rules of Professional Conduct.