In some states, after the dust settles on your personal injury lawsuit, and you find yourself getting a favorable outcome, what happens? I mean, you won! The complicated part is over, right? In the majority of cases, you may face more challenges before you collect the money awarded to you. Speaking of money, after winning your lawsuit the court will issue a judgment that contains the amount the defendant owes you. At that point, the defendant must pay, or they choose to appeal the verdict. If the former happens, you still find yourself working hard to get that payment. Let’s break it all down.
Appealing the Verdict
A defendant has the right to appeal any judgment against them, and in many cases, the losing party will do just that. In Tennessee, they must file an appeal with the courts in 10 to 30 days. If the appeal is granted, a different judge will hear the case in court. Any judgment against them levied by the original judge will be suspended from collection through the appeals process.
Who pays you for your personal injury case? You can go after insurance coverage with a claim, or you can go after personal assets. You can also file a claim with your own insurance company that covers uninsured or under-insured drivers.
Collecting a Judgment in Tennessee
Before you decide to file a lawsuit from which you hope to be awarded a judgment by the court, you should investigate the ability to pay by the person against whom you plan to file. It will do no good to sure a person who lives paycheck to paycheck with no assets or savings for millions or even thousands of dollars because they may never be able to pay.
However, if you go forward with your lawsuit and win in court, getting payment from the defendant may or may not be complicated. Really, it falls to the plaintiff to collect the payment from the defendant because the court’s role basically ends once the judgment is entered. Perhaps the defendant, or more likely their insurance company, is fully ready and able to do so. More often, it can take a little work to collect.
It’s important to note, if the defendant has a job, he or she is required to pay the judgment. However, sometimes getting them to meet that requirement can be a challenge. In those cases, you have several options in the state of Tennessee:
If you can discover the defendant’s employer, you should file their employment information with the court. In most cases, the court will rule that they must pay you up to 25% of their wages each paycheck until their debt is paid. The courts forward the money to you from payments collected automatically from their paychecks. The wage garnishment stays in effect as long as they keep that job.
If you know where the defendant has money in a bank account, you can also file this information with the court. The court in turn will notify the defendant’s bank of the debt, and it will send the amount owed to the court who will distribute it to you. This option is best for lower-end judgments of a few thousand dollars.
Another option if the defendant doesn’t pay their debt is to take your judgment from the court and file it with the register of deeds for your county. With this paperwork on file, the law requires the defendant to settle the judgment from any property they sell. Alternatively, you can file a judgment lien to obtain a writ of execution. The defendant must sell their property to satisfy the judgment, though there are many exceptions to property covered by this law. In some states, placing an attachment on vehicles that can be sold to satisfy the judgment is an option. However, in Tennessee, the option of a property lien only applies to real property and not automobiles or other types of property.
Can They Avoid Paying?
If the defendant has filed for bankruptcy or is otherwise a person without assets, you can’t collect. This goes back to one of my early points. If you have a non-collectible defendant, you probably shouldn’t file a lawsuit in the first place. So do your research before taking that step.
Important Information About Your Judgment
After a judge rules in your favor and requires payment of a judgment by the defendant, you don’t have forever to collect. You must collect this debt within ten years of a judgment entered by the court. Payment can take from several months to several years to collect, and interest due to you on the original amount can accrue over time.
What obligations do you have for the money collected in the lawsuit’s judgment? Taxes must be paid out of most judgments, though there are exceptions. You need not pay taxes on judgments covering physical injury costs and any pain, suffering, and emotional distress resulting from this injury. In almost all other cases, you must pay taxes, including lost wages, emotional distress without physical injury, and punitive damages. There are also many ways to reduce the taxes owed. Because navigating tax requirements can get really complicated, you should seek help from a professional.
Hiring an Attorney with Experience
These guidelines are based on Tennessee law, but those laws can vary from state to state. To understand the laws that apply to your situation it is a great idea to get expert advice and guidance. Hiring an experienced personal injury attorney to guide you from filing to collecting a judgment is a valuable investment. Knoxville Attorney, Jed McKeehan is available to help you navigate through the courts and laws in Tennessee. If you need help (or think you might need help soon), call Jed today at (865) 294-8008.