In most cases, the end goal of a civil lawsuit is for the party who has been legally wronged, the plaintiff, to recover money from the person who has wronged them, the defendant. Some civil suits can last as long as 3-5 years before the court enters a judgment against a defendant that allows a plaintiff to collect. One of the unintended results of this process is that defendants often have a long time to think about the pending lawsuit and just how much money they may owe a plaintiff at the end of the day. In order to avoid paying the money they owe, some dishonest defendants may resort to secretive or unethical means to hide or move their assets so that there will be no money left at the end of the case for the plaintiff to recover. This is often accomplished by means of gifting items of property to family members or friends, transferring sums of money between various bank accounts, or other methods that will make the defendant’s assets unattainable prior to the conclusion of a lawsuit.
So what can a plaintiff do to make sure that a defendant will still have the money to pay them at the end of a lawsuit?
The answer often lies in is pre-judgment remedies. Pre-judgment remedies are legal mechanisms that may be used to ensure that a defendant is unable to transfer or hide their assets while a lawsuit is pending against them, and their proper use can help guarantee that there is money available for the plaintiff at the end of the day. There are various avenues that a plaintiff can pursue, and in determining which form of pre-judgment remedy is appropriate, it is important to keep in mind what assets the debtor owns or may have access to.
The most common form of pre-judgment remedy is attachment. Attachment grants the plaintiff a lien that is attached to a piece of the defendant’s property. In layman’s terms, this means that when the defendant attempts to sell their property, all or a portion of the sale will be paid to the plaintiff. This method, while useful, does have its drawbacks. If another creditor such as a bank, the government, or another third party already has a lien placed on that same piece of property, their lien may take priority over the plaintiff’s. In such a case, the holder of those liens would be entitled to recover from the defendant first, leaving the plaintiff with whatever is left. This unfortunately can leave the plaintiff in a situation where they are only able to collect less than what is owed, or sometimes nothing at all. Another drawback to attachment is that the defendant may never actually sell the attached property. In this case, the lien may expire and the attachment will be ineffective. While the lien gives the plaintiff an interest in the property, they are left with no tangible form of payment.
Another pre-judgment remedy that is similar to attachment is replevin. Repelevin can grant the plaintiff a superior interest in a piece of property and can allow the plaintiff to take possession of property. Replevin is different from attachment in that the plaintiff will gain possession of the property, and is often used in situations where a third party is holding property that should be in possession of another. The property is seized and the plaintiff will hold a superior interest in the property while the lawsuit is pending. The plaintiff may then elect to keep or sell the property in such a case, and the defendant will receive whatever interest remains to them after the fact.
A final option available to plaintiffs is a writ of garnishment. A writ of garnishment allows the court to “freeze,” or otherwise restrict a defendant’s access to, assets or personal property held by a third party. This is done in certain cases to ensure that there there is an attainable form of payment available to plaintiffs at the end of a lawsuit. A common example of a writ of garnishment is when a plaintiff will seek to have a defendant’s bank account frozen. The plaintiff would seek to garnish the defendants accounts, thereby preventing the defendant from distributing or transfering money until the conclusion of the lawsuit. This pre-judgment remedy is not only applicable to liquid assets, however, and in a situation where tangible personal property is at issue, the plaintiff may also have a sheriff take possession of items and hold them as collateral while the lawsuit is pending. Not all states have laws in place that allow for garnishment, and in South Carolina the direct garnishment of wages is prohibited.
While pre-judgment remedies are not available in every case, they are valuable tools that attorneys can and should use to protect their clients. When entering a lawsuit for the recovery of funds, the attorney should determine whether pre-judgment remedies are appropriate and use them proactively to help guarantee that their client will have the ability to recover the money owed to them.