Many companies often do business across multiple states. While this is a good sign that the business is growing, it does come with some specific challenges. One of these is collections. The laws in the United States are set up to where you can’t have a Florida collection judgment enforced in California unless you take some specific steps.
One of these steps is that you have to go to court to file a petition for judgment enforcement under the Uniform Enforcement of Foreign Judgments Act. The UEFJA is accepted by 47 states and the District of Columbia. It’s a way for entities to enforce judgments that occur in other jurisdictions.
How does the UEFJA work?
A petition has to be filed to “domesticate” the judgment in the jurisdiction in which the debtor lives. This is done in the local court. Once you file this, the debtor is told of the filing and has a chance to respond to it. If they don’t respond, the domestication goes through and you can have the judgment enforced. This is done through a levy, garnishment or attachment.
It’s possible that the debtor will respond to the notification of the petition. They can’t ask to litigate the case again, however. Instead, they can try to have the petition considered non-enforceable because of procedural error. One example of this is if you don’t file it in a timely manner.
Collecting on a legal judgment across state lines is always a tricky situation, especially if the debtor doesn’t want to pay. Working closely with a business attorney who’s familiar with commercial collections and business litigation may be beneficial.