Is There a Statute of Limitations on Judgment Collection?
U.S. law places a statute of limitations on most civil and criminal issues. A statute of limitations prevents legal action against a defendant after a certain amount of time. This reality prompts a question among defendants who have had civil judgments entered against them: is there a statute of limitations on judgment collection?
For example, let’s say you had a judgment entered against you for nonpayment of rent. Is there a limit on how long the landlord can attempt to collect from you? That depends on state law. Most states place a statute of limitations on judgment collections. We will use Utah as an example. According to Salt Lake City’s Judgment Collectors debt collection agency, the statute of limitations is eight years.
More About Statutes of Limitations
Statutes of limitations can be implemented at nearly any jurisdictional level. They exist at the federal, state, and local levels. They also exist internationally. The thing to remember about such statutes is that they are not uniform. They vary by jurisdiction.
Statutes of limitations also very according to the seriousness of the offense in question. Some offenses are considered so egregious that no prosecutorial limits are placed on them. Murder is one example. A murderer can be prosecuted for a past crime until the day they die.
Conversely, civil judgments are way down the scale in terms of seriousness. Therefore, most jurisdictions allow for a statute of limitations on judgment collection. Again, Utah’s law sets the limit at eight years. But that does not mean you could just avoid paying for eight years and then suddenly be in the clear. Judgment collectors have tools at their disposal to overcome such limits.
Renewing Judgments in Utah
Judgment collectors in Utah have the advantage of being able to file a Motion to Renew Judgment in a state court. This is essentially a motion asking the court to renew an outstanding judgment for another eight years. It’s done to give creditors a tool for working around debtors who might attempt to stall until the statute of limitations is reached.
Section 78B-2-311 of the Utah Code allows for renewing a judgment under certain circumstances. Attorneys for the judgment collector would file the motion and then wait for the court to hear the case. They have an advantage in that they only have to file the motion prior to the expiration of the original judgment. The case can be heard after the expiration date.
When that happens, a decision to renew the judgment is retroactive to the expiration date of the original judgment. The judgment collector now has another eight years to pursue action against the debtor. This includes everything from wage garnishment to asset attachment and execution.
Holding Out May Not Help
It is important to understand the statute of limitations if you are holding out on a judgment in hopes of it eventually expiring. Perhaps you have no nonexempt assets and only limited income. Perhaps you are avoiding payment in hopes of never having to pay at all. Don’t hold your breath.
Imagine holding out in Utah with the expectation that your judgment expires in eight years. In the ninth year, you purchase a piece of property with a small vacation home. You might discover that the judgment collector renewed the judgment the year before and can now seize that property.
Statutes of limitations do exist in relation to judgment collection. But in many states, judgments can be renewed. In such cases, holding out in hopes of reaching the statute of limitations is not necessarily a wise thing to do.