J. Norman Stark | July 17, 2017
Construction debt collection requires selection of the proper court with jurisdiction to hear such cases. Municipal courts have jurisdiction within a determined city or municipality, with limitations on the amount claimed by any party, which does not exceed $15,000.00. Limitations may vary by each jurisdiction.
Once a complaint is filed, and the debtor files a counterclaim in which the amount exceeds the monetary limit, the case must be transferred and certified over to the higher court, where there is no monetary limitation on claims. If a debtor fails or refuses to answer timely, after receiving a summons from the court, the court may grant default judgment in favor of the plaintiff.
Construction Claim Legal Procedure
Construction cases are routinely assigned to a Judge or a court-appointed Magistrate for hearings, which are open to the public. During such formal hearings in open court, each party is afforded an opportunity to present evidence and witness testimony to support their claim(s) for determination and judgment (ruling) for one of the parties. Frequently, witnesses may be called to support the claims of either party. The hearings are concluded by a written judgment, stating the nature, extent and amount awarded, or denied, together with the Court’s findings of fact and law.
Once a construction debt judgment has been rendered, the winning or prevailing party may file a Judgment Lien with the Clerk of Courts in the county where the judgment was rendered. A judgment lien acts as a charge against, or interest in, all real and personal property owned by the debtor in the county where the judgment lien is filed. Such liens may also be transferred to other jurisdictions where the Defendant resides. Judgment liens serve to secure payment of the judgment debt, by attaching to all of the assets of the debtor.
In the case of real property, once a judgment lien has attached, and payment is not forthcoming, the judgment creditor may initiate a foreclosure action. Such action demands the property be sold (liquidated) to secure payment of the judgment, together with all court costs, and interest at the legal rate from the date of the original judgment, and continuing until fully paid.
The assistance of an experienced construction attorney is important; it can make the collection of debts more of a certainty than a mere, remote probability. An experienced construction lawyer can help avoid costly mistakes; legal counsel doesn’t cost, it pays!