I am not a lawyer, I am a Judgment and Collections Broker. This article is my opinion, from my California experiences, and laws vary in each state. If you want a strategy to use or legal advice, you should contact an attorney.
What if a debtor doesn't have a typical wage job, and gets paid by customers, relatives, renters or tenants, or almost anyone else?
Assignment orders could be the right (while document intensive) way to attempt to pay off a judgment. This article covers California assignment orders. It's extremely important to know the laws of your state, and how and if assignment orders are permitted.
Assignment orders are (noticed motion) court orders that need a new hearing, and must get served on the other parties. Assignment orders may be able to capture most types of (future and current) non-wage payment streams.
As an assignment order is a lawful alternative to a conventional levy, one does not (in California) have to get a writ of execution. Different from typical levies, the funds often is turned over directly to you.
In some locations, the court might require that the sheriff be the levying officer. If that's the case, you will have to get a registered process server create a sheriff levy file, and then have the assignment order served on the parties, and then file the proofs of service with the sheriff.
Assignment orders can reach most commissions, distributions, and almost any type of K-1 income. When approved by the court, an assignment order instructs someone who owes money to your debtor, to pay you instead of the debtor.
An assignment order is most helpful if a judgment debtor receives (non-exempt and non-retirement-based) money. Assignment orders might work, even when the debtor claims they are poor, because income is income. (Most truly poor debtors do not have income streams.)
An assignment order can last as long as they need to repay the judgment. Similar to most court orders and judgments, nothing is guaranteed. The debtor might go bankrupt. Other things could happen to stop any recovery strategy or action.
In theory, assignment orders for non-exempt income, may ask for all of the income, not just 25% of the income, like most wage levies (garnishments) can reach.
When a judgment is small, or the debtor is wealthy, ask for 50-100%. If the judge doesn't think your proposed order is reasonable, compromise and aim for 25%. (Because CCP 706.050 seems to be very similar to CCP 708.510-f.)
If a debtor isn't wealthy, it could be wiser to request a percentage, instead of all of their income stream. In judgment enforcement, being really aggressive might increase the chance that the judgment debtor will file for bankruptcy protection.
Usually, judges will not rubber-stamp endorsements on assignment orders for creditors. If the creditor clearly shows a synopsis of why an assignment order is appropriate, then a judge might approve their proposed order.
You can document why you have no other obvious way to recover the judgment. One could also document any previous court-endorsed expenses and attempts that didn't satisfy the judgment.
Assignment orders may also be used to reach funds coming from other judgments, if your debtor is the creditor. An assignment order can command the debtor of your debtor to pay you rather than them (or the sheriff). Again, consider requesting a percentage.
A first action for any assignment orders is learning who is making payments to the debtor. A judgment debtor exam, could subpoena sufficient judgment debtor documentation and information, to know who to serve assignment orders to. Some judgment debtors may pay, if their clients contact them, and ask what's going on?
Assignment orders can be general, and not list specific names. They could say "25% of all monies due to the debtor from clients they performs accounting services for". Then, one can serve the assignment order on anyone that pays the debtor, including any of their new clients you later discover, after your assignment order is issued.
Another general example could be "The tenant residing at 44 First Drive will pay you". That way, if the tenant moves and someone new moves in, one could have the same assignment order served on the new tenant. If the judge will not allow a generic order, one could find out who is renting, one legal way or another.
Sometimes, after getting served an assignment order, the 3rd parties still pay the judgment debtor instead of you. Even if they mistakenly pay the debtor, they still owe you that payment.
It is good practice to get certified copies of the assignment order, to quickly serve on parties and/or their lawyers, so they cannot claim they did not believe it to be genuine.
As with most court hearings - on assignment orders; obeying court rules, state laws, and a substantial paperwork load is required.
Many times, 5-6 parts (usually in 5-6 documents) are needed. As an example, an Assignment Order, (an optional) Restraining Order, a Memorandum of Points and Authorities, a Motion, a Notice of Motion (or Entry of Order), and Proofs Of Service, that must be filed with the court.
The Notice of Motion (Entry of Order) and the Motion (Order) are sometimes merged into 1 document. You need to make several copies of all documents, schedule a hearing date at the court, and have the debtor served everything.
California law, CCP 708.510 specifies the judgment debtor may be served by mail. Bring the proof of service to the court, and appear on the court date.
When your order is granted, serve a copy of the order on the judgment debtor by mail, and the parties that must pay you by mail first. If they do not respond, contact them politely, and if necessary, re-serve them in person.
Be sure to consult with an attorney when you do your first assignment order.