When an individual or business fails to uphold their legal obligations, filing a lawsuit may be the only way to right the wrong. But a judgment in the plaintiff’s favor is only a piece of paper if it cannot be enforced. That is why the law of every state, including Texas, provides for receiverships. Receivership allows a third party to locate, seize, and liquidate assets of a judgment debtor for the benefit of the judgment creditor. Receivers are not debt collectors, nor do they represent either party in a lawsuit; they are appointed by state and federal courts to enforce their judgments.
At Volberding Legal Group, PLLC., we concentrate our work exclusively in the area of receivership, taking a proactive approach to identifying, locating, seizing, and liquidating non-exempt assets. These matters are often complex, requiring sophisticated analysis and strategy. Attorney James W. Volberding is not only an attorney but also a Certified Public Accountant. Our broad skill set and narrow practice focus give us an advantage in efficiently satisfying the judgments of Texas courts.
In the typical civil court case, a plaintiff sues a defendant for money. If the plaintiff wins, the court renders judgment in favor of the plaintiff and against the defendant and orders the defendant to pay the plaintiff money.
If the defendant, now judgment debtor, does not pay the judgment, the plaintiff, now judgment creditor, can ask the court to appoint a Receiver for the judgment debtor. If appointed, the Receiver’s role is to take possession of the judgment debtor’s non-exempt property and accounts, liquidate them, and pay the plaintiff, thereby satisfying the court’s judgment. Receivership is an effective tool for the court to ensure that its judgments are enforced.
All states have procedures for appointment of a Receiver. Texas law allows judges to appoint a Receiver to collect unpaid judgments in Chapters 31 and 64 of the Texas Civil Practice & Remedies Code andChapter 11 of the Texas Business Organizations Code.
Any Texas court which has issued a judgment can later appoint a Receiver to enforce it. This includes state district courts down to justice of the peace courts.
Federal courts may also appoint receivers to enforce their judgments. Federal courts in Texas apply Texas state law for receivers.
If a court issued a final judgment in your favor as a plaintiff and the judgment is not paid, your lawyer (not Mr. Volberding) can file a motion for appointment of a receiver to collect the judgment. If you retain Volberding Law Firm to serve as the Receiver, we draft the motion and proposed order for your lawyer to file. Getting assistance with the motion and proposed order is important, because the documents must contain certain required information and language.
If the court grants the motion, the court will sign an order appointing a Receiver and authorizing the Receiver to seize the judgment debtor’s accounts and assets.
It then becomes the Receiver’s responsibility to collect the judgment. Texas law affords robust tools for seizing a judgment debtor’s non-exempt assets by a Receiver, including:
If you hold a court judgment from another state, but the judgment debtor has assets in Texas, Mr. Volberding can explain how to “domesticate” the judgment in Texas, thereby making it a Texas judgment. From there, the Texas court may appoint a Receiver for the judgment debtor.
It depends on the country. If the U.S. recognizes judgments from that country, then the judgment can be “domesticated” in a federal court in Texas. Once domesticated, then it becomes a fully enforceable Texas judgment.
If someone owes you or your company money on a contract or account receivable, Mr. Volberding can explain how to sue the person or company to obtain a court judgment. Once done, then you may be able to apply for appointment of a Receiver if the judgment is not paid. Mr. Volberding would not represent you. He would refer you to one or more attorneys. You would need to retain your own attorney independently.
The plaintiff / judgment creditor must obtain a judgment from the presiding court against the defendant / judgment debtor.
The plaintiff / judgment creditor may provide the judgment and relevant pleadings and financial documents to the Receiver.
Receiver will prepare the motion and proposed order for Receiver’s appointment for attorney for plaintiff / judgment creditor to file.
The attorney for plaintiff / judgment creditor must file the motion for appointment and obtain a signed order.
Receiver will then assume control of the judgment debtor’s non-exempt assets and liquidate them as necessary to satisfy the judgment and receivership fees and expenses.