Assignments of judgments in the State of California are the topic of this blog post. Civil Code § 954 states that a judgment creditor in California may assign the judgment to a third person.
Assignments of judgments in California are now very widely used compared to 20 years ago when the author worked in commercial and industrial property management and collected Court judgments for his employer.
However the assignment should state that "all right, title and interest" in the judgment is being assigned to avoid any objections as the California Supreme Court has ruled that an assignment of only part of a judgment probably is not valid unless the judgment debtor consents or ratifies the assignment, see Buckeye Ref. Co. v. Kelly (1912) 163 Cal. 8, 12.
All of the assignments of judgment that the author uses in collecting judgments state that "all right, title and interest in the judgment" is being assigned.
An assignment of judgment in California generally transfers all the rights that the judgment creditor had to the assignee of record.
"In doing so, the judgment creditor assigns the debt upon which the judgment is based. Through such an assignment, the assignee ordinarily acquires all the rights and remedies possessed by the assignor for the enforcement of the debt, subject, however, to the defenses that the judgment debtor had against the assignor." Great Western Bank v. Kong (2001) 90 Cal. App. 4th 28, 31, 32, (internal citation omitted).
An assignee may become the assignee of record by filing an acknowledgment of assignment with the clerk of the court that entered the judgment, see Code of Civil Procedure, § 673(a).
The acknowledgment must be made in the same manner as an acknowledgment of a real property conveyance. It must be executed and acknowledged by the judgment creditor or by the prior assignee of record (if any), see Code of Civil Procedure § 673(c).
Pursuant to Code of Civil Procedure § 673(b), the acknowledgment must contain:
The title of the court where the judgment is entered and the cause and number of the action;
The date of entry of the judgment and any renewals, and where entered in the court records;
The judgment creditor's name and address, and the judgment debtor's name and last known address;
A statement describing the right represented by the judgment that is assigned to the assignee, such as whether the assignment is absolute such as a sale, or merely for collection, and whether the judgment is for money, etc.;
The assignee's name and address.
If the assignment does not contain the information listed the judgment debtor could object to any enforcement actions taken by the assignee of record.
However, so long as the assignment of judgment complies with the provisions of Code of Civil Procedure §§ 673 and 681.020, a judgment debtor cannot object to the legal standing of the assignee of record. See California Coastal Comm. v. Allen (2008) 167 Cal.App. 4th 322, 327, rehearing denied, review denied, in which the Court of Appeal stated that, "These statutes, read together, specify requirements for an assignee to obtain standing as a judgment creditor to enforce a judgment under the Enforcement of Judgments Law. No provision is made for a debtor to attack the judgment creditor's authority to make the assignment; the scope of the provision is limited to the process for an assignee to obtain standing to proceed as a creditor. For this reason, we conclude the Legislature did not intend a proceeding under the Enforcement of Judgments Law to become a forum for litigating the validity of the underlying assignment agreement", and at page 328 of California Coastal Comm. v. Allen 167 Cal.App. 4th, supra, it states that, "Allen argues this was insufficient because the acknowledgment stated that the judgment creditor "has temporarily assigned" its right in the judgment. We are provided no authority holding that an assignment must be permanent in order to grant standing to the assignee. " See also Cal. Forms of Pleading and Practice (2008) ch. 318, Judgments, § 318.155; 2 Goldsmith et al., Matthew Bender Practice Guide: Cal. Debt Collection and Enforcement of Judgments (2008) § 14.08; 8 Witkin, Cal. Procedure (5th ed. 2008) Enforcement of Judgment, §§ 24, 217.
An exception would be if the assignee of record lacks capacity to enforce the judgment such as with a suspended corporation or similar problem.
A party can also become the assignee of record by using any other available means to become an assignee of record such as pursuant to a probate court order where the judgment is an asset of the decedent, see Code of Civil Procedure § 673(d).
Upon execution and delivery to the assignee of a written assignment of the rights represented by a judgment, the judgment is perfected and becomes enforceable against third persons, see Fjaeran v. San Bernardino County Board of Supervisors (1989) 210 Cal. App. 3d 434, 440–441, in that case the Court ruled that a pre-tax-sale judgment assignee who did not record the assignment could still file a claim for excess sale proceeds.
However, an assignee must become the "assignee of record" before he or she can obtain a writ of execution or otherwise enforce the judgment under the Enforcement of Judgments Law, see Code of Civil Procedure § 681.020; see also Fjaeran v. San Bernardino County Board of Supervisors, supra, 210 Cal.App 3d at 440, and see also Great Western Bank v. Kong, supra, 90 Cal. App. 4th at 32.
Note that if a judgment creditor makes a bona fide assignment of the same judgment to two or more assignees neither of whom has notice of the other assignment(s), the assignee who first becomes the assignee of record by filing an acknowledgment of assignment with the court or otherwise has priority, see Civil Code § 954.5(b).
The author has seen that situation before as he collected unpaid judgments in the State of California from 1992 through 2008. Many judgment creditors will forget that they assigned their judgment to someone else, and will attempt to assign the judgment again to another person even though the previous assignment of judgment was filed with the Court.
The author of this blog post, Stan Burman, is an entrepreneur and freelance paralegal who has worked in California and Federal litigation since 1995. Visit his website at http://www.legaldocspro.com
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Please note that the author of this blog post, Stan Burman is NOT an attorney and as such is unable to provide any specific legal advice. The author is NOT engaged in providing any legal, financial, or other professional services, and any information contained in this blog post is NOT intended to constitute legal advice.
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