Posts Tagged ‘defense’

Judgment Day

November 30th, 2011

A client asks:

  • “I have a judgment from GE Capital that was issued in 10/2008.  How would I go about getting that removed from my credit?  Yes, it is mine.  Whom would I contact?  The court or the creditor?”

If by “removed” you mean, “make it go away,” the [only*] solution is to pay it.

Escaping Judgment

A judgment is a judicial (court) order establishing that a debt is valid. A judgment creates an automatic lien on any real property you own in the county where it was issued, regardless of when the property was/is purchased. It can be “transcribed” so that it applies in any other county in the state for about $10/county. A judgment is valid initially for 10 years, and is renewable indefinitely each 10 years. A judgment automatically earns interest at the legal rate (currently 8%), or at whatever rate the contract may specify (if it specifies a different rate). Judgments can be “imported” from state to state, but that requires legal work; however, in many cases, the cost of importing it can be added to the judgment, so wherever it goes, it grows and grows.

Judgments (or, rather, the right to collect on them) can be assigned (sold) like any other asset, and their value depends on whether you already own property, what it’s worth, etc. Judgment buyers are not subject to quite the exact same rules as bill collectors.

The only way to remove a judgment is to record a satisfaction, and that must be done by the person who holds the judgment. It is possible to negotiate satisfaction for less than the face value of a judgment.

A credit bureau can report a judgment in good faith as long as it’s still on the records in the county (even if it’s been satisfied) and the county records don’t show that it’s been satisfied (which people sometimes overlook when they pay them off).  If it has been paid, and you demand that the holder record the satisfaction, they are subject to penalties if you can prove payment and they don’t record the satisfaction within a specified time.

This is why, whenever possible, you want to resolve any debt claims before they are reduced to judgments.

I’m going to guess that’s not the answer you were hoping for….

For Every Rule, Exceptions…

*Payment is often the only practical solution to eliminate a judgment. However, it is possible to seek relief from a judgment through the court. This is often impractical for relatively small judgments, as it will involve legal fees and a minor lawsuit. It’s more likely to succeed if you do it promptly, and if there’s a valid argument that it shouldn’t have been issued in the first place. Here, where the debt is/was valid, your chances of success are slim. You can also have judgments modified or avoided in bankruptcy in some cases, but you need to deal with that while the bankruptcy is pending, and there’s no guarantee of success; a bankruptcy expert (I am not one) can provide better insight into your chances of success there.

Let me check my files and get back to you…

July 21st, 2010

Good recordkeeping is a cornerstone of good business, and most business managers know that.  And, because Human Resource Management (formerly known as Personnel, back when employees were people, not mere human resources) is one of the areas of management that poses the most challenges and some of the greatest risks, most managers keep good personnel records.

Good Personnel Records

Good personnel records start before hiring, and track the employer/employee (or contractor) relationship to its termination and beyond.  A thorough personnel file will document:

  • When and why the employee was hired;
  • When and why the employee was promoted (or demoted or transferred);
  • When the employee was reviewed for performance, who did it, and the outcome;
  • When the employee was disciplined (and whether the problem that led to the discipline was resolved);
  • Any special requests the employee made, from routine vacation, sick days, or exception time, to medical leave, FMLA leave, leaves of absence, etc.; and
  • When an employee was terminated, why, and on what terms (Free to reapply?  References allowed?)

A thorough record is important for several reasons.  Among these is the fact the managers and supervisors may change over the life of the business, and these records allow new managers to come up-to-speed on employees and their performance issues, work and promition histories, and so forth.  Institutional memory should never rely entirely on personal memory.

Good Personal Records

When you consider why your boss is keeping these records, you will realize why it could be very useful for you to keep your own records.  Why do you suppose that is?  Part of the purpose is general recordkeeping, that is, the personnel side of accounting:  How much time have you taken off?  Have you used any special leave?  Did you receive and sign for an employee handbook?

Generally, however, the most important legal reason for keeping this file is to build a case to support a termination, or to defend any allegations you might make of harassment, discrimination, or other wrongful termination.  If any of these situations should arise, it is VERY helpful to have copies of these things!

When an employee has extensive documentation of problems at work, employers sometimes insinuate that the employee was “looking for trouble.”  However, by that same logic, an employee could argue that an employer who keeps a personnel file was “gunning for you” from the beginning.

Your right to access your employment records or personnel file will vary from state to state, and company to company.  Thus, keeping your own copy of your personnel file – at least the parts that you are aware of – is just good recordkeeping, as you may need that information later, and your work file may be incomplete, lost in an office move, etc.  Sure, you don’t have huge file storage space for keeping these things.  You don’t need it.  Disk space is very inexpensive these days, and a scanned copy of these documents is just as good as the original.  Your recordkeeping should be as thorough as your employer’s.  You should save a copy of:

  • Job postings / classified ads you responded to;
  • Resumes you submitted;
  • Contracts, offer letters, employment agreements, waivers, etc.;
  • Employee handbooks;
  • Policy memos, or other policy handouts;
  • Evaluations or performance improvement plans (especially documents showing you have satisfied the requirements of the plan);
  • ALL disciplinary documents and correspondence;
  • All official correspondence to and from the company (this includes e-mail you send and receive regarding policy, personnel issues such as vacation requests, etc., but does NOT include internal correspondence about business operations, clients, etc.);
  • Time sheets, if you keep time manually;
  • Pay stubs or payment advice (especially if it includes vacation balances, pension contributions, etc.);
  • Grievances, complaints, suggestions, or proposals (for contractors);
  • Incident or accident reports, doctors’ notes, excused absences, etc.; and
  • Anything you sign (simply ask for a copy for your files if one isn’t handed to you).

If you don’t know your company’s policy on access to your personnel file, and it’s not in the company policy handbook, you should feel free to ask.

In addition to having your own important defensive information if you should find yourself in the unfortunate situation of being harassed or forced out, you may find that these records also provide a lot of valuable life planning information:  How is your pension growing?  When were you last promoted?  When was your last raise?  Have you been compensated for all of your performance objectives?  These are just a few examples of the information that’s in your file – and should be in YOUR file.

Coming soon:  Running Your Life Like a Business.