How to Collect a Judgment in Colorado

Getting through and winning any complex legal case is an accomplishment in and of itself. You may want to close this chapter of your life and move on to the next one, but to actually get money in your hand you need to collect your judgment.

Even when you receive a judgment in your favor at the end of a case, a judgment is not a check or a payment and there is no guarantee that you’ll be able to collect from the opposing party.

The Court does not handle judgment collection for you, and it is your responsibility to pursue the funds you are owed pursuant to the judgment. No one wants to wind up in further litigation with the person or entity who owes you money. However, there are several ways to collect your judgment.

Explore Options for Collecting Your Judgment

The business or person who owes you money pursuant to a judgment is known as a judgment debtor. You, as the person who obtained a judgment in your favor stating that you are owed money, are called the judgment creditor.

One of your first options is to ask the judgment debtor in writing to pay you the money they owe you pursuant to the judgment. This is one way not to involve the court or further legal proceedings.  But you might need further legal action to collect what you are owed, especially if the judgment debtor refuses to pay or claims they do not have the money to pay you.

Requesting a certified transcript of judgment from the Court is a good next step. Once you have the certified transcript of judgment, for which you may have to pay a small fee, you may have more collection options.

With the certified transcript of judgment in hand, you may obtain a judgment lien on the judgment debtor’s real property (real estate). The money judgment can attach directly to the property so that when the property is sold or refinanced, you are paid out of the money from the sale or refinance. You may obtain a judgment lien by recording a certified transcript of the judgment with the county clerk and recorder in the county where the judgment debtor owns the real property.

Another collection option is garnishment. Garnishment generally refers to taking money from the judgment debtor’s bank accounts, wages, or insurance policies to pay the judgment. You will have to obtain a writ of garnishment from the Court and have it served on the judgment debtor’s bank, employer, or insurer.

Other methods of collecting a judgment include charging orders (which can help you intercept payments from a business that the judgment debtor owns that the judgment debtor would otherwise receive), writs of attachment (which can encumber various other types of property), writs of execution (which may force the sale of assets, from which you could be paid), and motions pursuant to Colorado Rule of Civil Procedure (“C.R.C.P.”) 69(g).

An experienced business litigator might be required to assist you with determining all potential options for collecting your judgment.

Gathering Information About the Business or Person Who Owes You Money

To effectively pursue many of the above judgment collection options, you may need to conduct public records research to determine important details about the judgment debtor. You may need to find where they work, where they own property, and where they bank, for example. If you already have these details, additional research may not be necessary. However, if you do not know this information, you may need to issue collection discovery to the judgment debtor, which will force the judgment debtor to answer questions about their assets under penalty of perjury.

Some examples of form collection discovery that the Colorado Judicial Branch has made available to judgment creditors include form JDF 105 (pattern interrogatories to a judgment debtor that is a person) and form JDF 108 (pattern interrogatories to a judgment debtor that is a business).

These forms ask multiple questions that the business or person who owes you money must answer. You can file the form with the court, and the court will send it to you, or you can file proof of service with the court after you have served the judgment debtor. The business or person who receives this form must file their answers with the court and return their copy no later than fourteen (14) days after they get the form. The answers should give you details you need to help collect your judgment. If the judgment debtor refuses to answer, you may consider seeking an order from the Court holding the judgment debtor in contempt of Court to force them to answer.

You may also issue subpoenas to third parties to get more information about the judgment debtor’s assets, which may help your collection efforts.

Understanding Expiration Dates of Colorado Judgments

If you obtained a money judgment in a Colorado District Court, it expires 20 years after the date of judgment. If you obtained a judgment in County Court, it expires six years after the date of the judgment. It is important that you make efforts to collect your money before the expiration of this judgment.

You can potentially revive or renew your judgment before it expires, but that process can take time.  It is important to not wait until the last minute as too much delay risks not being able to renew your judgment.

Your recorded judgment lien will likely prevent the judgment debtor from selling or refinancing the real property until your judgment is paid. Note, however, that judgment liens on real property expire six years after the entry of judgment unless they too are revived. While your judgment itself may continue longer than this six years, if you let your recorded judgment lien expire the judgment debtor may be able to sell or refinance their real estate without paying your judgment.

What to do if a Judgment Debtor is Hiding Assets

Unfortunately, some judgment debtors hide or fraudulently transfer their assets to avoid collection. Judgment debtors may move their assets around, “sell” their assets to a friend or family member in a sham transaction, or otherwise transfer their assets in an attempt to hinder, delay, or defraud you. It can be very frustrating when a “deadbeat” defendant hides assets, hides money, or moves assets or money to escape judgment. Some defendants may lie in response to your collection interrogatories to try to cheat you. Others may “give” their house to their husband, wife, other relative, or friend to avoid judgment and avoid paying you.

Thankfully, the Colorado Uniform Fraudulent Transfer Act (“CUFTA”) can help you collect your judgment in situations where judgment debtors are simply trying to frustrate your efforts to collect a judgment. Attorneys at our firm led the way to strengthen CUFTA so it now includes a 50% penalty, in certain situations, against those who hide assets from collection.

Fraudulent transfer cases are complicated, and you need a lawyer with CUFTA experience to pursue such a case. Our attorneys are recognized leaders in the area of fraudulent transfer cases. We know how to spot the asset protection schemes that defendants use to make themselves “judgment proof” and unwind them for our clients. In many cases we are able to freeze assets even before you have a judgment so that the defendant is unable to take further steps to conceal them. We have helped our clients recover millions of dollars in fraudulent transfer cases. We also routinely co-counsel fraudulent transfer cases with other lawyers to maximize their clients’ recoveries.

What to do after you have Collected your Judgment

Hopefully, you will be able to collect some or all of your judgment and move on with your life. After you have collected your judgment in full or in part, you can fill out form JDF 111 and file it with the Court and record it with any county clerk and recorder where you previously recorded your transcript of judgment. This must be signed in front of a notary public.