10.08 Judgments


Terminology Regarding Judgments


A judgment is the final determination of the rights of the parties entered by a court of competent jurisdiction. No judgment can be considered final as long as the action is either pending on appeal or the time to appeal from the judgment has not expired.

Judgment Creditor

A judgment creditor is a person in whose favor a judgment against a debtor has been entered, and which judgment remains unsatisfied.

Judgment Debtor

A judgment debtor is a person against whom a judgment has been entered, and which judgment remains unsatisfied.

Judgment In Personam

A judgment in personam is a judgment against the person as distinguished from an action against the thing itself--or an action in rem. A judgment in personam may be termed a general lien. Most judgments are against the person.

Judgment In Rem

A judgment in rem is a judgment against the thing itself, as distinguished from an action against the person. The judgment only binds or affects a particular piece of real estate.

Judgment Lien

A judgment lien is a lien binding the real estate of a judgment debtor, in favor of the holder of the judgment, and giving the latter a right to levy on the land for the satisfaction of the judgment to the exclusion of other adverse interests subsequent to the judgment.

Alternative Judgment

An alternative judgment is a judgment that by its terms might be satisfied by doing one of several acts at the election of the party or parties against whom the judgment is rendered and from whom performance is required by the judgment.

Conditional Judgment

A conditional judgment is a judgment whose force depends upon the performance of certain acts to be done in the future by one of the parties.

Confession of Judgment

A confession of judgment is a written statement whereby a debtor permits judgment to be entered against the debtor without the necessity of the creditor's bringing legal proceedings against him. In some states, confession of judgment clauses cannot be executed before the party is in default.

Consent Judgment

In a consent judgment, the provisions and terms of the judgment are settled and agreed to by the parties to the action.

Declaratory Judgment

A declaratory judgment is a judgment by a court of law in a legal action, declaring the rights and duties of parties under an agreement or their status with respect to each other without ordering anything to be done.

Default Judgment

A default judgment is a judgment in consequence of the nonappearance of the defendant at the appointed time.

In some jurisdictions, the term is also applied to judgments entered under statutes or rules of court for want of affidavit of defense, plea, answer, and the like, or for failure to take some required step in the cause.

Deficiency Judgment

A deficiency judgment is a personal judgment in a foreclosure action for any remaining balance of an obligation secured by a mortgage, if enough money is not realized to liquidate the mortgage debt under the foreclosure sale.

Domestic Judgment

A judgment is domestic in the courts of the same state or country where it was originally rendered; in other states or countries it is called a foreign judgment. The federal court sitting for the state is a domestic court, and its judgments within the scope of its jurisdiction are domestic judgments.

Dormant Judgment

A dormant judgment is a judgment that has not been satisfied or extinguished by lapse of time, but has so long remained unexecuted that execution cannot now be issued upon it without first reviving the judgment. State laws provide conditions for revival or renewal of dormant judgments.

Federal Judgment

A federal judgment is a judgment rendered in a federal court.

Foreign Judgment

A foreign judgment is a judgment rendered by the courts of a state or country politically and judicially distinct from the jurisdiction where the judgment or its effect is brought in question.

Interlocutory Judgment

An interlocutory judgment reserves or leaves an issue, question, or direction for future determination. Interlocutory judgments are entered in the progress of a cause of action and do not determine or complete the suit.

Money Judgment

A money judgment provides for the awarding of money and sets forth the amount of money owed by the debtor to the creditor, as distinguished from a judgment directing an act to be done or property to be restored or transferred.

Personal Judgment

A personal judgment imposes on the defendant a personal liability to pay the judgment, and which may therefore be satisfied out of any of the defendant's property within the reach of process, as distinguished from a judgment that may be satisfied only out of a particular fund or the proceeds of particular property.


Judgment Liens

The effect of a judgment is that a lien immediately attaches against the debtor's real property upon the entry of the judgment and automatically binds all the real estate located in the county where the judgment is entered. A lien may be defined as a hold or claim that one person has upon the property of another as security for some debt or charge. It is the right which the creditor has under state law to have the debt satisfied out of the debtor's property. If the creditor merely has a claim, not reduced to judgment, the debtor can sell or mortgage the property, free and clear of the unsecured claim. If the creditor has reduced the creditor's claim to a judgment, a lien is thereby created against the real estate in some states, but in other states further action must be taken by the creditor to perfect the lien. A purchaser would then take the property subject to the lien.

A judgment lien is security for the judgment debt. Usually, the lien covers only the personal and real property of the debtor located within the county where the judgment is rendered. A judgment, other than a judgment in rem, binds every freehold interest of the debtor in the county. Notices of the lien must be filed in all counties when the creditor wishes to extend the lien coverage.

A judgment lien is not a title, interest, or estate in land, but is merely a security for the judgment debt against subsequent purchasers and encumbrancers.

A judgment lien is purely a creature of statute. In the absence of a statutory provision, a judgment does not become a lien on the debtor's land.

Most state statutes provide for compliance with certain requirements in order for a judgment to become a lien upon all nonexempt property of the judgment debtor for a specified period of years. In this regard, state law must be fully scrutinized.


Time In Which A Judgment Lien Attaches

The precise time at which a judgment lien attaches to property or becomes operative depends upon the kind of action and the jurisdiction in which the judgment is entered. Generally, a judgment may attach from the:

  • Date of the filing of the action or suit upon the issuance of a writ of attachment.
  • Date of the filing of the lis pendens.
  • Date of the judgment.
  • Date of the actual rendition of the judgment.
  • First day of the term in which the judgment is rendered.
  • Last day of the term in which the judgment is rendered.
  • Date of the docketing, filing, recording, registering, or indexing of the judgment in the proper record or entry book.
  • Date otherwise provided by state law.


Interests In Land Subject To Judgment Liens

A judgment becomes a general lien on real property owned by the judgment debtor before and after its perfection.

As a general rule, a judgment lien attaches to all the real property of the debtor in the county in which the judgment is rendered but does not extend to real property situated in other counties of the state unless a transcript of the judgment is filed in accordance with state law in the properly designated public office of other counties. This rule also applies to judgments entered in other states.

Judgments do not create liens on real property previously conveyed in good faith by deed and recorded before the perfection of the judgment lien, although they may so operate upon lands previously conveyed in fraud of creditors.

In general, but subject to any statutory exception or exemption, when real property is owned by several persons, the undivided interest of each is subject to the lien of a judgment.

The effect of a judgment against any party in any of the following forms or situations of ownership must be considered under the pertinent or appropriate state or case law:

  • Tenancy by the entirety.

    A judgment lien against only one spouse will not attach to the title if both spouses acquired the land as tenants by entireties in accordance with state law and if their marital status has not changed and if the land is located in Delaware, District of Columbia, Florida, Indiana, Maryland, Michigan, Missouri, North Carolina, Pennsylvania, Rhode Island, Vermont, Virginia, or Wyoming. In all other states, the judgment lien against the spouse must be released or excepted if the spouses are selling or mortgaging the land.
  • Community property.

  • Legal and equitable title in separate persons.

  • Contract vendor.

  • Contract vendee.

  • Reversionary interest.

  • Remainder interest


Priority Of A Judgment Lien

In general, judgment liens take priority over subsequent liens, claims, encumbrances, and are subordinate to previous liens, claims, encumbrances, and conveyances found of record.

In any jurisdiction, the priority of a judgment lien over any subsequent matter of record is dependent upon the following factors:

  • The precise time in which the judgment lien attaches.
  • The nonexistence of any applicable federal, constitutional, statutory, or case law.


Duration Of The Lien Period

The duration of a judgment lien varies from state to state. Statutes in nearly every state prescribe the period of time during which a general judgment that has become a lien shall remain a lien. The periods prescribed vary from two to twenty years, with a large number providing for ten years. If there is no specific statutory period, the expiration of the period during which an execution may be issued will cause the judgment to cease to have any effect upon the land.

The conditions under which a judgment can be extended, renewed, or revived--in those states where allowed--are statutorily prescribed and strict compliance with the statutes is required.

Ordinarily, when the extension, renewal, or revival occurs before the expiration of the judgment lien, the judgment lien continues in existence and its validity and priority is preserved. However, when the judgment lien expires prior to the extension, renewal, or revival, jurisdictions are divided as to the effect of the extended, renewal, or revival lien upon liens and encumbrances of record.

In addition to the statutory time termination, a judgment lien may also be terminated through any of the following:

  • The payment or satisfaction of the judgment.
  • The partial release of the property from the lien of the judgment by the judgment creditor.
  • The proper foreclosure of a prior lien.
  • An execution sale and return for the full amount of the judgment.
  • A final order vacating the judgment.
  • The reversal of the judgment in appeal proceedings.
  • By operation of law.

Note: Under the Bankruptcy Code, a judgment lien on real property at the time of the bankruptcy is not affected by the discharge of the debtor (unless otherwise specifically disposed of by an order of the court.)


Enforcement Of A Judgment Lien

Although a judgment is the final determination of the rights of the parties in a judicial action, after its rendition there remains the problem of its enforcement.

Usually, the enforcement of a judgment will produce any of the following results:

  • Payment of a certain sum of money by one party to another.
  • Specific conduct or performance by one party to another.
  • Making a record of the court's determination of the ownership property.

The enforcement of a money judgment is accomplished by the foreclosure of the lien and subsequent execution upon property of the debtor. Its form is wholly statutory.

The enforcement process, subject to specific statutory variations, may be summarized as follows:

  • Rendering of a final nonappealable judgment.
  • Judgment with a direction that execution issue.
  • Request for issuance of execution.
  • Issuance of the execution.
  • Delivery of execution to the sheriff.
  • Delivery of a copy of the order of execution by the sheriff to the judgment debtor and demand of payment.
  • Levy on the debtor's real estate made by the sheriff. Generally, this is accomplished by the sheriff endorsing the description of the real property on the execution.
  • Filing of a notice of levy with the register of deeds or recorder of deeds of the city or county in which the real estate is situated.
  • Sheriff's execution is returned and filed in court.
  • Publication of notice of sheriff's sale: time, place, and manner of sale.
  • Consummation of sale--report to court--court's approval--redemption period (if any).
  • Execution of sheriff's deed.

Note: Insuring a purchaser at the execution sale of a judgment foreclosure is an extrahazardous risk due to the vulnerability of such sales to judicial attack. Specific written approval from the Company is necessary prior to the issuance of any title commitment in favor of such a purchaser.


Federal Judgments

Title 28 U.S.C.A. section 1961 provides as follows:

"Every judgment rendered by a district court within a State shall be a lien on the property located in such State in the same manner, to the same extent and under the same conditions as a judgment of a court of general jurisdiction in such State, and shall cease to be a lien in the same manner and time. Whenever the law of any State requires a judgment of a State court to be registered, recorded, docketed, or indexed, or any other act to be done, in a particular manner, or in a certain office or county or parish before such lien attaches, such requirements shall apply only if the law of such State authorizes the judgment of a court of the United States to be registered, recorded, docketed, indexed or otherwise conformed to rules and requirements relating to judgments of the courts of the State."


Homesteads And Judgment Liens

Generally, constitutional provisions and statutes on homesteads provide that a judgment is unenforceable against the homestead property of the judgment debtor.

Company policy is not to ignore judgment liens against the homestead property of the debtor.


Purchase Money Mortgages And Judgment Liens

Purchase money mortgages generally take priority over any other prior or subsequent judgment or lien attaching to the property through the mortgagor.

In this regard, state law must be fully scrutinized.


Contents Of A Judgment Exception

Any judgment exception must include the following:

  • Type of judgment.
  • Title of the court.
  • Number of the action.
  • Name of the judgment creditor.
  • Name of the judgment debtor.
  • Amount of the judgment.
  • Date on which the judgment was entered.
  • The judgment books, minutes, or docket, in which the judgment was entered in the court records.
  • Recording data pertaining to the real estate records.