A:  I learned many years ago, as a younger lawyer, that persistence pays off when pursuing a debtor.  I had a particular case in which we obtained judgment against a debtor who operated a small business, and his major asset and necessary piece of equipment was his truck.  After we obtained judgment, the debtor was not cooperating, even though he was making numerous promises that the matter would be resolved.  I then sent out the sheriff with an execution and bond and we seized the debtor's truck.  The debtor still did not follow through and I arranged a sheriff's sale.  The debtor showed up at the sheriff's sale and purchased his own vehicle back, but his high bid was only about half the amount of the judgment.  At that point, the debtor thought he had prevailed and found a cheap way out of the judgment.

After making demand on the debtor for payment of the remaining balance, and him not following through, I arranged with the sheriff to go out and seize the vehicle again.  I held another sheriff's sale.  Again, the debtor showed up and made a bid less than the amount that was due and purchased the truck back.  In the meantime, all of the costs of the sheriff's sale, the seizure, the towing of the truck, were being added to the amount of the judgment.

At that point, the debtor was a little more careful and was not parking his truck in the usual place, where it had been parked in the past.  However, after contacting client I found out several service stations that the debtor used on a regular basis.  It so happened that the client had some contacts at both of the service stations and we were able to arrange for the stations to contact my office when the debtor was at the station.  I had also made arrangements with the sheriff for a third seizure.  As soon as I received the call, I phoned the sheriff and he was over at the station seizing the vehicle for the third time.  Shortly thereafter I received a call from the debtor and, finally, he came to my office with a cashier's check to pay the remaining balance due on the judgment and all of the costs and expenses.

Collections are not always easy.  However, with persistence and cooperation from the client providing whatever information they have, questionable accounts can turn into cash.  Years later when I ran into a debtor who appealed and challenged every court proceeding, took our case to the Wisconsin Court of Appeals twice, and once to the Wisconsin Supreme Court, I thought back about the truck case and the persistence necessary, and the ultimate result was the same, in the end the debtor paid. 

A: One of my top five craziest cases...

Debtor purchased a hairpiece using business credit card issued by my client.  A month later, debtor decides he doesn't like the hairpiece and tries to return it.  Merchant refuses because it's been used.  Debtor attempts to chargeback the charge to the card.  Client refuses because it was a face-to-face purchase and debtor purchased the item without right to return/exchange.  It was a custom piece after all.  Debtor refuses to pay client.  Card goes into default.  A year (and four collection agencies) later, the debtor sues the client plus all four agencies.  I am hired to defend, and we successfully obtain a dismissal.  Debtor appeals.  After a year, the case is fully briefed and ultimately, oral argument is ordered.  I show up on the date of argument, and the debtor is wheeled into the courtroom, complete with a cast on his leg and arm!  Shockingly, the dismissal is reversed.  We then litigate for another year.  Debtor shows up to his deposition with a disbarred attorney who refuses to leave the deposition.  We move for a  protective order, and the court denies it!  We forget about the deposition and instead file for summary judgment.  The court agrees and enters judgment in favor of all defendants but refuses to award our attorneys' fees.  We decide to just let it go.  Debtor files an appeal (again!) and the case gets to wind its way through appeals for another year.  This time, the court of appeal rejects his appeal.  The debtor swears, "I will not let this go."  He convinces the Los Angeles Times to publish a story.  Ultimately, he is ordered to pay the costs incurred (approximately $6000), which are only a fraction of the legal fees paid by my clients to defend against this nonsense (nearly $80,000 when it was all done).

PS - here's a link to the LA Times story:

 http://articles.latimes.com/2007/oct/27/local/me-parsons27

A: Pursuing a fallen star

Several years ago I was retained to pursue the collection of a Maryland judgment for $175,000. I should have known better than to take a case where I was the third Pennsylvania attorney to give this a try. There was a delay of about 6 years before the client and his Maryland attorney decided to pursue the collection of the judgment in Philadelphia where the debtor resides. When the case finally arrived at my door it was almost 12 years old. The debtor who was once a popular gospel singer now appeared to be a fallen gospel rock star. Undeterred we pursued nonetheless. We proceeded to garnish bank accounts only to find out from debtor's legal aid attorney that he was receiving social security disability. Not wanting to hog all the fun we enlisted the aid of a fellow collection attorney in NYC. We were able to garnish some royalties, but have only collected a small fraction of the balance.

To make things even more interesting the debtor was most popular with a European audience, and toured there in his heyday. Needless to say there were not any European lawyers eager to take on this case for a contingent fee.

The client is not ready to give up, but I can't say that I share his enthusiasm.  The lesson is collectability does not improve with age. Act timely to protect your interest.

Jay C. Scheinfield, Esquire

Upper Darby PA 

A: Lesson Learned

Don't get fooled.  There is an important lesson to be learned in the law and in business.  It's important to garnish new business but at what cost?  During my initial years of practice I was approached by a potential new client late afternoon with an emergency.  There was a case that was up for a hearing in a Law Division courtroom the next day.  The client needed immediate representation.  After discussing the matter I agreed to accept the case provided I was paid a retainer prior to beginning any work.  The potential client agreed, and came to my office with the agreed retainer check that same afternoon.  So far the story sounds great.   I immediately began working on the case.  The hearing was scheduled for 2:00 p.m. the next afternoon on a major issue potentially costing my new client money damages in excess of $100,000.00.  I prepared through the night.  The case lasted 5 days with multiple hearings, court reporters and expenses incurred.  At all times throughout the representation I had no idea what I was going to face after all of my hard work.  I won the case client was pleased to say the least.  What was my gift for all of my hard work and sleepless nights?  The check bounced.  Not only did I ultimately lose my fees, I was out of pocket $2,500.00 in expenses for court reporters and transcripts.  My lesson learned was a business lesson.  I will not take on an emergency case at last minute without funds cleared in hand. 

Michael S. Baim, Esq.

The CKB Firm

Chicago, Illinois