subject: When Your Judgment Debtor Dies [print this page] If people, or a person owes you judgment money, the death of a debtor(s) does not always kill your judgment. When you sue a corporation that then passed away, the judgment is more likely to actually be gone. If a corporation closes, it all depends on the situations which caused it to fold. This article is my opinion and is not, legal advice. I'm a judgment broker, and not a lawyer. If you ever want a strategy to use or legal advice, you should contact an attorney.
First, how many judgment debtors were listed as being liable to pay the judgment? If not all your judgment debtors have died, you can probably try to collect the judgment from the (still living) debtors. This article covers cases where you wish to attempt to recover some money from a dead judgment debtor's estate.
Can you collect anything from the debtor's estate after your debtor dies? Their death doesn't automatically stop their estate's obligation to pay the debtor's judgment debts. Everything depends on the details.
When did your judgment debtor pass away? If they died before the judgment specified them as the judgment debtor, the judgment is defective. When the final judgment was issued before the date of the judgment debtor's death, you have a chance of collecting something.
Presuming your debtor died recently, the first step is to contact the personal representative or executor of the judgment debtor's estate. You will have to make a timely and valid claim on the estate of the judgment debtor.
Basically, the estate of your debtor, including their personal property, real estate, or trusts, are often liable for repaying the dead debtor's debts before there are a distribution to the debtor's heirs.
To get any real chance at collecting some money from your debtor's estate, you must act quickly, and the debtor needs to have had some assets. If the debtor was broke before they died, they won't be getting any richer after they pass away. When your debtor and their relatives were poor, there is no point filing a claim. When your dead debtor's immediate family are wealthy, send them a claim with a sympathetic and polite letter, with a copy of the judgment. Who knows, they may pay you off.
The first reason to move quickly, is that the first creditors to submit a claim are more likely to be paid. Late judgment owners may get scraps, or nothing. Another reason to act hastily is that every state has their own statute of limitations on making a claim on the estate of judgment debtors.
What if you are not near enough to your judgment debtor, to know if they died recently? Some methods to monitor their possible demise, is to scan the obituaries for the city or county where they live. Maybe a web version of a newspaper may list obituaries. There are lots of web sites to find this kind of information including Ancestry.com and Searchbug.com. The more you know about the debtor, the more useful such sites will be. When your debtor is old or sick, perhaps verify their status every few months. Occasionally, a clever judgment debtor fakes their demise on public records to thwart judgment owners.
Generally, judgments will continue to earn interest, even after the demise of the debtor. However, usually there isn't sufficient assets in the judgment debtor's estate to fully repay all creditors. Be willing to settle, especially when that is the situation. Judgment recovery is often tough, and getting something for your judgment is always a big win.
