Using a Writ of Possession in Debt Collection
It's always good business practice for creditors to obtain security for their commercial agreements, namely, interests in tangible property that can be used to compensate for losses in the event of a default. This form of collateral could be a house, a car, furniture or a piece of construction equipment. In some cases, the collateral is the very item being sold or leased in the underlying commercial agreement. When a secured agreement goes sour and the buyer or lender stops making payments, the creditor can fall back on its collateral to try and make itself whole.
When this plays itself out in a civil court case, plaintiffs have access to powerful pre-judgment relief in the form of a writ of possession. Here you'll find more information about using a writ of possession in debt collection.
What is a Writ of Possession?
Unlike a writ of attachment, which is typically used for unsecured agreements, a writ of possession is used when the plaintiff has a security interest in property held by the defendant. In essence, the writ acts as a court order authorizing a local sheriff to obtain possession of the collateral on the plaintiff's behalf. If the underlying security agreement authorizes the plaintiff to take possession and sell the collateral, it may do so to mitigate any damages.
It's important to note that when the collateral is a house or other residence, there are generally greater restrictions on what plaintiffs can do with the collateral before a judgment is entered. These cases proceed under state laws governing judicial foreclosures.
Whenever a plaintiff applies for a writ of possession, it's also good practice to simultaneously obtain a court order specifically directing the defendant to turn over the property in question. These turn over orders can be an effective tool in getting a defendant to surrender possession of any collateral. After all, failure to comply with such orders could result in contempt proceedings against the defendant.
Writ of Possession: Common Elements
Obtaining a pre-judgment writ of possession typically requires showing:
- That the plaintiff is entitled to possession of the property (i.e. the plaintiff has a valid security interest);
- That the property is wrongfully detained by the defendant (i.e. the defendant is violating the security agreement);
- A specific description of the property and an estimate of its value; and
- A probable belief in the location of the property.
When it comes to the validity of a plaintiff's security interest, it's important for creditors to ensure that their interests are properly perfected. That may require the filing of a UCC Filing Statement or the recording of a Deed of Trust/Security Agreement after the original agreement with the defendant is signed.
The Writ of Possession Process
In order to obtain a writ of possession, or any other judicial relief, you first need to file a civil lawsuit against the person or business that owes you money. Once your complaint has been filed and served, you can apply for a writ of possession from the court, which you may initiate at any time before judgment.
Usually a plaintiff will apply for a writ of possession immediately due to the concern that a defendant may hide, transfer or damage the collateral. However, in some cases, plaintiffs may want to wait to file a writ of possession application until they can learn more about its condition and location during the discovery process.
Next, a plaintiff will need to file application and notice documents (typically these are on court-created forms). In addition, it will have to submit declarations and evidence establishing all of the elements required to obtain a writ of possession. The court will then set a hearing date to review the evidence and any opposing evidence submitted by the defendant before deciding whether to issue the writ of possession.
Get Legal Help With a Writ of Possession
Collecting on debts can be a thorny process, especially when the specter of a debtor's bankruptcy is on the horizon. However, the court system offers remedies to help you protect your interests while pressuring debtors to pay up. Find out more about using a writ of possession in debt collection, as well as other mechanisms to recover your losses, by speaking with collections attorney in your area today.
You Don’t Have To Solve This on Your Own – Get a Lawyer’s Help
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.