When a plaintiff wins a lawsuit against a defendant, the plaintiff is entitled to collect a judgment. It is the first step in obtaining repayment. Instead of investigating the defendant’s finances to freeze a bank account, the plaintiff may request a debtor examination.
What Is a Debtor Examination?
A debtor examination is a court hearing to investigate the defendant’s finances. The goal of the hearing is for the plaintiff to figure out if it can collect the judgment if the defendant doesn’t pay. Another goal is to put pressure on the defendant to pay the judgment.
What Happens at a Debtor Examination?
Under oath, the defendant is required to answer questions about the ability to pay and overall finances. The plaintiff asks questions regarding:
- Type of assets such as bank accounts or property
- Type of debts currently owed and to who
The entire hearing lasts up to 30 minutes. It may take place in a courtroom, attorney’s office or conference room.
Can I Skip the Debtor Examination?
No. A defendant is required to appear. A debtor can be sentenced to jail to for failure to appear for the debtor’s examination. This is called civil contempt. It is also civil contempt to appear, but refuse to answer questions.
Do I Have to Tell the Truth About My Finances?
Yes. Lying or giving misleading information is considered perjury.
Is There a Way to Avoid Attending a Debtor Examination?
Yes. If served with a request to attend a debtor examination, a defendant can:
- Make a complete payment
- Make arrangements with the creditor to make payments
Do I Need a Lawyer’s Help for a Debtor Examination?
It’s in your best interest to hire a bankruptcy lawyer for a debtor examination. The lawyer will explain your legal rights and your best option to resolve the debt.