What Does It Mean If Someone Is Judgment Proof?
People are considered “judgment proof” if they:
- Do not have the money to pay a court judgment
- Own only property that the law protects from being seized.
Civil courts are set up to decide disagreements between people or companies.
Contractual disputes can be decided in civil court.
Contractual disputes are one type of disagreement that is often filed in civil court.
- When two people (or companies) have a legally enforceable agreement, it is known as a contract.
If one side does not fulfill its obligations under the contract, the other side can sue in court and ask for a judgment. A judgment is the court’s decision about the disagreement.
- The court may issue an order for the defendant to fulfill its obligations to the plaintiff. This may include monetary damages (i.e., money) that the defendant owes the plaintiff under the contract.
For example, if a person paid for a coffee table and the furniture store did not deliver the table, the buyer may file a civil lawsuit against the furniture debtor.
- The debtor is a person or company that owes money to another person or company.
- The creditor is a person or company that is owed money.
Torts can also be addressed in civil court.
“Tort” is a word from Latin, meaning an injustice. A tort is a legal offense that one person (or company) commits against another.
- A tort is also described as a “breach” of a “duty” owed to another person.
If a person’s body or property was injured by someone else’s tort, the injured victim might sue the person who caused the injury.
One of the most common torts is negligence. Negligence is a legal term for carelessness. In general, people have a duty of care (a legal requirement to be careful) if their behavior will impact other people.
When a person or company does not take enough care, and someone else is injured as a result, the careless person or company may be guilty of negligence.
- For example, if a truck driver is operating an 18-wheeler above the speed limit and causes an accident, the driver may have committed a tort. The driver may be responsible for bodily harm and property damage caused by the truck accident.
Under Texas state law, the negligent person or company must pay for injuries and property damage caused by that negligence.
Plaintiffs’ Lawsuits Against Judgment Proof Defendants
Most lawsuits have at least one person suing, and one person being sued.
- The person or company filing a lawsuit is known as the plaintiff.
- The person or company that is being sued is known as the defendant.
- The plaintiff and the defendant are known as the parties to the lawsuit.
Enforcing a judgment against a defendant who does not pay
- If a defendant does not pay a judgment, the plaintiff can try to enforce the judgment by filing another lawsuit. For example, if the defendant owns several cars, the plaintiff can sue to have the car transferred to the plaintiff.
- In some cases, the car is sold at an auction, and the plaintiff receives the money from the auction.
- The plaintiff can also hire a collection agency.
- The agency will take steps (like lawsuits) to collect the money from the defendant. For its services, the collection agency will keep a percentage of the money that is recovered.
- The plaintiff receives the rest of the recovered money.
But some defendants do not have the financial resources to make a payment, even if a Texas court orders them to pay.
- Some people have a lot of debt, or are unemployed.
- Some people may not own very much property.
- A person’s money and property are called the person’s assets.
In addition, there are laws that limit which of the defendant’s property can be seized by the plaintiff, even if there is a judgment.
If a person cannot pay a judgment, and owns property that cannot be seized under the law, that person is generally called “judgment proof.”
What Makes A Defendant Judgment Proof?
A judgment proof defendant is someone who owns nothing of substantive value and either earns no income or receives income from an “exempted” source.1
In general, people most meet the following conditions to be considered judgment proof:
- All of their debt must be unsecured
- Their income cannot be garnished
- Their property is “exempted”
- Their financial situation is unlikely to change in the near future.
NOTE: An individual who is judgment proof can still be sued or have a court order placed against them.
- The question is how much money the plaintiff can recover from the lawsuit.
What Can A Plaintiff Do To Recover Money From A Defendant After a Judgment?
In Texas, “Self-Help” Is Not Permitted To Enforce a Court Judgment Against a Debtor
A creditor may take action to seize a debtor’s assets only after a court has authorized their request.
A plaintiff who receives a favorable judgment is not entitled to seize the defendant’s property without the court’s order.
- For example, a creditor cannot simply take a debtor’s car, even if there is a money judgment.
However, Texas Courts Can Order a Defendant To Use The Defendant’s Property To Pay a Judgment to a Plaintiff
Texas allows creditors to seek a court judgment against the debtor. This means the court will order debtors to use certain property to pay the money they owe.
This includes creditors like plaintiffs, who are owed money by a defendant-debtor under a court judgment.
- Only certain assets (property owned by the defendant) can be reached by the creditor.
After a court has issued a judgment against a defendant, Texas plaintiffs may seek to recover the money they are owed with several types of court rulings:
- Money Judgment
A money judgment allows a creditor to take funds from the defendant’s bank account.2 This is also known as a levy.
- Judgment Lien
A judgment lien3 allows a creditor to get ownership of:
- A defendant’s real property.
- Money received from the defendant’s sale of the property, or take what money they are owed from the defendant’s sale of such property.
- Order of Repossession
An order of repossession permits a creditor to seize (take possession of) an asset in which they hold a secured interest.
- Note that secured assets (like mortgages and auto loans) cannot be judgment proof. Under Texas law, secured assets can be seized by the plaintiff under an order of repossession.
A debtor’s exempted income and assets cannot be seized, even with a court order.
Even if a creditor wins a lawsuit and is granted a money judgment or judgment lien, the creditor is not entitled to seize any exempted sources of income or exempted assets.
So if a court authorizes a judgment against a judgment proof defendant, a creditor will not be able to collect certain assets that are legally protected.
What Property Can Be Recovered From A Defendant Under Texas Law?
Money Judgments and Exempted Income
Garnishing wages after a court judgment under Texas Law
Oftentimes, a creditor who has been granted a money judgment may seek to garnish a defendant’s income.
A garnishment is a court order that a debtor uses part of their income to pay the debt.
When somebody’s income is garnished, a creditor can take money directly from each paycheck until the judgment is paid in full.
Exemptions on Garnishment For An Unpaid Debt or Judgment Under Texas Law
Not all income can be garnished. In fact, the Texas Constitution explicitly prohibits wage garnishment except for several different kinds of debt, such as past-due child support or student loan payments.4
Freezing someone’s bank account under Texas law
Creditors cannot seek wage garnishment to fulfill most private or “ordinary” debts.
However, in some cases, Texas law permits creditors to have a debtor’s bank account frozen. freeze bank accounts.
Writ of Garnishment: Court order to freeze a bank account
Creditors can only freeze a bank account after they have won a lawsuit and obtained a court order.
This court order is called—somewhat confusingly—a “writ of garnishment.”5
After a writ of garnishment has been authorized, the creditor can then seize funds from a bank account, although they may not take any incoming wages.
- Since creditors can still obtain a writ of garnishment to freeze a bank account and collect any past-due debts, there is a risk they may garnish funds which were disbursed from an exempted source of income.
- If a creditor is permitted to levy a defendant’s bank account, and they seize any exempted income, then they will have to return any funds collected from an exempted source of income.
Government Benefits and Judgment Proof Defendants
Typically, any government-related benefits are exempt from money judgments.
Examples of exempted income under Texas state law include:
- Social Security benefits
- Veteran’s benefits
- Unemployment insurance payments
- Child support income
- Federal retirement benefits If a creditor is permitted to levy a defendant’s bank account, and they seize any exempted income, then they will have to return any funds collected from an exempted source of income.
Assets Protected from Judgment Liens Under Texas Law: Life and Well-Being
Alongside income, Texas does not allow creditors to seize assets which are necessary to sustain one’s life and well-being.
Under Texas law,7 a judgment proof defendant may shield the following assets from collection:
- Household items, with a maximum value of $30,000 for a single person or $60,000 for a family
- One vehicle for each licensed driver in the home
- A homestead on which to live. This may include either:
- An urban homestead, including up to 10 acres of urban property for a single person or family.
- A rural homestead, including up to 100 acres of rural property for a single person or up to 200 acres of rural property for a family.
- Other exempt property:
- Two firearms
- Tools of a defendant’s trade
- Two horses
- Sporting equipment
- Agricultural items
- Some livestock
Texas residents who seek to be considered judgment proof should be aware that a homestead can still be seized or foreclosed upon if they are behind on their mortgage or have not paid property taxes.
How Texas Residents Can Show They Are Judgment Proof
Texas residents may wish to attest to their judgment proof status before or after a creditor has filed a lawsuit against them.
However, attorneys often advise their clients to notify any potential creditors that they are judgment proof before the creditor initiates legal action.
- If an indebted person does not send notice of their status before they are sued, then they may still have to expend additional resources going to court.
Judgment Proof Declaration
People who believe they are judgment proof should send prospective creditors a letter notifying them of their status.
This letter should explain:
- That they are judgment proof.
- Why they are judgment proof.
- That their financial situation is not likely to improve any time in the near future.
Texas residents should know that, if and when their financial circumstances do change, creditors can act on whichever judgment orders they have been granted.
Recovering Damages from a Judgment Proof Defendant
Under Texas law, if a person is truly judgment proof, then creditors may not have many options to pursue recompense for a past-due debt or damages.
In some cases, the creditor is simply out of luck.
But in other situations, the plaintiff may be able to hold another person or company responsible for the debt or injury. The legal word for responsible is liable.
Vicarious Liability and the Judgment Proof Defendant
When a person or company is legally responsible for the actions of another, the person or company is said to be vicariously liable.
- “Vicarious” means “acting for another.”
- Under certain circumstances, the company or person who is also legally responsible is “vicariously liable” for paying the debt of the judgment proof defendant.
Respondeat Superior: Employer Liability For Employees’ Activities and Accidents
Many Federal and Texas state laws make an employer legally responsible for injuries caused by their employees on the job.
In legal terms, employer responsibility for an employee’s actions is known as respondeat superior. Respondeat superior is a fancy legal word for employer responsibility.
If an employee was careless while doing their work, respondeat superior may make the employer have to pay for damage caused by the employee’s carelessness.
Making employers legally responsible for their employee’s unsafe behavior encourages employers to run their business safely. It also gives them a reason to screen potential hires, and remove careless employees.
In order to file a respondeat superior claim, a plaintiff must show that at the time of the injury, the person who caused the injury:
- Met the Texas definition of what constitutes an “employee”.8
- Was acting within the scope of his or her employment.
- Were under the authority of their employer and were acting in or for the employer’s benefit.
Employers are not necessarily responsible for all of an employee’s actions, even those done during work hours.
If an employee was acting outside the scope of their job, the employer may not be liable.
- If a driver causes an auto accident while delivering food in a restaurant’s delivery van, the restaurant may be responsible.
- But if the delivery driver took the van and drove around running their own personal errands, the restaurant might be responsible. The rules are complex, and vicarious liability is often a complicated area of law.
Employer liability (respondeat superior) claims can be very complex and are subject to many legal technicalities.9
Anyone seeking to file a lawsuit against a judgment proof worker’s employer should consult an experienced personal injury attorney.
Getting More Help When More Help Is Needed
Even when a person clearly did something wrong to injure you, getting money from a Judgment Proof defendant can be extremely difficult.
Understanding which assets and money can be seized requires knowing Texas state laws of civil practice and property, as well as familiarity with the courts and legal processes of recovering money.
Even if a person’s employer should be held responsible under the law, collecting money from the employer usually requires a lawsuit.
The injured person must show the court not only how the employee injured them, but that the employee was on the job, acting on the authority of the employer.
Recovering compensation for your injuries can take some time, and usually requires spending money on court filing fees, preparing evidence, researching and writing court documents and other costs needed to prove the case.
Talking To An Austin Personal Injury Attorney At Justinian & Associates Costs Nothing
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Statutes of limitation are laws that limit how much time you have to file a lawsuit after being injured. Texas statutes of limitation may apply to your property damage insurance claim if it has been denied. Don’t let your rights expire.
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We understand that the well-being and livelihood of you and your loved ones may be at stake.
Call, text or email us for a free consultation, with no obligation. Speak to an Austin personal injury attorney from Justinian & Associates (not a “screener” or paralegal) to understand your rights.
 Collecting The Debt, Texas State Law Library (2021).
 Texas Civil Practice and Remedies Code, Chapter 63, Garnishment.
 Texas Property Code, Chapter 52, Judgment Lien.
 Texas Constitution, Article 16, Section 28, Garnishment.
 Texas Civil Practice and Remedies Code, Chapter 63, Garnishment.
 Guide to Garnishments in Texas, Texas Young Lawyers Association and the State Bar of Texas (2021).
 Texas Property Code, Section 42.002 (Personal Property).
 Painter v. Amerimex Drilling I, Ltd., 561 S.W.3d 125, 128-29, 139 (Tex. 2018).
 Frolicking Away: Texas Courts Shield Employers From Respondeat Superior Claims, Garreth A. DeVoe, State Bar of Texas (2019).