Confidential
Settlement – $100,000Judge
Court
USDC Central
Attorneys
Plaintiff
Defendant
Facts
At one time, the defendant a prominent real estate developer, had assets valued at over $12 and maintained numerous residences in a variety of states, including California. On Aug. 22, 1989, the defendant executed a promissory note in the principal sum of $100,000, in consideration of a bank loan. The defendant failed to repay those sums owed. Sudbsequently the lending institution was closed and the Resolution Trust Corporation ("RTC") was appointed receiver. A lawsuit was commenced by the RTC in the state where the defendant resided. During the lawsuit, the RTC sold the obligation to a New York limited partnership which obtained judgment against the defendant in the sum of $145,737.55. In December 1995, the judgment was registered in California as it was determined that defendant had moved to this state and was living in an exclusive, gated golf-course community in Southern California. The plaintiff then attempted to serve the defendant with a debtor examination and his wife with a third party debtor examination. The process server was not able to serve the defendants he drove away when he saw that his wife had been served with process. In April of 1996, the plaintiff conducted a third party examination of defendant's wife who testified that she had been married to the defendant since 1959; that she did not know how much their rent was; that she did not know if her husband had any bank accounts; that she did not know where their money came from; and, that she drove a 1989 Mercedes and her husband drove a 1993 Toyota Landcruiser, but that she did not know who owned them. The plaintiff later discovered that immediately after the third party examination, the title to the vehicles was transferred from defendant's wife name, to the name of the defendant's bookkeeper. In August 1997, the New York limited partnership assigned the judgment an all corresponding liens to another out-of-state limited partnership which maintained plaintiff's counsel on this file for pusposes of collection. Thereafter, plaintiff vigorously pursued post-judgment strategies which included the following: applying to the court, ex parte, for a motion to levy on bank accounts held in various third persons' names, including defendant's bookkeeper, a foreign corporation and a various trusts. Said motion was granted. Applying ex parte, for a temporary protective order with regard to the third party bank accounts (granted and bond posted). Conducting a seven-hour, third party debtor examination of defendant's bookkeeper. Preparing and serving document productions/subpoenas on financial institutions, defendant's landlord, the foreign corporation defendant was President of defendant's bookkeeper and defendant himself who responded to 116 requests. Bringing a motion for an assignment order of defendant's interest in an account receivable that at one time was valued at 2.1 million (granted). Bringing a motion for an order directing the levying officer to seize property (including the two vehicles) in a private place. The settlement of this matter was a consummated immediately following the issuance of the order granting plaintiff the right to seize the defendant's non exempt personal property and vehicles located at his residence, and almost three years to the day the judgment was registered in California. The defendant contended that although he lived in a gated community, drove an old model European Sedan and had reported net worth of over $12 million in prior years, that he was now impoverished, without any source of income and without means to satisfy the judgment.
Settlement Discussions
The plaintiff sought $30,000 after a few weeks (which offer lapsed). The defendant made an offer for $30,000 while plaintiff had been seeking $150,000. After the court issued an order authorized plaintiff to have Marshall's enter plaintiff's residence to levy on non-exempt personal proeprty (including his automobiles), the defendant children volunteer a settlement was reached.
Other Information
The settlement was reached approximately four years after the judgment was entered. The case was filed originally in Midwest. Post-judgment efforts in California took three years, plaintiff's efforts to discovery defendant was without any assets.
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