Bob Markoff quoted by Illinois Bar Journal

New citation procedures make enforcing debt-collection judgments easier

Illinois Bar Journal,October 2013 • Volume 101 • Number 10 • Page 498, Available Online
By Adam W. Lasker

A new law reduces the role of sheriffs in collection proceedings and increases the power of courts and practitioners to enforce judgments.

The Illinois General Assembly has enacted a law drafted by an ISBA section council member that is designed to streamline the process for enforcing judgments and to allow greater court supervision over debt-collection procedures.

Governor Quinn signed Public Act 98-0557 on August 27, and effective Jan. 1, 2014, Illinois law will be changed in four substantive ways: to allow the recording of foreign judgments as liens on in-state property, to allow service of “bank garnishments” by certified mail rather than by sheriff or process server, to allow collection procedures to continue in “dormant” cases, and to clarify that courts are authorized to enter any order in citation proceedings that would also be permitted to be entered in non-wage garnishment proceedings.

“This law is seemingly innocuous,” said Chicago-based collections attorney Robert G. Markoff, the Commercial Banking, Collections and Bankruptcy Section Council member who drafted the underlying bill, “but at the same time, it represents a major turning point in Illinois law and practice regarding the enforcement of judgments.”

Fewer sheriffs’ levies

Markoff said the new law recognizes the benefits that come to plaintiffs, defendants, and courthouse personnel in expanding the use of citations to discover assets in debt-collection matters for procedures that historically were burdensome, costly, and redundant for the parties, and that lacked an adequate level of judicial oversight.

Historically, when a judgment debtor failed to pay his debts, the plaintiff creditor was prohibited from obtaining garnishment orders in citation proceedings and had to obtain a levy from the county sheriff in order to discover whether the debtor owned any real or personal property of value.

“These days, most sheriffs don’t even know how to do levies,” said Markoff, who’s been working in the debt-collection industry for almost 40 years. “Even in the collar counties, you do a real estate levy and you’re going back to the Middle Ages. The sheriff sends out his commissioners – who get paid $5 a day – to track down the debtor’s assets. We’re talking about stuff from Robin Hood’s day.”

The new law will eliminate the need to use levies that are handled by a sheriff. Instead, it will transfer those procedures into the courtroom with the use of citations to discover assets. Such citations are already commonplace in many areas of law, Markoff said, but an appellate court has ruled that courts lack authority to enter garnishment orders in citation hearings, forcing the need for the sheriff’s levies when trying to enforce judgments and collect those debts.

“The point here is there is a rogue appellate court decision out of the first district that said a court had no authority to enter garnishment orders in citation hearings,” Markoff said. “The bigger agenda here is that now, by the use of a citation to discover assets, you can reach [a debtor’s] bank accounts and other assets. The even bigger agenda is that we have moved enforcement law out of the office of the sheriff and into the supervision of the courtroom. No longer are we going out and having the sheriff levy on personal property and real estate – yes, we do that sometimes, but now that entire process can be done by citations to discover assets.”

Other changes

Markoff said the new law also fills “holes, shall we say, in Illinois law” regarding the recording and enforcement of foreign judgments.

He said current Illinois statutes refer to the recording of judgment orders that are entered by courts from other jurisdictions, but many years ago the state adopted the Uniform Enforcement of Foreign Judgments Act and eliminated certain sections of law that are still referred to in today’s statutes.

“We no longer enter judgments on foreign judgments,” Markoff said. “We just ‘register’ the judgments and enforce them, which left no way to record a foreign judgment as a lien on real estate. This [new] law corrects those holes…and the references to the repealed sections of law have been removed from the statutes.”

The new law will also eliminate the need for non-wage garnishments – otherwise known as “bank garnishments” – to be served by a process server or sheriff. Now, creditors will be able to serve those garnishments by less-expensive certified mail.

“We already [are allowed to] serve wage deductions by certified mail, so this does not really create any major change in the Illinois service of process rules by allowing certified mail service for non-wage garnishments,” Markoff said. “The big thing here is it saves court costs and filing fees for the debtor’s attorney, and it saves roughly $60 for the creditor in service fees, so it’s a win-win – it really benefits both parties.”

The final “technical but very important” change in the law involves wage garnishments and the revival of judgments in cases that require collection procedures. Markoff said this amendment will “tweak” the Illinois Code of Civil Procedure to allow that if a judgment becomes dormant, which happens every seven years, a creditor may move forward with the collection process without having to go through the time and expense of a revival action.

Markoff said the original intent of revival hearings was to allow the debtor to challenge the existence of, or the amount of, the alleged debt and to show cause why there should be no garnishment or other collections. But under current law, the debtor may raise such challenges at any time – whether or not a revival action has been filed – rendering the revival actions somewhat superfluous.

“In essence, the revival is redundant and unnecessary and a waste of everyone’s time, and the debtor’s money, so this is another win-win situation,” Markoff said. “My personal agenda [in drafting this law] was not to put my thumb on the scale for creditors, but to improve the administration of justice and the process of enforcement law for all the parties and the court.”

‘[G]ood enough for Lincoln’

As a side note in support of the new law, Markoff said he believes even Abraham Lincoln, himself, would have been pleased with these legislative amendments. He said that prior to becoming president, Lincoln was both a judgment debtor (with three known money judgments against him) and he was a debt collector.

“When he became an attorney, about 60 percent of his known court cases were debt-collection matters,” Markoff said.

Markoff also said that Lincoln once wrote in an article: “I don’t mind the collection practice, but I hate chasing sheriffs all over the counties to enforce the judgments.”

So, Markoff believes it is a good idea to allow courts, rather than sheriffs, to handle these debt-collection matters because “if it was good enough for Abraham Lincoln, it’s good enough for me.”

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