John Halpern Chaired All-Day Seminar on Collection Litigation

On September 30 John Halpern chaired a program featuring 13 faculty members providing insight into litigation against debtors in behalf of business creditors that are unsecured, secured, or victims of fraud.  The all-day seminar at the Continuing Legal Education Center in Minneapolis was sponsored by the Minnesota State Bar Association.

John spoke on the following topics: (A) Collections and Litigation Strategies and (B) Post-Judgment Pressure on Debtors.  His two comprehensive appendices were entitled Initial Collection Correspondence and Pleadings and Standard Post-Judgment Discover Pleadings and Legal Process Forms.  These documents were disseminated to seminar attendees, and John answered questions regarding effective litigation strategies and collection pleadings that attorneys use to sequester, garnish, and levy upon debtors’ assets.

The Legacy

This marks the 83rd year of Halpern litigation and collection services in Minnesota.  When Maurice L. Halpern graduated from the University of Minnesota Law School and started his legal practice in 1932, the depth of the Great Depression, he began acquiring extensive experience in the field of creditors' rights. Counseling other attorneys on commercial litigation matters, he built a reputation based on direct communication, pithy pleadings, aggressive post-judgment creditors' remedies, and monetary recovery for clients. Now, the second generation of Halpern collection counsel continues the tradition of handling delinquent accounts, claims, and litigation against debtors anywhere in the State of Minnesota.

John A. Halpern Featured in Minnesota Litigator

http://www.leventhalpllc.com/2012/06/minnesota-litigator-profile-john-halpern-talks-commercial-collections-give-tips-tracking-uncooperative-debtors/

Judgment Levies

        Chapter 551 of Minnesota Statutes allows collection counsel to levy on money, other personal property, and earnings by using a quick alternative to a formal writ of execution through the sheriff’s office or a formal garnishment procedure. Notice of execution levy on a third-party holding money of the debtor is served by certified mail by collection counsel, along with two copies of an exemption notice if debtor is an individual. The maximum amount that can be levied upon in the possession of a particular third party is $10,000. There is an affirmative duty imposed by Minnesota Statutes, section 551.04(6) on a third-party holding money to immediately remit funds to collection counsel who served the notice of execution levy and copy of the writ of execution, if the debtor is a corporation, or 15 days after the third-party mails the exemption notice to debtor (assuming no exemption is claimed, and assuming the levy is neither upon funds on a financial institution, nor earnings).

Seminar Article By: John A. Halpern

Contempt of Court Motions

        Minnesota Statutes, chapter 588, and rules 45.07 and 69 of the Minnesota Rules of Civil Procedure allow the district court to hold the debtor in contempt of court for failure to obey a subpoena or a court order in supplementary proceedings. Collection counsel will have to draft the following documents: notice of motion and motion, affidavit of non-appearance (executed by the court reporter or notary public) attesting to debtor’s failure to appear, memorandum of law, order to show cause why the debtor should not be held in contempt of court, and proposed order holding debtor in contempt of court (most judges prefer findings of fact, conclusions of law, and order of contempt and apprehension). Said documents must be served personally on the person failing to obey the prior subpoena or court order in supplementary proceedings. No substituted service of process thereof is allowed. Sanctions on debtor that the district court may impose include incarceration and/or fine.

Seminar Article By: John A. Halpern

Orders for Disclosure

        Minnesota Statutes, section 550.011, allows a judgment creditor to request of the district court an order requiring the debtor to provide the creditor with information regarding the “nature, account, identity of, and location of all of the debtors’ assets, liabilities, and personal earnings.” The order for disclosure is a valuable, low cost means of gathering information in the post-judgment stage, and is available after a judgment has been docketed for 30 days. Collection counsel should mail to the district court administrator a completed request for order for disclosure, accompanied by the required fee. An order for disclosure, along with a financial disclosure form, are then mailed by the district court administrator to the debtor. The debtor then has ten days to complete the financial disclosure form and return it to the creditor or creditor’s attorney. The financial disclosure form requires bank, assets, liabilities, and place of employment information. Failure to return the completed financial disclosure form within ten days may subject the debtor to contempt of court proceedings, similar to the debtor’s failure to obey a subpoena or order in supplementary proceedings. Costs for both the order for disclosure and enforcement of same vary from one district court to another.

Seminar Article By: John A. Halpern

Interrogatories and Supplementary Proceedings

        Rules 69 and 33 of the Minnesota Rules of Civil Procedure also allow collection counsel to draft extensive interrogatories to be answered under oath, as in prejudgment discovery. They may be served upon debtors by mail or by personal service. Failure of a debtor to answer the interrogatories under oath within 30 days of the date of service may subject debtor to a motion to compel, followed by a possible contempt of court motion.

        Minnesota Statutes allow judgment creditors to apply to the court by affidavit for an order compelling judgment debtors to appear before a court reporter or notary public to be examined under oath as to assets, liabilities, cash flow, tax returns, etc. A writ of execution must first be “returned unsatisfied” by the sheriff’s office. The order in supplementary proceedings has the same effect on a debtor as a subpoena and notice of taking deposition to compel debtor’s testimony and the production of a debtor’s records. The order in supplementary proceedings must be served upon a deponent personally. No substituted service of process is allowed. A deponent should be first shown the inked signature of the judge signing the order, and then given a conformed copy of the order, along with a copy of collection counsel’s affidavit submitted to the judge in support of said order. The deposition must be in the venue of the county where a debtor resides or where a debtor’s business is conducted. A powerful specialized order directed at any of debtor’s assets, regardless of who possesses same, also can be obtained ex parte from the court, pursuant to Minnesota Statutes, section 575.05. If the debtor has hidden known assets or placed them in the possession of third parties, the court “may order any of the debtor’s property in the hands of the judgment debtor or any other person, or due to the judgment debtor, not exempt from execution, to be applied toward the satisfaction of a money judgment.”

Seminar Article By: John A. Halpern