Need Alternative Settlement Method.....

[unx07]

What is the name of your state? CA

Need to know what various types of settlement documents can be drafted when negotiating final terms for a lessor amount with a collections attorney? Apparently I am suppose to believe there is only one type of agreement called a "judgment" that can used but I know that is definitely not correct. Any advice on where to look or what might work best is appreciated.

Thanks !!

 

[Chien]

Is it possible that you're referring to a "Confession of Judgment"? Because I suspect that's what you've been told and what you're describing.

If it is, despite what you know is definitely not correct, that's correct.

Oh, you could ask for something like a promissory note or a personal guarantee of payment, but the attorney wouldn't agree or accept either, and I'll explain why. With a Confession of Judgment, you acknowledge the amount that's owed and, if you're paying a lesser amount and/or paying over time or both, those terms are also included. If you pay as promised, you get the Confession back, no suit is ever filed and everyone is as happy as they can be under those circumstances. If you default on your promise, the attorney files the Confession and takes judgment for whatever was agreed, less credit for any payments made.

With anything else - a promisssory note, a guarantee etc. - if you default, it's just a new and additional basis for the attorney to sue you. If he/she has already got one, who needs another? So yes, it's a Confession of Judgment or nothing.

This is before you file an Answer and as an alternative to filing an Answer. If you want to pay the cost of filing and then settle, the comparable document to a CofJ would now be called a Stipulation for Payments and Judgment. There are some differences in form, but the distinctions are not worth discussing.

 

[unx07]

It's being called a Stipulation for Entry of Judgment Pending Performance (CCP 664.6). I'm not comfortable signing such a document against myself. It literally strips me of all my legal rights. The trial is what a judgment is for and full payment will have been received way in advance. I believe making the full payment that has already been agreed to is sufficient as once they receive it before trial, they won't need a judgment which they would be trying to get at trial. No?

 

[Chien]

It’s a Stipulation, so you must have already filed a response. It’s a “Stipulation for Entry of Judgment Pending Performance”. Different name – same vehicle as I described.

“I'm not comfortable signing such a document against myself.”

Then don’t sign.

“It literally strips me of all my legal rights.”

You agree that the allegations of the Complaint are true. If that’s how you choose to characterize that, that’s your prerogative. If they aren’t true, why settle instead of going to trial? Compare a Stipulation to a Confession of Judgment. The latter specifically requires your agreement to give up your legal rights. In both cases, in return you get a benefit that the creditor is not obligated to give. Your choice.

“I believe making the full payment that has already been agreed to is sufficient as once they receive it before trial, they won't need a judgment which they would be trying to get at trial. No?”

No. Here are the problems they have to deal with. First, they have no reason to trust you. Sorry to be blunt. You’re probably a peach of a guy, who keeps his promises but, the fact of the matter is that you wouldn’t be talking to them, if the bill had been paid. Second, if they just accept your promise that it’s going to happen and it doesn’t, they have a little problem with their client, and it’s called malpractice – messy, embarrassing and costly. Third, once they have a signed Stipulation, they can file a Notice of Settlement with the court. That tells the court that everything is ok, there’s not going to be a trial and the court can stop bugging them to make appearances, file statements etc. in contemplation of trial. Without that Notice, all those other things will happen for them and for you. More work for both sides, and the only difference between them and you is that they get to add the cost of that work to their fees and the judgment.

You’re making a deal, and that’s what they want to make it. Nothing less or different will work. You can make the deal or reject it. As I said, it’s your choice.