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ENFORCING A FOREIGN JUDGMENT

You just won a civil judgment, but the judgment debtor is in another state.  How are you going to enforce it?  Consider a simple example: ABC Corporation (“ABC”) forms a contract with XYZ, Inc. (“XYZ”) wherein XYZ agrees to purchase 1,000 widgets from ABC at $100 per widget and ABC agrees to deliver the widgets to XYZ at a particular location on a particular date.  XYZ renders payment in full, but on the date of delivery, ABC only delivers 500 widgets.  XYZ sues for breach of contract and wins; however, the lawsuit occurred in South Carolina pursuant to a provision in the contract that requires dispute resolution to occur there, and ABC – as well as all of its assets – is in North Carolina.  How can the South Carolina courts enforce the judgment against ABC?  This is a common occurrence, and North Carolina is among the many states that provides a statutory solution: the Uniform Enforcement of Foreign Judgments Act (the “UEFJA”).

 

The UEFJA is essentially the statutory embodiment of the Full Faith and Credit Clause of the United States Constitution.  This clause states “[f]ull faith and credit shall be given in each state to the public acts, records, and judicial proceedings of every other state.” (emphasis added).  The UEFJA, authorized by the Full Faith and Credit Clause, permits State A to enforce a valid final judgment won by a litigant in State B.

 

There are certain limitations to the applicability of the UEFJA:

 

  • The North Carolina statute provides that child support orders, custody decrees, and domestic violence protective orders do not fall within the purview of the statute. Foreign enforcement of these judicial decisions is controlled by other statutes.

 

  • Additionally, the UEFJA only applies to final judgments.  A judgment debtor can successfully move for relief of foreign enforcement if a) the decision being enforced has been appealed or b) the enforcement of the decision has been stayed by the court that rendered it.

 

  • Finally, North Carolina’s statute, similar to most states, provides that the foreign judgment is not enforceable in North Carolina if it is “contrary to the public policies of North Carolina.”  Applying this in practice, North Carolina is one of few states that still recognizes a cause of action for heart balm torts, known as alienation of affection or criminal conversation.  These causes of action permit a spouse to sue a third party for interfering with his or her marital relationship.  If Mr. Smith, a North Carolina resident married to Mrs. Smith, seeks to enforce a judgment against Mr. Jones, a New Mexico resident, for one of these causes of action, he may be able to do so – New Mexico also recognizes and enforces them.  However, if Mr. Jones is a resident of Ohio, which does not recognize heart balm torts, Mr. Smith is likely out of luck when he seeks to enforce the judgment in the Buckeye State.

 

If you have questions regarding an enforcement of a civil judgment or other civil litigation matter, please call us at (704) 457-1010 to schedule a consultation.  For more information regarding our firm, attorneys, and practice areas, please visit http://www.lindleylawoffice.com/.

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