When you are injured in an accident and sue a negligent party for damages, you would be correct in thinking that a large hurdle is actually winning your case. Get beyond the liability issues, prove negligence, demonstrate how you were injured, and persuade a jury in a trial, and the check that represents your damage award comes in the mail. Well, it may not be that simple.
Can the Defendant Pay?
In many cases, winning your case—or settling it—does not automatically mean that you will see the money. In many cases, a liable defendant has to be pursued to get them to pay a judgment. That is why an important part of analyzing a personal injury case, is determining who the potential defendant is and whether they can or will pay a judgment. After all, although it has the force of a law, a judgment really is just a piece of paper, and there is no debtor’s prison in America for people who choose to ignore judgments entered against them.
In most cases, if a defendant is a large company—FedEx, Publix, or any number of other large companies—there is generally little risk, as these companies are soluble and will usually pay almost any judgment entered against them.
But in some cases, smaller or privately owned businesses may not be able to satisfy a judgment. Mom-and-pop shops may be a risky bet to pay a judgment. The same goes with individual drivers who cause car accidents, and do not have the proper insurance coverage. There, you may be suing a person just like yourself who may make a regular income and struggle to pay bills.
Insurance Companies
In most cases, your saving grace is insurance. Most companies, large and small, will normally have some form of liability insurance, which will step in and finance their defense, and also pay almost any judgment entered against them. So, although you are suing Joe’s Gas Station, it may be Farmer’s Insurance that will pay the defense attorney and the judgment entered against you.
Insurance companies are usually reliable in paying judgments entered against them, or settlements that they may agree to pay. They owe their insureds that obligation, and certainly have deep enough pockets to pay any type of judgment.
Car accidents may present a special problem because of the number of uninsured drivers on our roads. Making it worse, Florida law requires that drivers carry personal injury protection insurance, but that insurance does not protect others that a driver may injure. A driver must have liability insurance for that. So, even if you are injured by a driver with insurance, but without liability coverage, there will be no insurance to satisfy any judgment or settlement.
Options for Enforcement
When they do not pay, or when a defendant who is uninsured does not pay, a victim has a few options. If the defendant was an insurance company, and there was a settlement that remains unpaid, Florida Law allows you to bring a motion to enforce the settlement agreement. Not only will you get to enforce the agreement, but the law also allows you to collect attorney’s fees and 12% interest on the settlement amount.
If the defendant is not an insurance company, you can still bring an action to enforce the settlement, but will not get the interest or attorney’s fees. However, the workaround is to include in any settlement agreement, a provision for attorney’s fees and interest or other penalties, if the defendant does not pay the settlement amount. That way, your ability to collect these items if you need to enforce the agreement is preserved as a matter of contractual agreement, regardless of what the law says.
Another option is to include the insurance company in the settlement agreement, even if they were not a named defendant in the case. Doing that will also give you the protections of the statute.
Post Judgment Collections
In all cases, if a defendant does not pay, there is also the right to post-judgment collections. A party who owns a judgment (that is, to whom money is owed, such as an injured victim who obtains a personal injury judgment or settlement) can conduct an inquiry into a defendant’s assets, income, and ability to pay the judgment.
You can conduct depositions and obtain banking records and other financial information from a defendant who owes a judgment. If assets are identified through the course of discovery, a party can obtain a writ from the court, which the Sheriff will then serve upon the assets of the defendant. Practically, this means that the Sheriff will seize the defendant’s assets and allow you to sell them in order to pay the judgment.
If identified, bank accounts can also be garnished through court processes. In many cases, defendants who may say they have nothing and can not satisfy a judgment, end up having sufficient money in bank accounts.
If you do go through the collection process, you may also be able to obtain post-judgment interest. Florida law sets a statutory interest rate, which accrues on unpaid judgments. Right now, that amount is 4.9%, but it varies every year. So, although that is not a large amount, there is at least some extra payment there in the event that a long post-judgment collection process is needed.
Your case may not end at trial or settlement. If you are injured, make sure you can collect on any judgment or settlement you obtain. Contact Brill & Rinaldi today about a free consultation to discuss your accident case.