Vacating Judgment after BK

[rpraver]

In Florida, to discharge a judgments of record, after it has been discharged in bankruptcy, you need to wait a year after the discharge, file your motion in state court (in the case that the judgment was entered) and follow the procedures set forth in the statute. Look at Florida Statute 55.145:

55.145

Discharge of judgments in bankruptcy.
—

At any time after 1 year has elapsed since a bankrupt or debtor was discharged from his or her debts, pursuant to the act of congress relating to bankruptcy, the bankrupt or debtor, his or her receiver or trustee, or any interested party may petition the court in which the judgment was rendered against such bankrupt or debtor for an order to cancel and discharge such judgment. The petition shall be accompanied by a certified copy of the discharge of said bankrupt or by a certified copy of the order of confirmation of the arrangement filed by said debtor. The petition, accompanied by copies of the papers upon which it is made, shall be served upon the judgment creditor in the manner prescribed for service of process in a civil action. If it appears upon the hearing that the bankrupt or debtor has been discharged from the payment of that judgment or of the debt upon which it was recovered, the court shall enter an order canceling and discharging said judgment. The order of cancellation and discharge shall have the same effect as a satisfaction of judgment, and a certified copy thereof may be recorded in the same manner as a satisfaction of judgment. This section shall apply only to liens under judgments or obligations duly scheduled in the bankruptcy proceedings.


--------------------
This is different from avoiding the lien. That you would do by motion in the bankruptcy case. Usually you file a Motion to avoid a lien to remove a lien from homestead property. The procedure set forth above under Florida law is to satisfy or discharge of record and judgment that was discharged in the bankruptcy proceeding.

[SunshineGal]

Got an answer back from the attorney. In order to avoid the the lien in the BK Court, it must impair an exemption. We didn't claim a homestead exemption so now it's on to the state courts. IBroke, will you keep us updated on how it works out for you? I'm thinking I can file the motion pro-se because it seems pretty basic.

I had a friend who had a huge headache when he went to refinance his property. Knowing what I do now, he should have signed a homestead declaration and it would have been fine, but instead he had to jump through hoops having the judgment vacated before he could get clear title. And, this was in Florida and the judgment debt had been discharged in BK. The problem boils down to the fact lenders and title agents don't know the bk laws.

[SunshineGal]

Now see, our attorney says to file it in the BK court because there isn't a filing fee, whereas the county court there is. However, I don't know if it can be avoided in BK because it doesn't impair an exemption. I emailed my wonderful paralegal and will let you know what I find out.

[IBroke]

If that doesn't work you can try this.

or (5) that the judgment or decree has been satisfied, released, or discharged

Gee, I thought I had a nice simple plan and after the two threads today I'm more confused than ever, lol. Do I motion through the BK court which is what my attorney said, or do I wait and file with the local state court? There seems to be very different rules regarding vacating a lien or judgment so I just don't know!!! Maybe I'll just wait and see how your case pans out, lol.

The motion to vacate judgment would go through the court where the judgment "originated". If you have any judgment lien on property, you would have to take care of that first - through the BK-court.

I went with (5) on my motion because I didn't know of the 524-clause when I filed my motion - but I think (5) could be used as well after BK-discharge. Not because the judgment has been satisfied, released or discharged - BUT because the judgment lost its "perspective application" due to your BK-discharge.

[SunshineGal]

If that doesn't work you can try this.

or (5) that the judgment or decree has been satisfied, released, or discharged

Gee, I thought I had a nice simple plan and after the two threads today I'm more confused than ever, lol. Do I motion through the BK court which is what my attorney said, or do I wait and file with the local state court? There seems to be very different rules regarding vacating a lien or judgment so I just don't know!!! Maybe I'll just wait and see how your case pans out, lol.

[IBroke]

RULE 1.540. RELIEF FROM JUDGMENT, DECREES, OR ORDERS
(a) Clerical Mistakes. Clerical mistakes in judgments, decrees, or other parts of the record and errors therein arising from oversight or omission may be corrected by the court at any time on its own initiative or on the mo-tion of any party and after such notice, if any, as the court orders. During the pendency of an appeal such mis-takes may be so corrected before the record on appeal is docketed in the appellate court, and thereafter while the appeal is pending may be so corrected with leave of the appellate court.
(b) Mistakes; Inadvertence; Excusable Neglect; Newly Discovered Evidence; Fraud; etc. On motion and upon such terms as are just, the court may relieve a party or a party‘s legal representative from a final judgment, decree, order, or proceeding for the following reasons: ....(4) that the judgment or decree is void;....

Whoomp! (There it is..)

[IBroke]

Awesome IB -- so are you going to change any of your paperwork? I want to follow this plight if you don't mind.

I certainly don't mind..

For now, I'm going to wait and see what happens. It's possible that my motion might be denied due to this "wait one year from discharge"-clause - IF the judge is aware of that.

If it is denied for any other reason, I'm prepared and going to file a much more detailed motion. I also didn't add a copy of my discharge and petition because I thought the court or judge might prefer seeing my documents on PACER to validate them.

For now, I'm happy that I'm likely going to get rid of this personal record within months instead of years.

Oh, BTW, I found an interesting case online that deals with the validity of a judgment after BK based on the fact it there was a judgment lien or not. I think it supports my POV I posted before:

http://ftp.resource.org/courts.gov/r...5214570015.pdf

[SunshineGal]

I'm in FLA and just happened to speak with a lawyer here today and she was unaware this could be done. Anyone know anything more specific for FLA by chance?

This is from the Florida State Courts:

RULE 1.540. RELIEF FROM JUDGMENT, DECREES, OR ORDERS
(a) Clerical Mistakes. Clerical mistakes in judgments, decrees, or other parts of the record and errors therein arising from oversight or omission may be corrected by the court at any time on its own initiative or on the mo-tion of any party and after such notice, if any, as the court orders. During the pendency of an appeal such mis-takes may be so corrected before the record on appeal is docketed in the appellate court, and thereafter while the appeal is pending may be so corrected with leave of the appellate court.
(b) Mistakes; Inadvertence; Excusable Neglect; Newly Discovered Evidence; Fraud; etc. On motion and upon such terms as are just, the court may relieve a party or a party‘s legal representative from a final judgment, decree, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial or rehearing; (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (4) that the judgment or decree is void; or (5) that the judgment or decree has been satisfied, released, or discharged, or a prior judgment or decree upon which it is based has been re-versed or otherwise vacated, or it is no longer equitable that the judgment or decree should have prospective application. The motion shall be filed within a reasonable time, and for reasons (1), (2), and (3) not more than 1 year after the judgment, decree, order, or proceeding was entered or taken. A motion under this subdivision does not affect the finality of a judgment or decree or suspend its operation. This rule does not limit the power of a court to entertain an independent action to relieve a party from a judgment, decree, order, or proceeding or to set aside a judgment or decree for fraud upon the court.

http://www.floridabar.org/TFB/TFBResources.nsf/Attachments/10C69DF6FF15185085256B29004BF823/$FILE/Civil.pdf?OpenElement

You can find it on page 71.

I'm not sure what it means though, lol. Maybe Des or Msbklawyer will chime in.

[df04527]

Awesome IB -- so are you going to change any of your paperwork? I want to follow this plight if you don't mind.

[IBroke]

Yes, a discharge does void any judgment to the extent that it is a determination of personal liability. But ONLY to that extent.

Hmm, that's good enough for me. In my case, the judgment always was a determination of personal liability - nothing more. No lien existed, exists and due to my BK, won't exist in the future. So there is nothing left of that judgment that is NOT void by the definition of 524. That results in the lack of "perspective application" and is a reason to vacate a judgment.

It certainly is different from 522(f). If you have property in jeopardy, you want to file that first - but for many no asset cases, there is no need to because you can't avoid a lien on property you simply don't own.

I also share the opinion that judgments can be vacated in EVERY state because the legal grounds (524 a 1) are Federal BK-law.

The case I mentioned occured in Florida.

[Freddy03]

If I'm not mistaken, it is 10 years in Florida. Could be wrong though. It's true that it can't be renewed - but I certainly want to get it off my credit-report ASAP.

10 years then it could be renewed for another 10 years (20 years total)

[MSbklawyer]

Yes, a discharge does void any judgment to the extent that it is a determination of personal liability. But ONLY to that extent. It does NOT void the judgment in toto or "vacate" the judgment.

"Vacating a judgment" has a specific legal meaning under the bankruptcy rules (and most state procedural rules) and it is distinctly different from and broader than getting discharged from personal liability on a judgment. It is also different from "avoiding a judgment lien" under 522(f).

But as has been said here already, if under your state's rules the judgment did not become a lien, you'd probably have little to gain by avoiding the judgment under 522(f).

I was unaware that any state had made bankruptcy discharge a grounds for vacating a judgment -- as Michigan apparently has. It may be worth looking into to see if Florida has something similar. It must if someone has successfully vacated a judgment on the basis of a bankruptcy discharge. If so, that would take care of your credit report problem that the judgment is causing.

So, like Des, I will eat my words about discharge not being grounds for vacating a judgment -- apparently in some states it is.

[IBroke]

IBroke: What is the statute of limitations on judgments in your state? In Arizona it's 5 years and can normally be renewed indefinitely but I've been told that since the underlying debt that created the judgment has been discharged, the judgment can't be renewed so it will automatically be void even if the judge doesn't sign off on the motion to vacate.

If I'm not mistaken, it is 10 years in Florida. Could be wrong though. It's true that it can't be renewed - but I certainly want to get it off my credit-report ASAP.

[IBroke]

IBroke,

Good for you. I completely forgot about this (the very 1st provision of 524). I always think in terms of the discharge acting as an injunction against collections. I forgot that it also acts to void judgments. As a result, my post on this thread is wrong as it relates to the validity of the actual judgment post discharge.

My hat's off to ya!

Des.

I'm honored, Des.!

I was so confused because there were so many other users on different boards that stated - without any doubt - that a BK-discharge would be sufficient to vacate.

After your confirmation, I feel MUCH better now.

So what do you think? Could my motion be successful? I failed to mention 524 but I used the claim that a judgment - after BK-discharge - has no prospective application.

[despritfreya]

§ 524. Effect of discharge
(a) A discharge in a case under this title—
(1) voids any judgment at any time obtained, to the extent that such judgment is a determination of the personal liability of the debtor with respect to any debt discharged under section 727, 944, 1141, 1228, or 1328 of this title, whether or not discharge of such debt is waived;

IBroke,

Good for you. I completely forgot about this (the very 1st provision of 524). I always think in terms of the discharge acting as an injunction against collections. I forgot that it also acts to void judgments. As a result, my post on this thread is wrong as it relates to the validity of the actual judgment post discharge.

My hat's off to ya!

Des.