For the past decade, California businesses have struggled to figure out how to manage negative online reviews and commentary. Sometimes an outraged owner has even sought out a small business attorney to take their critics to court, claiming that their negative unjust reviews cost them business.
Bitcoin is a virtual currency that has exploded in popularity over the past year. Invented in 2008 and made widely available in 2009, this software allows people to make payments directly between peers, without interference from or reliance upon any central monitoring group. Perhaps the biggest attraction of Bitcoin is its complete lack of regulation by any federal government. Transactions take place in so-called Bitcoin Exchanges, which allow buyers and sellers to communicate directly. Continue reading
If your judgment debtor is offering to pay you a fee to forbear collection of your judgment, rest assured the forbearance agreement is not usurious.
In the recently-decided case, Bisno v. Kahn, 14 C.D.O.S. 4439 (April 25, 2014), the Court made clear that a forbearance agreement is a separate contract, wholly separate from a judgment and the sums owed under a judgment.
In Bisno, a judgment debtor offered to pay to the judgment creditors a fee in exchange for the judgment creditors’ agreement to forbear from enforcing the judgment while the judgment debtor closed an unrelated real estate transaction. After the judgment was fully satisfied, that same judgment creditor sought to recover the forbearance fees he paid to the judgment creditors, claiming the payment of the forbearance fees was a violation of California’s usury laws.
Following a thorough summary of the legislative history of California’s usury laws and the intent behind those laws, the Court held that the usury laws do not prohibit a judgment creditor from receiving forbearance fees in addition to statutory post-judgment interest. The Court further held that while a forbearance fee does not constitute a recoverable cost under the Enforcement Of Judgments Law (see Code of Civil Procedure section 685.040, which allows a judgment creditor to recover “the reasonable and necessary costs of enforcing a judgment”), there is no provision in the Enforcement Of Judgments Law that prohibits parties from entering into private agreements to forbear collection of a judgment.
Note: “Forebearance” is defined in legal terms as “the action of refraining from exercising a legal right, especially enforcing the payment of a debt.”
DEBTORS’ PAYMENT OF JUDGMENT IN FULL BY CASHIER’S CHECK CUTS OFF CREDITOR’S RECOVERY OF POST-JUDGMENT ATTORNEY’S FEES
This case highlights the necessity of creditors to act diligently post-judgment to file their motions for accrued fees as soon as possible in order to avoid cutting off their claims upon the debtor’s payment of the judgment in full. Accepting but not cashing a check that fulfills the judgment will not keep their claim open.
In Gray1CPB, LLC v. SCC Acquisitions, Inc. (2014) 225 Cal.App.4th 410, the Court considered whether the debtors’ payment of a judgment in full by cashier’s check cuts off the creditor’s right to move for attorney’s fees previously incurred in collection efforts.
In August, 2010, Gray1 obtained a judgment against the debtors in excess of $9.1 million plus interest as a result of the debtors’ failure to make good on their guaranties of a loan made to a limited liability company. The written guaranties provided for an award of attorney’s fees.
In June, 2012, the debtors delivered a cashier’s check to Gray1 in the amount of $12.9 million which covered the amount of the judgment plus accumulated interest. Gray1 did not immediately cash the check. Rather, twelve days after receiving the cashier’s check, Gray1 filed a motion for post-judgment costs, including attorneys’ fees in attempting to enforce the judgment, and thereafter cashed the check. Continue reading
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