In a previous post we discussed collecting from both spouses when one spouse incurs a debt in Arizona. What happens when a judgment creditor obtains a foreign judgment, and wants to collect the judgment in Arizona? First, the judgment must be domesticated in Arizona. If the judgment was obtained against a married person in a separate property State, and the creditor wants to collect the judgment in Arizona, the creditor must take care to avoid common mistakes in Arizona judgment domestication actions.
In many cases, Arizona law allows a judgment creditor to domesticate a foreign judgment against both spouses, even if the foreign judgment was entered against only one spouse. In Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v. Greene, Charles Greene signed a promissory note that was governed by the laws of New York. When he signed the note, both Charles and his wife were residents of Texas. When Charles defaulted on the note, National Union made payment and afterwards filed suit against Charles in New York, where judgment was entered against Charles. His wife was not served, did not become a party to the suit, and was not named in the judgment (which would have been required had the lawsuit been filed in Arizona). Thereafter, Charles and his wife moved to Arizona and National Union sought to enforce the judgment in Arizona.
In Greene, the court held that Arizona may not impress Arizona procedural law upon a foreign judgment, and cannot refuse to recognize a foreign judgment merely because Arizona law was not followed in obtaining it. Therefore, Arizona could not require the creditor to name the spouse in the New York proceeding, even though joining the spouse would have been required in Arizona. Since New York did not require (or even allow) the creditor to join the spouse, due process did not require joining both spouses in New York to obtain a valid judgment against the marital community in Arizona. The creditor was able to collect the foreign judgment against the Greens’ community property, even though the New York judgment was entered only against Charles.
If you are a creditor with a foreign judgment against a married person, and you wish to domesticate and enforce the judgment in Arizona, you must follow Arizona procedural requirements to enforce the judgment against the marital community in Arizona. Without providing due process to the debtor’s spouse, the domesticated judgment may be unenforceable.
Experienced judgment domestication attorneys will be familiar with the steps required to enforce a foreign judgment against a debtor’s spouse, and will know how to give you the best chance at collection. If you need a judgment domesticated in Arizona, or are facing a creditor domesticating a foreign judgment against you, you should hire a knowledgeable attorney with experience dealing with these issues.
The attorneys at Windtberg & Zdancewicz, PLC provide clients with experienced legal representation in all litigation and bankruptcy matters. We are experienced in creditor’s rights prosecuting and defending garnishments, charging orders, attachment, property execution, trustee’s sales, foreclosures, judgments, judgment collection, domestication of foreign judgments, and creditor’s issues in bankruptcy cases. If you need assistance with your collection matters, please contact us at (480) 584-5660.