Evicted Tenant and awarded a judgement in Cobb County Georgia their uncashed rent check was returned back to me.Can I cash it?

Question

After I evicted the tenant she agreed to a settlement which awarded me a  judgement which stated she would pay $250 a month until the balance was paid.  She has not paid me (which I figured would be the case ), when I called her, she said she filed bankruptcy and was not going to pay. I really do not believe she did file, but just think it is another lie. When I went to garnish her wages, she has changed jobs and I do not know where she works now. After I filed for eviction, she tried to send me two rent payments with personal checks which I would not accept. I told her I would only accept a money order for the full amount, so I know she was playing games.  Each time she sent a check I returned it certified mail. She accepted and signed for the first check and then mailed another check the next day. When I returned the second one she never accepted it and the check was returned to me about a month later. I am wondering if I can cash the check and use it toward the judgement. Before I call my attorney, I was wondering if anyone has any experience with this situation. Personally I have moved on and found a great new tenant, paying a higher rent. However I have been looking at it on my desk for the past few weeks and it has me wondering.

David Stratton · Answer

Joel,

Thank you as usual for all of the great advice you give.  I have a  Judgement, that she signed off on, for $3605 which is basically 2 months rent.  I had the deposit of $1500 (which has no bearing on the Judgement), so I only lost about a months worth of rent.  The good news is they didn't trash the house.  I have kind of written off the money, but I think it is more out of principle to help the next landlord down the road and to teach her a lesson. I have sent this attorney  a lot of work over the years, so maybe it is better to make a quick phone.

Thanks Again

Dave

Joel Owens · Answer

David so you have a judgment from the court??

How much is it??

You have options but first is the tenant judgment proof??

Usually first thing landlords do is sick a collection company on them. Then an attorney to write a " scare letter ".

You could skip all of that and just use a judgment recovery company. They will generally split any money recovered 50/50 and pursue them in court. Sometimes they will buy from you for 10 cents to 15 cents on the dollar and you are done with it.

You could also do nothing and sit on the judgment waiting for one day for them to clean up their credit and offer a settlement to satisfy the judgment and keep renewing it.

The BK action of filing does not render the judgment useless. It depends on if a chapter 7 which if approved would clear it out or if a chapter 13 you would need to approve as a creditor the re-payment plan. 90% roughly of 13 filings fall out and never finish to discharge so then you collect again after the relief of stay.

You have an attorney. They key is if this is a small amount it is cost prohibitive to pursue with your attorney and filings etc.

Might want to just offer to settle it for cheap if she is not in BK currently to get some coin. People in BK can still contact the creditor but it has to be initiated by them to not be seen as a collection activity violating the stay by you.

I wouldn't do anything with the check without your attorneys consent. You are paying them for a legal opinion relative to the situation at hand for counsel.

No legal advice given.

David Stratton · Answer

Thank you everyone for the great advice.  It is written to my LLC, so I was wondering if they would cash it.  I figure I will bring as much paperwork for my LLC showing me as the manager and that the LLC owns the property.  If I can at least find out if there is enough in the account, I can deposit in my account. Rod thank you for the information on the bankruptcy.  I will let you know how I make out

Rod Desinord · Answer

Yea I would cash it also because all she has to say is that you refused to accept her payment by you sending it back. Also there's ways of seeing if someone filed bankruptcy. You can use the pacer system to see any bankruptcy nationwide. Google it! greatest thing ever.

Steve Babiak · Answer

If it was made out to you personally as payee, then you could do that. Of course, there will probably insufficient funds in the account to cover it, but you can just keep trying until you get lucky.

The tenant may have put a stop payment on it too, so you might never get your money for that check.

BTW - if it was made payable to a company or business name, the bank likely won't cash it.

Dana Whicker · Answer

No legal advice follows:

If she did file bankruptcy and you are listed as a creditor, the court will notify you of the filing.  When you are notified, you have to stop attempting to collect.  If you have not been notified, you have the right to collect.

When someone writes you a check they are signing a legally binding instrument.  She owes you that money and agreed in court that she owes you.  If you have not been notified that you are a creditor in her bankruptcy I would cash the check and hope it clears.

I'm not a lawyer.

Good luck!

David Stratton · Answer

I was figuring the same thing that it would bounce, but it is from  Bank of America and was thinking to go into one of their branches to cash it.  I think she forgot about it, so I will probably wait for a Friday and see if I get lucky.

Chris Martin · Answer

I would say cash the check... but expect that the check may bounce. You have already gained possession, so the payment is on the judgment. After the check clears (assuming it does) don't forget to update the money received with your state's equivalent of Payment of Judgment form with the clerk of court.