GLOSSARY OF COLLECTION LAW TERMINOLOGY

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1 GLOSSARY OF COLLECTION LAW TERMINOLOGY The purpose of this glossary is to assist community association board members and property managers in better understanding legal terms and procedures that are frequently utilized by our law firm in the collection process against unit owners who owe common expenses to an association. Please feel free to contact us if you have any questions about any of these terms. Affidavit of Diligent Inquiry - A document that is filed with the Court which certifies that we have used all reasonable efforts to serve the Complaint upon the unit owner personally, but that we are unable to effectuate personal service; therefore, we are serving the Complaint by sending it in the mail by certified and regular mail to the last known address of the unit owner or by publishing a notice in the local newspaper. Affidavit of Non-Military Service - An affidavit required by the Court to obtain a judgment, in which we certify that the unit owner is not actively serving in any branch of the United States Armed Forces. Affidavit of Service of Complaint - An affidavit which we receive from the process server (the person who serves legal documents) attesting that the Complaint was properly served upon the unit owner as required by the New Jersey Court Rules. Answer - The response to the Association s collection Complaint, which the unit owner files with the Court when the unit owner is contesting the allegations made by the Association in the Complaint. Attach/Levy - Generally, to seize personal property such as a bank account, vehicles, any other personal property, or real property (real estate) in an effort to pay the Association s judgment. Complaint -The initial document filed by the Association in Court that commences the collection lawsuit and sets forth claims for relief by the Association. Default - Generally, the failure to perform a legal or contractual duty; specifically within the context of a collection lawsuit, the failure by the unit owner to file an Answer to the Complaint within the time period prescribed by the Court rules. Default Judgment - A decision or Order entered by the Court awarding the Association all outstanding amounts owed to it by the delinquent unit owner. After a unit owner has failed to file an Answer to the Association s collection complaint, and the Court has entered Default against the unit owner, our law firm files a motion asking the Court to enter the default judgment. Deed In Lieu of Foreclosure - The process by which the unit owner and the lender agree that the lender will accept title to the unit (or other real estate owned by the unit owner) in satisfaction of the lender s debt, without going through the foreclosure process and

2 having the unit sold at Sheriff s sale. Delinquency Letter - The initial letter (demand) which we send to the unit owner advising that he/she is in arrears on the payment of monthly common charges and demanding that such charges be paid. Discovery - Generally, a method in litigation to obtain facts and information from the other party in order to assist the party s preparation for trial; discovery is routinely conducted when a lawsuit is contested by the unit owner, i.e., the unit owner files an Answer to the Complaint. Deposition - A method of discovery in contested litigation in which one party asks questions of the other party or a witness under oath, outside of court and with a court reporter present, to obtain facts and information to assist the party s preparation for trial. Docketing a judgment - The process in which a judgment is listed in the Superior Court in Trenton, such that the judgment becomes a lien upon any real estate owned by the unit owner in New Jersey. Fair Debt Collection Practices Act - The federal statute that debt collectors must follow which governs certain aspects of the process for the collection of consumer debts. Foreclosure - A proceeding by which a lender or a mortgage holder on a property seeks to take title or forces a sale of that property to satisfy its debt. Information Subpoena - After we obtain a judgment for an association against a unit owner, a form set of questions which we serve upon the unit owner, which the unit owner is required to answer within 14 days of receipt under the New Jersey Court Rules, to identify assets the unit owner may own and on which we can have the Sheriff levy in order to satisfy the Association s judgment. Interrogatories - A method of discovery in contested litigation in which written questions are served by one party on the other party in order to obtain facts and information to assist the party s preparation for trial. Judgment - Generally a decision and/or Order by the Court regarding the rights and claims of the parties in the lawsuit; specifically in the collection process an award by the Court to the Association for the outstanding charges that the Association can demonstrate to the Court are due and owing to it. Lien - Generally, a claim or encumbrance on property for payment of a debt, obligation or duty. Lien Claim - A document that is recorded in the County s recording office against the unit itself for any unpaid assessments and other charges duly owed to the Association by the unit owner.

3 Motion - Generally, an application made to the Court requesting that the Court rule in favor of the party making the request. Motion to Enforce Litigants Rights - A motion that is filed with the Court, after a judgment has been entered by the Association against a unit owner, when the unit owner fails to provide answers to the Information Subpoena or to appear for his/her deposition/supplemental proceedings, and which compels the unit owner to provide answers to the Information Subpoena or deposition/supplemental proceedings, or face arrest by the County Sheriff. Motion to Enter Final Judgment By Default - A motion made to the Court by the Association to enter judgment against a unit owner who has failed to file an Answer to the Complaint (an uncontested litigation) for outstanding common expenses or other charges. Motion for Summary Judgment - A motion made to the Court in contested litigation, in which the Association asserts that there are no genuine issues of material facts in a case, that the Association is entitled to judgment as a matter of law, and that therefore the Court should grant the judgment to the Association for outstanding common expenses and other charges. Motion to Turn Over Funds - A motion filed with the Court after the Association has obtained a judgment, which authorizes the Bank to release funds from the unit owner s bank account on which the County Sheriff has levied at our law firm s request. Notice of Acceleration - A demand letter sent to the unit owner advising that he/she is in arrears on the payment of common expenses and other charges, and that if payment is not made within a stated period of time, as required under the by-laws, the Association will demand payment of the total amount of common charges due through the end of the Association s fiscal year. Order for Discovery - An Order issued by the Court upon filing a Petition for Discovery which permits us to take the defendant s deposition regarding his/her assets. Order for Arrest - An Order entered by the Court in connection with the Association s Motion to Enforce Litigants Rights, compelling the unit owner to answer the Information Subpoena or appear for his/her deposition/supplemental proceedings, within a period of time, otherwise a warrant for the unit owner s arrest will be issued. Petition for Discovery - A request made to the Court after the Association obtains a judgment, asking for an Order allowing us to take the unit owner s deposition for the purpose of identifying any assets the unit owner may own, and on which the Association can have the County Sheriff levy in order to satisfy its judgment. Post-judgment collection - Generally, the process and procedures we follow to locate any assets of the unit owner to collect on the Association s judgment.

4 Present owner search/title search - A search which we perform before we file the lien claim and/or Complaint to find out who is the owner of the unit and whether there are any mortgages or other liens on the property. Process Server - An entity which we use in order to serve the Complaint upon the unit owner. Proof of Claim - A term most frequently used here in the context of a collection matter pertaining to an Estate (deceased unit owner). A document filed with the County Surrogate s Office (office which deals with Estates), the purpose of which is to place the Estate s representative, i.e., the Executor/Executrix or administrator on notice of the Association s claim for outstanding common charges. It also used in the context of a bankruptcy filed by the unit owner for the same purpose, i.e., placing the unit owner and bankruptcy court on notice of the outstanding charges due to the Association at the time the unit owner filed bankruptcy. Release of Lien Claim - A document which we file with the County Register releasing the lien claim that was recorded against the unit. This release is filed only after the arrears to the Association are paid in full. Request for Admissions - A discovery method in contested litigation by which one party demands that the other admit certain facts in the case so those facts become undisputed at trial. Request to Enter Default - A request made to the Court when the unit owner fails to file an answer to the Complaint, and which, once entered, allows the Association to proceed with filing a motion to enter final judgment by default. Request for Production of Documents - A discovery method in contested litigation in which one party demands that the other party provide documents regarding relevant information to the case, in order to assist the party s preparation for trial. Skip Trace - A search performed by the process server when a new address needs to be found for the unit owner in order to serve the Complaint. Sheriff s sale - A proceeding by which the Sheriff sells foreclosed property at public auction in order to satisfy the lender s debt. Supplemental Proceedings - Refers to proceedings in which we take the deposition of the unit owner after a judgment has been entered, in order to discover what assets he/she may own from which the Association, by having the County Sheriff levy on the asset, may satisfy its judgment. Substitution of attorney - A document filed with the Court which notifies the Court that prior counsel has withdrawn from the case and that our firm is now representing the Association in the case.

5 Wage garnishment - A proceeding after a judgment has been entered, by which a unit owner s wages/income is levied upon in order to satisfy the judgment Warrant for Arrest - A document issued by the Court in connection with a motion to enforce litigants rights and Order for Arrest, which is sent to the Sheriff instructing the Sheriff to arrest the unit owner; the unit owner is brought to the Sheriff s Office or to Court to answer the Information Subpoena and/or appear for his/her deposition/supplemental proceedings. Although the unit owner is arrested, the unit owner is never incarcerated or held overnight. Warrant to Satisfy Judgment/Warrant of Satisfaction - A document releasing the judgment when the arrears to the Association are paid in full. Please contact us if you have any questions. Buckalew Frizzell & Crevina LLP 55 Harristown Road, Suite 205 Glen Rock, NJ Phone: