What is a Domestication of Judgment in Texas?

A judgment won in a state other than Texas is referred to as a "foreign judgment".   If you won a judgment in another state, but now the judgment debtor or debtors now live in Texas, you must first domesticate the judgment in order to enforce it.  In other words, if you have obtained a judgment against a business entity or an individual who is doing business, and the judgment debtor(s) now reside and have assets in Texas, then you can seek to enforce your judgment in Texas under a procedure known as domestication.  A foreign judgment is any judgment obtained in a court that is located outside of the State of Texas – it does not mean a foreign country, rather, it means an out-of-state judgment.  In other words, a foreign court is any court located in another state other than the state of Texas.

Trying to collect a debt can be frustrating. When demand letters and phone calls fail to solicit a response from the debtor, the creditor’s sole remedy is to get a judgment against the debtor. In order to get a judgment, the creditor must first file a lawsuit and then receive a verdict in the creditor’s favor or enter a default judgment against the debtor if the debtor fails to respond to the action.  However, judgments do not automatically compel a debtor to pay. In many instances, the creditor must utilize post judgment collection remedies in order to locate and seize assets, levy bank accounts or force a sale of other assets owned by the debtor.  One factor adding a level of complication is the location of the debtor or the debtor’s assets.  If a judgment is entered against the debtor or debtors in one state, but the debtor now resides in another state, or the debtor’s assets are located in another state, then the creditor must domesticate the judgment in the state in which the debtor has assets in order to be able to more effectively collect the judgment against the debtor.

Let’s say for example, that the debtor is a company located in Texas. The debtor owns assets located in Texas, which can include real or tangible property.  And, for example, let’s say that the creditor is a business located in Utah, who provided goods and services to the debtor, but the debtor failed to pay. The creditor files a lawsuit against the debtor in the state in which the creditor resides (in this example, Utah) and gets a judgment in the Utah courts.  Since the debtor is not located in the same state in which the judgment was obtained (Utah), and does not have any assets in that state, the Utah judgment will not be useful for the creditor when the creditor attempts to enforce the judgment because the Utah court has no jurisdiction over the company or the property in Texas. Instead of the creditor filing a new lawsuit in Texas against the same debtor, the creditor can follow the process under the Unified Enforcement of Foreign Judgments Act (UEFJA).

For more information about the Unified Enforcement of Foreign Judgments Act (UEFJA), click here.

What is the best way to domesticate a Judgment?  Click here for more information!