To clarify, I am not a lawyer, and thus, I am not giving anyone legal advice. If you disagree with the outcome of your lawsuit, you should consult with your lawyer on your right to appeal.

As a Licensed Insolvency Trustee (LIT), I meet with many people who have a judgment against them as they failed to file a defence to a statement of claim or had judgment awarded against them at trial. Once a creditor obtains a judgement, they can then take enforcement steps to collect their debt by obtaining a garnishment order or a writ of seizure and sale of personal property. If you are unable to pay the debt in full but can afford monthly payments, contact the creditor to try to come to agreeable repayment terms over time.

If you are struggling with all of your debt, consult with a Licensed Insolvency Trustee to review your full financial situation and potential solutions. The LIT will review the following solutions:

  • Obtaining a consolidation loan to pay the judgement and any other debt in full and be left with one loan at hopefully a lower interest rate.
  • Debt management program through an accredited not-for-profit credit counselling agency. They negotiate with your creditors to accept payments over a 4-year time period and may be able to reduce the interest paid on your debt. A judgement creditor may not be willing to step back and participate in the program when they have the right to enforce their judgement.
  • A consumer proposal offers a compromise to your creditors to settle the debt you owe them over a maximum 5-year time period. A proposal can only be filed with a LIT who will review your financial situation in detail to determine how much you can offer that is affordable to you. On the filing of a consumer proposal, your creditors are immediately stayed from taking any further collection proceedings against you. It stops a judgement creditor who has already commenced a garnishment of your wages.
  • Filing an assignment in bankruptcy. In a bankruptcy, your realizable assets vest in the trustee to realize for your creditors, and you may have to make surplus income payments, but it will also stay your creditors from their enforcement of a judgement and any collection proceedings.

Most LITs offer a free consultation to review solutions. If you have lost a lawsuit and are unable to pay, educate yourself on solutions by reaching out to Taylor Leibow Inc. today.

Kathy LenartBy Kathy Lenart – Insolvency Partner, Licensed Insolvency Trustee
CPA, CA, CIRP
Canadian Association of Insolvency and Restructuring Professionals (CAIRP)