What do I do with my judgment now? A primer on the new centralized judgment lien law.

• Author: Bolton, Joseph D.
• Position: Florida

Effective October 1, 2001, the way money judgments are enforced in Florida is undergoing a sweeping revision, affecting everything from the manner of perfecting a lien on personal property to the duration of judgment liens and priorities among judgment creditors. (1) The changes apply to all stages of the judgment collection process, from entry to expiration, and affect existing judgments and judgment liens as well. Despite the significant changes which the new system will cause to debtor-creditor law, transactional practice, and the perfection of judgment liens on personal property, it has received surprisingly little publicity. It is the intent of this article to highlight the major points of the new law.

The Florida Legislature in the 2000 Legislative Session established a centralized system for perfecting and prioritizing judgment liens on personal property by filing of a judgment lien certificate with the Department of State, to be maintained in a statewide database accessible online. (2) Although the bill was signed by the governor in June 2000, the effective date of the centralized judgment lien filing provisions was delayed to October 1, 2001. (3) A "glitch" bill making additional changes was passed by the Florida Legislature in this year's session, and also takes effect on October 1, 2001. (4)

Judgment Lien Certificate

Commencing October 1, 2001, the mechanism for obtaining a judgment lien on personal property of the debtor subject to levy shall be through the filing with the Florida Department of State (the "department") of a judgment lien certificate. (5) This mechanism replaces the docketing of execution with the sheriff as the means of perfecting a judgment lien on personal property, and will create a lien on personal property of the debtor statewide, rather than only property within the county of docketing as heretofore. (6)

The new law also applies to existing judgment liens. If the creditor has already obtained a lien by delivery of a writ of execution to a sheriff prior to October 1, 2001, a judgment lien certificate must be filed before October 1, 2003, together with an affidavit signed by the creditor, including a statement of the date or a certification by the sheriff of the date of delivery. (7)

The department is establishing a centralized statewide filing system, based upon the system now being utilized for filings under the Florida Uniform Commercial Code. The centralized database will be accessible online, both for filing and review. The department is charged with prescribing mandatory forms for the judgment lien certificate and affidavit. Forms promulgated by the Department are available for download at its website: http:// www.dos.state.fl.us/doc/pdf/ jlien_cert.pdf.

A judgment lien certificate may be filed by 1) the holder of a judgment enforceable under the laws of Florida or of the United States (8) and 2) by the holder of a validly entered child support order being enforced or enforceable in Florida. (9) Any liens, warrants, assessments, or judgments collected by the Department of Revenue may be filed directly into the central database. (10) The holder of a federal court judgment entered or registered in Florida may also now file a lien certificate directly into the central database without first domesticating the judgment pursuant to F.S. [section] 55.501 et seq. (11) The new centralized filing appears to comply with the "one office within the state" rule of IRC [section] 6323(F), and therefore should supplant the filing requirements of the Florida Uniform Federal Lien Registration Act (12) as to where a federal tax lien should be filed as against personal property of an individual.

The judgment lien certificate may be filed at any time after the judgment has become final and enforceable, (13) provided that no stay of the judgment or its enforcement is then in effect. (14) In case of judgments rendered by courts of other states or other countries, the judgment lien certificate may be filed as soon as an order recognizing it has been entered by a Florida court. (15) As with issuance of execution, there is no deadline for filing a judgment lien certificate, and it is therefore permissible at any time during the 20-year life of the judgment. (16)

A judgment lien certificate must include the legal names and last known addresses of each judgment debtor and, if a recorded legal entity, the registered name and document filing number as shown in the records of the department. The Social Security number or federal employer identification number of a judgment debtor must be included only if shown on the judgment itself. (17) The legal name and address of each judgment creditor and the name of the judgment creditor's attorney or duly authorized representative, if any, also must be included. (18) If the creditor is a recorded legal entity, the certificate must identify the registered name and document filing number of the creditor. (19) The certificate must identify the court which entered the judgment, the case number and date the written judgment was entered, the amount of the judgment, and applicable interest rate. (20) The judgment lien certificate must be signed by the judgment creditor or its attorney or duly authorized representative. (21) If the certificate is filed as to a pre-existing lien, an affidavit must also be filed attesting the date execution was delivered to a sheriff. (22)

Duration of Lien

The new judgment certificate is valid as a lien on personal property for a period of five years after filing. (23) The creditor can obtain one new judgment lien by filing a new judgment lien certificate within six months before or six months after the expiration of the initial lien, but the refiled lien is a new lien effective as of the refiling, and not a continuation. (24) This represents a departure from the concept of the Uniform Commercial Code, where a continuation statement if timely filed continues the priority status of the original financing statement. The five-year limitation is not applicable to state tax warrants and child support obligations, which have a duration of 20 years from the date of the filing of the warrant or other document required by law to establish a lien. (25)

If specific itemized personal property is subject to a judgment lien as of the date of expiration of the five-year lien period, the law provides for a 90-day extension of the lien if the levy was delivered to the sheriff before the lapse of the lien, the property is itemized and its location is described sufficient for levy, and the property is located in the designated county in which the sheriff had jurisdiction at the time of delivery of the writ. (26) A court also has the discretion to extend the lien beyond the 90 days if extraordinary circumstances have prevented a levy. While "extraordinary" is not defined, it is reasonable to assume that only circumstances beyond the creditor's control would be sufficient. (27)

The five-year lien period will be tolled under [section] 55.204(5) during the time in which the enforceability of a judgment lien is temporarily stayed or enjoined as a result of any legal or equitable proceeding until 30 days after the stay or injunction is terminated. (28)

Indexing of Judgment Liens

Similar to the Uniform Commercial Code database, the department is instructed to maintain an Internet-accessible index of all judgment lien certificates, including 1) a unique file number, 2) date and time of filing, 3) index each certificate by name of judgment debtor, and 4) index all subsequently filed documents relating to an original judgment lien certificate in a manner that associates them to the original certificate. (29)

Priorities

A properly filed judgment lien is effective as of the date of filing, including the time of day, but no lien attaches to the property (and the creditor does not become a "lien...