HB 583

Under existing law, the owner of a judgment may file in the office of the judge of probate of any county in this state a certificate of clerk or register of the court by which the judgment was entered, showing the court name, the amount of the judgment and costs, and the names of the parties

Every judgment that is properly filed constitutes a lien in the county in which it is filed against the property of the defendant which is subject to levy and sale under execution

Also under existing law, there is no requirement that a judgment creditor whose judgment has been satisfied file an acknowledgment of satisfaction of the judgment to remove the lien

This bill would provide that when a money judgment is satisfied, the judgment creditor is required to file an acknowledgment of satisfaction of the judgment with the court and serve a notice of that acknowledgment with the judgment debtor

This bill would provide a procedure where the judgment debtor may demand that the judgment creditor file an acknowledgment of satisfaction of the judgment with the court when the judgment creditor's judgment has been satisfied

Relating to civil actions; to add Sections 6-9-213 through 6-9-222 to the Code of Alabama 1975, to provide a procedure for the satisfaction of judgments.

Section 1

Sections 6-9-213 through 6-9-222 are added to Article 9 of Chapter 9 of Title 6 of the Code of Alabama 1975, to read as follows: §6-9-213. (a) A money judgment may be satisfied by payment of the full amount required to satisfy the judgment or by acceptance by the judgment creditor of a lesser sum in full satisfaction of the judgment. (b) Where a money judgment is satisfied by levy, the obligation of the judgment creditor to give or file an acknowledgment of satisfaction arises only when the judgment creditor has received the full amount required to satisfy the judgment from the levying officer. (c) Where a money judgment is satisfied by payment to the judgment creditor by check or other form noncash payment that is to be honored upon presentation by the judgment creditor for payment, the obligation of the judgment creditor to give or file an acknowledgment of judgment arises only when the check or other form of noncash payment has actually been honored upon presentation for payment. §6-9-214. The court clerk shall enter satisfaction of a money judgment in the register of actions when any of the following occur: (1) A writ is returned satisfied for the full amount of a lump-sum judgment. (2) An acknowledgment of satisfaction of judgment is filed with the court. (3) The court orders entry of satisfaction of judgment. §6-9-215. When a money judgment is satisfied, the judgment creditor immediately shall file with the court an acknowledgment of satisfaction of judgment. §6-9-216. If an abstract of a money judgment has been recorded with the recorder of any county and the judgment is satisfied, the judgment creditor shall immediately do both of the following: (1) File an acknowledgment of satisfaction of judgment with the court. (2) Serve an acknowledgment of satisfaction of judgment on the judgment debtor. Service shall be made personally or by mail. §6-9-217. (a) If a money judgment has been satisfied, the judgment debtor, the owner of real or personal property subject to a judgment lien created under the judgment, or a person having a security interest in or a lien on personal property subject to a judgment lien created under the judgment may serve personally or by mail on the judgment creditor a demand in writing that the judgment do one or both of the following: (1) File an acknowledgment of satisfaction of judgment with the court. (2) Execute, acknowledge, and deliver an acknowledgment of satisfaction of judgment to the person who made the demand. (b) The demand shall include the following statement: "Important warning. If this judgment has been satisfied, the law requires that you comply with this demand not later than 15 days after you receive it. If a court proceeding is necessary to compel you to comply with this demand, you will be required to pay my reasonable attorney's fees in the proceeding if the court determines that the judgment has been satisfied and that you failed to comply with the demand. In addition, if the court determines that you failed without just cause to comply with this demand within the 15 days allowed, you will be liable for all damages I sustain by reason of your failure and you will also forfeit one hundred dollars ($100) to me." (c) If the judgment has been satisfied, the judgment creditor shall comply with the demand not later than 15 days after actual receipt of the demand. (d) If the judgment creditor does not comply with the demand within the time allowed, the person making the demand may apply to the court on noticed motion for an order requiring the judgment creditor to comply with the demand. The notice of motion shall be served on the judgment creditor. Service shall be made personally or by mail. If the court determines that the judgment creditor has not complied with the demand, the court shall either order the judgment creditor to comply with the demand or order the court clerk to end satisfaction of the judgment. (e) If the judgment has been satisfied and the judgment creditor fails without just cause to comply with the demand within the time allowed, the judgment creditor is liable to the person who made the demand for all damages sustained by reason of such failure and shall also forfeit one hundred dollars ($100) to the person. §6-9-218. If an abstract of a money judgment has been recorded with the recorder of any county and the judgment is satisfied, the judgment creditor shall immediately do both of the following: (1) File an acknowledgment of satisfaction of judgment with the court. (2) Serve an acknowledgment of satisfaction of judgment on the judgment debtor. Service shall be made personally or by mail. §6-9-219. (a) An acknowledgment of satisfaction of judgment shall contain all of the following information: (1) The title of the court. (2) The cause and number of the action. (3) The names and addresses of the judgment creditor, the judgment debtor, and the assignee of record if any. If an abstract of judgment has been recorded in any county, the judgment debtor's name shall appear on the acknowledgment of satisfaction of judgment as it appears on the abstract of judgment. (4) The date of entry of judgment and of any renewals of the judgment and where entered in the records of the court. (5) A statement that the judgment is satisfied in full or that the judgment creditor has accepted payment or performance other than that specified in the judgment in full satisfaction of the judgment. (6) A statement whether an abstract of the judgment has been recorded in any county and, if so, a statement of each county where the abstract has been recorded and the book and page of the county records where the abstract has been recorded, and a notice that the acknowledgment of satisfaction of judgment, or a court clerk's certificate of satisfaction of judgment, will have to be recorded with the county recorder of each county where the abstract of judgment has been recorded in order to release the judgment lien on real property in that county. (7) A statement whether a notice of judgment lien has been filed in the office of the Secretary of State and, if the notice has been filed, a statement of the file number of the notice, and a notice that the acknowledgment of satisfaction of judgment, or a court clerk's certificate of judgment, will have to be filed in that office in order to terminate the judgment on personal property. (b) The acknowledgment of satisfaction of judgment shall be made in the manner of an acknowledgment of a conveyance of real property. (c) The acknowledgment of satisfaction of judgment shall be executed and acknowledged by one of the following: (1) The judgment creditor. (2) The assignee of record. (3) The attorney for the judgment creditor or assignee of record unless a revocation of the attorney's authority is filed. §6-9-220. (a) If a judgment creditor intentionally conditions delivery of an acknowledgment of satisfaction of judgment upon the performance of any act or the payment of an amount in excess of that to which the judgment creditor is entitled under the judgment, the judgment creditor is liable to the judgment debtor for all damages sustained by reason of the action or five hundred dollars ($500), whichever is greater. (b) Subsection (a) does not apply if the judgment creditor has agreed to deliver an acknowledgment of satisfaction of judgment to the judgment debtor prior to full satisfaction of the judgment in consideration for the judgment debtor's agreement to either furnish security or to execute a promissory note, or both, the principal amount of which does not exceed the amount to which the judgment creditor is entitled under the judgment. §6-9-221. In an action or proceeding maintained under this article, the court shall award reasonable attorney's fees to the prevailing party. §6-9-222. (a) If satisfaction of a judgment has been entered in the register of actions, the court clerk shall issue a certificate of satisfaction of judgment upon application and payment of a twenty-five dollar ($25) fee. (b) The certificate of satisfaction of judgment shall contain all of the following information: (1) The title of the court. (2) The cause and number of the action. (3) The names of the judgment creditor and the judgment debtor. (4) The date of entry of judgment and of any renewals of the judgment and where entered in the records of the court. (5) The date of entry of satisfaction of judgment and where it was entered in the register of actions.

Section 2

This act shall become effective on the first day of the third month following its passage and approval by the Governor, or its otherwise becoming law.