Overview
For additional guidance, please refer to Steptoe's COVID-19 Resource Center.
First Tuesday Update is our monthly take on current issues in commercial disputes, international arbitration, and judgment enforcement.
Once again, we continue to hope you are reading this in good health and that you, members of your family, and your colleagues are safe as we deal with COVID-19 together. We, like you, are continuing to work at home while some parts of the country start to reopen during uncertain times. As of now, the Washington, DC-area (including Maryland and Virginia) has not provided any timetable on when restrictions may be lifted.
This month we discuss enforcing judgments during COVID-19. Judgment enforcement is almost always accomplished at the local level where a federal marshal, sheriff or other deputized local official serves a writ of attachment, garnishment, or execution to levy an asset. Even at the federal level, Rule 69 of the Federal Rules of Civil Procedure provides that "the procedure on execution—and in proceedings supplementary to and in aid of judgment or execution—must accord with the procedure of the state where the court is located, but a federal statute governs to the extent it applies." Moreover, courts (federal and local) supervise the process of judgment enforcement and issue writs to local sheriffs or federal marshals directing them to take legal process against assets or property. Thus, in this environment, a myriad of executive orders, state, and local laws, regulations, and court orders, are affecting the ability to enforce judgments. While the public policy purpose of many of the recently passed emergency relief measures is aimed at consumer debt and personal situations like residential foreclosures, business disputes could easily fall under these temporary restrictions. Bottom-line: check the specific rules and orders in the locality before proceeding with judgment enforcement (a good tip even during non-COVID-19 times).
By way of one prominent example, the New York Council has proposed legislation (see Council of City of NY Intro No. 1912-2020) to cease "the taking and restitution of property and the execution of money judgments by the city sheriff and marshals due to the impacts of COVID-19." The proposed legislation remains in committee as of this writing. Sheriff Joe Fucito testified about the proposed legislation. His major concern was that "judgment and execution enforcement are mandates that come from the court. They are under the governance of the State court system and implemented through the State Civil Practice Law and Rules. Indeed, they represent the core function of the judiciary branch and the ultimate expression of its independent decision-making authority. We believe that Intro 1912 would require actions that interfere with this well-established structure. The bill assigns duties to the Sheriff that presupposes the Sheriff has control over the judgment and execution process. However, that is not the case. The Sheriff is an officer of the court and wholly guided by the exacting statutory steps set forth in the CPLR which preclude the Sheriff's personal judgment or outside review." See the Proposed Legislation. In other words, with superior law and court supervision already governing the process, a local authority’s ability to change those rules is uncertain at best.
Other jurisdictions have been taking various approaches. For instance, in Florida, each county has issued administrative orders suspending the service of writs of execution or possession with varying differences—some counties have only suspended writs in connection with family courts whereas other county administrative orders apply broadly to all judicial writs. California, by executive order, permitted local authorities to suspended writ of possession. By contrast, Minnesota issued a state-wide executive order suspending the execution of all writs of recovery and residential evictions as well as requiring financial institutions to place a moratorium on residential foreclosures.
In other jurisdictions, courts have taken the lead. The courts of Missouri suspended the issuing writs of restitution, attachment, execution and replevin through June 1, 2020. And in Texas, courts issued an order suspending execution of the writ of possession until after May 7, 2020.
As a practical matter, it could be difficult under current circumstances to execute the actual steps involved in judgment enforcement: a sheriff or marshal serving the order personally on the relevant property or holding a public auction to sell it. Notwithstanding these difficulties, the courts have equitable powers when a legal remedy is insufficient or inadequate that could preserve the property through injunctions and the like. We view these current barriers to judgment enforcement as temporary but challenging.
