• Carolina Barbalace

Failure to Pay Court Ordered Payment Plan

Updated: Nov 21


You won your court case and the other party (debtor) now owes you money. The judge ordered the debtor to pay you money over time. This is called a payment plan. The debtor did not pay at all or has made some of the payments but stopped paying, what should you do next?


Since the debtor breached the payment plan, you may ask the court to cancel it and accelerate the debt. In the same request, you may also request the court to grant interest on the judgment (10 percent per year). If the judge agrees, you can start enforcing the entire remaining balance of the judgment (with post-judgment interest, if requested and granted) and begin the process to collect from the debtor the money you are owed.

1. Notify the Court

The first thing you want to do is let the court know that the payment plan has been defaulted. File the SC-223 (Declaration of Default in Payment of Judgment) to the court.

Obtain the SC-223 form. A separate form for each debtor who did not make payments as ordered is required.

  • Fill out the court name, court address, and the original case number and case name.

  • Fill out Section 1 to 7 on the form, attach additional pages if needed.

  • Sign and date the form.

  • File the form with the court in person or by mail.

In-Person Filing

If you choose in-person filing, it is recommended that you bring one additional copy of each original paper to be filed: for the court to conform copies (marking with an official court stamp) and give them to you for your own records.


File by Mail

If you decide to file by mail, place the completed court papers in an envelope, add the correct postage, and mail the paperwork directly to the court. It is recommended that you include the following: one additional copy of each original paper to be filed: for the court to conform copies and give them to you for your own records. If you choose to do so, include a self-addressed stamped envelope for the court to mail conformed copies back to you.


2. Await the Court’s Decision

If the other party disagrees, they will have 10 days to respond to your declaration that they defaulted in their payment plan. If they do respond, they will do so by serving you and all other parties to the case with SC-224 (Response to Declaration of Default in Payment of Judgment) and filing SC-224 with proof of its service on all other parties to the case with the court.


After 10 days from your filing of the SC-223 form or from the debtor’s filing of the SC-224 form in response (account for extra days for mailing), you will receive a decision (SC-225 and/or SC-225A) from the court or a notice to go to a hearing (SC-225).

3. Return to Court

You are asked to go to a hearing so the court can come to a decision. Usually this happens because the court wants to learn more about the filed SC-223 or the other party has filed a SC-224 in response and objected to your request.

  • Go to the hearing as scheduled.

  • If you are unable to make the date scheduled, you can file SC-150 or write a letter to the court requesting a new date. This request requires serving all other parties with the request and paying a fee to the court.

  • Gather evidence and present to the court to support the payments and non-payments from the other party based on the numbers provided in your original SC-223 form.

  • Ask the court in person what decision you are looking for. If you want the original payment plan to be canceled due to the other party’s non-payment, make sure to ask for it.

  • The other party may ask for a different payment plan due to financial hardships. If you disagree, be sure to have evidence or an explanation as to why you disagree.

  • You may refer to the EJ-165 (Debtor’s Financial Statement) that was provided when the debtor first applied for a payment plan to get more information about the debtor’s financial situation.

  • Also, since the time has passed, you may have some evidence demonstrating that financial information provided by the debtor in their EJ-165 is now outdated: for example, because debtor’s financial situation has been improved due to a new lucrative job obtained, inheritance received, etc.


Outcome 1: The other party now owes you the full amount

Outcome 2: The existing payment plan remains unchanged

  • The other party will have to continue to pay you base on the existing payment plan.

  • The amount that is past due may become immediately “collectible”, meaning that you can use collection processes on those amounts.

  • Learn more about how to collect money after a judgment.


Outcome 3: A new payment plan is ordered by the court

  • The other party will have to pay you based on the terms on the new payment plan. If they default again, you may file the SC-223 form to ask for a new court order canceling it and accelerating the debt, as explained above.

  • The amount that is past due may become immediately “collectible”. Meaning that you can use collection processes on those amounts.

  • Learn more about how to collect money after a judgment.


 

NEED HELP WITH YOUR JUSTICE JOURNEY?


The quest for justice is never easy, particularly when it comes to getting your money back. However, thanks to advances in technology, it has become easier. Quest for Justice’s first app, JusticeDirect, is the only app of its kind designed to support people without lawyers resolve their dispute and get their money back, both in and out of court. The first step to getting money back is through a letter demanding payment from the other party JusticeDirect offers customizable demand letters for free. If the letter demanding payment does not work, then the next step is taking them to court. JusticeDirect* will guide users every step of the way through the small claims court process by helping them:

  1. Understand the legal process;

  2. Evaluate the pros and cons that come with taking someone to court;

  3. Generate small claims court forms; and,

  4. Avoid common mistakes when filing your forms and serving notice on the other side.

*Currently, JusticeDirect can only help litigants sue in California’s small claims court.



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