December 2016

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 By Attorney Ellen French

Once a creditor has obtained a judgment, a supplemental examination is one of the first steps in collecting the judgment.  Pursuant to Wisconsin law, judgment creditors may apply for a supplemental court commissioner to order a judgment debtor to appear before the commissioner to answer questions under oath regarding the judgment debtor’s income and assets.
[1]  These supplemental examinations can be a critical part of discerning the location of a judgment debtor’s assets and lead to an eventual resolution of the judgment.  The resolution may entail either a voluntary payment arrangement or the discovery of involuntary means of collecting on the judgment.

During these supplemental examinations, a number of disputes and complaints may arise regarding the debt underlying the judgment, the sufficiency of the underlying legal proceedings, or the prior actions of the judgment creditor or its counsel.  This article shall focus on two of the more common disputes and complaints that arise during supplemental examinations and the available remedies to resolve these issues.

Generally speaking, the most common dispute encountered during supplemental examinations is a request for validation of the debt by the judgment debtor.  As supplemental examinations may occur at any point after a judgment has been entered, judgment debtors often appear at supplemental examinations years after a judgment has been entered against them.  When this occurs, the original judgment entered often may have been a default judgment and the supplemental examination may be the first contact between the judgment creditor and the judgment debtor.  Judgment debtors may see the supplemental examination as an opportunity to dispute the merits of the underlying debt or request documents indicating that the debt is owed.

In these cases, it is critical to recognize that the judgment debtor is not entitled to dispute the merits of the judgment during a supplemental examination.  As the supplemental examination serves solely as an opportunity for the judgment creditor to ask the judgment debtor questions under oath regarding his or her income and assets, a supplemental examination is the improper venue for such disputes.  Furthermore, the validation period requiring judgment creditors, as debt collectors, to provide documents regarding the underlying debt has passed once a judgment has been entered.  The Fair Debt Collection Practices Act (FDCPA) dictates that debt collectors must send out written notice of the debt to consumers “[w]ithin five days after the initial communication with a consumer in connection with the collection of any debt… unless the [required] information is contained in the initial communication or the consumer has paid the debt.”
[2]  This written notice must contain the following:

(1) the amount of the debt;
(2) the name of the creditor to whom
the debt is owed;
(3) a statement that unless the consumer,
within thirty days after receipt of the notice, disputes the validity of
the debt, or any portion thereof, the debt will be assumed to be valid
by the debt collector;
(4) a statement that if the consumer notifies
the debt collector in writing within the thirty-day period that the debt,
or any portion thereof, is disputed, the debt collector will obtain
verification of the debt or a copy of a judgment against the consumer
and a copy of such verification or judgment will be mailed to the
consumer by the debt collector; and
(5) a statement that, upon
the consumer’s written request within the thirty-day period, the debt
collector will provide the consumer with the name and address of the
original creditor, if different from the current creditor.

Therefore, when a judgment debtor is appearing at a supplemental examination after a judgment has been entered, this validation period has inevitably passed.  Consequently, the judgment debtor is not entitled to documentation underlying the debt nor is he or she permitted to use the supplemental examination as a second opportunity to litigate the judgment.  It is essential to refocus supplemental examinations back to the discovery of the judgment debtor’s income and assets.

Judgment debtors also often raise complaints during supplemental examinations regarding the frequency and timing of supplemental examinations.  As previously indicated, judgment creditors are entitled to have a judgment debtor appear before a supplemental court commissioner to answer questions regarding said judgment debtor’s income and assets under oath.


[4]  When a judgment goes unpaid, multiple supplemental examinations may be needed, especially when the judgment debtor is self-employed or unemployed at the time of the supplemental examination.  With respect to a self-employed individual, frequent updates on a judgment debtor’s financial situation is necessary for the successful pursuit of non-earnings garnishment, which relies heavily on well-timed execution on the judgment debtor’s assets. Accordingly, until a judgment has been satisfied, judgment creditors are able to proceed with multiple supplemental examinations, as needed, in order to pursue a resolution of the judgment.[5]

In sum, supplemental examinations are a valuable tool in collecting on a judgment.  When proceeding with a supplemental examination, judgment creditors must be sure to maintain a clear focus on determining the judgment debtor’s income and assets available for execution rather than be stymied by the judgment debtor’s efforts to re-litigate the underlying judgment or make complaints regarding the continued need for the judgment debtor to appear for supplemental examinations.  If able to maintain this emphasis on the judgment debtor’s income and assets, a supplemental examination can be an effective means of resolving a valid judgment.

[1] Wis. Stat. 816.03(1)(b)

[2] 15 U.S.C. § 1692g(a)
[3] Id.
[4] Wis. Stat. 816.03(1)(b)
[5] Judgment creditors prefer to keep open lines of communication with judgment debtors, as opposed to formal supplemental proceedings, however the supplemental proceedings are necessary when those open lines of communication break down.
Posted: 12/14/2016 9:15:47 AM by Tom Connor | with 0 comments