December 2017

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By Kirk R. Emick, Associate Attorney 

            Your client obtains a judgment against a defendant in State X.  However, that defendant has moved to Wisconsin.  You’d like to proceed with a garnishment in Wisconsin, but you only have a judgment in State X.  What are your options?  One option you have is to have that judgment moved into Wisconsin.  This is called a foreign judgment.  A foreign judgment is “any judgment, decree or order of a court of the United States or of any other court which is entitled to full faith and credit” in the state of Wisconsin.  Wis. Stat. § 806.24(1).  

Once you have your foreign judgment, a few questions may arise.  The purpose of this article is to further examine two of the issues that arise regarding foreign judgments in Wisconsin.  The areas discussed will include the length of a foreign judgment in Wisconsin, and the interest associated with the foreign judgment.  

            Once you have your judgment, it is important to know how long that judgment is valid.  Once you have docketed the foreign judgment in Wisconsin, the lien is enforceable for ten years from the date it was entered.  Wis. Stat. § 806.15(1).  “Every judgment properly entered in the judgment and lien docket showing the judgment debtor’s place of residence shall, for 10 years from the date of entry, be lien on all real property.”  Id.  There is no case law or annotations that apply to a foreign judgment that may indicate that a foreign judgment should not be considered under “every judgment.”  As with any other judgment in Wisconsin, the property may be subject to the homestead exemption as found in Wis. Stat. § 815.20.  

            While the firm does not obtain child support judgments, it may come into effect.  If a debtor has a child support judgment either in their favor or against them, it may alter the household income.  Unlike the ten years a property lien is valid, a foreign child support lien is only valid for five years from the date it becomes effective.  Wis. Stat. § 49.854(12)(a).  

            The State of Wisconsin allows for a money judgment to accrue interest.  The interest rate for a money judgment is controlled by Wis. Stat. § 815.05(8).  The interest rate is set at:  

“[O]ne percent plus the prime rate in effect on January 1 of the year in which the judgment is entered if the judgment is entered on or before June 30 of that year or in effect on July 1 of the year in which the judgment is entered after June 30 of that year, as reported by the federal reserve board in federal reserve statistical release H. 15, on the amount recovered from the date of the entry of the judgment until it is paid.”  Id.  

The prime rate as of June 30, 2017 was 4.25%, therefore the interest rate on money judgments in Wisconsin would accrue interest at 5.25% under Wis. Stat. § 815.05(8).  

            However foreign judgment interest rates are not controlled by Wis. Stat. § 815.05(8).  The Court of Appeals of Wisconsin determined the interest rate for foreign judgments in Prof. Office Buildings, Inc. v. Royal Indemnity Co.  In Prof. Office Buildings, an airplane owned by a Wisconsin corporation crashed near Tupelo, MS, causing serious injuries to several passengers.  145 Wis. 2d 573, 577, 427 N.W.2d 427 (Ct. App. 1988).  The injured sued the Wisconsin corporation in Mississippi, and obtained a judgment against the Wisconsin corporation.  Id. at 578.  The judgment was then subsequently docketed in Wisconsin.  Id. at 579.  

The insurance company for the Wisconsin corporation, Royal Indemnity, argued that the interest rate should be controlled by the state where judgment was originally obtained, here Mississippi, rather than where the foreign judgment occurred (Wisconsin).  Id. at 586.  The Court of Appeals of Wisconsin held that even when the judgment had been docketed in Wisconsin, the interest rate provided in the Mississippi judgment is applicable.  Id. at 577. 

As with standard judgments, the State of Wisconsin has regulated how long a foreign judgment is valid in Wisconsin.  Once you have your judgment, and docket it in Wisconsin, you have a typical ten-year lien.  While you do have that judgment, you will have to ascertain the interest rate for the state where the judgment was first obtained.  Once you have determined that interest rate, you will be cleared to collect on your judgment.

Posted: 12/4/2017 9:55:36 AM by Tom Connor | with 0 comments