Glossary of Collection Legal Terms<\/p>\n\n\n\n
ABEYANCE. To withhold further activity.<\/p>\n\n\n\n
ACCELERATION CLAUSE. A clause in contracts of debt that makes the entire amount due upon the debtor’s default.<\/p>\n\n\n\n
ACCORD AND SATISFACTION. An understanding or conciliation between two or more adversarial parties, which addresses and resolves a dispute, obligation, claim or lawsuit.<\/p>\n\n\n\n
ACKNOWLEDGEMENT. 1) A letter from an attorney that advises that a collection claim or legal matter was received. 2) A written statement by a Notary Public that a person signed a legal document (most commonly used on a deed for the transfer of real property).<\/p>\n\n\n\n
ACTION. A word commonly used synonymously with a lawsuit.<\/p>\n\n\n\n
Actionable – Grounds for\nlegal action.<\/p>\n\n\n\n
ADJUDICATION. A pronouncement or decree, rendered by an official of the judiciary; an award or judgment.<\/p>\n\n\n\n
ADMINISTRATOR. One appointed by the court to manage and distribute an estate where the decedent has not left a will, or where for some reason an executor has not been appointed or qualified under the will.<\/p>\n\n\n\n
ADVANCEMENT OF COSTS. An outlay of funds to cover some actual expenses of legal action. Costs will vary jurisdiction-to-jurisdiction and action-to-action. Initial legal expense may consist of: 1) COURT COSTS, covering the filing of complaint, initial attempts at service of summons and, if required, a security bond. If not exhausted by preliminary expense, court costs may also be applied to post-judgment remedies: executions, writs and citations. 2) SUIT FEES, representing payment to the attorney for his\/her services in the lawsuit.<\/p>\n\n\n\n
AFFIANT. An individual who executes an affidavit.<\/p>\n\n\n\n
AFFIDAVIT. A written statement of facts signed under penalty of perjury or before a notary public.<\/p>\n\n\n\n
AFFIRMATIVE DEFENSE. A statement set forth in the defendant’s answer to a plaintiff’s complaint that recites facts that, if proven true, would excuse the defendant from some or all obligation owed to the plaintiff.<\/p>\n\n\n\n
AGENT. A person authorized by another, i.e. the principal, to act for him.<\/p>\n\n\n\n
ALLEGATION. A declaration made, but not yet substantiated. In a court of law, an assertion or contention presented by plaintiff or respondent, the merit of which is dependent on evidence subsequently presented.<\/p>\n\n\n\n
AMEND. To alter, by addendum or modification, an existing document or action.<\/p>\n\n\n\n
ANSWER. A response to a complaint in a lawsuit. Depending\nupon the court, an answer may be oral or written. Usually an answer admits or\ndenies each allegation in the complaint and may allege affirmative defenses.<\/p>\n\n\n\n
APPEAL. The process of a higher court reviewing the decision\nof a lower court. Depending upon the court, an appeal may be by trial de noveau\n(new trial) or a review based upon the record of the lower court.<\/p>\n\n\n\n
APPEARANCE. The presence of the plaintiff or defendant,\nrepresented by agent or pro se, in a courtroom.<\/p>\n\n\n\n
ARBITRATION. An informal trial to resolve a dispute before\na neutral party or parties (arbitrators) who hear testimony, apply the law and\nrender a decision. Arbitration may be mandatory (required by law or contract)\nor non-mandatory. It may be binding (no right of appeal) or non-binding (right\nof appeal is reserved).<\/p>\n\n\n\n
ASSETS. The resources and\/or property in the possession of\nan individual or business entity.<\/p>\n\n\n\n
ASSIGNEE. A term used to describe a person or entity to\nwhich property rights of another person have been assigned.<\/p>\n\n\n\n
ASSIGNMENT. A word used to describe the legal and voluntary\ntransfer of one person’s title or rights in property to another person or\nentity.<\/p>\n\n\n\n
ASSIGNMENT OF CLAIM. A transfer to an assignee of an\nobligation owed to the assignor by a third party and the right to collect the\nobligation. In some states if a claim is assigned to an assignee that then\nfiles suit in the assignee’s name, this may preclude the defendant from\nrequesting a non-resident cost bond, from asserting certain defenses and from proposing\ncertain discovery.<\/p>\n\n\n\n
ASSIGNMENT FOR THE BENEFIT OF CREDITORS. A voluntary\ntransfer, by an insolvent debtor, of all property and assets to a neutral third\nparty. A distribution of liquidated assets is then disbursed to secured and\nunsecured participants\/creditors. It is, in essence, a voluntary bankruptcy\nwithout the expense or intervention of the Federal Court.<\/p>\n\n\n\n
ASSIGNOR. One who transfers or assigns rights and\/or\nproperty to another.<\/p>\n\n\n\n
ATTACHMENT. A legal seizure of assets by an officer of the\ncourt pursuant to a judgment rendered, or court order.<\/p>\n\n\n\n
ATTORNEY-IN-FACT. An individual or business entity\nauthorized, by a written Power of Attorney, to act for another.<\/p>\n\n\n\n
BANKRUPTCY. A uniform system under the Federal bankruptcy\ncode whereby a person or other legal entity can 1) reorganize debts and pay\ncreditors over a period of time or 2) turn over all non-exempt assets to be\nadministered by a trustee under the control of the bankruptcy court for the\nbenefit of the creditors in exchange for a release from any further liability\nto the creditors. There are four common types of bankruptcy.<\/p>\n\n\n\n
1. CHAPTER 7: Straight liquidation – the company,\ncorporation, partnership or proprietorship closes; current and fixed assets are\nliquidated and the proceeds are distributed among the creditors according to\nset priorities as satisfaction of outstanding obligation. Can also be filed by\nan individual. <\/p>\n\n\n\n
2. CHAPTER 11: This is a reorganization proceeding where\nthe debtor tries to rehabilitate its financial structure. The creditors are paid\npursuant to a court-approved plan of arrangement in an amount no less than\nwould have been received in a Chapter 7 proceeding. <\/p>\n\n\n\n
3. CHAPTER 12: Protection specifically designed for the\nfamily farmer petitioning for reorganization. Debts may not exceed $1,500,000.00\n(exclusive of principal residence). 80% of debt must have been incurred by\nfarming operations and an excess of 50% of the petitioner’s income during the\nlast taxable year must have been generated by farming. <\/p>\n\n\n\n
4. CHAPTER 13: This is a reorganization proceeding for\nindividuals with a regular source of income (formerly called a wage earner’s\nplan) who have undisputed debts of less than $100,000 unsecured and $350,000\nsecured. The creditors are paid pursuant to a court-approved plan of\narrangement in periodic payments over a set period of time (usually 3 years).\nThey are paid in an amount equal to a pro-rata share of debtor’s disposable\nearnings over the life of the plan but in no event less than what would have\nbeen received in a chapter 7 proceeding. It allows the wage earner to keep\nassets that might otherwise be liquidated in a Chapter 7. The bankruptcy case\n(called an estate) is administered by a court-approved trustee. In a chapter 11\npreceding the estate are generally administered by the debtor, called a\ndebtor-in-possession (DIP), who has all of the power of the trustee. <\/p>\n\n\n\n
BAR RATES. Legal commissions charged or mandated in certain\ngeographic locations.<\/p>\n\n\n\n
BENCH WARRANT. A directive, issued by the court, ordering\nthe arrest of a subpoenaed individual who has ignored a previous judicial\norder.<\/p>\n\n\n\n
BILL OF LADING. A receipt and contract issued by a common\ncarrier for the shipment of goods.<\/p>\n\n\n\n
BILL OF PARTICULARS. A request by a party in a lawsuit\nrequiring the other party to provide a more detailed explanation of the facts\nin that party’s complaint. This is also referred to as a request for a more\ndetailed statement.<\/p>\n\n\n\n
BONE\nFIDE. In good faith.<\/p>\n\n\n\n
BRIEF. A written document filed in court which sets forth\nthe questions (issues) before the court, a statement of the case (the facts),\nthe applicable law, the discussion of the parties filing the brief\nincorporating the issues, facts and law and a conclusion. There are trial\nbriefs and appellate briefs. Trial briefs are filed either before or after\ntrial to guide the court in rendering a decision. Appellate briefs are filed\nwith the appeals court in support of an appeal or in response to the other\nparty’s appeal brief.<\/p>\n\n\n\n
BULK SALES LAW. This is a statutory law that varies from\nstate to state. It does not apply in all states. The law’s purpose is to ensure\nthat when a business is sold, the creditors of the existing business are\nnotified of the sale. In some states the law requires that the proceeds from\nthe sale be actually distributed to the creditors. The law generally applies\nonly when there is a transfer of inventory.<\/p>\n\n\n\n
BULK TRANSFER. The transfer of inventory or trade fixtures\nor a major portion thereof not in the ordinary course of business.<\/p>\n\n\n\n
CAUSE (OF ACTION). Factual allegations in a suit or\ncomplaint setting forth a claimant’s right to recover.<\/p>\n\n\n\n
CHATTEL. Any type of personal property as distinguished\nfrom real property.<\/p>\n\n\n\n
CHATTEL MORTGAGE. A written agreement giving a lender an\ninterest in the personal property of a borrower to secure payment of an\nobligation. This is a term and form of an agreement utilized prior to the\nenactment of the Uniform Commercial Code.<\/p>\n\n\n\n
CLOSING LETTER. A letter sent by the attorney to the\ncreditor or its agent, advising that the attorney is closing his file and\nstating the reasons for termination of collection efforts.<\/p>\n\n\n\n
COLLATERAL\nSECURITY. A separate obligation in a contract that is given to secure the\nperformance of the obligation.<\/p>\n\n\n\n
COMMERCIAL CLAIM. A claim which arises from an obligation\nto pay for goods sold or leased, services rendered, or monies loaned, for use\nin the conduct of a business or profession.<\/p>\n\n\n\n
COMMISSION. The compensation payable by a creditor and\nearned by a receiver for effecting collection of a claim, in whole or in part;\nit is normally contingent and computed as a percentage of the sum collected.<\/p>\n\n\n\n
COMPLAINT. Generally a written document (pleading) filed by\na plaintiff to initiate a lawsuit. The complaint usually consists of a\nstatement of jurisdiction (when required), factual allegations (causes of\naction) and a statement of what relief is requested (prayer for relief).<\/p>\n\n\n\n
COMPOSITION SETTLEMENT. An agreement between a debtor and\nhis creditors whereby the creditors agree to accept payment of a lesser sum in\nfull satisfaction of their claims. This is an out of court settlement that\noperates as a functional equivalent to a chapter 11 bankruptcy plan of\narrangement.<\/p>\n\n\n\n
COMPROMISE. A mutually agreed upon adjustment on an\naccount, effected to expedite the resolution of a dispute or prompt payment.<\/p>\n\n\n\n
CONDITIONAL SALE. An installment sale in which the goods\nare delivered to the buyer, but title remains with the seller until payment is\nmade for the goods.<\/p>\n\n\n\n
CONFESSION OF JUDGMENT NOTE. An executed document\npermitting its holder to pursue the maker, through the entrance of uncontested\njudgment, should the debtor default on a payment schedule. A confession of\njudgment note leaves the debtor in an indefensible position but is not\nrecognized in some states.<\/p>\n\n\n\n
CONFLICT OF INTEREST. When the attorney cannot handle the\ncase sent to him, usually because he represents the debtor on other cases or\nfor personal reasons.<\/p>\n\n\n\n
CONSUMER CLAIM. A claim that arises from an obligation to\npay for goods sold or leased, services rendered, or monies loaned for\nhousehold, personal or family use (the debtor is an individual).<\/p>\n\n\n\n
CONTEMPT OF COURT. A finding by a judge that a person has\nviolated a court order or is guilty of conduct before the court calculated to\ndisrupt the proceedings of the court.<\/p>\n\n\n\n
CONTINGENT FEE. Compensation earned by an attorney or agent\nwhich is payable only upon the occurrence of an event which is usually the\ncollection of money in behalf of the client. The contingent fee is usually\ncomputed as a percentage of the amount collected.<\/p>\n\n\n\n
CONTINUANCE. A mutually agreed upon postponement or\ntemporary adjournment of a pending court action.<\/p>\n\n\n\n
CONTRACT. An agreement, either written or oral between two\nor more parties, which define the obligations, and liabilities of the parties.<\/p>\n\n\n\n
CONVEYANCE. A transfer of one party’s rights or title in\nproperty to another party in accordance with law. The term usually refers to\nthe transfer of real property.<\/p>\n\n\n\n
CORPORATE VEIL (CORPORATE SHIELD). A legal term referring\nto the separation between a shareholder and a corporation. The term refers to\nthe fact that a shareholder is not liable for the debts of the corporation.<\/p>\n\n\n\n
CORPORATION. A legal entity that has its own individuality,\nin accordance with local law, separate and distinct from its members, directors\nand incorporators.<\/p>\n\n\n\n
COST ADVANCE. Sums of money advanced by the creditor to the\nreceiving attorney as a fund from which court costs are to be expended.<\/p>\n\n\n\n
COUNTERCLAIM. A complaint by a defendant against the\nplaintiff in a currently pending lawsuit whereby the defendant is seeking\naffirmative relief against the plaintiff rather than simply asserting a defense\nagainst the plaintiff’s claim.<\/p>\n\n\n\n
COURT COSTS. See Advancement of Costs.<\/p>\n\n\n\n
COVENANT. A promise made by one person to another.<\/p>\n\n\n\n
CREDITORS’ COMMITTEE. A voluntary group, representative of\nthe creditors of record, prevalent in Chapter 11 bankruptcies, installed and\nformed to examine the affairs and ongoing function of an insolvent debtor\ncompany. A neutral body organized to monitor, advise and ensure an equitable\nreturn to creditors.<\/p>\n\n\n\n
CROSS-COMPLAINT. A cause of action filed by a Defendant\nagainst a co-defendant in the same lawsuit. See also Counterclaim.<\/p>\n\n\n\n
DEFAULT. The failure to perform in accordance with an\nagreement, observe a promise, fulfill an obligation or discharge a duty.<\/p>\n\n\n\n
DEFAULT JUDGMENT. A judgment granted when the defendant\nfails to respond or appear.<\/p>\n\n\n\n
DEFENDANT. The subject of a court action, against whom\nrelief or recovery is sought through suit.<\/p>\n\n\n\n
DEFENSE. The formal response by the adversary in a court of\nlaw. An argument attempting to justify the defendant’s position.<\/p>\n\n\n\n
DEFUNCT. A description of a business, no longer\noperational, lacking resources and\/or assets.<\/p>\n\n\n\n
DEMAND LETTER. A letter addressed to a defendant or debtor\nadvising of another\u2019s (agency\/attorney) representation of the plaintiff or\ncreditor and requesting payment or performance of some obligation.<\/p>\n\n\n\n
DENIAL. A response by a defendant in a lawsuit to the\nfactual allegations of the plaintiff’s complaint. The effect of a denial is to\nrequire the plaintiff to prove his allegations.<\/p>\n\n\n\n
DEPONENT. A person who is required to appear for a\ndeposition and give sworn testimony.<\/p>\n\n\n\n
DEPOSITION. Oral testimony taken under oath in preparation\nfor trial for the purpose of discovering evidence concerning the issues to be\ntried; or, in a post-judgment deposition, testimony taken under oath for the\npurpose of discovering assets to satisfy a judgment obtained by a creditor.<\/p>\n\n\n\n
DISCHARGE. A term, which refers to an order, entered in a\nbankruptcy case, the effect of which is to relieve a debtor from having to pay\nany debt or obligation, which is subject to the order of discharge.<\/p>\n\n\n\n
DISHONOR. The nonpayment of a negotiable instrument on its\ndue date.<\/p>\n\n\n\n
DISMISSAL. Cessation of judicial consideration; termination\nof court action.<\/p>\n\n\n\n
DISTRIBUTION. Dividend payments made to creditors, who have\nduly filed claims and are acknowledged by the trustees, executors, assignees or\nadministrators of an insolvency proceeding.<\/p>\n\n\n\n
DRAFT. A mode of currency exchange; a written order for the\npayment of money drawn by one person or bank on another.<\/p>\n\n\n\n
ENDORSEMENT.\nThe signature of the person transferring a negotiable instrument.<\/p>\n\n\n\n
ESCROW.\nDelivery by a grantor of a deed or personal property to a third person for\ndelivery to the grantee in a sale.<\/p>\n\n\n\n
EXECUTION. An order issued by the Court commanding a\nSheriff, Court Officer or Bailiff to seize sufficient property belonging to the\ndebtor to satisfy the Judgment obtained by the creditor.<\/p>\n\n\n\n
FACTOR. A term which refers to a person or entity which, to\nfacilitate accounts receivable financing, makes an outright purchase of the\nmanufacturer’s accounts receivable. The purchase and sale of the accounts\nreceivable is called factoring.<\/p>\n\n\n\n
FICTITIOUS TRADE STYLE (TRADE NAME). The title utilized by\na business in lieu of the actual names of the individual owners or partners,\nor, in the instance of a corporation, the common usage of a name different from\nthe formal title registered with the state.<\/p>\n\n\n\n
FILED ANSWER. A debtor’s formal response to a complaint.<\/p>\n\n\n\n
FORCED SALE. A sale made under a court order and in the\nmanner prescribed by law.<\/p>\n\n\n\n
FORECLOSURE. An option of the secured creditor, upon\ndefault by the debtor, to orchestrate the sale of the mortgaged property in\norder to satisfy the outstanding obligation.<\/p>\n\n\n\n
FOREIGN CORPORATION. A corporation created under the laws\nof another state.<\/p>\n\n\n\n
FORWARDER. A person who or an entity which, as the agent of\nthe creditor, refers claims to attorneys for collection. A forwarder may be an\nattorney, a collection agency, a credit bureau, a credit insurance company, or\nany other entity, which acts on behalf of the creditor as its agent, in the\nreferral of claims for collection.<\/p>\n\n\n\n
FORWARDING CONTRACT. The agreement entered into between the\ncreditor (or the forwarder as the agent of the creditor) and the receiver,\nspecifying the commissions and other terms and conditions upon which the\nforwarder is offering the claim to the receiver for the purpose of effecting\ncollection of the claim. The forwarding agreement may incorporate the Operative\nGuides of the Commercial Law League of America.<\/p>\n\n\n\n
FRAUDULENT CONVEYANCE. The illegal transfer of property or\nassets, the intention of which is to defraud creditors or to avoid payment of\nan obligation.<\/p>\n\n\n\n
GARNISHEE. One against whom process of garnishment is\nissued. This individual or company has possession of money or other property,\nbelonging to the debtor, but subject to court directive.<\/p>\n\n\n\n
GARNISHMENT (WRIT OF GARNISHMENT). A directive from a court\nor other related authority directed to a third party who owes money or property\nto a judgment debtor not to pay or surrender the property to the judgment\ndebtor but to deliver it to the judgment creditor for use in either satisfying\na judgment (post judgment garnishment) or to be held as security for a debt\n(prejudgment garnishment). Typically garnishment is used in aid of execution or\nattachment. A writ of garnishment is issued pursuant to state law. The requirements\nvary from state to state.<\/p>\n\n\n\n
GUARANTEE. To assume the\nliability for debts of another in the event of his default.<\/p>\n\n\n\n
GUARANTOR. An individual or entity that undertakes\nresponsibility for an obligation of another.<\/p>\n\n\n\n
GUARANTY. Generally a written agreement between a creditor\nand a guarantor which sets forth the terms and conditions under which the\nguarantor will pay the debts of another person.<\/p>\n\n\n\n
HEARING. A preliminary examination, by a judicial body, of\npertinent facts presented by opposing parties: usually a prelude to actual\ntrial.<\/p>\n\n\n\n
HOLDER IN DUE COURSE. A bona fide holder who takes a\nnegotiable instrument (i.e. check, promissory note, etc.) for value, in good\nfaith, without notice of it being overdue or of possible defenses.<\/p>\n\n\n\n
INDEMNITY.\nCompensation paid for damage or loss sustained or anticipated <\/p>\n\n\n\n
INSOLVENCY. Condition of a\nperson who is unable to pay his debts. The general term is distinguished from a\nperson who is bankrupt and whose liabilities exceed assets.<\/p>\n\n\n\n
INDORSEMENT. The signature of the person transferring a\nnegotiable instrument.<\/p>\n\n\n\n
INJUNCTION. Word used to describe an order of the court\ndirected to another person forbidding them to do some act or in some cases\nrequiring that person to act.<\/p>\n\n\n\n
INSOLVENT. A term used to describe the negative financial\ncondition of a person or business when they have an inability to pay their\ndebts as they become due. A person is insolvent when their liabilities exceed\ntheir assets.<\/p>\n\n\n\n
INTERROGATORIES. A term used to describe a form of\ndiscovery in a lawsuit. They are written questions served upon one party by\nanother party for the purpose of obtaining factual information in the lawsuit.\nThe answers to interrogatories must be in writing and answered under oath.<\/p>\n\n\n\n
JUDGMENT. An award or opinion handed down by the bench or\njury, in summary, after determining the merit of all facts and evidence\nsubmitted by opposing parties.<\/p>\n\n\n\n
JUDGMENT PROOF. A term used to describe a judgment debtor\nwho is believed to have no assets from which a judgment could be satisfied.<\/p>\n\n\n\n
JURISDICTION. The authority by which courts are empowered\nto hear and determine controversies.<\/p>\n\n\n\n
KEEPER. A court appointed officer, directed to the\ndefendant’s place of business for the purpose of seizing the debtor’s assets to\nsatisfy a judgment.<\/p>\n\n\n\n
LAW LIST. A publication, which lists the names, addresses\nand telephone numbers of receiving attorneys and law firms.<\/p>\n\n\n\n
LEASE CONTRACT. A written agreement by which equipment or\nfacilities are provided on a rental payment basis, subject to the terms and\nconditions mutually assented. This agreement allows the lessor to retain rights\nand title, and the lessee has user ability without large capital expenditure.<\/p>\n\n\n\n
LEGAL COMPOSITION. A term, which refers to the type of\norganization under which a legal entity conducts business, i.e.,\nproprietorship, partnership, corporation, etc.<\/p>\n\n\n\n
LETTER OF CREDIT. A guaranty of payment, either revocable\nor irrevocable, in letterform generally supplied by a financial institution to\nanother party. Payment pursuant to a letter of credit will only be made in\naccordance with the terms set forth in the letter of credit and the submission\nof proper documentation. The term “standby letter of credit” refers\nto a guaranty, provided by the debtor’s bank or some other financial\ninstitution directly to a creditor, pledging satisfaction of the balance due\nthe creditor, should the debtor default on terms of payment.<\/p>\n\n\n\n
LEVY. A legal term, which refers to the process by which\nassets are seized pursuant to a writ of execution or writ of attachment.<\/p>\n\n\n\n
LIABILITIES. Debts or obligations due.<\/p>\n\n\n\n
LIABLE. Held responsible according to law.<\/p>\n\n\n\n
LIEN. An encumbrance on particular assets, utilized as\nsecurity in the extension of credit, or after the recording of a judgment.<\/p>\n\n\n\n
LIMITED PARTNERSHIP. A type of legal entity created by\nstatute. It consists of a general partner(s) who is responsible for the\noperation and management of the business and a limited partner(s) who does not\nparticipate in the management and control of the partnership. The limited\npartner in exchange for giving up management and control of the partnership is\nnot liable for the debts of the partnership.<\/p>\n\n\n\n
LIQUIDATION. The orderly sale of assets and other\nproperties for disbursement among creditors.<\/p>\n\n\n\n
LISTEE. A lawyer or law firm listed in a law list.<\/p>\n\n\n\n
MORTGAGE. A written agreement granting an interest in real\nproperty as security for a debt. A mortgage is usually foreclosed by a judicial\nproceeding.<\/p>\n\n\n\n
MOTION. A request or petition to the court, usually in\nwritten form, relative to a ruling on a point of law.<\/p>\n\n\n\n
NON-CONTINGENT\nSUIT FEE. Money sent to the attorney for filing a lawsuit. The attorney keeps\nthe money whether or not the debt is collected.<\/p>\n\n\n\n
NULLA\nBONA. Return of writ of execution by the sheriff after a search has been made\nand no assets found. It usually triggers the right to have a Supplementary Proceedings.<\/p>\n\n\n\n
OUTLAWED ACCOUNT. A claim or account that cannot be pursued\nthrough the courts by virtue of its age. Statutes of limitation will vary from\nstate to state.<\/p>\n\n\n\n
PARTICULARS (ALLEGATIONS). The factual statements set forth\nin a plaintiff’s complaint or in the defendant’s answer.<\/p>\n\n\n\n
PARTNERSHIP. A form of legal entity created by statute\nwherein two or more parties conduct business as co-owners.<\/p>\n\n\n\n
PERFECTION. The proper recording or filing of an\ninstrument, thereby giving notice to the world; usually applied to the\nperfecting of a security interest under the Uniform Commercial Code.<\/p>\n\n\n\n
PETITION. A formal application or request submitted to the\ncourt for consideration.<\/p>\n\n\n\n
PLAINTIFF. The initiating party in a court action.<\/p>\n\n\n\n
PLEADINGS. Written contentions presented by opposing\nparties, identifying their respective position in an action at law.<\/p>\n\n\n\n
POWER OF ATTORNEY. The written authorization, allowing one\nto act for another in a legal capacity.<\/p>\n\n\n\n
PREFERENCE (PREFERENTIAL PAYMENT). A term primarily used in\nthe bankruptcy court which refers to the act of paying one creditor to the\nexclusion of or disproportionate to other creditors.<\/p>\n\n\n\n
PREFERRED CREDITOR (SECURED OR PRIORITY CREDITOR). An\nindividual, organization or entity holding a security interest or claim of\npriority status.<\/p>\n\n\n\n
PRIMA FACIE. Evidence sufficient in law to establish a fact\nunless rebutted.<\/p>\n\n\n\n
PRIORITY CREDITOR. A term most commonly used in bankruptcy\nproceedings. It refers to a creditor whose claim falls into a class of claims\nwhich as a class receive payment prior to the claims of general unsecured\ncreditors, i.e. taxes, wages, and rents.<\/p>\n\n\n\n
PRO RATA. An equal share or proportionate share of debtor’s\nassets after liquidation.<\/p>\n\n\n\n
PRO SE. Without the benefit of counsel; the act of speaking\nor representing oneself in a court of law.<\/p>\n\n\n\n
PROBATE. A court proceeding utilized to administer the\nestate of a deceased person. A will, which is deemed to be valid, is admitted\nto probate. An executor or administrator is appointed in a probate proceeding.<\/p>\n\n\n\n
PROMISSORY NOTE. A formal signed pledge, binding the maker\nto tender specific payments in accordance with an expressed schedule.<\/p>\n\n\n\n
PROOF OF CLAIM. A written statement filed by a creditor in\na bankruptcy or probate proceeding setting forth the amount claimed due and\nowing to the creditor from the debtor or the estate of the deceased person.<\/p>\n\n\n\n
PROPRIETORSHIP. Sole and exclusive ownership of a business.<\/p>\n\n\n\n
QUID PRO QUO. The exchange of one valuable thing for\nanother.<\/p>\n\n\n\n
REAL PROPERTY (REAL ESTATE). A term, which is used to\ndescribe land. Real property is transferred by a deed. All other property is\nknown as personal property.<\/p>\n\n\n\n
RECEIVER. 1) A neutral third person appointed by a court to\ntake possession of or manage property, which is involved in litigation. A\nreceiver is appointed pursuant to state law. The grounds for appointing a\nreceiver vary from state to state. A receiver operates under the direction and\ncontrol of the court. 2) An attorney to whom an account is referred for\ncollection by a forwarder, and who is thereby employed, as attorney for the\ncreditor, to collect the same. Upon acceptance of the claim for collection, the\nfull attorney-client relationship exists between the receiver and the creditor.<\/p>\n\n\n\n
RECEIVERSHIP. A voluntary or involuntary position taken by,\nor forced upon, the debtor, allowing the control of the business by a neutral\nthird party.<\/p>\n\n\n\n
RECLAMATION. An action undertaken by one having a security\nor ownership interest, in an attempt to obtain possession of property held by a\ndebtor or trustee; also, an action undertaken by a seller of goods to reclaim\nsuch goods from an insolvent debtor, usually a debtor in bankruptcy or\nreceivership.<\/p>\n\n\n\n
RECORD. The act of filing a document in the office of the\nRecorder for a particular county or with the Secretary of State, the effect of\nwhich is to give notice to the world of the existence of that document and the\nclaim of interest or rights set forth in that document. Typical documents,\nwhich are recorded, are deeds, mortgages, mechanics liens, judgments, etc.<\/p>\n\n\n\n
REHABILITATION (OF A DEBTOR). A wage earner’s plan; a type\nof partial bankruptcy where a debtor keeps property and pays a\ncourt-established proportion of a debt.<\/p>\n\n\n\n
REMITTANCE.\nWhen a debtor makes payment to the agency\/attorney, the agency\/attorney puts\nthe money into their account to clear. After it has cleared, they make a\nremittance to the client, less the commissions.<\/p>\n\n\n\n
REORGANIZATION (UNDER THE BANKRUPTCY CODE). A plan approved\nby the Bankruptcy Court which implements the debtor’s restructuring of its\nfinancial affairs.<\/p>\n\n\n\n
REPLEVIN. A type of legal proceeding to recover possession\nof personal property unlawfully taken or unlawfully held. It is commonly filed\nby a secured creditor to recover possession of his collateral. In some states\nthis proceeding is referred to as a “claim and delivery proceeding.”<\/p>\n\n\n\n
RETAINER. A sum of money paid in advance to retain the\nservices of an attorney, which sum should be taken into account in determining\nthe ultimate fee to be charged for services rendered and results obtained.<\/p>\n\n\n\n
RESCIND. To recall, void or cancel an agreement.<\/p>\n\n\n\n
RETAIL CLAIM. See Consumer Claim.<\/p>\n\n\n\n
RETURN. The report submitted by a court officer,\nidentifying the actions taken to enforce a judicial order.<\/p>\n\n\n\n
SATISFACTION OF JUDGMENT. A document by plaintiff’s\ncounsel, giving evidence that a previously awarded judgment is satisfied.<\/p>\n\n\n\n
SCAM OPERATION. A business formed for the express purpose\nof obtaining credit, procuring product, and defrauding creditors by\nmisrepresentation. The principals of a scam operation have no intention of\npaying the suppliers or stabilizing the enterprise.<\/p>\n\n\n\n
SECURITY. An item of value, the rights and title of which\nare pledged to another in order to obtain an extension of credit.<\/p>\n\n\n\n
SECURITY AGREEMENT. An instrument identifying the terms and\nconditions by which one pledges security to another.<\/p>\n\n\n\n
Security Interest – Any\ninterest in property acquired by contract for the purpose of securing payment\nor performance of an obligation.<\/p>\n\n\n\n
SETTLEMENT. An agreement to resolve a dispute. The term\nfrequently results in a debtor paying a lesser sum of money or returning\nproduct to resolve a debt.<\/p>\n\n\n\n
SHERIFF. An appointment or elected county officer whose\nduties vary depending upon in which county and state he serves. The sheriff’s\nduties may range from that of being the chief law enforcement officer to merely\none who enforces judicial orders.<\/p>\n\n\n\n
SKIP.\nThis is when the debtor leaves the area in which he incurred the debt and\ncannot be located.<\/p>\n\n\n\n
SKIP\nTRACING. A service an agency does in order to locate the debtor.<\/p>\n\n\n\n
STATUS\nREPORT. This is a regular report that the attorney must write to the client\/forwarder\ninforming him of each and everything that is being done to collect the file.<\/p>\n\n\n\n
STATUTE\nOF LIMITATION. A law that limits the length of time within which a suit must be\ncommenced before the right to sue is lost.<\/p>\n\n\n\n
SUIT\nFEE. Monies that are due counsel for initiation of civil action. These monies\nmay be made contingent. They are in addition to collection commissions.<\/p>\n\n\n\n
SUIT\nFILED. When an attorney files a lawsuit in the local court to have the court\nrule on the validity of the claim. <\/p>\n\n\n\n
SOLVENT. The ability of an individual or business entity to\nmeet financial obligations within terms. Simply put: assets exceed liabilities.<\/p>\n\n\n\n
STATUTE OF LIMITATIONS. The lawful time frame, varying\nstate to state, for judicial pursuit of obligations, debts and\/or encumbrances.\nA creditor who fails to bring formal action within the parameters set down by\nthe debtor’s home state is barred from legal recourse.<\/p>\n\n\n\n
STAY. See Abeyance.<\/p>\n\n\n\n
STIPULATION. A course of action, mutually agreed upon by\nopposing counsel.<\/p>\n\n\n\n
SUBORDINATE. To assign a claim or account a lower priority\nthan other obligations.<\/p>\n\n\n\n
SUBPOENA. An order by the court, compelling the attendance\nof an individual, or representative of an entity, in court for the purpose of\nproviding testimony.<\/p>\n\n\n\n
SUBPOENA DUCES TECUM. A subpoena incorporating not only the\nappearance of an individual or representative of a business, but also the\nrequirement to present all books and records relevant to the action.<\/p>\n\n\n\n
SUBROGATION. The\nsubstitution of one person in place of another with reference to a lawful claim\nso that the person who is substituted succeeds to the rights of the other\nparty. The most common form of subrogation is an insurance company who pays a\nloss to its insured. The insurance company is subrogated to the rights of its\ninsured and may sue the party who caused the loss.<\/p>\n\n\n\n
SUIT FEE. An attorney’s compensation for the preparation\nand filing of a lawsuit. Depending upon the nature of the suit and other\nrelevant factors, an attorney’s suit fee may be all contingents, partially\ncontingent, entirely non-contingent or simply a minimum flat fee.<\/p>\n\n\n\n
SUMMARY JUDGMENT. A pre-trial motion where the moving party\nattempts to show the court that there are no material issues of fact to be\ndetermined at trial and therefore judgment should be entered as a matter of\nlaw. If the motion is successful, judgment will be granted without the\nnecessity of a trial. Trials are only conducted for the purpose of determining\nthe facts and if it can be established that there are no material issues of\nfact, then accordingly there is no need for a trial.<\/p>\n\n\n\n
SUIT REQUIREMENTS. Items which must be provided by the\ncreditor in order for a lawsuit to be instituted; these requirements should be\nset forth by the attorney at the time suit is recommended, and usually include\nan advancement for court costs and an agreement on suit fees to the attorney,\nas well as necessary paperwork and documentation.<\/p>\n\n\n\n
SUMMONS. A notification, served upon the defendant by an\nofficer of the court, identifying a duly filed action taken against him and\nrequiring him to answer by a specific date.<\/p>\n\n\n\n
SUPPLEMENTAL PROCEEDING (SUP PRO). A procedure requiring a\njudgment debtor to answer, under oath, the questions put to him by the\ncreditor’s attorney. A supplemental proceeding, facilitating the execution of a\njudgment, may be manifested as:<\/p>\n\n\n\n
1. An Examination <\/p>\n\n\n\n
2. A Citation to Discover Assets <\/p>\n\n\n\n
3. Writ of Garnishment <\/p>\n\n\n\n
4. A Rule to Show Cause (as to why the debtor should not be\nheld in contempt of court, commonly known as a Rule). <\/p>\n\n\n\n
5. A Writ of Body Attachment (physical arrest of a debtor).\n<\/p>\n\n\n\n
TRIAL DATE. Once the lawsuit is filed, the court sets a\ntrial date when the matter will be heard by a judge.<\/p>\n\n\n\n
TRUSTEE. One who holds the legal title to property for the\nbenefit of another? Also, the person\nappointed or required by law to execute a trust. <\/p>\n\n\n\n
TURNOVER\nPROCEEDING. A summary proceeding authorized under the provisions of the\nBankruptcy Act requiring a bankrupt company\/person to turn over property to a\nreceiver or trustee for administration. It may also be used in connection with\nproperty belonging to the bankrupt held by a third person.<\/p>\n\n\n\n
USURY. The body of law, which makes it illegal to charge\ninterest above a stated rate. Many states do not have usury laws. The result of\ncharging interest in excess of the allowed amount (usurious rate) varies from\nstate to state, and may include assessment of penalties, total disallowance of\ninterest or reduction in the rate of interest.<\/p>\n\n\n\n
VENUE. The geographic location of the court where a lawsuit\nmay be filed. Depending upon the circumstances, there may be more than one\nvenue in which a lawsuit could be filed.<\/p>\n\n\n\n
WAIVER. The relinquishment or refusal to accept some right\nor benefit. A waiver may result from an express agreement, by the act of a\nparty or by failure to take appropriate action when required.<\/p>\n\n\n\n
WRIT. Directive of the bench, requiring the\nsheriff\/constable or other court officer to implement a court order.<\/p>\n\n\n\n
CAUTION: The definitions appearing in this glossary are not\nexhaustive of all definitions of a particular word. They are intended to\nprovide a simplified common definition for use by non-attorneys. This should\nnot be relied on as legal advice. If questions arise consult an attorney.<\/p>\n","protected":false},"excerpt":{"rendered":"
Glossary of Collection Legal Terms ABEYANCE. To withhold further activity. ACCELERATION CLAUSE. A clause in contracts of debt that makes the entire amount due upon the debtor’s default. ACCORD AND SATISFACTION. An understanding or conciliation between two or more adversarial parties, which addresses and resolves a dispute, obligation, claim or lawsuit. ACKNOWLEDGEMENT. 1) A letter […]<\/p>\n","protected":false},"author":2,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":["post-325","page","type-page","status-publish","hentry"],"_links":{"self":[{"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=\/wp\/v2\/pages\/325","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=325"}],"version-history":[{"count":4,"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=\/wp\/v2\/pages\/325\/revisions"}],"predecessor-version":[{"id":571,"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=\/wp\/v2\/pages\/325\/revisions\/571"}],"wp:attachment":[{"href":"https:\/\/commercialrecoveryinc.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=325"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}