Judgment Renewal is Easy; Calendaring the Deadline can be Hard

Nearly ten years ago, I preached about the virtues of patience and perseverance in collection of judgments. Specifically, I discussed Tenn. Code Ann. § 28-3-110, which says that judgments are good for ten years. For judgment creditors, a lot can change for your judgment debtors in ten years.

I constantly tell my clients that. For example, that Nashville property contractor who was dead broke in 2010 could be on top of the world in 2018 Nashville. Just be patient.

But, don’t be too patient. As you approach the ten year mark, remember that judgments can be renewed for another ten years, using a pretty easy, straight-forward process under Tenn. R. Civ. P. 69.04.

Under new(-ish) Rule 69.04, this can be done via Motion, but the Motion itself must be filed prior to the expiration of the judgment. So, Tennessee creditor rights attorneys, the burden is on you to make sure you’re making a list and checking it twice, looking for judgments that are nine years old, right?

Creditors: Make a Judgment List and check it. Twice, if necessary.

What happens if your law firm gets the judgment for a client but fails to renew the judgment?

Like many issues, it depends, but a brand new opinion from the Tennessee Court of Appeals discusses this issue. The case is Linda Rozen v. Wolff Ardis, P.C., W201900396COAR3CV, 2019 WL 6876769 (Tenn. App. Dec. 17, 2019).

In that case, the law firm obtained a judgment, generally discussed the 10 year requirement with the client, and, years later, no renewal request was made; the clients sued for malpractice.

There’s a lot to unpack in this case, but here’s my quick take-away:

When you get a judgment for a client, tell them that it will expire in ten years. As part of that message, remind them that people change firms, lawyers die, files get closed, files get dormant and sent to storage, things change, but, no matter what happens, if they want you to renew the judgment in ten years, they have to call you and specifically ask you to do it. Your representation does not necessarily include this renewal request, unless you and the client agree it does.

That was a decisive fact here, that the law firm had put the client on notice that specific action was needed to renew this judgment before ten years passed. As that ten year mark approached and passed, the client didn’t raise the issue, either by confirming that the firm did it or, alternatively, suing them for malpractice within one year of the failure to renew it.

So, in a perfect world, we calendar up all our judgments for renewal and we discuss the action with our clients in advance and mutually agree on an engagement for a renewal.

But, in reality, a lot of things can change in ten years. A good practice is to make sure that the client understands that it has a responsibility in ten years to notify you that it wants you to take this action.

To Renew a Tennessee Judgment, the Motion Must be Filed Within the Ten Year Period

A quick follow-up to my discussion of Rule 69.04 and renewal of judgments in Tennessee.

A few of you e-mailed me to ask about the timing of filing a motion to extend the judgment for another ten years. Specifically, does the motion have to be granted in the ten year period, or is it enough to simply file the motion during the ten year period?

The answer is contained in Rule 69.04.

As long as a motion to extend is filed “[w]ithin ten years from entry of a judgment,”  a judgment creditor may “avoid having the judgment become unenforceable by operation of Tenn. Code Ann. § 28-3-110(a)(2).” See Tenn. R. Civ. P. 69.04 Advisory Comm. cmt. to 2016 revision.

Also, look at In re Hunt, 323 B.R. 665, 669 (Bankr. W.D. Tenn. 2005), which says “it is not essential that the debtor receive these pleadings within the ten-year period, only that the renewal pleading be filed within that time.”

To be clear, it’s my interpretation that Tenn. R. Civ. P. 69.04 does not require the order extending the judgment for the additional ten-year period to be entered within ten years from the entry of the old judgment. But you have to file that Motion to Renew before the ten years expires.

New Version of Rule 69.04 Makes Renewing a Tennessee Judgment Easier

A few months ago, I warned you all that Tennessee judgments are only enforceable for ten years and, if you have a file of uncollected judgments, you might need to check your drawers.  If you do a lot of creditors rights law work (like me), then you have about ten drawers full of unpaid judgments, so this is a big deal.

The Tennessee legislature may saw this issue coming, because, in 2016, they simplified the process by which a judgment creditor can renew (extend) the life-span of a judgment. The revisions to Tenn. R. Civ. P. 69.04 provide that the creditor:

Within ten years from the entry of a judgment, the creditor whose judgment remains unsatisfied may file a motion to extend the judgment for another ten years. A copy of the motion shall be mailed by the judgment creditor to the last known address of the judgment debtor. If no response is filed by the judgment debtor within thirty days of the date the motion is filed with the clerk of court, the motion shall be granted without further notice or hearing, and an order extending the judgment shall be entered by the court. If a response is filed within thirty days of the filing date of the motion, the burden is on the judgment debtor to show why the judgment should not be extended for an additional ten years. The same procedure can be repeated within any additional ten-year period.

So, long story short, now, it’s done by Motion and without the prior “show cause” process used in the past (and, notably, in the same case docket as the original action).

The Tennessee Court of Appeals discussed this new process in a recent opinion, at Trina Scott v. Sharfyne L’Nell White, No. M2015-02488-COA-R3-CV, July 14, 2017).  You’ll note that the underlying matter in this case was decided prior to 2016, but Judge McBrayer (himself, once a well known debtor-creditor lawyer) discusses both the new and old laws in issuing the opinion.