How The Kala Law Firm Helped A Client Tackle A Settlement
Very often, people who get sued by a debt buyer don’t respond to the lawsuit, until they are faced with the unpleasant reality that a default judgment has been entered against them. A default judgment is passed when you don’t submit a written answer to a lawsuit against you. When the court enters a default judgment, it gives the debt buyer everything they are asking for.
Sometimes people get served with a lawsuit and don’t know what to do, so they do nothing. At other times, the debt buyer gets permission to serve a person through the mail and mails the complaint and summons to the wrong address. The danger of allowing a default judgment against you is once this occurs, the debt buyer can garnish your wages and your bank accounts.
At the Kala Law Firm Professional Corporation, we have several clients who have had their wages and bank accounts garnished every week and didn’t even know a judgment had been entered against them.
In these situations, we work hard to find a solution for our clients. Keep reading to learn about how we helped a client who was pursuing a settlement with a default judgment.
The Challenge: Undoing a default judgment.
In one particular situation, our client was unaware that there was a lawsuit against them. It was only weeks later that our client learned that they had not just a lawsuit, but a very large default judgment on their credit report.
The client approached us as they needed to negotiate a settlement on this default judgment, but they neither wanted to pay too much for a settlement nor have a long drawn out legal battle.
Generally, when a default judgment has been entered against you, you can either ask the court to set aside the default judgment and give you an opportunity to contest it, or settle the debt with the debt buyer for an amount less than what the default judgment is for, or eliminate the default judgment completely, by filing for bankruptcy.
As our client sought a settlement, and our challenge was to get the debt buyer to accept our reasons for a settlement.
The Solution: We played on our client’s weak financial position.
After considering all the options we had, we finalized the strategy we needed to employ. The plan was to analyze our client’s financials and prepare a settlement offer which capitalized on their weak financial position. We shared our client’s financial statements with the opposing counsel to convince their client that the money they were seeking was not going to be available.
The most challenging aspect of this case was the time constraints. We needed to read through extensive amounts of financial documents, as well as make court appearances as the contesting party was simultaneous initiating court action while the settlement was being negotiated.
Though we were able to formulate a plan and strategize quickly, obtaining the settlement took around a month due to the extensive financials which needed to be reviewed. In the end, we successfully received a settlement, and our client settled the debt and avoided any legal battles.
*past results are not necessarily indicative of future results*
The Bottom Line
At the Kala Law Firm Professional Corporation, we offer direct and personable legal services for debt-related matters, real estate closings, family law, wills and estates, and corporate law. Kala Law Firm Professional Corporation offers consulting services in the Mississauga, Toronto, Oakville, Brampton, and Milton area. To get started, get in touch with us by clicking here. To learn more about how we can help you, please click here. Or to read what our clients are saying about us, please click here.