Unfortunately, winning a case does not guarantee that you will collect money. The court is not responsible for collecting the judgment. Rather, if the judgment debtor (losing party) does not voluntarily pay the judgment to the judgment creditor (winning party), the judgment creditor must take action to collect.
For construction cases, the issue becomes more complicated and nuanced where a construction lien is filed on real property owned by a third-party. This was recently addressed by the Nebraska Supreme Court in McGill Restoration v. Lion Place Condo. Assn., 313 Neb 658 (2023). In this case, McGill Restoration, Inc. (“McGill”) obtained a judgment against Lion Place Condominium Association (“Association”) on a breach of contract claim for its failure to pay for repairs on a condominium building. McGill filed construction liens on each unit but did not initiate lien foreclosure proceedings. To note, the units of the condominium building are owned by Association members, not the Association.
To collect on the judgment, McGill sought and obtained a writ of execution directing the sheriff to levy execution upon a unit owned by a member of the Association. A writ of execution is an order from the court to directing a sheriff to seize and sell property of the judgment debtor to satisfy the judgment. The member filed a motion to quash the writ of execution, arguing that McGill could not levy execution against his unit, because judgment was entered against the Association—not the member. The district court overruled the motion to quash, and the member appealed.
The Nebraska Supreme Court held that, in general, “Nebraska law does not authorize a court to order a sheriff to levy a writ of execution on property in which the judgment debtor does not hold an interest.” McGill Restoration, 313 Neb. at 662. Because the Association did not hold any interest in the member’s unit, McGill was not entitled to execute against the unit. Although McGill had filed a construction lien against each unit of the Association, McGill did not initiate foreclosure proceedings against the owners of the real property. Therefore, McGill could only collect from property owned by the Association.
The Take-A-Way: If you have timely filed a construction lien for services rendered or materials provided for the improvement of real property, always file a lien foreclosure action to protect your ability to collect judgment from the real property subject to the construction lien.
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