Commercial Debt Collection Lawyers in Tennessee

Commercial Debt Collection Law Firm

In order to be successful in the collection of a debt or judgment owed to you or to your business, it is vital that you receive the assistance of an experienced commercial debt collection lawyer or law firm who will aggressively and skillfully take the steps necessary to collect the money which you are owed. The successful collection of a debt requires that you hire a lawyer who has experience with the tactics which debtors will use to avoid paying lawful debts.

Successful collection of a commercial debt often requires that you have a lawyer with the resources and the ability to locate concealed assets. It is also important to retain a lawyer or a law firm who has a solid working knowledge of the different procedures available under Tennessee law to "pin down" a debtor's assets and to collect against them. Your commercial collection case is important, and you should not settle for a lawyer (or law firm) who intends to do minimal work to try and make a quick and easy contingency fee, but who is not willing to pursue aggressively the debtor when the debt is not easily collected.

Many debtors have no respect for their obligation to pay a debt, and engage in tactics to hinder or to delay a creditor's collection of a debt. In order to avoid paying a judgment, some debtors hide assets or transfer assets to friends, to relatives or to "shell" businesses or corporations for nothing, or for a fraction of the true value of the assets. Some debtors misrepresent their assets, or the value of their assets, in order to avoid paying a debt or judgment. Many debtors, when pressed to pay a debt, suddenly come up with frivolous legal arguments as to why they should not have to pay the debt.

Attorneys Ross Pepper and Matthew Brothers have been responsible for collecting millions of dollars owed to banks, businesses, and individuals during the course of their forty years of combined practice. Pepper & Brothers, PLLC has a proven track record of success in collecting debts. We have represented clients throughout Tennessee in cases involving the collection of commercial debts. We have the experience, skill and commitment necessary to collect commercial debts successfully for our clients.

In many cases, we agree to represent clients in cases involving the collection of commercial debts or judgments on a contingency fee basis. Under a contingency fee arrangement, we guarantee that you do not have to pay us any fee, unless and until, we recover money for you.

In many cases, it is not possible for a creditor to receive payment for goods or services unless a lawsuit is filed against the debtor. The first step of any lawyer or law firm in collecting a commercial debt, in most instances, should be to file a lawsuit and "reduce the debt to judgment." In many cases, obtaining a judgment for a client is only the first half of the battle. After a judgment is obtained, it must be collected. In some cases, creditors against whom a judgment has been entered voluntarily pay the judgment. In many other cases, once the judgment is entered by the court for the creditor, additional legal procedures must be aggressively used to collect the judgment or debt.

Here are some of the legal procedures which can be used in Tennessee to collect debts and judgments:

• Lien and execution on real property: In Tennessee, a creditor can file a judgment as a lien against real property owned by a debtor. In many cases, it is vital that a judgment lien be filed as soon after a final judgment is entered as possible in order to preserve the priority of the payment of the debt with respect to other creditors who may also be owed money, and who may also claim a right to be paid from the proceeds of the sale of real property owned by the debtor. Merely filing a judgment as a lien against real property owned by the debtor may result in the payment of the debt. In many cases, however, the existence of the judgment lien itself does not result in the payment of the debt. In those cases, it is necessary to seek the assistance of a court, and to have a court enter an order directing that the debtor's land be sold to pay the debt in question.
• Mechanics' and materialmens' liens: In Tennessee, contractors and subcontractors are given certain lien rights with respect to real property and improvements on which they have performed work or with respect to which they have supplied materials or equipment. These lien rights are referred to as mechanics' and materialmens' liens (or sometimes as "construction liens"). A mechanics' and materialmens' lien can be used to compel the payment for a contractor's or subcontractor's work, including, labor, materials, services, equipment, machinery, overhead and profit. The filing of a mechanics' and materialmens' lien can also ensure that a contractor or subcontractor receives payment of its debt from the proceeds of the real property upon which it performed work or for which it provided materials. To meet the time deadlines and filing procedures required to have your lien be effective and enforceable, you need to retain the services of a lawyer or law firm familiar with the complex lien laws which are effective in Tennessee. We have been representing contractors and subcontractors in mechanics' and materialmen's lien cases for over twenty years.
• Garnishment of bank accounts, wages, salaries, and accounts receivable: Under Tennessee law, a person or entity in possession of funds owed or belonging to the debtor may be compelled to "freeze" the transfer of those funds, and to pay them over to the party owed money by the debtor. The procedure by which payment of a debt is received from a third party is known as garnishment. Garnishment procedures can be highly effective in recovering money owed to a creditor.
• Attachment and Execution: In Tennessee, personal property such as vehicles, boats, equipment, inventory, stocks, and bonds can be sold to satisfy debts owed by the owner of the personal property. In order to affect an attachment and execution, certain legal procedures and requirements must be implemented and followed.
• Post-judgment examination under oath and other post-judgment discovery: In order to locate assets of the debtor, Tennessee allows a creditor's lawyer to conduct a post-judgment examination under oath (or deposition) of a debtor. During this examination, a creditor is required by law to answer all questions which are asked which concern the location and value of assets owned by the debtor, and which concern the financial condition of the debtor. Before an attorney can effectively issue garnishments or execute on property, a post-judgment examination of the debtor may be necessary. In addition to conducting a post-judgment deposition of a debtor, a creditor's attorney can require a debtor to produce documents which are related to assets of the debtor, to the debtor's financial condition, or to transfers of assets made by the debtor. Documents which are typically requested in post- judgment discovery include bank records, such as monthly statements and cancelled checks, tax returns, records related to the ownership of bonds or securities, and financial records related to business operations.
• Piercing the corporate veil: In appropriate cases, a court may permit a party to "pierce the corporate veil" and hold individuals personally liable for the debts of a corporation or other business entity. There are several factors which a Tennessee court will consider in determining whether the "corporate veil" of a business should be pierced. Those factors are: Whether the business was grossly undercapitalized; whether there was diversion or manipulation of corporate assets; whether the corporation or business was used as an instrumentality for an individual, another corporation or a business; whether the entity was owned solely by one person; and whether there was a failure to collect paid-in capital. As part of our analysis of your case, we will determine what grounds exist for piercing the corporate veil so that all parties who may be legally responsible for the debt owed to you are held accountable.
• Pinpointing and setting aside fraudulent transfers and fraudulent conveyances: Tennessee has adopted the Uniform Fraudulent Transfer Act which allows a creditor, under certain circumstances, to set aside and to void a transfer of an asset made by a debtor so that the debt to the creditor can be satisfied from the asset. Generally speaking, transfers that may be set aside by a creditor in order to collect money owed to the creditor include any transfers made by a debtor with the intent to hinder, delay or defraud a creditor. The following are some of the questions that Tennessee courts ask to determine whether or not a creditor transferred an asset to hinder, delay or defraud a creditor:
• Was the transfer to an insider?
• Did the debtor retain possession or control of the asset after the alleged transfer?
• Was the transfer concealed and hidden?
• Was the debtor sued or threatened with a lawsuit before the transfer?
• Did the debtor transfer substantially all of the debtor's assets?
• Was the value of the asset transferred reasonably equivalent to the consideration received by the debtor for the asset?
• Did the debtor become insolvent shortly after the asset was transferred?
• Did the transfer occur shortly before or after a substantial debt was incurred?

If the answer to one or more of the above questions is in the affirmative, a creditor may well have adequate legal grounds to have the transfer set aside and used for the payment of the debt owed to the creditor. In cases where it appears that a fraudulent transfer may have been made, it is important for your commercial collection lawyer to conduct the necessary discovery and to take the necessary depositions to determine whether or not a transfer of an asset or assets by a debtor can be set aside as a fraudulent transfer. Part of our strategy in commercial collection cases is to determine whether a debtor might have made fraudulent transfers of assets, which, if set aside, could result in the payment of the debt owed to our client.

A transfer of an asset by a debtor may be set aside even if the debtor did not make the transfer with the intent to hinder, delay or defraud creditors where certain circumstances can be proven. For example, if a debtor transfers an asset for less than its value, and the debtor reasonably should have known that it would be incurring debts which the debtor could not pay, the transfer may be set aside so that a creditor can collect against the asset which was transferred.

Foreign judgment domestication: If you, or your client, has obtained a judgment from a state other than Tennessee which you need domesticated, our office can assist you in domesticating your judgment so that it is entitled to full faith and credit in Tennessee. Our office can assist you in employing Tennessee procedures such as garnishment, attachment and execution to collect the debt owed to you, or your client, from assets located in Tennessee.

If you need a Nashville commercial debt collection lawyer or a Tennessee commercial debt collection law firm, contact Pepper & Brothers, PLLC at 615-256-4838 for an initial consultation. Attorneys J. Ross Pepper and Matthew Brothers are committed to providing superior legal services in Nashville and throughout Tennessee to assist clients in the collection of commercial debts.