The first step in surviving a lawsuit is to understand what it is all about. The following definitions will help you to understand what you’ve been served with.
LAWSUIT. An action taken in a court of law in which one party (a person, group or business) is asking a court to provide a remedy for some wrong done by another party.
PLAINTIFF. The party starting the lawsuit.
CREDITOR. A person, business, etc., that is owed money. The creditor can be the original creditor (such as a credit card company, a mechanic, a medical office, etc.), or it can be an ASSIGNED CREDITOR, such as a collection agency or a law firm.
In lawsuits having to do with collections, the PLAINTIFF is almost always the CREDITOR. Those two terms are often used interchangeably.
DEFENDANT. The person being sued.
DEBTOR. A person who owes money to one or more CREDITORS. In collection suits, the terms DEBTOR and DEFENDANT are usually interchangeable.
SERVE or SERVICE OF PROCESS. In order to get a judgment against you, the plaintiff must SERVE you with notice of the lawsuit. To SERVE simply means to give you notice of the lawsuit in the means required by the law. There are a number of ways this can be done. One way is by PERSONAL SERVICE, which means to have someone personally hand you a summons and complaint (defined below). Another way is by SUBSTITUTED SERVICE, which means to give a copy of the summons and complaint to someone at your residence or workplace and then mail you a copy. Another way SERVICE BY PUBLICATION, under which a copy of the summons is published in a newspaper.
SUMMONS. A legal document notifying you that a lawsuit has been started and that you have a certain time in which to respond to the lawsuit or a judgment can be taken.
COMPLAINT. The legal document that states the plaintiff’s claim against you. Generally it says that you owe the plaintiff a certain sum of money that you haven’t paid.
ANSWER. A document filed by the defendant that responds to the plaintiff’s complaint. It can either agree or disagree that the money is owed to the plaintiff.
JUDGMENT. A final decision or ruling by a court that you owe the plaintiff a certain sum of money. A judgment is a matter of public record and normally goes down as a bad mark on your credit report. A judgment also gives the creditor the right to exercise various legal remedies, which will be discussed in more detail later.
GARNISHMENT, LEVY, and EXECUTION. These terms are sometimes used interchangeably. These are methods by which a plaintiff takes money or property from a defendant, through the use of court orders, normally only after a judgment has been obtained.
GARNISHMENT usually refers to the taking of a portion of someone’s paycheck. Normally 25% of the net monthly pay can be withheld, although it can be as high as 50% for child support.
LEVY normally refers to taking money from a bank account or some other source.
EXECUTION is a general term including several methods of enforcing a judgment, such as garnishment and levy.
The above has been excerpted from Mr. Crowder’s book, Lawsuit SURVIVAL 101, available for purchase here.