Legal Definitions - judgment creditor

A judgment creditor is an individual or entity that has successfully sued another party in court and obtained a formal court order, known as a judgment, stating that they are owed a specific amount of money. This judgment legally empowers the judgment creditor to take steps to collect the awarded funds from the party who owes the money (the judgment debtor).

• Example 1: Individual vs. Individual

  Imagine David hired a contractor, Emily, to renovate his kitchen. Emily took a large deposit but then abandoned the project without completing the work. David sued Emily in court to recover his deposit and the costs he incurred due to her breach of contract. The court ruled in David's favor and issued a judgment ordering Emily to pay him a specific sum. In this situation, David is the judgment creditor because he holds a court judgment that legally entitles him to collect the awarded money from Emily.

• Example 2: Business vs. Business

  Software Solutions Inc. developed custom software for Global Logistics Corp. After the software was delivered and implemented, Global Logistics Corp. refused to pay the final invoice, citing minor issues that Software Solutions Inc. argued were not part of the original agreement. Software Solutions Inc. filed a lawsuit and ultimately won a judgment from the court for the unpaid amount. Here, Software Solutions Inc. is the judgment creditor, as the court's decision grants them the legal authority to pursue collection of the outstanding debt from Global Logistics Corp.

• Example 3: Financial Institution vs. Individual

  First National Bank provided a personal loan to Ms. Rodriguez. After several months, Ms. Rodriguez stopped making payments on the loan. Despite repeated attempts to contact her, the bank was unable to resolve the default. First National Bank then sued Ms. Rodriguez to recover the outstanding balance. The court found in favor of the bank and issued a judgment for the full amount owed. First National Bank is now the judgment creditor, possessing the legal right through the court's judgment to enforce collection of the debt from Ms. Rodriguez.