Legal Definitions - Satisfaction of judgment

A Satisfaction of Judgment is a formal legal document that confirms a court-ordered debt, known as a judgment, has been fully paid or otherwise resolved. When a court rules that one party (the "judgment debtor") owes money to another party (the "judgment creditor"), and that debt is subsequently settled, the judgment creditor signs and typically files this document with the court. Its purpose is to officially clear the public record, indicating that the financial obligation from the lawsuit has been met and any associated claims or liens on the debtor's property are released.

Here are some examples to illustrate this concept:

• Example 1: Small Claims Debt

  Sarah sued her former landlord, Mr. Henderson, in small claims court for the return of her security deposit. The court ruled in Sarah's favor, issuing a judgment ordering Mr. Henderson to pay her $1,500. After receiving the court order, Mr. Henderson promptly sent Sarah a check for the full amount. Once Sarah confirmed the payment cleared, she signed a Satisfaction of Judgment document, acknowledging the debt was paid. She then filed this document with the small claims court, officially closing the case and ensuring there was no longer an outstanding judgment against Mr. Henderson on the public record.

• Example 2: Personal Injury Settlement

  Following a car accident, Mark sued the at-fault driver, Lisa, for medical expenses and lost wages. A jury awarded Mark a judgment of $50,000. To ensure payment, Mark's attorney might have placed a lien on Lisa's property. Once Lisa's insurance company paid Mark the full $50,000 as ordered by the court, Mark (or his attorney on his behalf) would sign a Satisfaction of Judgment. This document would then be filed with the court and potentially recorded with the county recorder's office to remove the lien from Lisa's property, confirming that the judgment debt has been completely satisfied.

• Example 3: Business Contract Dispute

  Tech Solutions Inc. sued a client, Global Enterprises, for unpaid services totaling $100,000. The court issued a judgment in favor of Tech Solutions Inc. After several negotiations, Global Enterprises agreed to pay the full amount, which it did via a wire transfer. Upon receiving the funds, Tech Solutions Inc.'s legal department prepared and signed a Satisfaction of Judgment. This document was then filed with the court where the original judgment was issued, formally notifying the court and the public that Global Enterprises had fulfilled its financial obligation stemming from the contract dispute.