Nobody ever wants to be sued. It can have devastating effects on you, as the defendant, especially if you are found liable. If you are sued and lose that lawsuit, what can the courts take? The short answer is potentially everything. If you lose a lawsuit and a money judgment is entered against you, all of your assets could potentially be at risk to pay off that judgment, and your wages could be garnished (i.e., taken) until the judgment is fully paid. We say “potentially” because there are some assets that would be protected against such judgments depending on how the asset is owned. For instance, if you own a home with a spouse, and you both hold the home as “tenants by the entirety,” a lawsuit against one of the spouses generally will not result in a lien against the home. Also, when a judgment is entered against you, and the other side attempts to collect, frequently they will issue you a “citation to discover assets” which basically asks you to identify all of your assets. This is done to evaluate what assets you have that might be available to pay off the judgment. When we issue citations to discover assets while attempting to collect on a judgment, the list of items we ask for is very extensive, and includes, for instance, all checking and savings accounts, business accounts, real estate, contents held in safety deposit boxes, jewelry, cash and credit/debit cards. One way to protect your personal assets from being taken to satisfy a judgment is to have the proper insurance in place. When we say the proper insurance, we mean the right types of coverages with the right policy limits. If you own a car with insurance policy limits of $25,000 per person and $50,000 per accident, and you cause an accident where one injured party has over $100,000 in damages, the injured party can collect the $25,000 limit of your insurance policy and then pursue you personally for the amount of damages incurred in excess of the policy limit. In our experience, this does not happen very often because of the difficulty in pursuing individuals personally, and due to the uncertainty in defendants being able to pay off judgments with personal assets, However, if you are wealthy, or have substantial assets, then the money and assets could be used to collect that judgment. In order to fully protect yourself, you will need to obtain an insurance policy with higher limits and also consider buying an umbrella policy. Otherwise, you could stand to lose your car, cash, or other assets to satisfy that judgment. For more questions about liability and insurance, contact one of our attorneys today at [email protected] or (708) 576-1624.