Legal Question in Credit and Debt Law in North Carolina
I need to sue someone who I've loaned money to (over $3400) for nonpayment in small claims court in NC. However, not long ago they moved to a different state... my question is what is the best way in which to sue them from out of state? He comes back to NC fairly frequently for work and has a family house here as well, so if I deliver the subpeona to him while he's here, would that be enough to still sue in NC?
2 Answers from Attorneys
If they are out of the county - then you can;t sue them in small claims. Best bet is to file a district court action and hopefully they will settle or default. If he has property in NC, you may be able to go after it but you said it was "family property" and I am not sure what that means - the ownership of the property will be a key consideration as to whether you will be able to execute on it successfully (as well as other factors such as the amount of equity the property has).
If the debtor is out of state then you cannot sue at all in small claims court. While you might be able to sue in district court, the question is why? There is no wage garnishment in North Carolina. Does the debtor own any property in North Carolina besides the family property you mentioned?
And what exactly does "family property" mean? Unless the debtor has an ownership interest in it, then you cannot get it through execution. And even if the debtor owns an interest, how many owners are there? Even if you get a judgment, the sheriff can only seize and sell what the debtor owns. Realistically, who wants to buy a fractional share of real property other than an interested family member maybe?
As a practical matter, if the debtor owns no property free and clear in North Carolina, you cannot collect on the judgment and you would have to transfer the judgment to the state where the debtor resides. Since you are here, you would probably need a lawyer to do that for you. It might be more cost effective, depending on where the debtor lives, for you to sue in small claims in the state where the debtor now resides and owns property. Most other states have wage garnishment and the states have different rules on what the debtor can and cannot exempt so a lawsuit in the debtor's state of residence may make more sense. I suggest that you talk to an attorney where the debtor lives and find out the procedures for going to small claims and collecting on a judgment in that state.