Adding Costs and Interest to a Judgment
Disclaimer: This guide is intended as general information only. Your case may have factors requiring different procedures or forms. The information and instructions are provided for use in the Sacramento County Superior Court. Please keep in mind that each court may have different requirements. If you need further assistance, consult a lawyer.
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The amount recoverable by a judgment creditor includes the total amount of the judgment entered by the court, plus any costs incurred after judgment and accrued interest on the total amount.
Under California Code of Civil Procedure (CCP) § 685.040, a judgment creditor is entitled to reimbursement for the "reasonable and necessary" costs of enforcing a judgment. The law provides a detailed list of the types of costs that can be recovered, including the costs of issuing the writ of execution; levying officers' fees for processing writs or levies; debtor's examination fees; and fees for preparing, issuing and recording an abstract of judgment or notice of lien (CCP § 685.050 et seq). Attorneys' fees related to the enforcement of judgment are generally not reimbursable, unless specifically allowed by law, or the underlying judgment includes an award of attorney's fees CCP § 685.040. The law does not provide for reimbursement of costs such as postage, photocopying, or long-distance telephone charges, nor can the judgment creditor be compensated for his or her time or mileage related to enforcement efforts. Once approved by the court, costs become part of the judgment (CCP § 685.090). To be reimbursable, costs must be reported to the court within two years of being incurred (CCP § 685.070(b)). For this reason, many judgment creditors regularly file a Memorandum of Costs after Judgment (Form MC-012) with the court.
Unpaid judgment amounts accrue interest at the legal rate of 10% per year (CCP § 685.010) (7% if the judgment debtor is a state or local government entity (California Constitution, Article XV, §1)). Costs approved by the court are included as part of the judgment amount, and thus accrue interest. Additionally, upon renewal of a judgment, the unpaid judgment amount and accrued interest are calculated to determine the renewed judgment amount. For this reason, many judgment creditors will renew a judgment as soon and as frequently as possible, i.e., every five years. See the Renewal of Judgments guide on our website at http://www.saclaw.org/pages/renew-judgment.aspx for more information. Interest begins to accrue on the day the judgment is entered (CCP §685.020(a)). If the judgment is payable in installments, interest accrues from the date each installment is due.
Payments received by the judgment creditor must be credited in the specific order detailed in CCP § 695.220. Payments are credited first toward costs incurred by the levying officer under CCP § 685.050(b) (e.g., the fees associated with processing a writ of execution). After that, payments are credited toward fees due to the court under California Government Code (Govt Code) § 6103.5 (court fees waived because a party was a government entity) or Govt Code § 68637 (waived filing fees). Payments are then credited toward accrued interest, and lastly toward the principal judgment amount.
To have costs and interest added to the enforceable amount owed, the judgment creditor must file and serve a Memorandum of Costs after Judgment (Form MC-012). On this form, the judgment creditor must include the exact amount of all costs and accrued interest. This means the judgment creditor is responsible for calculating this amount. This can be easy to calculate if the judgment is paid in a lump sum, but becomes complicated if smaller payments are made over time.
Luckily, there are several online judgment calculators to help you with this task. The San Diego Superior Court provides a free online program that will calculate the amount due on a specific day. All you do is input the judgment amount, date, and payment history, and the program does all the calculations for you. Unfortunately, you must input all your data each time you wish to make a calculation, which can be inconvenient if you need to frequently recalculate the amount owed. The calculator is available online at http://ijcalc.sdcourt.ca.gov/Disclaimer.aspx, and a detailed user guide is available at http://ijcalc.sdcourt.ca.gov/JCalcUserGuide.pdf.
Another free online calculator is provided by the Legal Aid Foundation of Santa Barbara County. This is a Microsoft Excel spreadsheet that you may download onto your computer. You input the judgment amount, date of entry, and the last date for which you wish interest to be calculated. The spreadsheet populates with the outstanding principal and interest amount due every day. As you add information about payments and costs, the spreadsheet recalculates the amounts due. Because this spreadsheet is downloaded to your computer, you can easily enter new payments and costs as they occur. You can download this spreadsheet at http://tinyurl.com/axthjbl.
STEP 1: COMPLETE YOUR FORM
Complete the Memorandum of Costs after Judgment (MC-012), available online at www.courts.ca.gov/documents/mc010.pdf. A sample completed form with instructions is included at the end of this Guide. Make one (1) photocopy of the completed form.
STEP 2: SERVE YOUR MEMORANDUM OF COSTS AFTER JUDGMENT
Have the photocopy of your Memorandum of Costs after Judgment (MC-012) served, either personally or by mail. Service must be made by someone over 18 who is not a party to your case. After service, your server must complete the Proof of Service on the second page of the Memorandum of Costs after Judgment (MC-012).
STEP 3: MAKE COPIES
Make two (2) photocopies of the Memorandum of Costs after Judgment (MC-012) with the signed proof of service.
STEP 4: FILE YOUR DOCUMENT(S)
File the original and two photocopies of your Memorandum of Costs after Judgment (MC-012). In Sacramento County, these will be filed in the drop box in room 102 of the Gordon D. Schaber Courthouse at 720 Ninth Street in downtown Sacramento. Fill out and attach the Civil Document Drop-Off Sheet, and date stamp the back of the original packet. A supply of Civil Document Drop-Off Sheets, Credit Card Authorization Forms, and a date stamp are located near the drop box. Following the instructions posted at the drop box, place the unstapled original document packet plus two copies of the packet in the drop box, along with a check or Credit Card Authorization Form for the filing fee, if any. The court will process the paperwork, and return the two copies, stamped "Endorsed/Filed," to you. The court will retain the original papers for its file The Memorandum of Costs after Judgment (MC-012) may be filed as a stand-alone document, or along with another document such as a Writ of Execution (EJ-130) or an Application for and Renewal of Judgment (EJ-190). If filed with another document, the other document can be issued immediately if your claimed costs are less than $100. If your costs are more than $100, the clerk will wait 10 days (15 days, if served by mail) to issue your document, to allow the judgment debtor to oppose your costs by filing a Motion to Tax Costs (CCP § 685.070). If the debtor does not contest it, your Memorandum of Costs after Judgment (MC-012) is automatically approved.
STEP 5: OPPOSE THE DEBTOR'S MOTION TO TAX COSTS, IF FILED
If the debtor files a Motion to Tax Costs, you will be served with a copy of the motion. If you choose to oppose the motion, you must act quickly. Your response must be filed and served at least nine court days before the scheduled hearing date. For more information on opposing a Motion to Tax Costs, see California Points and Authorities KFC 1010 .B4 Ready Reference) Chapter 60, available electronically on the Law Library's computers, using the Matthew Bender CD.
FOR MORE INFORMATION
On the Web:
Add Collection Costs & Interest to Your Judgment – Los Angeles County Department of Consumer Affairs
At the Law Library:
California Forms of Pleading and Practice KFC 1010 .A65 C3 (Ready Reference) Chap. 174
Electronic Access: On the Law Library's computers, using the Matthew Bender CD.
California Practice Guide: Enforcing Judgments and Debts KFC 1065 .A9 S3 Chap. 6, §§6:12-6:55.26
Electronic Access: On the Law Library's computers, using WestlawNext.
How to Collect When You Win a Lawsuit KFC 1065 .Z9 S25 (Self Help) Chap.16
Matthew Bender Practice Guide: California Debt Collection and Enforcement of Judgments KFC 1065 .E5 M38 Chap. 9, §§9.32-9.36
created 2/13 mpj
reviewed en 11/13