S-0594.1  _______________________________________________

                         SENATE BILL 5939

          _______________________________________________

State of Washington      56th Legislature     1999 Regular Session

By Senators Johnson, T. Sheldon, Oke and Roach

Read first time 02/17/1999.  Referred to Committee on Judiciary.

Authorizing use of collection agencies to collect small claims court judgments.

    AN ACT Relating to collection of small claims court judgments by collection agencies; amending RCW 12.40.105 and 12.40.110; and adding a new section to chapter 12.40 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1.  A new section is added to chapter 12.40 RCW to read as follows:

    (1) If the losing party fails to pay the judgment within thirty days, the prevailing party may retain at any time thereafter, without regard to whether or not the judgment has been certified, a collection agency licensed under chapter 19.16 RCW for the purpose of collecting the monetary judgment from the judgment debtor.

    (2) If a prevailing party retains a collection agency, the collection agency must submit an affidavit attesting to the actual amount of the collection agency's fee.  Upon submission, the judgment shall be increased by any reasonable collection fee of up to fifty percent of the outstanding judgment including all court costs without regard to the jurisdictional limits on the small claims department.

    (3) No judgment may be assigned to a collection agency unless:  (a) There has been an attempt to advise the debtor (i) of the existence of the judgment, and (ii) that the judgment may be assigned to a collection agency for collection if the judgment is not paid; and (b) at least thirty days have elapsed from the time the notice was attempted.

    Sec. 2.  RCW 12.40.105 and 1998 c 52 s 5 are each amended to read as follows:

(1) If the losing party fails to pay the judgment within thirty days or within the period otherwise ordered by the court, the judgment shall be increased by:  (((1))) (a) An amount sufficient to cover costs of certification of the judgment under RCW 12.40.110; ((and (2))) (b) the amount specified in RCW 36.18.012(2); and (c) any reasonable fee of up to fifty percent of the amount of the judgment, including all court costs, when the judgment creditor retains a collection agency licensed under chapter 19.16 RCW, without regard to the jurisdictional limits on the small claims department.

(2) If the judgment creditor intends to retain a collection agency and thereby increase the judgment under subsection (1)(c) of this section, the collection agency must submit an affidavit attesting to the actual amount of the collection agency's fee.

    Sec. 3.  RCW 12.40.110 and 1998 c 52 s 6 are each amended to read as follows:

    (1) If the losing party fails to pay the judgment according to the terms and conditions thereof within thirty days or is in arrears on any payment plan, and the prevailing party so notifies the court, the court shall certify the judgment in substantially the following form:

                                                       Washington.

    In the District Court of . . . . . . County.

.............................  Plaintiff,

              vs.

.............................  Defendant.

                  In the Small Claims Department.

    This is to certify that:  (1) In a certain action on the . . . . day of . . . . . . 19. . ., wherein . . . . . . . . . was plaintiff and . . . . . . . . . defendant, jurisdiction of said defendant having been had by personal service (or otherwise) as provided by law, judgment was entered against . . . . . . in the sum of . . . . . . dollars; (2) the judgment has not been paid within ((twenty)) thirty days or the period otherwise ordered by the court; and (3) pursuant to RCW 12.40.105, the amount of the judgment is hereby increased by any costs of certification under this section, any reasonable collection agency fees, and the amount specified in RCW 36.18.012(2).

    Witness my hand this . . . . day of . . . . . ., 19. . .

                    .............................................

                    Clerk of the Small Claims Department.

    (2) The clerk shall forthwith enter the judgment transcript on the judgment docket of the district court; and thereafter garnishment, execution, and other process on execution provided by law may issue thereon, as in other judgments of district courts.

    (3) Transcripts of such judgments may be filed and entered in judgment lien dockets in superior courts with like effect as in other cases.

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