North Carolina business owners are likely aware of the implications associated with a judgment either for or against their companies. For instance, if a company is being sold, a judgment that is waiting to be collected could be an asset. For someone looking to buy a business, a judgment against that entity could be a liability to consider during the due diligence process.
In some cases, a judgment that was thought to have expired could still be enforceable. For example, a change to the law could increase the amount of time that money could be collected from a business by a creditor or defendant in a lawsuit. In Arizona, judgments used to be enforceable for five years. As of August 2018, they became enforceable for 10 years. This could mean that business owners who believed that a judgment had expired could still be collected for another five years.
Those who want to enter into a partnership should learn more about whether there are judgments against that partner that may resurface prior to entering into a business deal. It is also possible that extended judgment enforcement could play a role when buying real property. This is because title insurance searches may not register any judgment that is between five years and a decade old.
When conducting business transactions, it may be worthwhile to have a team of advisers evaluate them. This may be especially important if the law has changed as it relates to statutes of limitations. Being privy to those changes may make it easier to determine if a deal is worth following through on or if there are better opportunities with less risk elsewhere. Generally speaking, parties to a deal have as much time as they need to thoroughly evaluate it.