Opinion ID: 2114550
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Heading Rank: 1

Heading: The law generally regarding how a money judgment can be satisfied.

Text: 1. Burden of proof and agreement to accept property in lieu of money. A judgment debtor has the burden of proving that a money judgment has been paid. In re Marriage of Farr, 542 N.W.2d 828, 834 (Iowa 1996) (Regardless of who files the satisfaction of judgment, it is the judgment debtor's burden to prove satisfaction, if challenged.). Ordinarily, a money judgment can only be satisfied by payment in money, unless the parties agree otherwise. 47 Am.Jur.2d Judgments § 1016, at 448-49 (1985). If the parties agree to substitute a different type of payment, the party claiming such an agreement must prove what was intended. Id. For example, where defendants alleged that they had transferred real estate in satisfaction of a judgment, they were required to plead facts sufficient to show that the plaintiffs agreed to accept the property in lieu of money. Id.; accord Heller v. Lee, 130 Ill.App.3d 701, 85 Ill. Dec. 896, 474 N.E.2d 856, 857-58 (1985). Heller presents a factual scenario similar to what happened here. In Heller, the trial court entered a money judgment in favor of the plaintiffs. The defendants appealed and the appellate court affirmed. The trial court granted the plaintiffs' motion to release the appeal bond. The bond consisted of a deed to real property and a certificate of deposit. The plaintiffs applied the certificate of deposit to the judgment and instituted garnishment proceedings against the defendants to recover the deficiency. The defendants then filed an action for a release from the judgment and for return of the excess bond. The trial court dismissed the action. The appellate court affirmed the dismissal, stating: The defendants have alleged only that they expected the property transfer to satisfy the judgment. They have failed to allege facts which show that the plaintiffs shared that expectation. The appraised value of the property [alleged to be sufficient to satisfy the judgment] is speculative and irrelevant unless the defendants show that the plaintiffs agreed to accept the property at its appraised value instead of cash. The fact that the plaintiffs never indicated that the property transfer would not satisfy the judgment proves nothing. Similarly, the fact that the plaintiffs elected to petition for release of property instead of compelling a sheriff's sale is not evidence of an agreement to accept the property in satisfaction of the judgment. The plaintiffs were entitled to petition for release of the appeal bond in order to obtain partial cash payment via the certificate of deposit. The plaintiffs did not give up the right to recover the rest of the judgment in cash. Heller, 85 Ill.Dec. 896, 474 N.E.2d at 858. The appellate court, however, did remand with directions to the trial court to sell the real estate, apply the proceeds to the judgment, and remit the excess, if any, to the defendants. Id. 2. The merits. Here, the Bowers were able to stay all proceedings once they appealed the fraudulent conveyance ruling. They were able to do so by assigning their interests in the two partnerships to the clerk of court for Douglas County. This was in 1992. The assignment precluded the bank from levying execution on these interests pending the appeal. The appeal was completed in January 1995. One month later, the clerk of court assigned the two partnership interests to the bank. On December 30, 1995, the bank was able to sell its interest in the Yorkshire Manor Apartments Partnership to the managing partner for $65,000 and applied that amount to the Iowa judgment. The bank's interest in the 108th & Q Street Farm Partnership netted the bank $85,311.72 after the interests of the partnership were sold at an auction. The bank applied this amount to the Iowa judgment. In the present proceedings, the defendants neither alleged nor proved that the bank agreed to accept the two partnership interests at the 1992 alleged values of $200,000 and $150,000 in satisfaction of the Iowa judgment. As Heller makes clear, such values are irrelevant unless the defendants show that the bank agreed to accept the partnership interests at those values instead of money. The defendants have made no such showing. From the bank's perspective, there would be no good reason to accept the partnership interests at the 1992 alleged values in lieu of money; it was too risky to do so. There was no hard evidence that those partnership interests were worth that kind of money; the values were speculative at best. The values were mentioned only as a way to establish the amount of a supersedeas bond. There was little likelihood that the bank could realize any money on those partnership interests in a relatively short period of time. As it turned out, the bank had to wait roughly three years before it realized any money, and the amounts it realized were considerably less than the 1992 alleged values. Absent any agreement by the bank to accept the partnership interests at the 1992 alleged values in lieu of money, the bank had every right to insist on money in satisfaction of the Iowa judgment. As mentioned, these values were therefore irrelevant as far as the present proceedings were concerned. Because the 1992 alleged values were irrelevant, defendants' theory of judicial estoppel must likewise fail.