A mutual promise between one or more persons (or companies or organizations) in which each party has agreed to do something (or not do something). In law, a contract is sometimes referred to as an “agreement.” While all contracts are agreements, not all agreements are contracts. The difference is that a contract is a legally enforceable agreement, while not all agreements are legally enforceable. Both agreements and contracts can be verbal or written, although it is always better to have an agreement in writing if you want it to be a legally enforceable contract that can protect you in court.

Money or property owned by a person or company. Examples of assets include salary/wages, properties, or money in bank accounts.

To “breach” something means to violate it. For instance, to breach a contract is to violate the contract, and to breach a law is to violate the law. So to sue someone for “breach of contract” means to sue them for violating the contract.

In contract law, an “anticipatory breach” is when a party to a contract makes it clear, either through words or actions, that it is not going to live up to its side of the bargain as required by the contract. The reason it is called “anticipatory” is that it is made in anticipation of that party’s breach; in other words, the party hasn’t breached yet, but it is making it clear that it will breach in the future (i.e., not live up to its end of the agreement in the future). (Example: Joe and Sue make a contract for Joe to loan Sue $5. Sue is supposed to pay back the loan in five days, according to the contract. But after just two days Sue gives Joe a call and says “No way am I ever gonna pay you that money back.” That is anticipatory breach. It is anticipatory because Sue wasn’t obligated to pay back the loan yet, but in anticipation of her obligation, she made it clear that she would not pay the money back.)

The collection process involves different methods of getting money from the debtor through their assets, such as their salary/wages, properties, or money in their bank accounts These first steps are to help you get clarity on what assets the debtor has that may be available to be used for paying off the debt to you.

After a court issues a judgment and at any time before the judgment expires (in California, money judgments expire automatically after 10 years), the plaintiff (who is owed the judgment) and the defendant (who owes the judgment) can enter into a conditional settlement agreement establishing a payment plan themselves. Under such an agreement, the plaintiff can agree to take no action to collect on the judgment so long as the defendant makes payments on time.

If a plaintiff initiates a lawsuit and a defendant responds to the lawsuit with claims of his or her own against the plaintiff, the defendant’s claims are “counterclaims. This is a direct claim from the defending party against the party who initiated the lawsuit for concurrent claims, including being wrongfully sued.

Harm that a plaintiff has suffered due to the defendant’s unlawful action. Normally, damages are financial harm (meaning the defendant has cost the plaintiff money). (Example: You sue your neighbor for failing to pay back a $500 loan. Your damages would be the amount your neighbor was supposed to pay you minus the amount your neighbor actually did pay you. If your loan contract stated that your neighbor was supposed to repay you $500 without interest and your neighbor didn’t pay you back anything, then your damages would be $500.)

A debtor is a person or entity that owes money. A judgment debtor is a person against whom a judgment ordering him to pay money has been obtained and remains unpaid.

A proceeding a court can order to help someone who is owed money under a court judgment find out which court-ordered collections methods can be used if the person who owes the money fails to pay the judgment voluntarily. (Example: A plaintiff wins a judgment over an unpaid debt. The defendant refuses to voluntarily pay off the judgment amount. The plaintiff applies to the court for a debtor’s examination in order to figure out where the defendant works, so that the plaintiff can then request a wage garnishment, through which the court can order the defendant’s employer to pay the defendant’s wages to the plaintiff in order to pay off the judgment that the defendant had been refusing to pay off).

Someone who relies on someone else as their primary source of income. (Example: Children are the classic example of dependents. Until they become adults and can earn their own income, they often rely on their parents for financial support).

A formal letter one sends to someone else prior to filing a lawsuit against that person in an attempt to settle a legal dispute prior to actually filing the lawsuit. When drafting a demand letter, it is important to specify what the other person owes (i.e., your “demand,” which is normally money) as well as why the other person owes what they do (for example, because they failed to repay a loan), and a deadline by which they must provide what they owe.

When a case is dismissed with prejudice, it means the case cannot be filed again. This can happen if the defendant attends the hearing and the plaintiff does not attend the hearing multiple times, which means a hearing cannot be heard and the judge dismisses the case altogether because it’s not the plaintiff’s first missed hearing.

When a case is dismissed without prejudice, it means the case can be filed again, as long as it’s within the statute of limitation. This can happen if the defendant attends the hearing and the plaintiff does not, which means a hearing cannot be heard and the judge dismisses the case, but allows the plaintiff to refile in the future.

A nickname companies use for themselves. Sometimes it referred to as a Doing Business As names. Many states require that these nicknames be registered with the state, county or city level governments. For example, in California every business operating under a fictitious business name or Doing Business As name in a particular county must register that fictitious business name in that county.

This is a California court form that asks comprehensive questions about someone’s financial state, such as how much the person makes, what assets they have, and what their expenses and debts are. The goal of the form is to provide a picture of whether someone can afford to pay (for instance, whether a defendant can pay off a judgment), and how they can afford to pay (i.e., with what income or assets).

Paying an amount of money owed over time in smaller amounts. Often a Payment Plan is set up that states when each installment will be paid and for how much.

Questions that are formally submitted in writing by one party in a legal case (e.g., the plaintiff) to another party in the case (e.g., the defendant), which are required by law to be answered. (Example: A plaintiff can be allowed by the court to submit interrogatories, or written questions, to a defendant in order to learn about the defendant’s ability to pay a judgment, in order to help the plaintiff decide whether to support or oppose a judgment payment plan.)

The legal authority to do something (Example: Small claims courts have the jurisdiction in California to decide cases in which a person is suing for up to $10,000. If the amount that a person is suing for is over that amount, then a small claims court does not have the authority, or legal power, to hear the case (i.e., another court would have to decide it).

The power to decide a case based on the parties involved in it (i.e., the plaintiff and defendant). The point of personal jurisdiction is to limit a court’s ability to stick its nose where it doesn’t belong and decide the fate of people who have no relation to the court’s state. One example of when a court does have personal jurisdiction, or the ability to decide a case based on the parties involved, is when both parties are residents of California and the court is located in California. An example of when a court probably would not have personal jurisdiction is when a California resident decides to sue another California resident in a Texas court over a car accident that happened in California. Note that the question of personal jurisdiction typically relates to in which state a court can decide a case, whereas the question of venue, a confusingly similar issue about a court’s authority to decide a case, relates to which county in that state a court can decide a case.

Parts of a case, or cause of action, that the plaintiff needs to prove to win (Example: In order to win a lawsuit for “Breach of Contract” (which is a cause of action), a plaintiff would need to prove certain legal elements such as 1) the existence of a contract, 2) that the plaintiff itself did what it was supposed to do under the contract, 3) that the defendant didn’t do what it was supposed to do under the contract, and 4) that the plaintiff suffered harm because the defendant didn’t do what it was supposed to do under the contract. If the plaintiff fails to prove any one of these elements, then it will lose the case for breach of contract.)

When a court orders that money be seized straight from the debtor’s bank account.

An entire amount. “Lump sum” is often used to describe a type of payment. A lump sum payment is one that is made in the entire amount all at once, rather than an amount that is split up over time (like according to a payment plan).

A process in which a trained neutral mediator facilitates communication between the parties and, without deciding the issues or imposing a solution on the parties, enables them to understand and to reach a mutually agreeable resolution to their dispute. In some courts, mediation is asked from the parties before the hearing taking place, to give the parties a chance to reach a settlement (an agreement that both parties are happy with, without going in front of the judge). If you have settled via mediation, you should have a new agreement with the other party including terms for both parties to perform.

A plan to pay off a certain amount over time, in smaller chunks, as opposed to all at once in a single lump sum. The debtor and creditor can set up a payment plan directly with each other. Another type of payment plan is when the debtor request to set up a payment plan with the court. The debtor will fill out a form to request to make payments, along with their financial statement to prove that they can’t pay in whole.

In law, unlike in movies or plays, to “perform” is not necessarily a fun activity. In law, “perform” is a word that is used in reference to contracts. When someone agrees to a contract, what he or she has agreed to is to do or not do something. The reason the person has agreed to do or not do something in a contract is that the other people who have signed the contract have also agreed to do or not do something in return. When the people who have agreed to a contract do that which they have promised to do (or not do) according to the contract, then it is said that they have “performed” according to the contract. (Example: You have agreed in a contract to pay a contractor to fix your house. When you pay the contractor you have “performed” under the contract, since this is what you agreed to do in the contract. When the contractor refuses to fix your house as agreed to in the contract, then the contractor has failed to “perform” under the contract. When you later sue the contractor for breaking the contract, you are suing the contractor for not performing under the contract.)

This is a California court form that one would use to formally approve or oppose another party’s request for a payment plan, or to suggest a different sort of payment plan than the one that was requested.

Meet (or exceed) the requirements for the applicable standard of proof (Example: If the plaintiff has proven that there was a contract in a case for breach of contract, then the plaintiff has “satisfied” that particular element of a breach of contract cause of action).

A special court that is designed to allow relatively minor cases (in terms of the amounts of money at stake) to be heard and decided relatively quickly and easily without the need for attorneys (who are typically very expensive). Different states have different standards for which cases can be heard in small claims courts. In California, a person can sue for an amount of up to $10,000 in small claims court.

An unincorporated business with only one owner who pays personal income tax on profits earned. Easy to establish and dismantle, due to a lack of government involvement, making them popular with small business owners and contractors.

To file a lawsuit against a person, company, or organization that has unlawfully hurt you in some way. The goal of a lawsuit is to get a court to force that person, company, or organization to do something (for example, repay you for the financial damage they have caused you) or discontinue doing something (for example, to discontinue occupying your property), in order to right the wrong they have caused you.

To have the judgement of the court removed or erased. If you did not attend the hearing and lost the claim or counterclaim, that means you’ve received a default judgment. You cannot appeal this kind of judgment and have a new trial until you “vacate the default judgment”, that is, until you have the judgment removed or erased. You can file a Notice of Motion to Vacate Judgment. Fill the form out and file it with the small claims clerk with a filing fee.

A collections method a court can order to force a defendant to pay off a judgment, through which a defendant’s wages are ordered to be paid directly to the plaintiff.

Rather than bringing a witness to court, they can write a statement to the judge. This statement should cover everything the witness would have said in the courtroom if he or she was present. It should begin with who the witness is and what qualifies them to offer testimony before they jump right into what he or she witnessed.