A judgment debt arises when a court has formally determined that a debtor owes money to a creditor and has issued a judgment order to that effect. Before judgment, a creditor has a claim; after judgment, that claim has been converted into a legal order that carries significant enforcement power.
What changes when a judgment is entered:
- Enforcement options open up. A judgment creditor can use mechanisms not available before judgment — including garnishee orders (to intercept wages or bank funds), writs of execution (to seize and sell assets), and charging orders over real property.
- Interest continues to accrue. In most Australian jurisdictions, post-judgment interest accrues on the outstanding amount at the rate prescribed by the relevant court rules, regardless of what was in the original contract.
- The limitation period resets. A judgment itself creates a new cause of action, with its own limitation period — typically 12 years in most states — giving the creditor a long window in which to pursue enforcement.
If a judgment has been entered against you and you have not yet paid, the creditor's next step will be to choose an enforcement method. Contacting us early — even at this stage — may still offer options for a managed resolution.
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