New Jersey Permanent Statutes
Title 2A Administration of Civil and Criminal Justice
2A:17-56.23b JUDGMENT FOR CHILD SUPPORT LIEN AGAINST NET PROCEEDS OF SETTLEMENT: PRIORITY
1. a. A judgment for child support entered pursuant to P.L.1988, c.111 (C.2A:17-56.23a) and docketed with
the Clerk of the Superior Court shall be a lien against the net proceeds of any settlement negotiated prior or
subsequent to the filing of a lawsuit, civil judgment, civil arbitration award, inheritance or workers' compensation
award. The lien shall have priority over all other levies and garnishments against the net proceeds of any
settlement negotiated prior or subsequent to the filing of a lawsuit, civil judgment, civil arbitration award, inheritance
or workers' compensation award unless otherwise provided by the Superior Court, Chancery Division, Family Part.
The lien shall not have priority over levies to recover unpaid income taxes owed to the State. The lien shall stay
the distribution of the net proceeds to the prevailing party or beneficiary until the child support judgment is satisfied.
As used in this act "net proceeds" means any amount of money, in excess of $2,000, payable to the prevailing
party or beneficiary after attorney fees, witness fees, court costs, fees for health care providers, payments to the
Medicaid program under section 6 of P.L.1979, c.365 (C.30:4D-7.1), reimbursement to the Division of Employment
Security in the Department of Labor, the employer or employer's insurance carrier for temporary disability benefits
that may have been paid pending the outcome of a workers' compensation claim as provided by section 1 of
P.L.1950, c.174 (C.34:15-57.1), reimbursement to an employer or the employer's workers' compensation insuranc
carrier as provided in R.S.34:15-40, and other costs related to the lawsuit, inheritance or settlement are deducted
from the award, proceeds or estate; "prevailing party" or "beneficiary" shall not include a partnership, corporation,
limited liability partnership, financial institution, government entity or minor child; and "agent" means an authorized
representative of the prevailing party or beneficiary, a union representative, an executor or administrator of a
decedent's estate, an arbitrator or any other person or entity if such person or entity is responsible for t
distribution of net proceeds to a prevailing party or beneficiary.
b. Before distributing any net proceeds of a settlement, judgment, inheritance or award to the prevailing
party or beneficiary:
) the prevailing party or beneficiary shall provide the attorney, insurance company or agent responsible
for the final distribution of such funds with a certification that includes the prevailing party's or beneficiary's full
name, mailing address, date of birth and Social Security number; and
(2) the attorney representing the prevailing party or beneficiary shall initiate a search of child suppor
judgments, through a private judgment search company that maintains information on child support judgments, to
determine if the prevailing party or beneficiary is a child support judgment debtor.
If the prevailing party or beneficiary is not represented by an attorney, the judgment search shall be initiated by the
opposing attorney, insurance company or agent before the proceeds are distributed to the prevailing party or
beneficiary. In the case of a workers' compensation action, the Administrative Office of the Courts shall, at least
once every 60 days, transmit information on child support judgment debtors to the Division of Workers'
Compensation in the Department of Labor. The information shall include the debtor's name, Social Security
number, the amount of the child support judgment, the Probation Division case number and the Probation Division
office to which the judgment is payable. The Division of Workers' Compensation shall match the data received on
child support judgment debtors against the information it maintains for individuals who have filed workers'
compensation claims with the division. When a match is identified, the Division of Workers' Compensation shall
notify the appropriate judge of compensation of the child support judgment before the decision, award,
determination, judgment or order approving the settlement is rendered. The judge of compensation shall
incorporate in the decision, award, determination, judgment or order approving the settlement, an order requiring
the employer or the employer's insurance carrier to contact the Probation Division to satisfy the child support
judgment out of the net proceeds of the workers' compensation award, order or settlement before any such monies
are paid to the employee. The Division of Workers' Compensation shall be immune from any civil liability that may
arise from any information provided by the division or any order issued by a judge of compensation relating to a
child support judgment, in accordance with this section. In the case of judgments or settlements resulting from a
labor arbitration involving employees of a school board or school district, a judgment search shall be initiated by the
school board or district prior to the release of any net proceeds to the employees and only if there is an income
withholding for child support active against the employee in the records of the school board or district. In the case
of an inheritance, the executor or administrator of the decedent's estate shall initiate the judgment search. The
judgment search company shall provide a certification to the attorney, insurance company, agent or party initiating
the lawsuit identifying whether or not the prevailing party or beneficiary is a child support judgment debtor.
In the case of net proceeds that are to be paid through a structured settlement or other payment plan, the attorney,
insurance company or agent shall be required to conduct the child support judgment search only at the time of
settlement or prior to the distribution of the first payment under the plan. If a child support judgment is identified,
the attorney, insurance company or agent shall provide the Probation Division with a copy of the structured
settlement or payment plan within 30 days of identifying the child support judgment.