Utahns face payday, eviction debts leave courts owing six times as much, study finds

The Utah Bar Foundation has released a new report that suggests “systemic problems” in the way the state handles eviction and debt collection cases – which account for nearly a quarter of all civil cases before Utah District Courts.

Among other findings, the study revealed exorbitant interest rates for debtors, inequalities in legal representation, and billions of dollars in still unsatisfied judgments against debtors.

“These data suggest that there is an inequity in the design of the system,” Christine Durham, co-chair of the Utah State Bar’s Access to Justice Commission, told a conference of press on Tuesday, in reference to a statistic showing how arbitrary legal costs can be, “and that there are systemic issues that the debtor cannot control.”

The foundation has already presented the study to Utah state courts and interested members of the Legislative Assembly, said executive director Kim Paulding, who hopes the data will be useful in guiding future policy decisions.


Some of the most striking findings of the study concerned deportation cases. The foundation considered data from 2013 to September 2021; during that time, 59,668 eviction cases were heard in Utah district courts, which awarded $165 million in judgments against defendants from 2013 to 2020, according to the study. As of December, $143 million of that, or 86%, remained unsatisfied.

In these situations, landlords are stuck waiting for money that may never materialize, and evictees are left with bleak prospects for life – potentially even after paying off their debt.

“It becomes a very serious issue when we talk about the housing shortage in the state of Utah, and in particular the severe lack of affordable housing,” Paulding said. “…In these tight rental markets, they [landlords] automatically refuse tenants who have an outstanding judgment.

Asked by the Salt Lake Tribune about other consequences that dissatisfied judgments can face, Paulding pointed to Jobs. Financial background checks uncover unpaid debts, which can be a black mark against someone looking for work. Garnishment orders can also complicate the employment of a person who has been evicted.

The unique state laws governing how these cases are handled also make settling the eviction debt difficult.

Utah uses a system that offers three days’ notice to pay or quit, after which mandatory treble (triple) damages can be assessed to a defendant.

These damages are the main reason why the initial amounts in dispute in eviction cases are usually much lower than the final judgments awarded to plaintiffs. In 2019, the controversial median amount in Utah eviction cases was $640, six times less than the median judgment of $4,070.

This means that being a few hundred dollars behind on rent can quickly become a debt of several thousand dollars between the filing of the case and the judgment.

Once the judgment is issued, it is then subject to a post-judgment interest rate, which had a median of 24% in a sample of 2019 cases. That’s the percentage specified in the standard lease that many landlords across the state use, Paulding said.

The high interest rate is another reason evictees often end up paying many times what they owed in rent to get satisfaction from complainants.

The study also revealed a wide disparity in the legal representation of plaintiffs and defendants in these cases. In 2019, only 3.3% of defendants in eviction cases were represented by a lawyer, while 88% of plaintiffs were represented by lawyers, according to the data.

“The fact that only one party is represented by counsel creates an imbalance in our legal system, which relies on adversarial submissions, and often slows down the legal process,” said Durham, who is also a former chief justice of the Supreme Court of Utah. “As pro se litigants, i.e. people who represent themselves, try to navigate our somewhat complicated legal system on their own.”

Payday lenders

Another important finding is that nearly 85% of small claims cases heard by the Court of Justice were contributed by corporations, the majority of which were registered with the Utah Department of Financial Institutions.

“That means they’re kind of a lender here in Utah State,” Paulding said. “It could be a bank or a credit union, a credit card or a payday lender or some other type of high-interest lender.”

Many states have banned payday lenders due to “predatory” tactics, according to the Center for American Progress. However, they are still allowed in Utah and present an inordinate amount in state courts.

“The most frequent filers of debt cases in small claims are from just nine companies, all of which are registered with the department as payday lenders,” Durham said.

Despite the study and its findings, Durham praised the work and transparency of the justice system for providing the foundation with its case data and said it is always looking for ways to better fulfill its mission.

“I’m glad to know that the Utah courts have also been active participants in discussions with recommendations on how to improve the system for all parties,” she said. “Courts consider transparency to be part of their job, and this is an example.”

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