Can a consent order be used to skip the court hearing and distribute the sale money by agreement?

Short answer: In Tennessee, parties can often use a consent order (also called a consent judgment or agreed order) to resolve disputes and direct distribution of sale proceeds without a full contested hearing, but the court must still review and sign the order. Certain statutes, lien priorities, court rules, and rights of non‑parties can prevent or limit that approach. This article explains how it works, when courts will accept a consent order, what cannot be waived by party agreement, and practical steps to follow.

What is a consent order?

A consent order is a written agreement between the parties submitted to the judge for approval and signature. Once the judge signs it, the agreement becomes a binding court order. Consent orders let parties resolve issues quickly and avoid hearings when the court finds the agreement lawful and supported by the record. See Tennessee Rules of Civil Procedure for court procedure and filing practice: Tennessee Rules of Civil Procedure.

When can a consent order replace a hearing?

Courts regularly enter consent orders without a contested hearing when the parties present a clear agreement and the judge has enough information to make a legal finding. Typical situations where courts accept consent orders include settlement of a civil suit, division of proceeds among or between consenting owners, and agreed dismissals.

However, a court will not enter a consent order if doing so would contravene statutory requirements, deprive non‑parties of notice or rights, or conflict with public policy. For general reference to Tennessee statutes and to check whether a statute requires a hearing in your situation, consult the Tennessee Code: Tennessee Code.

Specific issues when distributing sale proceeds

If you seek to use a consent order to distribute money from a sale (for example, a sheriff sale, foreclosure sale, partition sale, or sale under an execution), consider these constraints:

Priority of liens and statutory distribution: Sale proceeds must satisfy liens and statutory priorities (mortgages, judgment liens, tax liens, mechanic’s liens). Parties cannot use a private agreement to override a valid lienholder’s statutory priority unless that lienholder consents or the lien has been satisfied.
Notice to interested parties: The court needs assurance that all interested parties and creditors received required notice. If a creditor or lienholder lacks notice or did not consent, the court may refuse to enter an order altering distribution.
Statutes requiring court confirmation/hearing: Some Tennessee statutes or court rules may require a confirmation hearing or specific findings before funds are released (e.g., some probate or guardianship sales, or sales involving minors or incapacitated persons). In those cases a simple consent order by the parties may not suffice.
Bankruptcy stays: If a party has an active bankruptcy case, the automatic stay can block distribution until the bankruptcy court lifts the stay.
Clerks’ and sheriffs’ statutory duties: In many contexts the clerk or sheriff must retain and disburse funds according to statute or court order. A consent order should explicitly direct the clerk/sheriff how to distribute funds to ensure they comply with their legal duties.

Hypothetical example

Two co‑owners sell real property at auction after a judgment for partition. The sale brings $100,000. The co‑owners, who hold no mortgages and know of no other liens, agree to split the net proceeds 60/40. They prepare a joint proposed consent order asking the court to (1) confirm the sale, (2) find that notice requirements were met, (3) order deduction of sale costs and taxes, and (4) direct the clerk to pay each owner their agreed share. The court will review the submission, confirm there are no unpaid liens or creditors claiming entitlement, and — if satisfied — sign the consent order directing distribution. If a mortgage or tax lien existed but the lienholder had not been paid, the court could refuse to enter the order until the lien is resolved.

Practical steps to ask the court to enter a consent order for distribution

Confirm who has an interest. Identify recorded liens, judgments, and potential creditors. You may need title searches or lien searches.
Obtain necessary consents. Get written releases or payoffs from lienholders, or include them as signatories if they will accept distribution by agreement.
Prepare a clear proposed order. The order should recite the sale, list costs and liens that will be paid, show calculations for net proceeds, and direct the clerk or sheriff to distribute funds on entry.
Provide proof of notice or service. File affidavits showing required notice was given to all interested parties or cite the statutory basis for any reduced notice.
File the joint motion or agreed proposed order with the court. Request entry without a hearing if you believe the court has everything it needs. If the court needs more information, it may set a short hearing.
Wait for entry and ensure compliance. Only after the judge signs the order should the clerk/sheriff disburse funds per the order.

When a hearing is likely required

Expect a hearing or additional court scrutiny when:

Minors or incapacitated persons or guardianship/probate matters are involved.
There are unresolved liens, disputed claims, or competing claimants.
Statute or local rule requires confirmation or a report to the court (for example, some probate sales or sales under specific statutory schemes).
One party alleges fraud, coercion, or unconscionable terms in the agreement.

What a court will check before signing a consent order

The judge will typically ensure the order:

Complies with applicable statutes and rules;
Respects lien and priority rights;
Reflects that parties with a legal interest either consented or had notice; and
Contains sufficient factual recitals or supporting documents for the court to make a legal finding.

Helpful links

Tennessee Rules of Civil Procedure (court rules and filing practices): https://www.tncourts.gov/rules/rules-civil-procedure
Tennessee Code (search statutes that may govern specific sale or distribution types): https://www.tn.gov/content/tn/legislation/tn-code.html

Helpful Hints

Do a lien search before you draft an agreement. Undisclosed liens can stop a consent order.
Get written payoff letters or lien releases from lienholders whenever possible.
Address costs and fees explicitly in the proposed order (sale costs, commissions, taxes, attorney fees if agreed).
Include a recital that required notice was given, and attach any service affidavits to your filing.
If you’re unsure whether a statute requires a hearing, ask the court clerk or review the relevant Tennessee Code section before assuming the court will enter a consent order.
Remember that a judge must sign the order — the court can decline if legal requirements are unmet.

Disclaimer: This information explains general principles of Tennessee law and common practice. It is not legal advice and does not create an attorney‑client relationship. For advice about your specific situation, consult a licensed Tennessee attorney who can review your facts and relevant statutes and court rules.