4 Garnishment
4. GARNISHMENT
4.1 DEFINITIONS AND TYPES OF GARNISHMENTS
Special Note: The 2016 Act was a complete revision. Except as it relates to Claims (including Traverses) by Defendants, the law remains largely unchanged. With respect to the Defendant’s claim, procedures are revised, but the law remains largely the same. Case law from prior to the new law should remain viable.
4.11 Purpose:
A garnishment is a proceeding in which a third party (the "garnishee") who has money or other property belonging to the debtor-Defendant is required to turn over such money or property to the court.
4.12 Pre-judgment Garnishments No Longer Exist. Garnishments upon tax assessments are returnable only to state or superior court [OCGA 48-3-12].
4.13 Post-judgment "Traditional" Garnishment - may be filed after money judgment has issued from court of Georgia or federal court sitting in Georgia [OCGA 18-4-2(b)].
NOTE - An order for child support, alimony, installments to accomplish equitable division of property, or any similar figure subject to mathematical computation by reference only to the language of the order is a "money judgment" [Stoker v. Severin, 292 Ga.App. 870, 665 SE2d 913 (2008); 253 Ga.App. 248, 558 SE2d 791 (2002); 154 Ga.App. 670, 269 SE2d 519 (1980)], an order to pay medical expenses, college tuition, "repairs deemed necessary by both parties" or the like is not [212 Ga.App. 651, SE2d 847 (1994)]. Non-child support and alimony periodic amount due for the last seven years are not dormant and may be enforced directly; amounts between seven and ten years old are "dormant" and must be revived outside of the garnishment in order to be collected [See Taylor v. Peachbelt Props., Inc., 293 Ga.App. 335, 667 SE2d 117 (2008)]. Child Support and Alimony due never becomes dormant. OCGA § 9-12-60(d).
A judgment debtor on a support order may pursue both contempt and garnishment at the same time until all current obligations under the order are satisfied [Stoker [; 155 Ga.App. 593, 271 SE2d 725 (1980)].
4.14 Continuing Garnishment - may be filed after judgments against employers only and provides for the garnishment to proceed for 179 days (see 4.6 below).
NOTE - Continuing garnishment filed against non employer is treated as regular "one shot" garnishment [172 Ga.App. 773, 324 SE2d 595 (1984)]. Under new act use of the wrong form invalidates the garnishment and relieves the Garnishee of liability. OCGA § 18-4-7(d).
4.15 Continuing Support Garnishments - may be filed for collection of periodic support of a family member. Garnishment is directed against earnings and continues until back amounts are satisfied (see 4.7).
4.16 Procedure: Civil Practice Act applies.
The Civil Practice Act applies to all garnishments [OCGA 18-4-2(c)], including the provisions for counting days for answer, [OCGA 9-11-4(h)] and for discovery in contested proceedings [OCGA 18-4-2(c)],
This also means the five day rule applies. If the return of service is not filed within five days of service day one of the answer period is not until the return of service is filed with the court.
4.2 PERSONS AND PROPERTY SUBJECT TO GARNISHMENT
4.21 Debts: [OCGA 18-4-4]
A. Owed by the garnishee to the Defendant at the time of service of summons of garnishment upon the garnishee. Test is whether Defendant could recover property by direct suit against garnishee [Anderson v. Burnham, 12 Bankr. 286 (Bankr. N.D. Ga. 1981); Hiatt v. Edwards, 52 Ga.App. 152, 182 S.E. 634 (1935)].
• After judgment against the insured, an insurance policy may be garnished, but insurer has the defenses it would have against the insured [Hix v. Hertz Corp. (Ga. App. #A10A0965, 11/23/2010) (beyond minimum required coverage with auto coverage) Builders Insurance v. Tenenbaum, 327 Ga. App. 204; 757 S.E.2d 669 (2014)].
B. Accruing from the garnishee to the Defendant from the date of service to the date of the garnishee's answer.
NOTE There are specific provisions relating to earnings [see OCGA 18-4-5] (see 4.27).
4.22 Property or Monies Within Possession or Control - all property, money or effects of the Defendant in the possession or control of the garnishee is subject to garnishment [OCGA 18-4-4]. A check is an asset subject to garnishment [248 Ga. 597, 285 SE2d 21 (1981)].
4.23 Collateral Securities - are not subject to garnishment if there is an amount owed on the debt for which such securities were given as collateral [OCGA 18-4-4(b)].
4.24 State Salaries - sovereign immunity is waived and money due employees or officials of the state, counties, or municipalities as salary for services may be garnished [OCGA 18-4-26]. Garnishment of state salaries are subject to the same limitations as garnishment of other earnings [15 USC 1673] (see 4.27).
NOTE State Salaries: when the judgment arises out of liability incurred in the scope of the officials' or employees' governmental employment while responding to an emergency, garnishment invalid [OCGA 18-4-26]. ALSO jurisdiction for issuing garnishment is restricted to court located in the county in which the warrant is drawn upon the treasury of the government or in which the check is issued for the salary.
4.25 Federal Salaries - pay of federal, U.S. Postal Service, and Postal Rate Commission employees may be garnished [5 USC 5520a]. Each federal agency has regulations on who may be served with the summons of garnishment by certified mail. As a practical matter one should call up the agency to find out who must be served. The waiver of sovereign immunity is only for the employee's pay, so that entry of a default judgment against the United States would probably be improper. Child support garnishments have absolute priority under federal law in contrast to most garnishments [compare 4.44C].
4.26 Bank Accounts - Joint and under 3rd Party Names
A. Joint accounts - "A joint account belongs, during the lifetime of all parties, to the parties in proportion to the net contributions of each to the sums on deposit, unless there is clear and convincing evidence of a different intent" [OCGA 7-1-812(a); 151 Ga.App. 573, 260 SE2d 501 (1979); 193 Ga.App. 70, 386 SE2d 912 (1989) (make finding of fact as to no different intent)].
• Where the proceeds themselves come from jointly owned property, in absence of clear different intent, allocate equal shares [193 Ga.App. 70, 386 SE2d 912 (1989)].
B. Third parties - A financial institution has no liability for failing to turn over a bank account or safety deposit box when the account maintained is the account of a corporation, limited liability company, partnership, foundation, trust, governmental entity or other incorporated or unincorporated association, or any fiduciary account or account governed by power of attorney or other written designation of authority unless the garnishment is against the defendant's capacity as a fiduciary of the account or the summons of garnishment alleges that the account is being used by the defendant for an improper or unlawful purpose [OCGA 18-4-23(c)].
Note - The statute has no clear standard for determining how an account is "maintained," so it is likely that the bank may rely on the superficial appearances of the name on the account and signatures in a representative capacity.
4.27 Restrictions on Garnishing Earnings:
A. Definition - compensation paid or payable for personal services. May be called wages, salary, commission, bonus, or otherwise, and includes payments from a pension or retirement program [OCGA 18-4-1(2)].
B. Disposable earnings
1. The part of an individual's earnings remaining after deductions of the amounts required by law to be withheld [OCGA 18-4-1(1)]. Disposable earning exemptions apply regardless of whether it’s a Wage Garnishment or Regular Garnishment of a bank account where ‘take-home’ pay has been deposited.
2. Wages subject to withholding for child support, tax levies or bankruptcy orders are not considered a deduction required by law.
3. However, if these orders have priority over the creditor garnishment and are 25% of disposable wages (see C below), then no amount can be withheld for the creditor garnishment [29CFR § 870.11(b)(2)].
N.B. The 2016 Act writes the amount of $217.00 into law as the minimum wage exemption, notwithstanding that 30 x $7.25 - $217.50. If the Federal minimum wage rises, you will have to decide if Article VI, Paragraph 2 (the Supremacy Clause) of the United States Constitution remains in effect in the State of Georgia. OCGA § 18-4-5.
C. Amount - Except for family support obligations (see D below), the most that can be garnished from the Defendant's weekly pay is the lesser of:
1. 25% of his/her disposable earnings ("take-home" pay -see B above);
2. The remainder after subtracting 30 times the amount of the Federal minimum wage [OCGA 18-4-5].
EXAMPLE - Defendant brings home $280.00 after deducting social security and withholding taxes every week:
1. 25% of $280.00 = $70.00
2. $217.00 (30 times the minimum wage) OCGA § 18-4-5.
$280.00 – 217.00 = $63.00 ($7.25 as of 3/23/16: 30 x $7.25 = $217.50)
Since $63.00 is the smallest of the two answers, that amount is taken out of defendant's paycheck.
See note above regarding minimum wage in the 2016 Act.
D. Garnishments for support obligations - if summons shows that it is for child support or alimony, 50% of earnings are subject to garnishment [OCGA 18-4-53(c)]. Lump-sum cash award in divorce decree may not be "alimony" but "property division" [191 Ga.App. 718, 382 SE2d 730 (1989) (but would be non-support money judgment (see 4.13). The payments due being periodic as opposed to lump sum does not determine the character as “alimony” or “property settlement.” You have to look at the divorce decree to determine.
Example - Assume two garnishments, one for a regular judgment creditor, one for child support order. If none of the child support accrued before the other creditor's judgment, then the regular creditor would get the first 25% of disposable wages and the child support creditor would get the next 25%...
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