HB1093: Garnishment; garnishee shall pay money on behalf of judgment debtor directly to judgment creditor.

Offered January 11, 2012
Prefiled January 11, 2012
A BILL to amend and reenact §§ 8.01-512.3, 8.01-514, 8.01-515, 8.01-516.1, 8.01-517, and 8.01-520 of the Code of Virginia and to amend the Code of Virginia by adding a section numbered 8.01-520.1, relating to garnishment.
Patron-- Herring

Committee Referral Pending

Be it enacted by the General Assembly of Virginia:

1.  That §§ 8.01-512.3, 8.01-514, 8.01-515, 8.01-516.1, 8.01-517, and 8.01-520 of the Code of Virginia are amended and reenacted and that the Code of Virginia is amended by adding a section numbered 8.01-520.1 as follows:

§ 8.01-512.3. Form of garnishment summons.

Any garnishment issued pursuant to § 8.01-511 shall be in the following form:

(a) Front side of summons:

 (Court Name)
 (Name, address and telephone number of judgment creditor
 except that when the judgment creditor's attorney's name,
 address and telephone number appear on the summons, only
 the creditor's name shall be used.)
 (Name, address and telephone number of judgment creditor's
 (Name, street address and social security number of
 judgment debtor)
 (Name and street address of garnishee)
 .................... Hearing Date and Time
 This is a garnishment against (check only one of the
 designations below):
 [] wages, salary, or           [] some other debt due or
    other compensation.            property of the judgment
 DISPOSABLE EARNINGS SUBJECT        Judgment Principal   $ ...
 TO GARNISHMENT                     Credits              $ ...
                                    Interest             $ ...
 [] Support                         Judgment Costs       $ ...
 [] 50% [] 55% [] 60% [] 65%        Attorney's Fees      $ ...
 (if not specified, then 50%)       Garnishment Costs    $ ...
 [] state taxes, 100%
 If none of the above is
 checked, then § 34-29 (a)            TOTAL BALANCE DUE  $ ...
 applies.                           The garnishee shall
                                    rely on this amount.
 Date of Judgment

TO ANY AUTHORIZED OFFICER: You are hereby commanded to serve this summons on the judgment debtor and the garnishee.

TO THE GARNISHEE: You are hereby commanded to

(1) File a written answer with this court,; or

(2) Deliver payment to this court, the judgment creditor or the judgment creditor's attorney; or

(3) Appear before this court on the return date and time shown on this summons to answer the Suggestion for Summons in Garnishment of the judgment creditor that, by reason of the lien of writ of fieri facias, there is a liability as shown in the statement upon the garnishee.

As garnishee, you shall withhold from the judgment debtor any sums of money to which the judgment debtor is or may be entitled from you during the period between the date of service of this summons on you and the date for your appearance in court, subject to the following limitations:

(1) The maximum amount which may be garnished is the "TOTAL BALANCE DUE" as shown on this summons.

(2) If the sums of money being garnished are earnings of the judgment debtor, then the provision of "MAXIMUM PORTION OF DISPOSABLE EARNINGS SUBJECT TO GARNISHMENT" shall apply.

If a garnishment summons is served on an employer having 1,000 or more employees, then money to which the judgment debtor is or may be entitled from his or her employer shall be considered those wages, salaries, commissions, or other earnings which, following service on the garnishee-employer, are determined and are payable to the judgment debtor under the garnishee-employer's normal payroll procedure with a reasonable time allowance for making a timely return by mail to this court.

 ....................               ...................
 Date of Issuance of Summons               Clerk
 Date of delivery of writ of fieri facias to sheriff if
 different from date of issuance of this summons.

(b) A plain language interpretation of § 34-29 shall appear on the reverse side of the summons as follows:

"The following statement is not the law but is an interpretation of the law which is intended to assist those who must respond to this garnishment. You may rely on this only for general guidance because the law itself is the final word. (Read the law, § 34-29 of the Code of Virginia, for a full explanation. A copy of § 34-29 is available at the clerk's office. If you do not understand the law, call a lawyer for help.)

An employer may take as much as 25 percent of an employee's disposable earnings to satisfy this garnishment. But if an employee makes the minimum wage or less for his week's earnings, the employee will ordinarily get to keep 30 times the minimum hourly wage."

But an employer may withhold a different amount of money from that above if:

(1) The employee must pay child support or spousal support and was ordered to do so by a court procedure or other legal procedure. No more than 65 percent of an employee's earnings may be withheld for support;

(2) Money is withheld by order of a bankruptcy court; or

(3) Money is withheld for a tax debt.

"Disposable earnings" means the money an employee makes after taxes and after other amounts required by law to be withheld are satisfied. Earnings can be salary, hourly wages, commissions, bonuses, or otherwise, whether paid directly to the employee or not. After those earnings are in the bank for 30 days, they are not considered earnings any more.

If an employee tries to transfer, assign, or in any way give his earnings to another person to avoid the garnishment, it will not be legal; earnings are still earnings.

An employee cannot be fired because he is garnished for one debt.

Financial institutions that receive an employee's paycheck by direct deposit do not have to determine what part of a person's earnings can be garnished.

§ 8.01-514. When garnishment summons returnable.

The summons in garnishment, whether issued by a circuit court or a district court, may be directed to a sheriff of any county or city wherein the judgment debtor resides or where the garnishment defendant resides or where either may be found and shall be made returnable to the court that issued it within 90 days from the writ's issuance, except that, in the case of a wage garnishment, the summons shall be returnable not more than 180 days after such issuance on such date as fixed by the court.

§ 8.01-515. How garnishee examined; determining exemption from employee's withholding certificate; amount due pursuant to exemptions in § 34-29 (a).

A person so summoned shall appear in person and be examined on oath or he may file a statement. A corporation so summoned shall appear by an authorized agent who shall be examined on oath or may file a statement, not under seal of such authorized agent. Such statement shall show the amount the garnishee is indebted to the judgment debtor, if any, or what property or effects, if any, the garnishee has or holds which belongs to the judgment debtor, or in which he has an interest. Payment to the court judgment creditor or the judgment creditor's attorney of any amount by the garnishee shall have the same force and effect as a statement which contains the information required by this section. If the judgment debtor or judgment creditor disputes the verity or accuracy of such statement or amount and so desires, then summons shall issue requiring the appearance of such person or authorized agent for examination on oath, and requiring him to produce such books and papers as may be necessary to determine the fact.

In determining the exemption to which the employee is entitled, the employer may until otherwise ordered by the court rely upon the information contained in the employee's withholding exemption certificate filed by the employee for federal income tax purposes, and any person showing more than one exemption thereon shall be considered by him to be a householder or head of a family.

The employer may apply the exemptions provided in § 34-29 (a) unless otherwise specified on the summons, or unless otherwise ordered by the court.

§ 8.01-516.1. Garnishment dispositions.

A. If the amount of liability is not disputed and the garnishee admits liability to the court either by (i) examination on the return date of the summons, or (ii) written statement as provided by § 8.01-515 on or before the return date of the summons, the court shall order the delivery of such estate or payment of the value of such estate into court to the judgment creditor or the judgment creditor's attorney without entering judgment against the garnishee. Should a garnishee fail to comply with the order within thirty 30 days after service of such order on the garnishee, then judgment may be entered against the garnishee.

B. Upon certification by the judgment creditor, its bona fide employee, or its attorney that its claim has been satisfied or that it desires its action against the garnishee to be dismissed for any other reason, the court, or clerk thereof, where the action has been filed, shall, by written order, which may be served by the sheriff, notify the garnishee to cease withholding assets of the judgment debtor, and to treat any funds previously withheld as if the original garnishment action had not been filed. The court in which the garnishment action was filed shall then dismiss the action on or before the return date.

C. If any portion of the judgment remains unsatisfied after the return day of the summons, any subsequent garnishment based on the same judgment, even if sought against a different garnishee, shall be considered a continuation of the original garnishment proceeding and shall maintain the same case number as the original proceeding.

§ 8.01-517. Exemption of portion of wages; payment of excess.

Notwithstanding the provisions of §§ 8.01-515 and 8.01-516.1, any employer against whom any garnishment is served in connection with an action or judgment against an employee may pay to such employee when due wages or salary not exceeding the amount exempted by § 34-29 unless such exemptions shall have been specifically disallowed by the court and shall answer such garnishment summons by a written statement verified by affidavit, showing the amount of wages or salary due on the return date of the garnishment summons and the amount of wages or salary so exempted, and if there shall be an excess of wages or salary so due over the amount of the exemptions, the employer may pay the amount of such excess into the court where the garnishment summons is returnable to the judgment creditor or the judgment creditor's attorney, which payment when determined by the court to be correct will constitute a discharge of any liability of the employer to the employee for the wages or salary so withheld.

§ 8.01-520. Payment, etc., by garnishee before return of summons.

Any person, summoned under § 8.01-511, before the return day of the summons, may pay what he is liable for to the clerk of the court issuing the summons and such clerk judgment creditor or the judgment creditor's attorney who shall give a receipt, upon request, for what is so paid.

§ 8.01-520.1. Report of judgment creditor.

Within 15 days after the end of each month in which payments are received by the judgment creditor or the judgment creditor's attorney for the account of the judgment debtor, the judgment creditor or his attorney shall send via first-class mail, postage prepaid, to the garnishee and the judgment debtor a statement disclosing the payments received and the manner in which they were credited. The judgment creditor or his attorney shall retain a copy of each statement until 90 days after the termination of the garnishment proceeding and shall provide a copy upon request to any party or the court.