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1997 SESSION

973629362
HOUSE BILL NO. 2361
Offered January 20, 1997
A BILL to amend and reenact §§ 8.01-511, 8.01-512.3, 8.01-513, 8.01-514, and 8.01-517 of the Code of Virginia, and to amend the Code of Virginia by adding sections numbered 8.01-511.1 and 8.01-512.3:1, relating to garnishment; notice.
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Patron-- Moran
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Referred to Committee for Courts of Justice
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Be it enacted by the General Assembly of Virginia:

1. That §§ 8.01-511, 8.01-512.3, 8.01-513, 8.01-514, and 8.01-517 of the Code of Virginia are amended and reenacted and that the Code of Virginia is amended by adding sections numbered 8.01-511.1 and 8.01-512.3:1 as follows:

§ 8.01-511. Institution of garnishment proceedings.

On a suggestion by the judgment creditor that, by reason of the lien of his writ of fieri facias, there is a liability on any person other than the judgment debtor or that there is in the hands of some person in his capacity as personal representative of some decedent a sum of money to which a judgment debtor is or may be entitled as creditor or distributee of such decedent, upon which sum when determined such writ of fieri facias is a lien, a summons in the form prescribed by § 8.01-512.3 for nonwage garnishments and in the form prescribed by § 8.01-512.3:1 for wage garnishments may (i) be sued out of the clerk's office of the court from which an execution on the judgment is issued so long as the judgment shall remain enforceable as provided in § 8.01-251, (ii) be sued out of the clerk's office to which an execution issued thereon has been returned as provided in § 16.1-99 against such person, or (iii) be sued out of the clerk's office from which an execution issued as provided in § 16.1-278.18. The summons and the notice and claim for exemption form required pursuant to § 8.01-512.4 shall be served on the garnishee, and shall be served on the judgment debtor promptly after service on the garnishee. Service on the judgment debtor and the garnishee shall be made pursuant to subdivision 1 or 2 of § 8.01-296. When making an application for garnishment, the judgment creditor shall set forth on the suggestion for summons in garnishment the last known address of the judgment debtor, and shall furnish the clerk, if service is to be made by the sheriff, or shall furnish any other person making service with an envelope, with first-class postage attached, addressed to such address. A copy of the summons and the notice and claim for exemptions form required under § 8.01-512.4 shall be sent by the clerk to the sheriff or provided by the judgment creditor to the person making service, with the process to be served. Promptly after service on the garnishee, the person making service shall mail such envelope by first-class mail to the judgment debtor at his last known address. If the person making service is unable to serve the judgment debtor pursuant to subdivision 1 of § 8.01-296, such mailing shall satisfy the mailing requirements of subdivision 2 b of § 8.01-296. The person making service shall note on his return the date of such mailing which, with the notation "copy mailed to judgment debtor" shall be sufficient proof of the mailing of such envelope with the required copy of the summons and the notice and claim for exemption form with no examination of such contents being required nor separate certification by the clerk or judgment creditor that the appropriate documents have been so inserted. If the person making service is unable to serve the judgment debtor pursuant to subdivision 1 or 2 of § 8.01-296, such mailing shall constitute service of process on the judgment debtor. The judgment creditor shall furnish the social security number of the judgment debtor to the clerk, except as hereinafter provided.

The judgment creditor may require the judgment debtor to furnish his correct social security number by the use of interrogatories. However, use of such interrogatories shall not be a required condition of a judgment creditor's diligent good faith effort to secure the judgment debtor's social security number. Such remedy shall be in addition to all other lawful remedies available to the judgment creditor.

Except as hereinafter provided, no summons shall be issued pursuant to this section for the garnishment of wages, salaries, commissions or other earnings unless it: (i) is in the form prescribed by § 8.01-512.3 8.01-512.3:1, (ii) is directed to only one garnishee for the garnishment of only one judgment debtor and (iii) contains both the "TOTAL BALANCE DUE" and the social security number of the judgment debtor in the proper places as provided on the summons. Upon receipt of a summons not in compliance with this provision, the garnishee shall file a written answer to that effect and shall have no liability to the judgment creditor, such summons being void upon transmission of the answer.

However, if the judgment which the judgment creditor seeks to enforce (i) does not involve a business, trade or professional credit transaction entered into on or after January 1, 1984, or (ii) is based on any transaction entered into prior to January 1, 1984, then upon a representation by the judgment creditor, or his agent or attorney, that he has made a diligent good faith effort to secure the social security number of the judgment debtor and has been unable to do so, the garnishment shall be issued without the necessity for such number. In such cases, if the judgment debtor's correct social security number is not shown in the place provided on the summons, and the judgment debtor's name and address as shown on the garnishment summons do not match the name and current address of any employee as shown on the current payroll records of the garnishee, the garnishee shall file a written answer to that effect and shall have no liability to the judgment creditor, such summons being void upon transmission of the answer.

The judgment creditor shall, in the suggestion, specify the amount of interest, if any, that is claimed to be due upon the judgment, calculated to the return day of the summons in the case of nonwage garnishments and to a date certain in the case of wage garnishments. He shall also set out such credits as may have been made upon the judgment.

No summons shall be issued pursuant to this section at the suggestion of the judgment creditor or his assignee against the wages of a judgment debtor unless the judgment creditor, or his agent or attorney, shall allege in his suggestion that the judgment for which enforcement is sought either (i) involves a business, trade or professional credit transaction entered into on or after January 1, 1984, or (ii) does not involve a business, trade or professional credit transaction entered into on or after January 1, 1984, and a diligent good faith effort has been made by the judgment creditor, or his agent or attorney, to secure the social security number of the judgment debtor.

In addition, the suggestion shall contain an allegation that:

1. The summons is based upon a judgment upon which a prior summons has been issued but not fully satisfied; or

2. No summons has been issued upon his suggestion against the same judgment debtor within a period of eighteen months, other than under the provisions of subdivision 1; or

3. The summons is based upon a judgment granted against a debtor upon a debt due or made for necessary food, rent or shelter, public utilities including telephone service, drugs, or medical care supplied the debtor by the judgment creditor or to one of his lawful dependents, and that it was not for luxuries or nonessentials; or

4. The summons is based upon a judgment for a debt due the judgment creditor to refinance a lawful loan made by an authorized lending institution; or

5. The summons is based upon a judgment on an obligation incurred as an endorser or comaker upon a lawful note; or

6. The summons is based upon a judgment for a debt or debts reaffirmed after bankruptcy.

Any judgment creditor who knowingly gives false information upon any such suggestion or certificate made under this chapter shall be guilty of a Class 1 misdemeanor.

§ 8.01-511.1. Garnishment on wages.

A. The garnishment on wages shall be a continuing lien upon the wages payable to the judgment debtor to the extent permissible under § 34-29(a) until the full judgment, interest, costs and attorney's fees, if any, are fully satisfied and paid.

B. While the garnishment remains a lien, the garnishee shall withhold the amount of wages payable to the judgment debtor to the extent permissible under § 34-29(a) and remit the amount withheld to the creditor's attorney or if no attorney, to the creditor within fifteen days after the close of the judgment debtor's last pay period in each month and shall notify the debtor of the amount withheld each pay period showing the method used to determine the amount.

C. If the garnishee is served with more than one garnishment against the same debtor, the garnishments shall be satisfied in the order in which they are served on the employer-garnishee.

D. Any payments made by an employer-garnishee in conformity with this section shall constitute a discharge of any liability of the employer to the employee as to the wages or salary so withheld.

If a judgment debtor resigns or is dismissed from his employment while a garnishment upon his wages is wholly or partially unsatisfied, the garnishment shall lapse and no further deduction may be made unless the judgment debtor is reinstated or reemployed within ninety days of the resignation or dismissal.

E. Within fifteen days of the end of any month in which payments are received from any source, the judgment creditor shall furnish the employer-garnishee and judgment debtor, by regular mail, a written statement showing all payments that were credited to the account of the judgment debtor during that month, and, within thirty days after the satisfaction of the judgment, interest and costs, notify in writing the employer-garnishee, the debtor, and the clerk of the court of said satisfaction. If the judgment creditor fails to comply with the provisions of this subsection, the court, upon motion of any party in interest, may dismiss the garnishment and may award costs and attorneys fees to the prevailing party.

F. If the debtor has any defense to the garnishment summons, the debtor may file a motion to quash the garnishment summons stating his reasons therefor and be entitled to a speedy hearing thereon.

§ 8.01-512.3. Form of garnishment summons other than on wages.

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

(a) Front side of summons:

GARNISHMENT 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 attorney)

(Name, street address and social security number of judgment debtor)

(Name and street address of garnishee) 



 .................... Hearing Date and Time
 MAXIMUM PORTION OF                            STATEMENT
 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, 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 limitation:(1)
The that 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.




§ 8.01-512.3:1.  Form of garnishment summons
for wage garnishment.




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




A.  Front side of summons:




GARNISHMENT SUMMONS




(Court Name)




(Name, address and telephone number of judgment creditor)




(Name, address and telephone number of judgment creditor's
attorney)




(Name, street address and social security number of judgment debtor)




(Name and street address of garnishee)



......................Hearing Date and Time
MAXIMUM PORTION OF                              STATEMENT
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    $ ...
(printed on the reverse side         The garnishee shall
of this summons) applies             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.  Within thirty days of the date of service of this summons
file a written answer with this court and send a copy of it to the
plaintiff/creditor or his attorney stating
whether the defendant/debtor is employed by you, and if so employed, state the
rate of pay and whether there are any prior garnishments against the wages
which are or may become payable.




2.  Withhold the garnishable wages as defined in the MAXIMUM
PORTION OF DISPOSABLE EARNINGS SUBJECT TO GARNISHMENT,
§ 34-29(a) printed on the reverse side of this summons, for any
work week or any other pay period and to remit the amount
withheld to the creditor's attorney or if no attorney, to the
creditor within fifteen days after the close of the last
pay period of the defendant/debtor each month until the judgment, interest,
attorney's fees and costs as specified in the summons are satisfied or
until otherwise notified by the 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 twenty-five 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 thirty times the minimum hourly
wage."




But an employer may withhold a difference 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 sixty-five 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 thirty 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.




§ 8.01-513. Service upon corporation.




Notwithstanding the provisions of §§ 13.1-637, 13.1-766,
13.1-836 and 13.1-928, if If the person upon whom there is a
suggestion of liability as provided in § 8.01-511 is a corporation, the
summons shall be served upon an officer, or managing employee of the
corporation other than an officer of the corporation, unless the judgment
creditor shall file with the court a certificate that he has used due diligence
and that no such officer or managing employee of the corporation other than an
officer or other person authorized to accept such service can be found within
the Commonwealth, in which case such summons shall be served on the
registered agent of the corporation or upon the clerk of the State Corporation
Commission as is otherwise provided by law. Provided, however, that
service on the corporation shall not be made upon a managing employee of such
corporation if such managing employee is also the judgment debtor.




§ 8.01-514. When garnishment summons other than on wages returnable.




The summons in garnishment other than on wages shall be returnable
to the general district court from which it issued not more than ninety days
after the date thereof and to the circuit court from which it issued, not more
than ninety days after the date thereof. When issued by a district court, such
summons 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 made returnable before the general district court, and shall be
made returnable within ninety days at some certain place within such county or
city named in such summons.




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




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, 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, with a copy to
the creditor or his attorney, within thirty days of
service of the summons stating whether the debtor is an employee, and if so,
the rate of pay, the existence of any prior liens and any exemptions.  Any
payment by an employer garnishee in conformity with this section will
constitute a discharge of any liability of the employer to the employee for the
wages or salary so withheld.  If the answer denies employment, the garnishment
will be dismissed unless the creditor files a motion for a hearing within
fifteen days of receipt of the answer.