[CLBS] Bank account garnishment prior to BK - sheriff still has garnished funds [IWOV-GPDMS.FID693075]

[Randal French]

Good point about a corp not having exemptions. But the same procedure is used,  I think,  for third parties to assert a claim. I suspect the sheriff's office just plays it safe. 

May be a good question whether title to the funds transferred to the garnishing creditor when funds were paid to the sheriff.  I think someone already mentioned the US Supreme Court decision in Whiting Pools and its progeny.   That line of cases should provide at least an initial analysis.

Would this be a preferential transfer?  If under the limit of about $6250 or thereabouts Creditor has a good defense to the preferential transfer claim. 

If the funds are still part of the estate,  can creditor make an argument that it is entitled to adequate protection before returning the funds?  Does it have a possessory interest in the funds?  Is sheriff's possession attributable to creditor?  Hard to see the Sheriff as acting as an agent of the Debtor corp.  That may not mean that debtor corp's interest was not terminated.  I'm not sure. 






Sent from my Verizon Wireless 4G LTE smartphone

<div>-------- Original message --------</div><div>From: James Macdonald <jmacdonald at ejame.com> </div><div>Date:10/10/2015  8:19 AM  (GMT-07:00) </div><div>To: Robert Maynes <mayneslaw at hotmail.com> </div><div>Cc: clbs at admws.idaho.gov </div><div>Subject: Re: [CLBS] Bank account garnishment prior to BK - sheriff still
 	has	garnished funds [IWOV-GPDMS.FID693075] </div><div>
</div>How does Corp. have exemptions?

Sent from my iPhone

> On Oct 9, 2015, at 1:32 PM, Robert Maynes <mayneslaw at hotmail.com> wrote:
> 
> Amber,
> I think of it like a repossessed vehicle that has not yet gone to auction under Article 9—still property of the estate.  In my mind, the cash is still the debtor’s until it leaves the sheriff’s possession.
> Rob
> 
>> On Oct 9, 2015, at 9:57 AM, Amber N. Dina <amberdina at givenspursley.com> wrote:
>> 
>> I represent a creditor who has a judgment against an Idaho corporation.  We obtained a writ of execution and garnished money from the debtor's bank account.  The sheriff is still in possession of the funds (waiting for claim of exemption period to expire yesterday).  However, yesterday the debtor filed Chapter 11 bankruptcy.
>> 
>> Should I instruct the sheriff to turn the money over to my creditor client today, or must the sheriff hold onto the money or give it back to the debtor?   (I know if we get it we'll likely have a preference battle down the road).
>> 
>> I'm looking for case law on point or any other guidance.
>> 
>> Regards,
>> Amber
>> ______________________
>> 
>> AMBER N. DINA
>> GIVENS PURSLEY LLP
>> 601 W Bannock St, Boise, ID 83702
>> main 208-388-1200
>> direct 208-388-1244
>> fax 208-388-1300
>> amberdina at givenspursley.com
>> www.givenspursley.com<http://www.givenspursley.com/>
>> ______________________
>> 
>> CONFIDENTIALITY NOTICE: This communication is confidential and may contain privileged information. If you have received it in error, please advise the sender by reply email and immediately delete the message and any attachments without copying or disclosing the contents. Thank you.
>> 
>> _______________________________________________
>> CLBS mailing list
>> CLBS at admws.idaho.gov
>> http://admws.idaho.gov/mailman/listinfo/clbs
> 
> _______________________________________________
> CLBS mailing list
> CLBS at admws.idaho.gov
> http://admws.idaho.gov/mailman/listinfo/clbs
_______________________________________________
CLBS mailing list
CLBS at admws.idaho.gov
http://admws.idaho.gov/mailman/listinfo/clbs