[CLBS] New policy or have I just not seen this situation before regarding garnishment wages.

Wed Dec 13 21:53:58 MST 2017

The garnishment sent to the creditor is only the 25% allowed under the
11-207 already, so you cannot claim another 75% from the 25% garnished.
That would be double-dipping.

Regarding the $1,500 exemption in unearned wages, I believe In re Cantu
from Judge Pappas in 2014 would indicate that the garnishment was paid to
the debtor but diverted for the garnishment, so the $1,500 exemption cannot
be applied.

I believe the real question is what date does the employer do payroll?  If
payroll is run on the 16th and 1st of each month, but the pay date is the
20th and 5th, then that is a change in your facts.  I haven't researched
this for a few years, but if I remember right, that is where the case law
falls too.  My experience is that most sheriff's send payments relating to
garnishments received post-petition to the Trustee, who provide them back
to me for my clients.  Hopefully you notice the sheriff and court's when
you file to make this process work quickly.  But if payroll is ran
pre-petition and the checks or deposits are all set in motion by the
employer before filing, those funds were paid pre-petition, even if the pay
date on the check is post-petition.  Depends on your employer.  Some of our
school districts run payroll the Wednesday of the week before the employee
gets their pay by check or in their account.

If they were truly garnished pre-petition, and exceed $600 with other
garnishments, yes, I believe the Trustee can claim them.  I am not aware of
an exemption to apply to that 25% of the person's wages.

If the garnishment truly took place post-petition, that would be a
violation of the stay.  But are you going to get sanctions, no, because it
was not knowing and willing.  Depending on the amount, is it worth chasing?

Good luck!  Keep us updated.

Paul

On Wed, Dec 13, 2017 at 12:05 PM, Randy French <rfrench at rfrenchlaw.com>
wrote:

> You can also exempt earned but unpaid wages, up to $1500, under 11-605(11).
> So, the max unearned wages that can be exempted is $6,0000, 75% or $4500 by
> 11-207,, plus $1,500, by 11-605(11).
>
>
> Thanks.
> Randy French
>
> Law Office of Randal J. French, P.C.
> Attorneys at Law
> P.O. Box 836
> Boise, ID 83701
> (208) 859-6881
>
> IMPORTANT NOTICE: This communication, including any attachments, may
> contain
> information that may be confidential or privileged and is intended solely
> for the entity or individual to whom it is addressed. If you are NOT the
> intended recipient, you must delete this message and attachments and are
> hereby notified that any disclosure, copying, or distribution of this
> message is strictly prohibited. Nothing in this email, including any
> attachment, is to be a legally binding signature.
>
>
>
> -----Original Message-----
> From: CLBS [mailto:clbs-bounces at admws.idaho.gov] On Behalf Of Sarah
> Bratton
> Sent: Tuesday, December 12, 2017 2:10 PM
> To: Jon Wilson
> Cc: clbs at admws.idaho.gov
> Subject: Re: [CLBS] New policy or have I just not seen this situation
> before
> regarding garnishment wages.
>
> Did you exempt the wages under earned but unpaid wages up to 75%? If not
> then the Trustee is entitled to all of the wages paid post petition but
> earned pre-petition. If you have exempted 75% of the earned but unpaid
> wages
> then debtor owes Trustee 25% of the wages. So whether those wages are
> returned to debtor and then paid to Trustee is no different than if Trustee
> just keeps the garnished funds up to the unexempt 25%.
>
> Regardless of who gets the funds, debtor or Trustee there is in fact a stay
> violation. you have to consider what your clients damages are but yes a
> stay
> violation occurred and is debtors to pursue as the creditor garnished
> post-petition wages.
>
>
>
>
>
> Sarah B. Bratton, Attorney
>
> Bratton Law, PLLC
>
> Idaho Partner, Upright Law
>
>
> Phone (208)918-0394
>
> 1020 W. Main Street
>
> Suite 100K
>
> Located in the Alaska Building
>
> in Downtown Boise
>
> (By appointment only)
>
>
> Mailing Address:
>
> 7154 W.  State St. #167
>
> Boise, ID 83714
>
>
>
>
>
>
>
> *PRIVILEGE AND CONFIDENTIALITY NOTICE*
> This e-mail is intended only for the use of the recipient named and may
> contain information that is confidential, privileged, and exempt from
> disclosure under applicable laws. If you are not the named recipient, you
> may have received this transmission in error. We ask that you immediately
> notify the sender and remove this and all attached file(s) from your
> system.
> Receipt by anyone other than the intended recipient is not a waiver of the
> attorney-client or work-product privileges. You are hereby notified that
> any
> disclosure, copying, distribution, or use of any of the information
> contained in this transmission if you are not the intended recipient is
> prohibited and may expose you to liability.
>
>
>
> On Tue, Dec 12, 2017 at 1:50 PM, Jon Wilson <jon at boiselaw.org> wrote:
>
> > Dear List Mates,
> >
> >
> >
> > Recently had the following situation come up...
> >
> >
> >
> > Debtor's wages were being garnished at the time of filing.in fact over
> > at least a month prior to the bankruptcy filing.  Debtor files
> > bankruptcy on 1st , payday several days later, but check was still
> > garnished post-petition.  Trustee has taken the position that since
> > the wages were "earned before the bankruptcy was filed" AND the
> > payday/check was cut/paid AFTER the bankruptcy was filed, those wages
> > are property of the bankruptcy estate and will be kept by the Trustee.
> >
> >
> >
> > Any thoughts, case law, etc. which counters the Trustee's position
> > those wages earned, but paid post-petition via writ of continuous
> > garnishment filed by Creditor, are those garnished wages property of
> > the Bankruptcy Estate?
> >
> >
> >
> > If the Trustee is correct, is there a stay violation against the
> > Creditor who was garnishing the debtor's wages "post-petition" even if
> > the Trustee is allowed to keep these "wages"?
> >
> >
> >
> > Appreciate you input.
> >
> >
> >
> > Jon
> >
> > Jon R. Wilson
> >
> > Attorney at Law
> >
> >
> >
> > Wilson Law Offices, P.C.
> >
> > 4614 W. Emerald St.
> >
> > Boise, ID 83706
> >
> > Tel. (208)343-8400
> >
> > Fax (208)424-5006
> >
> > Email:  jon at boiselaw.org <mailto:jon at boiselaw.org>
> >
> >
> >
> > CONFIDENTIALITY NOTICE:  The preceding message (including any
> > attachment, if
> > any) is covered by the Electronic Communication Privacy Act, 18 U.S.C.
> > sections 2510-2521, is CONFIDENTIAL, and may also be protected by the
> > ATTORNEY/CLIENT OR  OTHER PRIVILEGE.  If you believe that this message
> > has been sent to you in error, do not read any further portion of the
> > message other than the remainder of this notice, please reply to the
> > sender that you have received the message in error, and delete the
> > message.  If you are not the intended recipient, you are hereby
> > notified that any retention, dissemination, distribution, or copying
> > of this communication is strictly prohibited.  We do not waive any
> > attorney/client or work privilege by the transmission of this message.
> > 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
>

-- 
Idaho Bankruptcy Law
T: (208) 219-7997
F: (208) 416-6996

This communication is intended for the party above.  If this e-mail has
been sent to you by mistake, please notify me immediately.  This
information is private and is confidential and unauthorized use can impose
penalties and liabilities.  A client-attorney relationship is not created
without a signed agreement and should not be construed as legal advice
without such an agreement.