Current Status Bill Number:3684 Type of Legislation:General Bill GB Introducing Body:House Introduced Date:19950223 Primary Sponsor:Stille, All Sponsors:Stille, Herdklotz, Bailey, Phillips, McCraw, Simrill, Tripp, Cooper and H. Brown Drafted Document Number:gjk\21311sd.95 Residing Body:House Current Committee:Judiciary Committee 25 HJ Subject:Garnishment Act
Body Date Action Description Com Leg Involved
______ ________ _______________________________________ _______ ____________
House 19950223 Introduced, read first time, 25 HJ
referred to Committee
View additional legislative information at the LPITS web site.
TO AMEND TITLE 15, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO CIVIL REMEDIES AND PROCEDURES BY ADDING CHAPTER 42 SO AS TO ENACT THE "SOUTH CAROLINA GARNISHMENT ACT OF 1995"; TO PROVIDE PROCEDURES WHICH GRANT TO PERSONS WHO HAVE SUED TO RECOVER CERTAIN DEBTS OR HAVE RECOVERED CERTAIN JUDGMENTS AGAINST ANOTHER PERSON A RIGHT TO A WRIT OF GARNISHMENT, SUBJECTING TO GARNISHMENT UP TO SPECIFIED LIMITATIONS INCOME, WAGES, INTEREST, RENTS, DIVIDENDS, AND OTHER PERSONAL PROPERTY OF THE DEBTOR.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Title 15 of the 1976 Code is amended by adding:
Section 15-42-10. This chapter may be cited as the `South Carolina Garnishment Act of 1995'.
Section 15-42-20. Every person who has sued to recover a debt or has recovered judgment in any court against another person has a right to a writ of garnishment, in the manner provided in this chapter, to satisfy the judgment he has obtained by subjecting to garnishment income, wages, interest, rents, capital gains, dividends, and commissions of the judgment debtor. In addition, a judgment creditor may subject to garnishment any debt due to defendant by a third person, and any tangible or intangible personal property of defendant in the possession or control of a third person.
Section 15-42-30. (A) No writ of garnishment under this chapter may issue in any action sounding in tort but only from actions arising under contract.
(B) If the amount of the judgment or the amount in controversy if the proceedings have not yet resulted in a judgment are five thousand dollars or less, jurisdiction of the garnishment action is in the magistrate's court. Otherwise, jurisdiction over such garnishment actions is in the Circuit Court.
Section 15-42-40. After judgment has been obtained against defendant but before the writ of garnishment is issued, the plaintiff, shall file a motion stating the amount of the judgment and that the plaintiff does not believe that defendant has in his possession visible property on which a levy can be made sufficient to satisfy the judgment. The motion may be filed and the writ issued either before or after the return of execution.
Section 15-42-50. Before judgment has been obtained by the plaintiff against the defendant:
(1) A writ of garnishment may be issued by the court.
(2) To obtain issuance of the writ, the plaintiff shall file in the court where the action is pending a verified motion or affidavit alleging by specific facts the nature of the cause of action; the amount of the debt and that the debt for which the plaintiff sues is just, due, and unpaid; that the garnishment is not sued out to injure either the defendant or the garnishee; and that the plaintiff believes that the defendant will not have in his possession, after execution is issued, tangible or intangible property in this State and in the county in which the action is pending on which a levy can be made sufficient to satisfy the plaintiff's claim. The writ of garnishment shall set forth a notice to the defendant of his right to an immediate hearing for dissolution of the writ pursuant to Section 15-42-140. Upon issuance of the writ of garnishment, the court shall provide by mail a copy of the writ to the defendant.
(3) Except when the plaintiff has had an attachment writ issued, no writ of garnishment before judgment may issue until the plaintiff gives a bond with a surety to be approved by the court payable to the defendant in at least double the amount of the debt demanded, conditioned to pay all costs, damages, and attorney's fees that the defendant sustains in consequence of plaintiff's improper writ of garnishment.
Section 15-42-60. Notwithstanding any other provision of this chapter, if salary or wages are to be garnished to satisfy a judgment in the manner permitted by Section 15-42-70, the court shall issue a continuing writ of garnishment to the judgment debtor's employer which provides for the periodic payment of a portion of the salary or wages of the judgment debtor as the salary or wages become due until the judgment is satisfied or until otherwise provided by court order. The court shall allow the judgment debtor's employer to collect up to five dollars against the salary or wages of the judgment debtor to reimburse the employer for administrative costs for the first deduction from the judgment debtor's salary or wages and up to one dollar for each deduction thereafter.
Section 15-42-70. (A) As used in this chapter:
(1) `Disposable earnings' means that part of the earnings of an individual remaining after the deduction from those earnings of the amounts required by law to be withheld.
(2) `Earnings' means compensation paid or payable for personal services, whether denominated as wages, salary, commission, bonus, or otherwise, and includes periodic payments pursuant to a pension or retirement program.
(B) All debts owed by the garnishee to the defendant at the time of service of the writ of garnishment upon the garnishee and all debts accruing from the garnishee to the defendant from the date of service to the date of the garnishee's answer shall be subject to process of garnishment; and no payment made by the garnishee to the defendant or to his order, or by any arrangement between the defendant and the garnishee, after the date of the service of the writ of garnishment upon the garnishee, shall defeat the lien of such garnishment.
(C) All property, money, or effects of the defendant in the possession or control of the garnishee at the time of service of the summons of garnishment upon the garnishee or coming into the possession or control of the garnishee at any time from the date of service of the writ of garnishment upon the garnishee to the date of the garnishee's answer shall be subject to process of garnishment except, in the case of collateral securities in the hands of a creditor, such securities shall not be subject to garnishment so long as there is an amount owed on the debt for which the securities were given as collateral.
(D) (1) Notwithstanding subsection (A) of this section, the maximum part of the aggregate disposable earnings of an individual for any work week which is subject to garnishment may not exceed the lesser of:
(a) twenty-five percent of his disposable earnings for that week; or
(b) the amount by which his disposable earnings for that week exceed thirty times the federal minimum hourly wage prescribed by Federal Fair Labor Standards Act of 1938 in effect at the time the earnings are payable.
(2) In case of earnings for a period other than a week, a multiple of the federal minimum hourly wage equivalent in effect to that set forth in subitem (D)(1)(b) of this subsection shall be used.
(E) The limitation on garnishment set forth in subsection (D) shall apply although the garnishee may receive a writ of garnishment in more than one garnishment case naming the same defendant. No garnishee shall withhold from the disposable earnings of the defendant any sum greater than the amount prescribed by subsection (D), as applicable, regardless of the number of writs.
Section 15-42-80. No employer may discharge any employee by reason of the fact that his earnings have been subjected to garnishment for any one indebtedness, even though more than one writ of garnishment may be served upon the employer with respect to the indebtedness.
Section 15-40-90. (A) Funds or benefits from a pension or retirement program or funds or benefits from an individual retirement account shall be exempt from the process of garnishment until paid or otherwise transferred to a member or beneficiary of the program. The funds or benefits, when paid or otherwise transferred to the member or beneficiary, shall be exempt from the process of garnishment only to the extent provided in Section 15-42-70 for other disposable earnings, unless a greater exemption is otherwise provided by law.
(B) Nothing in this section shall prohibit the attachment of welfare benefits as defined in 29 U.S.C. Section 1002(1) in the control of an administrator or trustee.
Section 15-42-100. The writ shall require the garnishee to serve an answer to it on plaintiff within thirty days after service stating whether he is indebted to defendant at the time of the answer, or was indebted at the time of service of the writ, or at any time between those times; and in what sum and what tangible or intangible personal property of defendant he has in his possession or control at the time of his answer, or had at the time of the service of the writ, or at any time between those times; and whether he knows of any other person indebted to defendant, or who may have any of the property of defendant in his possession or control. The writ must state the amount named in plaintiff's motion.
Section 15-42-110. Within ten days after service of the garnishee's answer on the plaintiff or after the time period for the garnishee's answer has expired, the plaintiff shall serve, by mail, the following documents: a copy of the writ, a copy of the answer, a notice, and a certificate of service. The notice must advise the recipient that he must move to dissolve the writ within the time period set forth in Section 15-42-140 or be defaulted and that he may have exemptions from the garnishment which must be asserted as a defense. The plaintiff shall serve these documents on the defendant at his last known address and any other address disclosed by the garnishee's answer and on any other person disclosed in the garnishee's answer to have any ownership interest in the deposit, account, or property controlled by the garnishee. The plaintiff shall file in the proceeding a certificate of this service.
Section 15-42-120. (A) Service of the writ makes the garnishee liable for all debts due by him to defendant and for any tangible or intangible personal property of defendant in his possession or control at the time of the service of the writ or at any time between the service and the time of his answer.
(B) The garnishee shall report in its answer and retain, subject to the provisions of Section 15-42-230 and subject to disposition as provided in this chapter, any deposit, account, or tangible, or intangible personal property in the possession or control of the garnishee, and the answer must state the name or names and addresses, if known to the garnishee, of the defendant and any other persons having or appearing to have an ownership interest in the involved property.
(C) In any case where a garnishee in good faith is in doubt as to whether any indebtedness or property is required by law to be included in the garnishee's answer or retained by it, the garnishee may include and retain the same, subject to the provisions of Section 15-42-130 and subject to disposition as provided in this chapter, and in that case the garnishee is not liable for so doing to the defendant or to any other person claiming the same or any interest therein or claiming to have sustained damage on account thereof.
(D) Service of a writ on a garnishee renders him liable as provided in this chapter in any fiduciary or representative capacity held by him if the fiduciary or representative capacity is specified in the writ.
Section 15-42-130. When any garnishee answers and plaintiff is not satisfied with the answer, he shall serve a reply within thirty days thereafter denying the allegations of the answer as he desires. On failure of plaintiff to file a reply, the answer must be taken as true and on proper disposition of the assets, if any are disclosed thereby, the garnishee is entitled to an order discharging him from further liability under the writ.
Section 15-42-140. (A) The defendant, by motion, may obtain the dissolution of a writ of garnishment, unless the petitioner proves the grounds upon which the writ was issued and unless, in the case of a prejudgment writ, there is a reasonable probability that the final judgment in the underlying action will be rendered in his favor. The court shall set down the motion for an immediate hearing. If the writ is dissolved, the action then must proceed as if no writ had been issued.
(B) The defendant and any other person having an ownership interest in the property, as disclosed by the garnishee's answer, shall file and serve a motion to dissolve the garnishment within thirty days after the date indicated in the certificate of service on the defendant and such other person of the plaintiff's notice required by Section 15-42-110 stating that any allegation in plaintiff's motion for writ is untrue. On this motion this issue must be tried, and, if the allegation in plaintiff's motion which is denied is not proved to be true, the garnishment must be dissolved. Failure of the defendant or other interested person to timely file and serve the motion to dissolve within the time limitation must result in the striking of the motion as an unauthorized nullity by the court, and the proceedings must be in a default posture as to the party involved.
(C) If the motion denies the debt demanded before judgment, the judge may require pleadings on motion of either party on the debt demanded to be filed in such time as he fixes.
(D) The issue, if any, raised by the pleadings must be tried at the same time as the issue, if any, made by defendant's motion to plaintiff's motion.
Section 15-42-150. On demand of either party, a jury must be impaneled to try the issues.
Section 15-42-160. (A) If the garnishee fails to answer as required, a default must be entered against him.
(B) On the entry of judgment for plaintiff, a final judgment must be entered against the garnishee for the amount of plaintiff's claim with interest and costs. No final judgment against a garnishee may be entered before the entry of, or in excess of, the final judgment against the original defendant with interest and costs. If the claim of the plaintiff is dismissed or judgment is entered against him the default against garnishee must be vacated and judgment for his costs entered.
Section 15-42-170. If no reply to garnishee's answer is served, garnishee may surrender any goods, chattels, or effects of defendant in his hands or possession to the sheriff and may pay any money or debt into registry of court. In this event or if garnishee prevails in the trial of any reply and after proper disposition of any property disclosed by his answer, the court shall discharge him from further liability under the writ.
Section 15-42-180. Judgment against the garnishee on his answer or after trial of a reply to his answer must be entered for the amount of his liability as disclosed by the answer or trial. The court may subpoena the garnishee to inquire about his liability to or possession of property of the defendant. No judgment in excess of the amount remaining unpaid on the final judgment against the defendant or in excess of the amount of the liability of the garnishee to the defendant, whichever is less, may be entered against the garnishee.
Section 15-42-190. If garnishee does not surrender the personal property belonging to defendant, so long as he has the power to do so, and which he has admitted is in his possession, the court may order execution issued against garnishee for the unpaid amount of plaintiff's judgment against defendant. Garnishee's property may be sold as under other executions. Garnishee may release his property from the levy and sale by surrendering the property of defendant to the officer levying the execution at the time appointed for the sale of his property so levied on, or at any time before the day of the sale and by paying the costs of the proceedings to sell up to the time of the surrender.
Section 15-42-200. When any garnishee has any of the personal property of defendant in his possession or control and surrenders it, the sheriff or other appropriate officer shall receive the property and sell it under the execution against defendant.
Section 15-42-210. If the answer of garnishee shows that there is any of defendant's personal property in the possession or control of any person who has not been garnisheed, on motion of plaintiff a writ of garnishment shall issue against the person having personal property of the defendant and the person shall answer and is liable as other garnishees.
Section 15-42-220. (A) If a person other than defendant claims that the debt due by a garnishee is due to him and not to defendant, or that the property in the hands or possession of any garnishee is his property and makes an affidavit to that effect, the court shall impanel a jury to determine the right of property between the claimant and plaintiff unless a jury is waived.
(B) If the verdict is against the claimant, plaintiff shall recover costs. If the verdict is in favor of the claimant, he shall recover costs against plaintiff.
(C) If the claim is interposed after a levy on property, the officer making the levy shall return the execution with his levy thereon and the affidavit of the claimant to the court from which execution issued, and the proceedings must be as in other cases of claims made to property taken on execution.
Section 15-42-230. No garnishee who is indebted to or has in his possession the money of a person whose money or credits may be garnisheed may retain out of the money more than double the amount which the writ of garnishment specifies as the amount plaintiff expects to recover or more than double the amount of the judgment plaintiff has recovered.
Section 15-42-240. (A) If the judgment is for defendant in the main action, plaintiff shall pay all costs which have accrued in consequence of suing out a writ of garnishment before judgment and the money or property brought into the court or custody of the officer thereby inures to the benefit of and must be controlled by defendant as completely as though it had been rendered in his favor.
(B) If plaintiff dismisses his action or has a judgment against him on the trial, the judgment against garnishee becomes a nullity and garnishee shall have execution for his costs against plaintiff.
Section 15-42-250. At any time before the entry of judgment, a defendant whose property has been garnisheed may secure its release by giving a bond with surety to be approved by the court in at least double the amount claimed in the complaint with interest and costs, or if the value of the property garnisheed is less than this amount, then in double the value, conditioned to pay any judgment recovered against him in the action with interest and costs, or so much thereof as shall equal the value. On the approval of the bond the court shall discharge the garnishment and release the property. The order becomes effective on its filing with the bond. If garnishee admits a debt to or possession of property of defendant in excess of a sum sufficient to satisfy plaintiff's claim, on motion of defendant and notice to plaintiff, the court shall release garnishee from responsibility to plaintiff for any debt to or property of defendant except in a sum deemed by the court sufficient to satisfy plaintiff's claim with interest and costs.
Section 15-42-260. The remedy provided by this is not exclusive but is in addition to the collection procedure provided by the laws of this State in effect at the time this act takes effect and is optional with the judgment creditor.
Section 15-42-270. This act does not apply to garnishment for income tax purposes or garnishment for child support purposes, which are provided for otherwise by the laws of this State."
SECTION 2. This act takes effect upon approval by the Governor.