Garnishment modifications/remedies (new law)

A new law aims to make the garnishment process more fair and useful to creditors and debtors.

Sponsored by Rep. Debra Hilstrom (DFL-Brooklyn Center) and Sen. Linda Scheid (DFL-Brooklyn Park), the law is the product of three years of negotiations between creditors, legal aid representatives and financial institutions. It modifies the timeline and forms required to be served related to certain exemptions that may be claimed by a judgment debtor.

Signed May 1 by Gov. Tim Pawlenty, it takes effect Aug. 1, 2009.

“The primary focus of the (law) is to make sure that the debtors who have exemptions that are released from garnishment process have access to their funds as quickly as possible,” Hilstrom said. “This is in the best interest of the debtor, but also the creditor and the banks so that they are not pursuing funds that are not to be collected.”

To do this, the mainly technical law:

• ensures that debtors get clear and proper notice prior to garnishment, including a second notice after the service of the summons explaining what they must do before their wages are garnished;

• simplifies the exemptions claim process for all parties, including updating necessary forms to put them into more plain language; and

• eases the process for people to protect exempt funds.

All parties that worked on the law asked Hilstrom to read the following message on the House floor: “This bill updates the exemption making changes that reflect their current names and deleting obsolete old ones. These changes are not meant to change existing law, nor are they intended to impact current or future case law.”

HF334*/SF683/CH31