Finding out a garnishment has placed a hold on a bank account or on your paycheck is highly stressful and many times very surprising. In order for a judgment creditor to get a garnishment, they must of had a judgment against a defendant for an amount of money first. Many clients call me and tell me that they never even knew there was a case against them. Let’s see how that is possible.
“Bulk Filers” are creditors or law firms that represent creditors that file hundreds if not thousands of cases each year against people in court in the hopes that they will be able to recover some of the money they claim is owed to them or their client. Every case is issued a summons by the court and then it must be served in person to the defendant, OR according to Missouri Rules of Civil Procedure 54.13, “by delivering a copy of the summons and petition personally to the individual or by leaving a copy of the summons and petition at the individual’s dwelling house or usual place of abode with some person of the individual’s family over the age of fifteen years, or by delivering a copy of the summons and petition to an agent authorized by appointment or required by law to receive service of process.”
If you are someone who was not served in the manner described above then a judgment should have never been taken against you. Here is the problem though, someone signed the paper that tells the court they actually did serve you and swears to it under oath. Usually they indicate the time and to whom they served the summons and petition. so the court has some representation that it was done correctly. Now its your word against the word of a process server. Guess who is going to lose that fight.
When no one shows up in court on the date indicated on the summons, the “bulk filier” asks the judge for a default judgment to be entered against you. The judge will actually call role to see who is there, if there is no response the sheriff will call your name three more times usually in the halls just to make sure. The problem is that you never even knew you were supposed to be there.
Once the default judgment has been entered against a defendant, its not finalized for 30 days. In other words if you happen to find out about it and it hasn’t been thirty days you could go into court and file a Motion to Set Aside the Default Judgment. Essentially the judge will open the case back up and allow you to make your case. Beyond thirty days and it is up to the judge whether there is good cause to reopen a case. Once you get a couple of months down the road your chances of a judge setting aside the case gets slimmer by the day.
If the default judgment is not set aside, the creditor, called a judgment creditor now, can file a request to the court asking for an “execution” or a garnishment on any property the sheriff can find that is not protected, or “exempt” under the law. Most commonly they seize bank accounts or if they know where you work get a wage garnishment.
Garnishments are almost impossible to have removed without the consent of the creditor. The problem is that the creditor has no incentive to work out a deal with you once they have the judgment and garnishment in place. Be prepared to offer a lump sum if you expect to work out any kind of deal.
Bankruptcy however stops the garnishment as soon as a bankruptcy case is filed. There is a federal law in place known as a “Stay Order” that prevents anyone from touching your “bankruptcy estate” until a judge or the law says they can. The stay order is so effective that a bank must release a hold on your account, a wage garnishment must be released, and any funds garnished after you have filed bankruptcy must be returned to you.
If you are experiencing a garnishment and it is problematic on your finances please feel free to contact us to see if bankruptcy is right for you. We will review your situation and make a recommendation as to the best course of action to minimize the garnishment or get rid of it completely. The consultation is free so call today (314) 456-9632.