The Courier Journal published a story (see below) about the difficulties of an employer (garnishee) who received a garnishment notice and disregarded it.


The law imposes on an employer (or other person holding property of a debtor) that allows a person who has obtained a judgment against the debtor to demand payment by the employer or any person holding property of the debtor.

The procedures for garnishments is set out in Chapter 425 of the Ky. Revised Statutes.

 If a person receives a garnishment notice they are required by law to respond to the court.  A failure to respond then creates a situation where the employer or garnishee can be held in contempt of court and can be held liable for any funds of the debtor they gave to the debtor instead of to the creditor.

Under Chapter 425, a judgment creditor may issue a garnishment by going to the Circuit Clerk’s office and filling out the form.  The form is then served on the employer (garnishee) who is believed to employ the debtor.

The employer (garnishee) must complete and return the form served on him. If he no longer employs the debtor and returns his form, this should end his involvement.  If he fails to return the form, then a petition must be filed by the creditor and the garnishee is directed to appear before the court for a contempt hearing.

More than a few employers ignore the garnishment notice.  They do so at their peril.  The court will almost certainly hold them in contempt and make them liable for any funds they are found to have held for the debtor at the time of the issuance of the garnishment notice.

The attached article details a story where the District court ordered a man to pay the entire $12,000 debt of the debtor.  The procedure followed in that case is questionable on many issues, but the result was a great deal of pain for the employer.  He could have avoided all the trouble by simply returning the completed garnishment notice with the statement that the debtor no longer worked for him.

We have heard  cases where a major corporation would return a garnishment notice with a statement like “we don’t do garnishments?.   Nothing will make the Judge receiving such a letter more angry.  Everybody does garnishments, and there is no exception.

The law limits the liability of the employer to the amount of garnished funds plus court costs.  While the law is not clear, we opine that after the court has held a hearing and ordered a specific amount to be paid by the employer (due to his failure to withhold funds as ordered) that interest at the legal rate (12%) should be applied and collected from the employer.

There are some exemptions from the type of funds that are subject to a garnishment.       If that defense exists the debtor should file a pleading with the court to have the garnishment dismissed.  The employer filling out the form is guided as to the type of funds and the amounts that are subject to the garnishment order.

Judge removes man’s $60,000 cloud  News article about garnishee who did not answer garnishment order and was adjudged to owe entire debt of debtor

The following statutes govern garnishment procedures:

               KY. GARNISHMENT LAWS
·KRS 425  .501   Proceedings for obtaining order of garnishment.
· KRS 425    .506   Attachment or garnishment of earnings — Priority — Order.
· KRS 425   .511   Appearance of garnishee — Failure to appear.
· KRS 425   .516   Payment by garnishee — Costs.
· KRS 425   .521   Procedure if garnishee indebted to defendant.
· KRS 425   .526   Action by plaintiff against garnishee — Attachment
This rule is at bottom of this page



KRS 425.511 Appearance of garnishee — Failure to appear.
(1) Each garnishee summoned shall appear. The appearance may be in person; or by the affidavit of the garnishee, served and filed in the manner and at the time
required for an answer by the Rules of Civil Procedure, disclosing truly the sum
owing by him to the defendant, whether due or not, and the property of the
defendant in the possession or under the control of the garnishee; and, in the case of a corporation, any shares of stocks therein held by or for the benefit of the
defendant, at or after the service of the order of attachment.
(2) If such garnishee or officer make default, by not appearing, the court may, on the motion of the plaintiff, compel him to appear in person for examination, by process as in cases of contempt; or it may hear proof of any debt owing or property held by the garnishee to or for the defendant, and make such order in relation thereto as if what is so proved had appeared on the examination of the garnishee or officer.
History: Created 1976 Ky. Acts ch. 91, sec. 32.

KRS 425.516 Payment by garnishee — Costs.
The garnishee may pay the money owing to the defendant by him, not exceeding the plaintiff’s claim and costs, to the sheriff having in his hands the order of attachment, or into the court or to such person as the court may direct in accordance with the Rules of Civil Procedure; and to that extent he shall be discharged from liability to the defendant.
He shall not be subjected to costs beyond those caused by his resistance of the claim against him; and, if he discloses the property of the defendant in his hands, or the true sum owing by him, and delivers or pays the same to the sheriff, or according to the order of the court, he shall be allowed his costs.
Effective: July 13, 1984
History: Amended 1984 Ky. Acts ch. 158, sec. 9, effective July 13, 1984. — Created
1976 Ky. Acts ch. 91, sec. 33.

KRS 425.526 Action by plaintiff against garnishee — Attachment.
If a garnishee fails to make a disclosure satisfactory to the plaintiff, the latter may bring an action against him, by petition or amended petition, in the same manner, and the proceedings therein shall be the same as in other actions; and the plaintiff may procure an order of attachment in the same manner, and the proceedings thereupon shall be the same, as is hereinbefore and hereinafter authorized concerning attachments–except that the plaintiff’s affidavit shall state, in addition to the facts required to be stated in KRS
425.301(3), the sum which the defendant owes to the plaintiff’s debtor; and the plaintiff shall not be entitled to attach for or recover more than that sum and costs nor more than the amount of the plaintiff’s claim against his debtor and costs.
History: Created 1976 Ky. Acts ch. 91, sec. 35.


KRS 425.521 Procedure if garnishee indebted to defendant.
If a garnishee, or officer of a corporation summoned as a garnishee, appear in person, he may be examined on oath; and, if it be discovered on such examination that, at the service of the order of attachment upon him, he or the corporation was possessed of any property of the defendant, or was indebted to him, the court may order the delivery of such property, and the payment, or security for the payment, of the sum owing by the garnishee, into court, or to such person as it may direct–who shall give bond, with
security, for the same; or the court may permit the garnishee to retain the property or the sum owing upon the execution of a bond with one (1) or more sufficient sureties, to the effect that the sum shall be paid, or the property be forthcoming, as the court may direct.
Performance of such bonds, for the forthcoming of property, may be enforced, as in cases of contempt; upon such bonds for payment of money, execution may be issued as upon replevin bonds.
History: Created 1976 Ky. Acts ch. 91, sec. 34.


     (1) Service of post-judgment orders of attachment or garnishment upon third-party garnishees, such as employers and financial institutions, shall be served as prescribed in
Rule 4 or, at the option of the plaintiff, may be directed by the plaintiff to the garnishee by regular first class or certified mail, or may be personally served by any person authorized to serve a subpoena pursuant to Rule 45.03. Expenses shall be recoverable as costs.
     (2) Upon receiving a post-judgment order of garnishment, the garnishee shall answer within the time required by Rule 12.01, and unless otherwise ordered by the court shall make payments directly to the attorney for the party in whose behalf the order of garnishment was issued. If such party has no attorney of record, as, for example, in the instance of a “small claim,” payments by the garnishee shall be made to the clerk of the court.
     Except for child support arrearages, where wages are garnisheed, the attorney for the party in whose behalf the order of wage garnishment was issued, or the clerk of the court if such party has no attorney of record, shall safely hold the garnisheed funds in escrow for a period of fifteen (15) days from the issuance date of the employer’s garnishment check. If the debtor files an objection within that period, the funds shall continue to be held until the court rules upon the objection. If an exemption is asserted and a hearing held, the attorney or clerk of the court shall disburse the garnisheed funds as ordered by the court. If no exemption is asserted the attorney or clerk of the court shall after the fifteen (15) day period disburse the funds to the party in whose behalf the order of garnishment was issued.
[Amended by Order 88-4, eff. 1-1-89; adopted eff. 6-1-78]
Judge removes man’s $60,000 cloud
Employer faced garnishment fight
By Jason Riley  The Courier-Journal  June 26, 2007
A little more than a year ago, Rocky Cisney was told he owed $60,000 for a 1992 blue Ford F-150 pickup that he didn’t own and had never seen.
“I thought they must have me mixed up with somebody else,” Cisney said in an interview yesterday. “It was like getting hit by a meteorite or something; I just couldn’t believe it.”
Fortunately for Cisney, a Jefferson Circuit Court judge has ruled that a past court order finding him responsible for paying off a former employee’s debt on the vehicle was “unreasonable.”
Judge Mary Shaw’s order Friday ends an ordeal for Cisney that hinged on a state law regarding an employer’s responsibility to garnish wages of workers for debts they owe.
Cisney’s troubles began in 1998 when he received a court order telling him to garnish the wages of an employee of his delivery service for the $9,000 she owed on the truck.
But Cisney threw the order away because the worker had quit a few weeks earlier, he said.
When he didn’t respond to the garnishment order and failed to appear for a contempt hearing in 1999, a judge declared him liable for the debt — and last year, Instant Auto Credit began collecting.
But on Friday, Shaw ruled that Instant Auto waited too long to begin collecting from Cisney — sitting on the judgment for seven years until the debt had ballooned to about $60,000 from annual interest of nearly 26 percent.
“I felt all along this was a miscarriage of justice. It simply wasn’t right,” Cisney said.
Now Cisney wants to know if he will get back the money that Instant Auto Credit took from him and his business — about $500 — as well as $1,000 in attorney fees.
“Am I going to get 26 percent interest on the money they’ve owed me for two years?” he asked. “This turned my life upside down.”
While fighting the order, Cisney said, he stopped running his delivery service out of his Okolona home, in part because he was worried Instant Auto Credit would continue to take his income.
Instant Auto hasn’t been collecting while the case was on appeal, according to court records. Cisney has been receiving a pension and disability checks, and his wife works, he said.
Keith Stonecipher, the attorney for Instant Auto Credit, did not return a phone call seeking comment.
In a past interview, Stonecipher said the company was following state law after Cisney didn’t respond to repeated calls and didn’t show up for the court hearing about the garnishment.
Instant Auto Credit went after Cisney only when it couldn’t find the worker, he said.
In Shaw’s order, she agreed that Cisney was properly served the garnishment order and notice of the court hearing.
But the damages owed were excessive and Cisney should have to pay only the amount he was supposed to garnish from Sullivan when she worked for him, according to the order.
And that amount, according to Cisney’s attorney, Tom Merrill, is nothing because Sullivan quit working for Cisney before the garnishment order.
Merrill said he will request the court to order that the money taken from Cisney be refunded.
Cisney said he is contemplating a suit against Instant Auto Credit. “Turnabout is fair play,” he said.

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