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Minnesota Session Laws - 1993, Regular Session

Key: (1) language to be deleted (2) new language

  
    Laws of Minnesota 1993 

                        CHAPTER 156-S.F.No. 384 
           An act relating to creditors remedies; regulating 
          executions and garnishments; providing that executions 
          and garnishments on child support judgments are 
          effective until the judgments are satisfied; exempting 
          child support payments from execution; amending 
          Minnesota Statutes 1992, sections 550.135, subdivision 
          10; 550.136, subdivisions 3, 4, and 5; 550.143, 
          subdivision 3; 550.37, subdivision 15; 551.04, 
          subdivisions 2 and 11; 551.05, subdivision 1a; 551.06, 
          subdivisions 3, 4, and 5; 570.025, subdivision 6; 
          570.026, subdivision 2; 571.72, subdivision 7; 571.73, 
          subdivision 3; 571.912; 571.922; and 571.923. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1992, section 550.135, 
subdivision 10, is amended to read: 
    Subd. 10.  [FORMS.] No judgment creditor shall use a form 
that contains alterations or changes from the statutory forms 
that mislead judgment debtors as to their rights and the 
execution procedure generally.  If a court finds that a judgment 
creditor has used a misleading form, the judgment debtor shall 
be awarded actual damages, costs, reasonable attorney's fees 
resulting from additional proceedings, and an amount not to 
exceed $100.  All forms must be clearly legible and printed in 
not less than the equivalent of 10-point type.  A form that uses 
both sides of a sheet must clearly indicate on the front side 
that there is additional information on the back side of the 
sheet. 
     Forms, including the statutory forms, used in executions 
upon earnings for the satisfaction of judgments for child 
support must be changed by the creditor to reflect the fact that 
the 70-day period of effectiveness does not apply to these 
executions if the judgment creditor is a county and the employer 
is notified by the county when the judgment is satisfied. 
    Sec. 2.  Minnesota Statutes 1992, section 550.136, 
subdivision 3, is amended to read: 
    Subd. 3.  [LIMITATION ON LEVY ON EARNINGS.] Unless the 
judgment is for child support, the maximum part of the aggregate 
disposable earnings of an individual for any pay period 
subjected to an execution levy may not exceed the lesser of: 
     (1) 25 percent of the judgment debtor's disposable 
earnings; or 
     (2) the amount by which the judgment debtor's disposable 
earnings exceed the following product:  40 times the federal 
minimum hourly wages prescribed by section 6(a)(1) of the Fair 
Labor Standards Act of 1938, United States Code, title 29, 
section 206(a)(1), in effect at the time the earnings are 
payable, times the number of work weeks in the pay period.  When 
a pay period consists of other than a whole number of work 
weeks, each day of that pay period in excess of the number of 
completed work weeks shall be counted as a fraction of a work 
week equal to the number of excess work days divided by the 
number of days in the normal work week. 
     If the judgment is for child support, the levy may not 
exceed: 
     (1) 50 percent of the judgment debtor's disposable income, 
if the judgment debtor is supporting a spouse or dependent child 
and the judgment is 12 weeks old or less (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); 
     (2) 55 percent of the judgment debtor's disposable income, 
if the judgment debtor is supporting a spouse or dependent 
child, and the judgment is over 12 weeks old (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); 
    (3) 60 percent of the judgment debtor's disposable income, 
if the judgment debtor is not supporting a spouse or dependent 
child and the judgment is 12 weeks old or less (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); or 
    (4) 65 percent of the judgment debtor's disposable income, 
if the judgment debtor is not supporting a spouse or dependent 
child, and the judgment is over 12 weeks old (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received). 
     Execution levies under this section on judgments for child 
support are effective until the judgments are satisfied if the 
judgment creditor is a county and the employer is notified by 
the county when the judgment is satisfied. 
    No court may make, execute, or enforce an order or any 
process in violation of this section. 
    Sec. 3.  Minnesota Statutes 1992, section 550.136, 
subdivision 4, is amended to read: 
    Subd. 4.  [MULTIPLE LEVIES ON EARNINGS.] Except as 
otherwise provided in this chapter or section 518.611, 
subdivision 6, the priority of multiple earnings execution 
levies is determined by the order in which the execution levies 
were served on the employer.  If the employer is served with two 
or more writs of execution at the same time on the same day, the 
writ of execution issued pursuant to the first judgment entered 
has priority.  If two or more execution levies are served on the 
same day and are based on judgments entered on the same day, 
then the employer shall select the priority of the earnings 
levies.  However, in all cases except earnings execution levies 
on judgments for child support if the judgment creditor is a 
county and the employer is notified by the county when the 
judgment is satisfied, the execution levies shall be effective 
no longer than 70 days from the date of the service of the writ 
of execution. 
    Sec. 4.  Minnesota Statutes 1992, section 550.136, 
subdivision 5, is amended to read: 
    Subd. 5.  [EARNINGS ATTACHABLE.] (a) Subject to the 
exemptions provided by sections 550.37 and 571.922, and any 
other applicable statute, and except as otherwise provided in 
paragraph (b), the service of a writ of execution under this 
chapter attaches all unpaid nonexempt disposable earnings owing 
or to be owed by the third party and earned or to be earned by 
the judgment debtor before and within the pay period in which 
the writ of execution is served and within all subsequent pay 
periods whose paydays occur within the 70 days after the date of 
service of the writ of execution.  "Paydays" means the days upon 
which the third party pays earnings to the judgment debtor in 
the ordinary course of business.  If the judgment debtor has no 
regular paydays, paydays means the 15th day and the last day of 
each month.  If the levy attaches less than $10, the third party 
shall not retain and remit the sum.  
    (b) The service of a writ of execution on a judgment for 
child support attaches to all unpaid nonexempt disposable 
earnings owing or to be owed by the third party and earned or to 
be earned by the judgment debtor before and within the pay 
period in which the writ of execution is served and within all 
subsequent pay periods until the judgment is satisfied if the 
judgment creditor is a county and the third party is notified by 
the county when the judgment is satisfied.  
     Sec. 5.  Minnesota Statutes 1992, section 550.143, 
subdivision 3, is amended to read: 
    Subd. 3.  [EXEMPTION NOTICE.] If the levy is on funds of a 
judgment debtor who is a natural person and if the funds to be 
levied are held on deposit at any financial institution, the 
judgment creditor or its attorney shall provide the sheriff with 
two copies of an exemption notice, which must be substantially 
in the form set forth below.  The sheriff shall serve both 
copies of the exemption notice on the financial institution, 
along with the writ of execution.  Failure of the sheriff to 
serve the exemption notices renders the levy void, and the 
financial institution shall take no action.  However, if this 
subdivision is being used to execute on funds that have 
previously been garnished in compliance with section 571.71, the 
judgment creditor is not required to serve additional exemption 
notices.  In that event, the execution levy shall only be 
effective as to the funds that were subject to the prior 
garnishment.  Upon receipt of the writ of execution and 
exemption notices, the financial institution shall retain as 
much of the amount due under section 550.04 as the financial 
institution has on deposit owing to the judgment debtor, but not 
more than 110 percent of the amount remaining due on the 
judgment.  
STATE OF MINNESOTA                             DISTRICT COURT
COUNTY OF ................       .......... JUDICIAL DISTRICT
.............(Judgment Creditor) 
.............(Judgment Debtor) 
TO:  Debtor                                  EXEMPTION NOTICE 
     An order for attachment, garnishment summons, or levy of 
execution (strike inapplicable language) has been served on 
............. (Bank or other financial institution where you 
have an account.)  
     Your account balance is $........  
     The amount being held is $........  
     However, all or a portion of the funds in your account will 
normally be exempt from creditors' claims if they are in one of 
the following categories:  
     (1) relief based on need.  This includes:  Aid to Families 
with Dependent Children (AFDC), AFDC-Emergency Assistance 
(AFDC-EA), Medical Assistance (MA), General Assistance (GA), 
General Assistance Medical Care (GAMC), Emergency General 
Assistance (EGA), Work Readiness, Minnesota Supplemental Aid 
(MSA), MSA Emergency Assistance (MSA-EA), Supplemental Security 
Income (SSI), and Energy Assistance; 
     (2) Social Security benefits (Old Age, Survivors, or 
Disability Insurance); 
     (3) unemployment compensation, workers' compensation, or 
veterans' benefits; 
    (4) an accident, disability, or retirement pension or 
annuity; 
    (5) life insurance proceeds; 
    (6) the earnings of your minor child and any child support 
paid to you; or 
    (7) money from a claim for damage or destruction of exempt 
property (such as household goods, farm tools, business 
equipment, a mobile home, or a car).  
    The following funds are also exempt: 
    (8) all earnings of a person in category (1); 
    (9) all earnings of a person who has received relief based 
on need, or who has been an inmate of a correctional 
institution, within the last six months; 
    (10) 75 percent of every debtor's after tax earnings; and 
    (11) all of a judgment debtor's after tax earnings below 40 
times the federal minimum wage. 
    TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:  
    Categories (10) and (11):  20 days 
    Categories (8) and (9):  60 days 
    All others:  no time limit, as long as funds are traceable 
to the exempt source.  (In tracing funds, the first-in, 
first-out method is used.  This means money deposited first is 
spent first.)  The money being sought by the judgment creditor 
is being held in your account to give you a chance to claim an 
exemption. 
    TO CLAIM AN EXEMPTION:  
     Fill out, sign, and mail or deliver one copy of the 
attached exemption claim form to the institution which sent you 
this notice and mail or deliver one copy to the judgment 
creditor's attorney.  In the event that there is no attorney for 
the judgment creditor, then the notice shall be sent directly to 
the judgment creditor.  The address for the judgment creditor's 
attorney or the judgment creditor is set forth below.  Both 
copies must be mailed or delivered on the same day. 
     If the financial institution does not get the exemption 
claim back from you within 14 days of the date they mailed or 
gave it to you, they will be free to turn the money over to the 
sheriff or the judgment creditor.  If you are going to claim an 
exemption, do so as soon as possible, because your money may be 
held until it is decided. 
     IF YOU CLAIM AN EXEMPTION:  
     (1) nonexempt money can be turned over to the judgment 
creditor or sheriff; 
     (2) the financial institution will keep holding the money 
claimed to be exempt; and 
     (3) seven days after receiving your exemption claim, the 
financial institution will release the money to you unless 
before then it receives an objection to your exemption claim.  
     IF THE JUDGMENT CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM: 
     the institution will hold the money until a court decides 
if your exemption claim is valid, BUT ONLY IF the institution 
gets a copy of your court motion papers asserting the exemption 
WITHIN TEN DAYS after the objection is mailed or given to you.  
You may wish to consult an attorney at once if the creditor 
objects to your exemption claim.  
     MOTION TO DETERMINE EXEMPTION:  
     At any time after your funds have been held, you may ask 
for a court decision on the validity of your exemption claim by 
filing a request for hearing which may be obtained at the office 
of the court administrator of the above court. 
     PENALTIES:  
     If you claim an exemption in bad faith, or if the judgment 
creditor wrongly objects to an exemption in bad faith, the court 
may order the person who acted in bad faith to pay costs, actual 
damages, attorney fees, and an additional amount of up to $100.  
                              ............................. 
                              ............................. 
                              ............................. 
                              ............................. 
                              Name and address of (Attorney 
                              for) Judgment Creditor
     EXEMPTION:  
     (a) Amount of exemption claim.  
     / / I claim ALL the funds being held are exempt.  
     / / I claim SOME of the funds being held are exempt.  
         The exempt amount is $............  
     (b) Basis for exemption.  
     Of the 11 categories listed above, I am in category number 
............  (If more than one category applies, you may fill 
in as many as apply.)  The source of the exempt funds is the 
following:  
.............................................................
.............................................................
.............................................................
     (If the source is a type of relief based on need, list the 
case number and county:  
     case number:  ...............; 
     county:  ....................) 
     I hereby authorize any agency that has distributed relief 
to me or any correctional institution in which I was an inmate 
to disclose to the above named creditor or its attorney only 
whether or not I am or have been a recipient of relief based on 
need or an inmate of a correctional institute within the last 
six months.  
     I have mailed or delivered a copy of the exemption notice 
to the judgment creditor or judgment creditor's attorney if 
represented. 
                             .............................
                             DEBTOR
DATED:  .............        .............................
                             .............................
                             .............................
                             DEBTOR ADDRESS 
    Sec. 6.  Minnesota Statutes 1992, section 550.37, 
subdivision 15, is amended to read: 
    Subd. 15.  The earnings of the minor child of any debtor 
and any child support paid to any debtor, or the proceeds 
thereof, by reason of any liability of such debtor not 
contracted for the special benefit of such minor child. 
    Sec. 7.  Minnesota Statutes 1992, section 551.04, 
subdivision 2, is amended to read: 
    Subd. 2.  [PROPERTY ATTACHABLE.] Subject to the exemptions 
provided by subdivision 3 and section 550.37, and any other 
applicable statute, the service of a writ of execution under 
this chapter attaches: 
    (a) Except as otherwise provided in paragraph (c), all 
unpaid nonexempt disposable earnings owing or to be owed by the 
third party and earned or to be earned by the judgment debtor 
within the pay period in which the writ of execution is served 
and within all subsequent pay periods whose paydays occur within 
the 70 days after the date of service of the writ of execution.  
"Payday" means the day upon which the third party pays earnings 
to the judgment debtor in the ordinary course of business.  If 
the judgment debtor has no regular paydays, payday means the 
15th day and the last day of each month. 
    (b) All other nonexempt indebtedness or money due or 
belonging to the judgment debtor and owing by the third party or 
in the possession or under the control of the third party at the 
time of service of the writ of execution, whether or not the 
same, has become payable.  The third party shall not be 
compelled to pay or deliver the same before the time specified 
by any agreement unless the agreement was fraudulently 
contracted to defeat an execution levy or other collection 
remedy. 
    (c) For an execution on a judgment for child support, all 
unpaid nonexempt disposable earnings owing or to be owed by the 
third party and earned or to be earned by the judgment debtor 
within the pay period in which the writ of execution is served 
and within all subsequent pay periods until the judgment is 
satisfied if the judgment creditor is a county and the third 
party is notified by the county when the judgment is satisfied.  
    Sec. 8.  Minnesota Statutes 1992, section 551.04, 
subdivision 11, is amended to read: 
    Subd. 11.  [FORMS.] No judgment creditor shall use a form 
that contains alterations or changes from the statutory forms 
that mislead judgment debtors as to their rights and the 
execution procedure generally.  If a court finds that a judgment 
creditor has used a misleading form, the judgment debtor shall 
be awarded actual damages, costs, reasonable attorney's fees 
resulting from additional proceedings, and an amount not to 
exceed $100.  All forms must be clearly legible and printed in 
not less than the equivalent of 10-point type.  A form that uses 
both sides of a sheet must clearly indicate on the front side 
that there is additional information on the back side of the 
sheet.  
    Forms, including the statutory forms, used in executions 
upon earnings for the satisfaction of judgments for child 
support must be changed by the creditor to reflect the fact that 
the 70-day period of effectiveness does not apply to these 
executions if the judgment creditor is a county and the employer 
is notified by the county when the judgment is satisfied. 
     Sec. 9.  Minnesota Statutes 1992, section 551.05, 
subdivision 1a, is amended to read: 
    Subd. 1a.  [EXEMPTION NOTICE.] If the writ of execution is 
being used by the attorney to levy funds of a judgment debtor 
who is a natural person and if the funds to be levied are held 
on deposit at any financial institution, the attorney for the 
judgment creditor shall serve with the writ of execution two 
copies of an exemption notice.  The notice must be substantially 
in the form set forth below.  Failure of the attorney for the 
judgment creditor to send the exemption notice renders the 
execution levy void, and the financial institution shall take no 
action.  However, if this subdivision is being used to execute 
on funds that have previously been garnished in compliance with 
section 571.71, the attorney for judgment creditor is not 
required to serve an additional exemption notice.  In that 
event, the execution levy shall only be effective as to the 
funds that were subject to the prior garnishment.  Upon receipt 
of the writ of execution and exemption notices, the financial 
institution shall retain as much of the amount due under section 
550.04 as the financial institution has on deposit owing to the 
judgment debtor, but not more than 100 percent of the amount 
remaining due on the judgment, or $5,000, whichever is less.  
    The notice informing a judgment debtor that an execution 
levy has been used to attach funds of the judgment debtor to 
satisfy a claim must be substantially in the following form: 
STATE OF MINNESOTA                             DISTRICT COURT 
County of ................         .........JUDICIAL DISTRICT 
................(Judgment Creditor)
................(Judgment Debtor) 
TO:  Judgment Debtor                 EXEMPTION NOTICE 
      An order for attachment, garnishment summons, or levy of 
execution (strike inapplicable language) has been served on 
............. (bank or other financial institution where you 
have an account).  
      Your account balance is $........  
      The amount being held is $........  
      However, all or a portion of the funds in your account will 
normally be exempt from creditors' claims if they are in one of 
the following categories:  
      (1) relief based on need.  This includes:  Aid to Families 
with Dependent Children (AFDC), AFDC-Emergency Assistance 
(AFDC-EA), Medical Assistance (MA), General Assistance (GA), 
General Assistance Medical Care (GAMC), Emergency General 
Assistance (EGA), Work Readiness, Minnesota Supplemental Aid 
(MSA), MSA Emergency Assistance (MSA-EA), Supplemental Security 
Income (SSI), and Energy Assistance; 
      (2) Social Security benefits (Old Age, Survivors, or 
Disability Insurance); 
      (3) unemployment compensation, workers' compensation, or 
veterans' benefits; 
     (4) an accident, disability, or retirement pension or 
annuity; 
    (5) life insurance proceeds; 
    (6) the earnings of your minor child and any child support 
paid to you; or 
    (7) money from a claim for damage or destruction of exempt 
property (such as household goods, farm tools, business 
equipment, a mobile home, or a car).  
    The following funds are also exempt: 
    (8) all earnings of a person in category (1); 
    (9) all earnings of a person who has received relief based 
on need, or who has been an inmate of a correctional 
institution, within the last six months; 
    (10) 75 percent of every judgment debtor's after tax 
earnings; or 
    (11) all of a judgment debtor's after tax earnings below 40 
times the federal minimum wage.  
    TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:  
    Categories (10) and (11):  20 days 
    Categories (8) and (9):  60 days 
    All others:  no time limit, as long as funds are traceable 
to the exempt source.  (In tracing funds, the first-in, 
first-out method is used.  This means money deposited first is 
spent first.)  The money being sought by the judgment creditor 
is being held in your account to give you a chance to claim an 
exemption. 
    TO CLAIM AN EXEMPTION:  
      Fill out, sign, and mail or deliver one copy of the 
attached exemption claim form to the institution which sent you 
this notice and mail or deliver one copy to the judgment 
creditor's attorney.  The address for the judgment creditor's 
attorney is set forth below.  Both copies must be mailed or 
delivered on the same day.  
      If they do not get the exemption claim back from you within 
14 days of the date they mailed or gave it to you, they will be 
free to turn the money over to the attorney for the judgment 
creditor.  If you are going to claim an exemption, do so as soon 
as possible, because your money may be held until it is decided. 
      IF YOU CLAIM AN EXEMPTION:  
      (1) nonexempt money can be turned over to the judgment 
creditor or sheriff; 
      (2) the financial institution will keep holding the money 
claimed to be exempt; and 
      (3) seven days after receiving your exemption claim, the 
financial institution will release the money to you unless 
before then it receives an objection to your exemption claim.  
      IF THE JUDGMENT CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM: 
      the institution will hold the money until a court decides 
if your exemption claim is valid, BUT ONLY IF the institution 
gets a copy of your court motion papers asserting the exemption 
WITHIN TEN DAYS after the objection is mailed or given to you.  
You may wish to consult an attorney at once if the judgment 
creditor objects to your exemption claim.  
      MOTION TO DETERMINE EXEMPTION:  
      At any time after your funds have been held, you may ask 
for a court decision on the validity of your exemption claim by 
filing a request for hearing which may be obtained at the office 
of the court administrator of the above court. 
      PENALTIES:  
      If you claim an exemption in bad faith, or if the judgment 
creditor wrongly objects to an exemption in bad faith, the court 
may order the person who acted in bad faith to pay costs, actual 
damages, attorney fees, and an additional amount of up to $100.  
                               ............................. 
                               ............................. 
                               ............................. 
                               ............................. 
                               Name and address of (Attorney 
                               for) Judgment Creditor 
      EXEMPTION:  
      (a) Amount of exemption claim.  
      / / I claim ALL the funds being held are exempt.  
      / / I claim SOME of the funds being held are exempt.  
         The exempt amount is $............  
      (b) Basis for exemption.  
      Of the 11 categories listed above, I am in category number 
............  (If more than one category applies, you may fill 
in as many as apply.)  The source of the exempt funds is the 
following:  
.............................................................
.............................................................
.............................................................
    (If the source is a type of relief based on need, list the 
case number and county:  
    case number:  ...............; 
    county:  ....................) 
    I hereby authorize any agency that has distributed relief 
to me or any correctional institution in which I was an inmate 
to disclose to the above named judgment creditor's attorney only 
whether or not I am or have been a recipient of relief based on 
need or an inmate of a correctional institute within the last 
six months.  
    I have mailed or delivered a copy of the exemption notice 
to the judgment creditor's attorney.  
                             .............................
                             DEBTOR
DATED:  .............        .............................
                             .............................
                             .............................
                             DEBTOR ADDRESS
    Sec. 10.  Minnesota Statutes 1992, section 551.06, 
subdivision 3, is amended to read: 
    Subd. 3.  [LIMITATION ON LEVY ON EARNINGS.] Unless the 
judgment is for child support, the maximum part of the aggregate 
disposable earnings of an individual for any pay period 
subjected to an execution levy may not exceed the lesser of: 
    (1) 25 percent of the judgment debtor's disposable 
earnings; or 
    (2) the amount by which the judgment debtor's disposable 
earnings exceed the following product:  40 times the federal 
minimum hourly wages prescribed by section 6(a)(1) of the Fair 
Labor Standards Act of 1938, United States Code, title 29, 
section 206(a)(1), in effect at the time the earnings are 
payable, times the number of work weeks in the pay period.  When 
a pay period consists of other than a whole number of work 
weeks, each day of that pay period in excess of the number of 
completed work weeks shall be counted as a fraction of a work 
week equal to the number of excess work days divided by the 
number of days in the normal work week. 
    If the judgment is for child support, the levy may not 
exceed: 
    (1) 50 percent of the judgment debtor's disposable income, 
if the judgment debtor is supporting a spouse or dependent child 
and the judgment is 12 weeks old or less (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); 
     (2) 55 percent of the judgment debtor's disposable income, 
if the judgment debtor is supporting a spouse or dependent 
child, and the judgment is over 12 weeks old (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); 
    (3) 60 percent of the judgment debtor's disposable income, 
if the judgment debtor is not supporting a spouse or dependent 
child and the judgment is 12 weeks old or less (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); or 
    (4) 65 percent of the judgment debtor's disposable income, 
if the judgment debtor is not supporting a spouse or dependent 
child, and the judgment is over 12 weeks old (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received). 
     Execution levies under this section on judgments for child 
support are effective until the judgments are satisfied if the 
judgment creditor is a county and the employer is notified by 
the county when the judgment is satisfied. 
    No court may make, execute, or enforce an order or any 
process in violation of this section. 
    Sec. 11.  Minnesota Statutes 1992, section 551.06, 
subdivision 4, is amended to read: 
    Subd. 4.  [MULTIPLE LEVIES ON EARNINGS.] Except as 
otherwise provided in this chapter or section 518.611, 
subdivision 6, the priority of multiple earnings execution 
levies is determined by the order in which the execution levies 
were served on the employer.  If the employer is served with two 
or more writs of execution at the same time on the same day, the 
writ of execution issued pursuant to the first judgment entered 
has priority.  If two or more execution levies are served on the 
same day and are based on judgments entered on the same day, 
then the employer shall select the priority of the earnings 
levies.  However, in all cases except earnings execution levies 
on judgments for child support if the judgment creditor is a 
county and the employer is notified by the county when the 
judgment is satisfied, the execution levies shall be effective 
no longer than 70 days from the date of the service of the writ 
of execution. 
    Sec. 12.  Minnesota Statutes 1992, section 551.06, 
subdivision 5, is amended to read: 
    Subd. 5.  [EARNINGS ATTACHABLE.] (a) Subject to the 
exemptions provided by sections 550.37 and 551.06, subdivision 
3, and any other applicable statute, and except as otherwise 
provided in paragraph (b), the service of a writ of execution 
under this chapter attaches all unpaid nonexempt disposable 
earnings owing or to be owed by the third party and earned or to 
be earned by the judgment debtor before and within the pay 
period in which the writ of execution is served and within all 
subsequent pay periods whose paydays occur within the 70 days 
after the date of service of the writ of execution.  "Paydays" 
means the days upon which the third party pays earnings to the 
judgment debtor in the ordinary course of business.  If the 
judgment debtor has no regular paydays, paydays means the 15th 
day and the last day of each month.  If the levy attaches less 
than $10, the third party shall not retain and remit the sum.  
     (b) The service of a writ of execution on a judgment for 
child support attaches to all unpaid nonexempt disposable 
earnings owing or to be owed by the third party and earned or to 
be earned by the judgment debtor before and within the pay 
period in which the writ of execution is served and within all 
subsequent pay periods until the judgment is satisfied if the 
judgment creditor is a county and the third party is notified by 
the county when the judgment is satisfied.  
     Sec. 13.  Minnesota Statutes 1992, section 570.025, 
subdivision 6, is amended to read: 
    Subd. 6.  [NOTICE.] The respondent shall be served with a 
copy of the preliminary attachment order issued pursuant to this 
section together with a copy of all pleadings and other 
documents not previously served, including any affidavits upon 
which the claimant intends to rely at the subsequent hearing and 
a transcript of any oral testimony given at the preliminary 
hearing upon which the claimant intends to rely and a notice of 
hearing.  Service shall be in the manner prescribed for personal 
service of a summons unless that service is impracticable or 
would be ineffective and the court prescribes an alternative 
method of service calculated to provide actual notice to the 
respondent. 
    The notice of hearing served upon the respondent shall be 
signed by claimant or the attorney for claimant and shall 
provide, at a minimum, the following information in 
substantially the following language: 

                           NOTICE OF HEARING 
     To:  (the respondent) 
      The (insert name of court) Court has ordered the sheriff to 
seize some of your property.  The court has directed the sheriff 
to seize the following specific property:  (insert list of 
property).  (List other action taken by the court).  Some of 
your property may be exempt from seizure.  See the exemption 
notice below. 
      The Court issued this Order based upon the claim of (insert 
name of claimant) that (insert name of claimant) is entitled to 
a court order for seizure of your property to secure your 
payment of any money judgment that (insert name of claimant) may 
later be obtained against you and that immediate action was 
necessary. 
     You have the legal right to challenge (insert name of 
claimant) claims at a court hearing before a judge.  The hearing 
will be held at the (insert place) on (insert date) at (insert 
time).  You may attend the court hearing alone or with an 
attorney.  After you have presented your side of the matter, the 
court will decide what should be done with your property until 
the lawsuit against you is finally decided.  
     IF YOU DO NOT ATTEND THIS HEARING, THE COURT MAY ORDER THE 
SHERIFF TO KEEP PROPERTY THAT HAS BEEN SEIZED. 

                           EXEMPTION NOTICE 
    An order of attachment is being served upon you.  Some of 
your property is exempt and cannot be seized.  The following is 
a list of some of the more common exemptions.  It is not 
complete and is subject to section 550.37, and other state and 
federal laws.  If you have questions about an exemption, you 
should obtain competent legal advice. 
     1.  A homestead or the proceeds from the sale of a 
homestead. 
     2.  Household furniture, appliances, phonographs, radios, 
and televisions up to a total current value of $4,500 at the 
time of attachment. 
    3.  A manufactured (mobile) home used as your home. 
    4.  One motor vehicle currently worth less than $2,000 
after deducting any security interests. 
    5.  Farm machinery used by someone principally engaged in 
farming, or tools, machines, or office furniture used in your 
business or trade.  This exemption is limited to $5,000. 
    6.  Relief based on need.  This includes Aid to Families 
with Dependent Children (AFDC), Supplemental Security Income 
(SSI), Minnesota Supplemental Assistance, and General Assistance.
    7.  Social Security benefits. 
    8.  Unemployment compensation, workers' compensation, or 
veterans' benefits. 
    9.  An accident disability or retirement pension or annuity.
    10.  Life insurance proceeds or the earnings of your minor 
child and any child support paid to you. 
    11.  Money from a claim for damage or destruction of exempt 
property (such as household goods, farm tools, business 
equipment, a manufactured (mobile) home, or a car). 
    Sec. 14.  Minnesota Statutes 1992, section 570.026, 
subdivision 2, is amended to read: 
    Subd. 2.  [SERVICE.] The claimant's motion to obtain an 
order of attachment together with the claimant's affidavit and 
notice of hearing shall be served in the manner prescribed for 
service of a summons in a civil action in district court unless 
that service is impracticable or would be ineffective and the 
court prescribes an alternative method of service calculated to 
provide actual notice to the respondent.  If the respondent has 
already appeared in the action, the motion shall be served in 
the manner prescribed for service of pleadings subsequent to the 
summons.  The date of hearing shall be fixed in accordance with 
Rule 6 of the Minnesota Rules of Civil Procedure, unless a 
different date is fixed by order of the court. 
    The notice of hearing served upon the respondent shall be 
signed by the claimant or the attorney for the claimant and 
shall provide, at a minimum, the following information in 
substantially the following language:  

                           NOTICE OF HEARING 
    TO:  (the respondent) 
    A hearing will be held (insert place) on (insert date) at 
(insert time) to determine whether the sheriff shall seize 
nonexempt property belonging to you to secure a judgment that 
may be entered against you. 
    You may attend the court hearing alone or with an 
attorney.  After you have presented your side of the matter, the 
court will decide what should be done with your property until 
the lawsuit which has been commenced against you is finally 
decided. 
     If the court directs the sheriff to seize and secure the 
property while the lawsuit is pending, you may still keep the 
property until the lawsuit is decided if you file a bond in an 
amount set by the court. 
     IF YOU DO NOT ATTEND THIS HEARING, THE COURT MAY ORDER YOUR 
NONEXEMPT PROPERTY TO BE SEIZED. 

                           EXEMPTION NOTICE 
    Some of your property is exempt and cannot be attached.  
The following is a list of some of the more common exemptions.  
It is not complete and is subject to section 550.37, and other 
state and federal laws.  If you have questions about an 
exemption you should obtain competent legal advice. 
     1.  A homestead or the proceeds from the sale of a 
homestead. 
    2.  Household furniture, appliances, phonographs, radios, 
and televisions up to a total current value of $4,500 at the 
time of attachment. 
    3.  A manufactured (mobile) home used as your home. 
    4.  One motor vehicle currently worth less than $2,000 
after deducting any security interests. 
    5.  Farm machinery used by someone principally engaged in 
farming, or tools, machines, or office furniture used in your 
business or trade.  This exemption is limited to $5,000. 
    6.  Relief based on need.  This includes Aid to Families 
with Dependent Children (AFDC), Supplemental Security Income 
(SSI), Minnesota Supplemental Assistance, and General Assistance.
    7.  Social Security benefits. 
    8.  Unemployment compensation, workers' compensation, or 
veterans' benefits. 
    9.  An accident disability or retirement pension or annuity.
    10.  Life insurance proceeds or the earnings of your minor 
child and any child support paid to you. 
    11.  Money from a claim for damage or destruction of exempt 
property (such as household goods, farm tools, business 
equipment, a manufactured (mobile) home, or a car). 
    Sec. 15.  Minnesota Statutes 1992, section 571.72, 
subdivision 7, is amended to read: 
    Subd. 7.  [FORMS.] No creditor shall use a form that 
contains alterations or changes from the statutory forms that 
mislead debtors as to their rights and the garnishment procedure 
generally.  If a court finds that a creditor has used a 
misleading form, the debtor shall be awarded actual damages, 
costs, reasonable attorney's fees resulting from additional 
proceedings, and an amount not to exceed $100.  All forms must 
be clearly legible and printed in not less than the equivalent 
of 10-point type.  A form that uses both sides of a sheet must 
clearly indicate on the front side that there is additional 
information on the back side of the sheet. 
     Forms, including the statutory forms, used in garnishments 
of earnings for the satisfaction of judgments for child support 
must be changed by the creditor to reflect the fact that the 
70-day period of effectiveness does not apply to these 
garnishments if the judgment creditor is a county and the 
employer is notified by the county when the judgment is 
satisfied. 
    Sec. 16.  Minnesota Statutes 1992, section 571.73, 
subdivision 3, is amended to read: 
    Subd. 3.  [PROPERTY ATTACHABLE.] Subject to the exemptions 
provided by sections 550.37 and 571.922 and any other applicable 
statute, the service of a garnishment summons under this chapter 
attaches: 
    (1) except as otherwise provided in clause (4), all unpaid 
nonexempt disposable earnings owed or to be owed by the 
garnishee and earned or to be earned by the debtor within the 
pay period in which the garnishment summons is served and within 
all subsequent pay periods whose paydays occur within the 70 
days after the date of service of the garnishment summons.  
"Payday" means the day upon which the garnishee pays earnings to 
the debtor in the ordinary course of business.  If the debtor 
has no regular paydays, "payday" means the 15th day and the last 
day of each month; 
    (2) all other nonexempt indebtedness, money, or other 
property due or belonging to the debtor and owing by the 
garnishee or in the possession or under the control of the 
garnishee at the time of service of the garnishment summons, 
whether or not the same has become payable.  The garnishee shall 
not be compelled to pay or deliver the same before the time 
specified by any agreement unless the agreement was fraudulently 
contracted to defeat a garnishment or other collection remedy; 
and 
    (3) all other nonexempt intangible or tangible personal 
property of the debtor in the possession or under the control of 
the garnishee at the time of service of the garnishment summons, 
including property of any kind due from or in the hands of an 
executor, administrator, personal representative, receiver, or 
trustee, and all written evidences of indebtedness whether or 
not negotiable or not yet underdue or overdue.; and 
    (4) for a garnishment on a judgment for child support by a 
county, all unpaid nonexempt disposable earnings owed or to be 
owed by the garnishee and earned or to be earned by the debtor 
within the pay period in which the garnishment summons is served 
and within all subsequent pay periods until the judgment is 
satisfied.  
     Sec. 17.  Minnesota Statutes 1992, section 571.912, is 
amended to read: 
    571.912 [FORM OF EXEMPTION NOTICE.] 
    The notice informing a debtor that an order for attachment, 
garnishment summons, or levy by execution has been used to 
attach funds of the debtor to satisfy a claim must be 
substantially in the following form:  
STATE OF MINNESOTA                            DISTRICT COURT 
COUNTY OF ................         ........JUDICIAL DISTRICT
........................(Creditor)
........................(Debtor)
TO:  Debtor                                EXEMPTION NOTICE
     An order for attachment, garnishment summons, or levy of 
execution (strike inapplicable language) has been served on 
............ (bank or other financial institution) 
............... where you have an account.  
     Your account balance is $.............  
     The amount being held is $............  
     However, all or a portion of the funds in your account will 
normally be exempt from creditors' claims if they are in one of 
the following categories: 
     (1) relief based on need.  This includes:  Aid to Families 
with Dependent Children (AFDC), AFDC-Emergency Assistance 
(AFDC-EA), Medical Assistance (MA), General Assistance (GA), 
General Assistance Medical Care (GAMC), Emergency General 
Assistance (EGA), Work Readiness, Minnesota Supplemental Aid 
(MSA), MSA Emergency Assistance (MSA-EA), Supplemental Security 
Income (SSI), and Energy Assistance; 
    (2) Social Security benefits (Old Age, Survivors, or 
Disability Insurance); 
    (3) unemployment compensation, workers' compensation, or 
veterans' benefits; 
    (4) an accident, disability, or retirement pension or 
annuity; 
    (5) life insurance proceeds; 
    (6) the earnings of your minor child and any child support 
paid to you; or 
    (7) money from a claim for damage or destruction of exempt 
property (such as household goods, farm tools, business 
equipment, a mobile home, or a car).  
    The following funds are also exempt: 
    (8) all earnings of a person in category (1); 
    (9) all earnings of a person who has received relief based 
on need, or who has been an inmate of a correctional 
institution, within the last six months; 
    (10) 75 percent of every debtor's after tax earnings; and 
    (11) all of a debtor's after tax earnings below 40 times 
the federal minimum wage. 
    TIME LIMIT ON EXEMPTIONS AFTER DEPOSIT IN BANK:  
    Categories (10) and (11):  20 days 
    Categories (8) and (9):  60 days 
    All others:  no time limit, as long as funds are traceable 
to the exempt source.  (In tracing funds, the first-in, 
first-out method is used.  This means money deposited first is 
spent first.)  The money being sought by the creditor is being 
held in your account to give you a chance to claim an exemption. 
     TO CLAIM AN EXEMPTION:  
     Fill out, sign, and mail or deliver one copy of the 
attached exemption claim form to the institution which sent you 
this notice and mail or deliver one copy to the creditor's 
attorney.  In the event that there is no attorney for the 
creditor, then such notice shall be sent directly to the 
creditor.  The address for the creditor's attorney or the 
creditor is set forth below.  Both copies must be mailed or 
delivered on the same day.  
     If they do not get the exemption claim back from you within 
14 days of the date they mailed or gave it to you, they will be 
free to turn the money over to the sheriff or the creditor.  If 
you are going to claim an exemption, do so as soon as possible, 
because your money may be held until it is decided. 
     IF YOU CLAIM AN EXEMPTION:  
     (1) nonexempt money can be turned over to the creditor or 
sheriff; 
     (2) the financial institution will keep holding the money 
claimed to be exempt; and 
     (3) seven days after receiving your exemption claim, the 
financial institution will release the money to you unless 
before then it receives an objection to your exemption claim.  
     IF THE CREDITOR OBJECTS TO YOUR EXEMPTION CLAIM: 
     The institution will hold the money until a court decides 
if your exemption claim is valid, BUT ONLY IF the institution 
gets a copy of your court motion papers asserting the exemption 
WITHIN TEN DAYS after the objection is mailed or given to you.  
You may wish to consult an attorney at once if the creditor 
objects to your exemption claim.  
     MOTION TO DETERMINE EXEMPTION:  
     At any time after your funds have been held, you may ask 
for a court decision on the validity of your exemption claim by 
filing a request for hearing which may be obtained at the office 
of the court administrator of the above court. 
     PENALTIES:  
     If you claim an exemption in bad faith, or if the creditor 
wrongly objects to an exemption in bad faith, the court may 
order the person who acted in bad faith to pay costs, actual 
damages, attorney fees, and an additional amount of up to $100.  
                              .............................
                              .............................
                              ............................. 
                              ............................. 
                              Name and address of (Attorney
                              for) Judgment Creditor
     EXEMPTION:  
     (If you claim an exemption complete the following): 
     (a) Amount of exemption claim.  
     / / I claim ALL the funds being held are exempt.  
     / / I claim SOME of the funds being held are exempt.  
         The exempt amount is $............  
     (b) Basis for exemption.  
     Of the eleven categories listed above, I am in category 
number ............  (If more than one category applies, you may 
fill in as many as apply.)  The source of the exempt funds is 
the following:  
.............................................................
.............................................................
.............................................................
    (If the source is a type of relief based on need, list the 
case number and county:  
    case number:  ...............; 
    county:  ....................) 
    I hereby authorize any agency that has distributed relief 
to me or any correctional institution in which I was an inmate 
to disclose to the above named creditor or its attorney only 
whether or not I am or have been a recipient of relief based on 
need or an inmate of a correctional institute within the last 
six months.  
    I have mailed or delivered a copy of the exemption notice 
to the creditor's attorney.  
DATED:  .............        .............................
                             DEBTOR 
                             .............................
                             DEBTOR ADDRESS
    Sec. 18.  Minnesota Statutes 1992, section 571.922, is 
amended to read: 
     571.922 [LIMITATION ON WAGE GARNISHMENT.] 
     Unless the judgment is for child support, the maximum part 
of the aggregate disposable earnings of an individual for any 
pay period subjected to garnishment may not exceed the lesser of:
     (1) 25 percent of the debtor's disposable earnings; or 
     (2) the amount by which the debtor's disposable earnings 
exceed the following product:  40 times the federal minimum 
hourly wages prescribed by section 6(a)(1) of the Fair Labor 
Standards Act of 1938, United States Code, title 29, section 
206(a)(1), in effect at the time the earnings are payable, times 
the number of work weeks in the pay period.  When a pay period 
consists of other than a whole number of work weeks, each day of 
that pay period in excess of the number of completed work weeks 
shall be counted as a fraction of a work week equal to the 
number of excess work days divided by the number of days in the 
normal work week. 
     If the judgment is for child support, the garnishment may 
not exceed: 
     (1) 50 percent of the judgment debtor's disposable income, 
if the judgment debtor is supporting a spouse or dependent child 
and the judgment is 12 weeks old or less (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); 
     (2) 55 percent of the judgment debtor's disposable income, 
if the judgment debtor is supporting a spouse or dependent 
child, and the judgment is over 12 weeks old (12 weeks to be 
calculated to the beginning of the work week in which the 
garnishment summons is received); 
    (3) 60 percent of the judgment debtor's disposable income, 
if the judgment debtor is not supporting a spouse or dependent 
child and the judgment is 12 weeks old or less (12 weeks to be 
calculated to the beginning of the work week in which the 
execution levy is received); or 
    (4) 65 percent of the judgment debtor's disposable income, 
if the judgment debtor is not supporting a spouse or dependent 
child, and the judgment is over 12 weeks old (12 weeks to be 
calculated to the beginning of the work week in which the 
garnishment summons is received). 
     Wage garnishments on judgments for child support are 
effective until the judgments are satisfied if the judgment 
creditor is a county and the employer is notified by the county 
when the judgment is satisfied. 
    No court may make, execute, or enforce an order or any 
process in violation of this section. 
    Sec. 19.  Minnesota Statutes 1992, section 571.923, is 
amended to read: 
    571.923 [MULTIPLE EARNINGS GARNISHMENTS.] 
    Except as otherwise provided in this chapter or section 
518.611, subdivision 6, the priority of multiple earnings 
garnishments shall be determined by the order in which the 
garnishment summonses were served on the employer.  If the 
employer is served with two or more garnishment summonses at the 
same time on the same day, the garnishment summons issued 
pursuant to the first judgment entered has priority.  If two or 
more garnishment summonses are served on the same day and are 
based on judgments entered on the same day or if there are two 
or more garnishment summonses based on prejudgment garnishment 
pursuant to section 571.93, then the employer shall select the 
priority of the earnings garnishments.  However, in all 
cases except wage garnishments on judgments for child support if 
the judgment creditor is a county and the employer is notified 
by the county when the judgment is satisfied, garnishments shall 
be effective no longer than 70 days from the date of the service 
of the garnishment summons. 
    Presented to the governor May 11, 1993 
    Signed by the governor May 14, 1993, 1:28 p.m.

700 State Office Building, 100 Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155 ♦ Phone: (651) 296-2868 ♦ TTY: 1-800-627-3529 ♦ Fax: (651) 296-0569