Minnesota Legislature
Office of the Revisor of Statutes
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.
Official Publication of the State of Minnesota
Revisor of Statutes