Traversing a Garnishment In Georgia

When creditors obtain judgments, they have to collect the money owed to them.  One of the ways by which creditors collect judgments is through garnishment.  In Georgia, a creditor must obtain a judgment by filing a lawsuit against the debtor before filing a garnishment.  A lot of my clients come to me wanting to filing a traverse of garnishment; however, the traverse process is not that easy.  To understand how a garnishment works, one must really understand how a creditor gets to the point of garnishing a paycheck or a bank account.  So, I'll outline that process for you below.

1.  Obtaining a Judgment
 
When you owe a creditor money, it can sue you to collect the money.  The purpose of filing the lawsuit is to obtain a "judgment" or a court order stating that you owe the money.  To obtain a judgment in Georgia, a creditor must:
  • file a lawsuit;
  • serve you (or someone who lives with you) with a copy of the lawsuit via a sheriff or private process server approved by the court;
  • if the creditor cannot serve you, it can serve you via publication the legal paper;
  • upon service, you have 30 days to answer the lawsuit;
  • if you do not answer, the creditor gets an automatic judgment against you (called a default judgment); and,
  • if you do answer, the court will hold a trial and determine whether the creditor can prove you owe the debt.

2.  What Happens After the Judgment is Entered?

After the creditor obtains a judgment, it can use the judgment (signed by the judge) to collect money against you.  There are several different methods by which to collect the money, including:

  • garnishment of wages;
  • garnishment of bank accounts;
  • levying property (such as cars or personal property of any kind); and,
  • filing a lien against all property that will also attach to real estate;

3.  How Does a Creditor File a Garnishment?

A creditor seeking to garnish wages or a bank account must file a new lawsuit.  The new lawsuit is known as the garnishment lawsuit.  The garnishment suit is really against the "garnishee," which is the party responsible for paying the money into the garnishment case.  That's usually going to be your employer or your bank.  Thus, the creditor must do the following to initiate a successful garnishment:

  • file the garnishment suit in court;
  • show that the creditor has a judgment against you;
  • serve the bank or the employer via a sheriff or private process server; and,
  • provide you with a copy of the garnishment (but not necessarily through personal service).

The employer or bank must:

  • answer the garnishment to disclose whether you're employed or if you have money in the bank; and,
  • mail the money into the clerk of court where it is held.

4.  What is a Traverse of Garnishment?

In Georgia, you can dispute a garnishment by filing a traverse.  However, successful traverses really only work under the following circumstances:

  • the bank account is not yours;
  • the money in the bank account was deposited by a joint account holder and the deposits can be proven;
  • the money in the bank account is social security income that is protected from garnishment; or,
  • the underlying judgment is void due to some sort of defect.  For example, the creditor never perfected service of the original lawsuit on you.

Showing that a bank account is social security income or belongs to another person is easier.  But, arguing that the creditor never served you with the garnishment suit is unlikely to work.  If you were never served with the original judgment, you would actually have to go back into the old case and ask that court to reopen the case and determine that the judgment was no good because you never received service.  That may not be economical if the judgment is small or if you were served by publication and you could lose.  

5.  How Does Bankruptcy Stop Garnishment Proceedings?

A lot of times, bankruptcy is better and more economical for fighting a garnishment in Georgia.  Filing bankruptcy initiates an "automatic stay" or a protection of the filer from collections, including garnishments.  The ideal end result of a bankruptcy case is a discharge order that wipes out the judgment altogether.  Bankruptcy makes more sense when:

  • you have lots of other debt in addition to the judgment on which the garnishment is based;
  • it will cost you more money to fight the garnishment than to file bankruptcy; or,
  • you have no sure argument for defending the garnishment (because you really do owe the money and were properly served with the original lawsuit).

6.  Are There Alternatives to Bankruptcy or Traverse of Garnishment?

If bankruptcy is not for you and a traverse will be unsuccessful, you can always try to settle the debt.  In my experience, offering a lump sum to settle the debt will be the easiest way to leverage a beneficial settlement and resolve the garnishment suit.

Although the above is not an exhaustive list of ways to fight a garnishment or traverse a garnishment in Georgia, it is helpful to understand how a creditor even gets to the point of garnishment.  Depending on your specific financial circumstances, bankruptcy may actually be more beneficial than filing a traverse.  Thus, when faced with a garnishment, your best bet is to consult with a Georgia bankruptcy attorney and figure out what options you have.