AB34: Bill Text

LRB-0307/1

RPN:wlj:sh

2007 - 2008 LEGISLATURE

2007 Assembly BILL 34

January 24, 2007 - Introduced by Representatives Owens, Hahn, Jeskewitz, Musser, Townsend and Vos, cosponsored by Senators Olsen, Roessler, Schultz and Grothman. Referred to Committee on Children and Family Law.

AB34,1,4 An Act to amend 812.30 (8), 812.35 (5), 812.35 (6), 812.40, 812.44 (3) (form), 812.44 (4) (form) and 812.44 (5) (form); and to create 812.30 (7m), 812.34 (2) (b) 3. and 812.35 (7) of the statutes; relating to: garnishment of the income of a minor.

Analysis by the Legislative Reference Bureau

Under current law, the court assigned to exercise jurisdiction under the Juvenile Justice Code (juvenile court) may order a juvenile who has committed an act resulting in damage to the property of another or in actual physical injury to another, excluding pain and suffering, and a parent who has custody of the juvenile to make reasonable restitution for that damage or injury. Current law also permits the juvenile court to order a juvenile who has committed a delinquent act or who has violated a civil law or ordinance and the parent of that juvenile to pay a forfeiture, plus certain costs and surcharges. If a juvenile or a parent with custody of the juvenile fails to pay restitution, costs, a forfeiture, or a surcharge as ordered, the juvenile court may order that the amount of the unpaid restitution, costs, forfeiture, or surcharge be entered and docketed as a judgment against the juvenile and parent.

Under current law, a person who has a civil judgment for a debt may bring an action in circuit court to garnish the earnings of the person who owes the debt. The creditor is required to comply with specified court procedures when bringing the action, including serving one earnings garnishment form upon the debtor and the other form upon the person who is the debtor's employer. Currently, the debtor may claim an exemption from the garnishment or may assert a defense against the garnishment.

Under current law, 80 percent of the debtor's disposable earnings (earnings left after deducting social security, federal, and state taxes) are exempt from garnishment. In addition, if the debtor's household income is below the poverty level or if the debtor is receiving needs-based public assistance, all of the debtor's earnings are exempt from garnishment. Currently, "household income" for purposes of this exemption is defined to mean the disposable income of the debtor and the debtor's dependents during the month in which the garnishment is in effect, plus any unearned income received that month by the debtor and the debtor's dependents, minus any of the debtor's earnings assigned by a family court order. The family court may order the assignment of a person's earnings for the payment of child support, family support, or maintenance.

Under this bill, if a debtor is an unemancipated minor who owes juvenile— court ordered restitution, costs, a forfeiture, or a surcharge, "household income" of the debtor includes the monthly unearned and disposable earnings of the debtor, the debtor's parents, and the parents' dependents, minus any of the earnings of the debtor and parent that are assigned by a family court. The bill, however, exempts from garnishment all of an unemancipated minor's earnings if the judgment that the creditor is seeking to satisfy is not a judgment for unpaid restitution, costs, a forfeiture, or a surcharge entered by the juvenile court.

Under current law, an earnings garnishment lasts for 13 weeks or until the debt is collected through the garnishment, whichever is less, except that for public employees, the garnishment continues until the debt is paid in full. This bill provides that the garnishment of a minor debtor who is not emancipated continues until the debt is paid in full.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB34, s. 1 Section 1. 812.30 (7m) of the statutes is created to read:

AB34,2,2 812.30 (7m) "Emancipated minor" has the meaning given in s. 48.375 (2) (e).

AB34, s. 2 Section 2. 812.30 (8) of the statutes is amended to read:

AB34,3,5 812.30 (8) "Household income" means the disposable earnings of the debtor and dependents during any month in which the garnishment is in effect, plus unearned income received by the debtor and dependents in that month, less any of the debtor's earnings assigned by court order under ch. 767. If the debtor is a minor, other than an emancipated minor, "household income" means the disposable earnings of the debtor, of the parent that the debtor resides with for at least 50 percent of the month, and of the parent's dependents during any month in which the garnishment is in effect, plus unearned income received by the debtor, the parent, and the parent's dependents in that month, less any of the debtor's and the parent's earnings assigned by court order under ch. 767.

AB34, s. 3 Section 3. 812.34 (2) (b) 3. of the statutes is created to read:

AB34,3,10 812.34 (2) (b) 3. The debtor is a minor, other than an emancipated minor, and the judgment that the creditor is seeking to satisfy is not a judgment for unpaid restitution, costs, a forfeiture, or a surcharge entered under s. 895.035 (2m) (a) or (b) by the court assigned to exercise jurisdiction under chs. 48 and 938.

AB34, s. 4 Section 4. 812.35 (5) of the statutes is amended to read:

AB34,3,19 812.35 (5) Upon Except as provided in sub. (7), after being served, the garnishee shall determine whether the garnishee may become obligated to the debtor for earnings earned within pay periods beginning within 13 weeks after the date of service. If it is unlikely that the garnishee will become so obligated, the garnishee shall send a statement of that fact to the creditor by the end of the 7th business day after receiving the earnings garnishment form under sub. (3). The creditor shall send a copy of this statement to the court within 7 business days after receipt of the statement.

AB34, s. 5 Section 5. 812.35 (6) of the statutes is amended to read:

AB34,4,8 812.35 (6) If Except as provided in sub. (7), if the garnishee may become obligated to the debtor for earnings earned within pay periods beginning within 13 weeks after the date of service, but one or more earnings garnishments against the debtor have already been served on the garnishee and not terminated, the garnishee shall retain the earnings garnishment form and place the garnishment into effect the pay period after the last of any prior earnings garnishments terminates. The garnishee shall notify the debtor of the amount of the garnishment and shall notify the creditor of the amount owed on the pending garnishments by the end of the 7th business day after receipt of the garnishment form under sub. (3). If, before the earnings garnishment takes effect, the garnishee determines that it is unlikely that the garnishee will continue to be obligated to the debtor for earnings, the garnishee shall notify the creditor and court under sub. (5) within 7 business days after making that determination.

AB34, s. 6 Section 6. 812.35 (7) of the statutes is created to read:

AB34,4,18 812.35 (7) (a) If the debtor is a minor, other than an emancipated minor, the garnishment shall continue until the amount that the creditor is seeking in the garnishment is paid in full. The garnishee shall determine whether the garnishee may become obligated to the debtor for earnings earned after the date of service. If it is unlikely that the garnishee will become so obligated, the garnishee shall send a statement of that fact to the creditor by the end of the 7th business day after receiving the earnings garnishment form under sub. (3). The creditor shall send a copy of this statement to the court within 7 business days after receipt of the statement.

AB34,5,5 (b) If the garnishee may become obligated to the debtor for earnings earned within pay periods beginning after the date of service, but one or more earnings garnishments against the debtor have already been served on the garnishee and not terminated, the garnishee shall retain the earnings garnishment form and place the garnishment into effect the pay period after the last of any prior earnings garnishments terminates. The garnishee shall notify the debtor of the amount of the garnishment and shall notify the creditor of the amount owed on the pending garnishments by the end of the 7th business day after receipt of the garnishment form under sub. (3). If before the earnings garnishment takes effect the garnishee determines that it is unlikely that the garnishee will continue to be obligated to the debtor for earnings, the garnishee shall notify the creditor and court under par. (a) within 7 business days after making that determination.

AB34, s. 7 Section 7. 812.40 of the statutes is amended to read:

AB34,5,19 812.40 Stipulated extension. At any time while an earnings garnishment is in effect, the debtor and creditor, if the debtor is an adult or an emancipated minor, may stipulate in writing to an extension of the earnings garnishment for additional pay periods. The extension may commence on the first day after the earnings garnishment ends and shall end within 13 weeks after the last day of the last pay period affected by the earnings garnishment. The garnishee shall be bound by the extension if a copy of the stipulation is delivered or mailed to the garnishee, together with an additional garnishee fee under s. 812.33, before the last day of the last pay period affected by the earnings garnishment or any prior stipulated extension of the earnings garnishment. A stipulated extension is void and the garnishee fee shall be refunded if, prior to the last day of the last pay period affected by the earnings garnishment, the garnishee is served under s. 812.35 (3) by a creditor seeking to satisfy a different judgment against the debtor.

AB34, s. 8 Section 8. 812.44 (3) (form) of the statutes is amended to read:

AB34,5,21 812.44 (3) (form)

AB34,5,22 STATE OF WISCONSIN

AB34,5,23 CIRCUIT COURT:.... County

AB34,6,2 A.B., Creditor

AB34,6,3 vs. File or Reference Number....

AB34,6,4 C.D., Debtor EARNINGS

AB34,6,5 and GARNISHMENT

AB34,6,6 E.F., Garnishee

AB34,6,8 THE STATE OF WISCONSIN, To the garnishee:

AB34,6,10 The creditor has been awarded a court judgment that has not been paid. As a result, the creditor claims that a total of $.... is owed by the debtor, as follows:

AB34,6,11 A. Unpaid balance on judgment $....

AB34,6,12 B. Unpaid postjudgment interest $....

AB34,6,13 C. Costs of this earnings garnishment

AB34,6,14 (estimated) $....

AB34,6,15 TOTAL $....

AB34,6,18 The creditor believes that you will owe the debtor for earnings within the next 13 weeks, or if the debtor is an unemancipated minor, within any time. If the $15 fee is tendered with these papers, you are directed by the court to do the following:

AB34,6,19 DETERMINE WHETHER YOU WILL