AB476: Bill Text

LRB-3395/1

TKK:klm&wlj

2017 - 2018 LEGISLATURE

2017 Assembly BILL 476

August 24, 2017 - Introduced by Representatives Hutton, Tusler, Allen, Ballweg, Gannon, Horlacher, Jarchow, Kuglitsch, Murphy, Quinn, Rohrkaste and Spiros, cosponsored by Senators Wanggaard, Stroebel, Kapenga and Nass. Referred to Committee on Financial Institutions.

AB476,1,4 An Act to repeal 812.40, 812.405 and 812.42 (2) (b); to amend 812.33 (1), 812.35 (5), 812.35 (6), 812.38 (2), 812.44 (3) and 812.44 (4); and to create 812.395 of the statutes; relating to: eliminating the 13-week limit on the garnishment of earnings of certain debtors.

Analysis by the Legislative Reference Bureau

This bill eliminates the 13-week limit imposed on the garnishment of earnings of certain debtors. Under current law, a creditor may file a garnishment notice with a court and pay a fee to a garnishee for the purpose of collecting an unsatisfied judgment for money damages from earnings owed to the debtor by the garnishee. Current law limits the number of weeks in which the earnings of a debtor, other than a debtor who is an employee of the state or a political subdivision of the state, may be garnished to 13 weeks.

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

AB476,1 Section 1. 812.33 (1) of the statutes is amended to read:

AB476,2,3 812.33 (1) The creditor shall pay a $15 fee to the garnishee for each earnings garnishment or each stipulated extension of that earnings garnishment. This fee shall be included as a cost in the creditor's claim in the earnings garnishment.

AB476,2 Section 2. 812.35 (5) of the statutes is amended to read:

AB476,2,11 812.35 (5) Upon 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.

AB476,3 Section 3. 812.35 (6) of the statutes is amended to read:

AB476,2,24 812.35 (6) 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.

AB476,4 Section 4. 812.38 (2) of the statutes is amended to read:

AB476,3,11 812.38 (2) A motion or petition under sub. (1) may be made at any time during the pendency of the earnings garnishment. Within 5 business days after a motion or petition is filed under sub. (1), the court shall schedule the matter for a hearing to be held as promptly as practicable. The court shall notify the parties of the time and place of the hearing. Upon conclusion of the hearing, the court shall make findings of fact and conclusions of law. The court shall make such order as required by these findings and conclusions. If the order permits the garnishment to proceed, the date on which the order is served upon the garnishee shall substitute for the original date of service of the garnishment upon the garnishee under s. 812.35 (3) for the purpose of determining any 13-week period under s. 812.35 (5) or (6). A court order shall bind the garnishee from the time the order is served upon him or her.

AB476,5 Section 5. 812.395 of the statutes is created to read:

AB476,3,16 812.395 Garnishment of earnings remains in effect. A garnishment of earnings payable to a debtor, including a debtor who owes victim restitution ordered under s. 973.20 (1r), remains valid and effective until the judgment is satisfied, unless sooner terminated by order of the court.

AB476,6 Section 6. 812.40 of the statutes is repealed.

AB476,7 Section 7. 812.405 of the statutes is repealed.

AB476,8 Section 8. 812.42 (2) (b) of the statutes is repealed.

AB476,9 Section 9. 812.44 (3) of the statutes is amended to read:

AB476,3,22 812.44 (3) The earnings garnishment form issued by the clerk under s. 812.35 (2) shall be in substantially the following form:

AB476,3,23 STATE OF WISCONSIN

AB476,3,24 CIRCUIT COURT: .... County

AB476,4,2 A.B., Creditor

AB476,4,3 vs.   File or Reference Number ....

AB476,4,4 C.D., Debtor   EARNINGS

AB476,4,5 and   GARNISHMENT

AB476,4,6 E.F., Garnishee

AB476,4,8 THE STATE OF WISCONSIN, To the garnishee:

AB476,4,10 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:

AB476,4,11 A. Unpaid balance on judgment $....

AB476,4,12 B. Unpaid postjudgment interest $....

AB476,4,14 C. Costs of this earnings garnishment (estimated) $....

AB476,4,15 TOTAL $....

AB476,4,18 The creditor believes that you will owe the debtor for earnings within the next 13 weeks after the date on which you receive this form. If the $15 fee is tendered with these papers, you are directed by the court to do the following:

AB476,4,19 DETERMINE WHETHER YOU WILL

AB476,4,20 OWE THE DEBTOR EARNINGS

AB476,4,23 1. Determine if you are likely to owe the debtor for earnings in pay periods beginning within the next 13 weeks earned on or after the date on which you receive this form.

AB476,5,2 2. If you are not likely to owe the debtor for earnings in pay periods beginning within the next 13 weeks earned on or after the date on which you receive this form, send a statement stating that fact to the creditor by the end of the 7th business day after receiving the earnings garnishment forms.

AB476,5,3 IF THE DEBTOR SENDS YOU AN ANSWER

AB476,5,6 3. Whenever you receive a debtor's answer form from the debtor, mail a copy of the answer form to the creditor by the end of the 3rd business day after receipt of that form. Include the date you received the answer form on the copy sent to the creditor.

AB476,5,9 4. If the debtor's answer form claims a complete exemption or defense, do not withhold or pay to the creditor any part of the debtor's earnings under this garnishment unless you receive an order of the court directing you to do so.

AB476,5,10 MULTIPLE EARNINGS GARNISHMENTS

AB476,5,18 5. If the debtor's earnings are already being garnisheed when you receive this earnings garnishment, place this earnings garnishment into effect the pay period after the last of any prior earnings garnishments terminates. Notify the debtor of the amount of the garnishment and notify the creditor of the amount owed on the pending garnishments by the end of the 7th business day after you receive these forms. If there are no prior pending earnings garnishments against the debtor's earnings, place this earnings garnishment into effect the pay period after you receive it.

AB476,5,23 EARNINGS GARNISHMENTS LAST 13 WEEKS, EXCEPT FOR PUBLIC EMPLOYEES AND EXCEPT FOR GARNISHMENTS TO SATISFY AN ORDER FOR VICTIM RESTITUTION REMAIN IN EFFECT UNTIL THE JUDGMENT IS SATISFIED

AB476,6,9 6. The garnishment of the earnings of employees of the state of Wisconsin and its political subdivisions, and a garnishment to satisfy an order for victim restitution under s. 973.20 (1r) for victim restitution remains in effect until the judgment is satisfied. The garnishment of earnings of other employees will affect the debtor's earnings for all pay periods beginning within 13 weeks after you receive it, unless the debtor's earnings are already being garnisheed. If this earnings garnishment is delayed under paragraph 5, above, it will affect the debtor's earnings for all pay periods beginning within 13 weeks after the first day of the pay period that you put this earnings garnishment into effect. If the amount claimed by the creditor is fully paid before the end of the 13 weeks, this earnings garnishment will terminate at that point.

AB476,6,10 PAYING THE CREDITOR

AB476,6,13 7. Between 5 and 10 business days after each payday of a pay period affected by this earnings garnishment, pay the creditor 20% of the debtor's disposable earnings for that pay period. Payment is complete upon mailing.

AB476,6,14 EFFECT OF COURT-ORDERED

AB476,6,15 ASSIGNMENTS FOR SUPPORT

AB476,6,23 8. If the debtor has assigned his or her earnings for support by court order, those support payments take priority over this earnings garnishment. If 25% or more of the debtor's disposable earnings is assigned for support by court order, do not pay any part of the debtor's earnings to the creditor. Instead, send the creditor a statement of that fact by the end of the 7th business day after you receive these forms. If less than 25% of the debtor's earnings is assigned for support by court order, the amount the creditor must be paid is reduced so that the total of earnings assigned and garnisheed does not exceed 25% of the debtor's disposable earnings.

AB476,6,24 EXTENSIONS

AB476,7,7 9. The debtor and creditor may agree in writing to extend this earnings garnishment for additional pay periods beginning within 13 weeks after this earnings garnishment would otherwise terminate. If you receive a written extension stipulation, and an additional garnishee fee for each extension, you must honor it unless a different garnishment against this debtor's earnings is served upon you before the extension takes effect. In that case, the extension is void and you must return the extension fee to the party who paid it to you.

AB476,10 Section 10. 812.44 (4) of the statutes is amended to read:

AB476,7,10 812.44 (4) The notice of exemption served upon the garnishee under s. 812.35 (4) shall be in substantially the following form:

AB476,7,11 STATE OF WISCONSIN

AB476,7,12 CIRCUIT COURT: .... County

AB476,7,14 A.B., Creditor

AB476,7,15 vs. File or Reference Number ....

AB476,7,16 C.D., Debtor EXEMPTION NOTICE

AB476,7,17 and EARNINGS GARNISHMENT

AB476,7,18 E.F., Garnishee

AB476,7,20 To the debtor:

AB476,8,2 The creditor was awarded a judgment against you or your spouse by .... (County Circuit or Federal District) Court on the .... day of ...., .... (year) That judgment not having been fully paid, the creditor has now filed a garnishment proceeding against your earnings from the garnishee. This means that the creditor is seeking to take some of your earnings to satisfy part or all of the judgment against you or your spouse.

AB476,8,3 The total amount of the creditor's claim is as follows:

AB476,8,4 Unpaid balance on judgment     $....

AB476,8,5 Unpaid postjudgment interest     $....

AB476,8,6 Costs:

AB476,8,7 a. Garnishment filing fee     $....

AB476,8,8 b. Garnishee fee     $....