Today's Trends in Credit Regulation

Georgia Court Declares State Garnishment Statute Unconstitutional
By K. Dailey Wilson

The Fifth and Fourteenth Amendments of the United States Constitution provide certain protections guaranteeing life, liberty and property. Those rights cannot be taken away from a person without due process of law. There are two types of due process - procedural due process and substantive due process. Procedural due process requires that certain steps - i.e. a procedure - be followed in order to deprive a person of their life, liberty or property. A September 2015 case from the Northern District of Georgia addressed just that - whether the Georgia garnishment statute provided sufficient procedural protections to permit the taking of a person's property.

Tony Strickland's credit card issuer retained a law firm to sue Strickland to recover an unpaid credit card debt. After a default judgment was entered against Strickland, the law firm filed a garnishment action and attempted to garnish funds in Strickland's JPMorgan Chase savings account. The money in his savings account consisted of workers' compensation benefits. After being served with the garnishment summons, Chase immediately froze Strickland's savings account. Strickland received a letter from the law firm notifying him of the garnishment action. The letter did not inform him that some forms of property were exempt from garnishment or how to claim an exemption. Strickland also received a letter from Chase explaining that it had been served with a writ of garnishment and that his bank account had been frozen. The letter also stated that some forms of income may be protected from garnishment, but did not advise him how to claim an exemption. Instead, Chase told him to contact the judgment creditor's attorney if he believed that the money in his account was exempt. Strickland sued the entities involved in the garnishment proceeding, and the case eventually returned to the U.S. District Court for the Northern District of Georgia to determine the constitutionality of Georgia's post-judgment garnishment statute.

Strickland argued that Georgia's post-judgment garnishment statute violates constitutional due process requirements because it (1) does not provide judgment debtors with adequate notice that their property may be exempt from garnishment; (2) fails to inform debtors of the procedure to claim such exemptions; and (3) establishes a process that deprives debtors of their exempt property for an unconstitutionally long period of time. The court concluded that due process requires that a judgment debtor receive notice that there are certain exemptions under state and federal law that the debtor may be entitled to claim with respect to the garnished property. Because the Georgia post-judgment garnishment statute requires no such notice to the judgment debtor, the court concluded that it is constitutionally deficient. The court found that, in this case, the letter sent by Chase to Strickland that mentioned possible exemptions did not satisfy the state's duty to provide adequate notice of exemptions.

The court also concluded that due process requires judgment debtors in garnishment actions to be informed of the procedures for claiming an exemption. Because the Georgia statute requires no such notice, the court concluded that it was constitutionally deficient. The court added that there is no publicly available information that explains to a judgment debtor facing garnishment how to claim an exemption or identifies the party to contact to obtain this information. Instead, the debtor is notified only that a creditor has filed or is about to file a garnishment action, the identity of the garnishee, the amount claimed due, and the court issuing the garnishment.

Finally, the court concluded that the Georgia statute violates due process because it does not provide for a prompt and expeditious procedure to resolve a debtor's claim that seized property is exempt from garnishment.

The story does not end with the September 8th judgment. On September 25, 2015, the office of the Attorney General of Georgia filed a motion to alter the Clerk's judgment, leaving open the possibility for a reversed judgment or subsequent appeals. However, until the motion has been heard, it may be wise to avoid seeking writs of garnishment in the state of Georgia.

Strickland v. Alexander, 2015 U.S. Dist. LEXIS 121958 (N.D. Ga. September 8, 2015)

K. Dailey Wilson is an associate in the Tennessee office of Hudson Cook, LLP. Dailey can be reached at 423-490-7567 or by email at

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