So You Have Been Garnished – now what?

You got a Notice of Garnishment telling you that your bank, another person who owes you money or your employer has been “garnished”: what does that mean?

Well, it usually means that you failed to file a defence to an action you were named as a defendant, and then judgment was awarded against you, usually for the amount of the debt, plus costs and interest.

Garnishments are usually issued one of two ways: (1) against your bank account; or (2) your employment.

I like to think of Garnishment using the analogy of a game of catch. Someone is throwing you a ball. I jump up and intercept the ball, thereby “garnishing” the ball. In theory anyone who owes you money can be garnished.

If your bank account was garnished, your bank account would be frozen and 100% of the funds in your account are withdrawn and sent to the Court to be given to the creditor. There are special rules if this is a joint account.

If your employer was served with a Notice of Garnishment, 20% of your net wages are garnished from your pay until the full amount of the Garnishment is satisfied. This is 50% if the Judgment is a Family Law matter.

What happens if your employer does not comply with the Garnishment?

The Notice of Garnishment is a Court order, and should they fail to comply with that Court order, the creditor can bring a Garnishment Hearing and obtain judgment against your employer.  Ditto for a bank who refuses to withdraw the funds from your account.

So, what do you do if you were garnished?  If you feel that you do not owe what is being claimed against you, you should have defended the action.  But sometimes things happen, and you don’t.  You would have to bring a Motion immediately to set aside the judgment so that you can file a defence.  This also stops the Garnishment, and usually the freeze on your account is lifted.

But if you genuinely owe the amount claimed, try to work something out with your creditor to avoid having to pay costs and interest when you inevitably lose at Trial.

Garnishments are not only stressful, they are also embarrassing.  Especially if the account that was garnished was your payroll account and you have to explain to your employees why their cheques bounced, or you try to make a purchase at the store and you’re declined.

Murray Brown, Licensed Paralegal