If a debtor does not pay a creditor who has a court judgment in the creditor’s favor, the creditor does not need to take it lying down. Instead, the creditor can use one of several legal processes to obtain payment. One such process is called garnishment; it is when a creditor gets an order forcing a third party in possession of some of the debtor’s money (or which owes the debtor money) to turn that money over for the creditor’s benefit. For example, in wage garnishment, the debtor’s employer is instructed to turn over part of the debtor’s wages or salary. Wage garnishment is what most people think of as garnishment, but it’s important to remember that garnishment is not limited to wages or salary: any money owed a debtor that is in a third party’s possession can be garnished.
Also remember that a “debt” in the law is broader than it is usually thought of in everyday life. A debt can be any legal obligation whatsoever to pay money. It can result from a promissory note, a contract, or a credit card—but also from obligations for child support or alimony, taxes, or even incurring legal liability due to negligence, professional misconduct, or committing an intentional tort (like assault).
Oklahoma Garnishment Exemptions and Non-Exemptions
Wage and salary income is subject to garnishment in Oklahoma (up to a maximum of 25%; see next section). However, a number of different types of non-wage, non-salary income are protected (or exempt), in whole or in part, from garnishment.
To begin with, Social Security can only be garnished for alimony, child support, federal taxes (e.g. income tax), and a few other debts to the federal government. Other types of income that are exempt in Oklahoma include:
- Pensions or retirement benefits: Oklahoma provides exemptions for many different kinds of retirement benefits, both private and public. Retirees (or soon-to-be-retirees) facing garnishment for debts should consult with an attorney to see if their income is protected.
- Veteran’s benefits: Oklahoma protects benefits to disabled veterans.
- Public assistance or benefits: several types of public benefits and assistance have protection from garnishment, including workers’ compensation; unemployment benefits; aid to families with dependent children; and crime victim’s compensation.
- Insurance benefits or annuities: benefits provided by groups or societies enjoy some protection from garnishment, such as group life insurance benefits, mutual benefits, and fraternal society benefits.
- Alimony and child support payments.
Oklahoma Maximum Threshold
Like many states, rather than establish its own threshold, Oklahoma has chosen to follow federal law in terms of how much (otherwise nonexempt) income can be garnished. Under federal law, the lesser of the following can be garnished:
- 25% total of the debtor’s disposable income (money left after paycheck deductions mandated by law, such as FICA); or
- The amount by which a debtor’s weekly income exceeds 30 times the minimum wage (this ensures the debtor at least the equivalent each week of working at 30 hours at minimum wage)
Note that certain debts—principally taxes and child support—will allow greater-than-normal garnishment. For example, depending on circumstances, potentially up to 60% of a debtor’s income could be garnished for child support purposes.
Oklahoma Statute of Limitations
Both lawsuits and actions to enforce judgments, such as by garnishing wages, need to be brought within state-defined time periods. These time periods to sue are called “statutes of limitation.” There are two types of statutes of limitation to pay attention to in regards to garnishment. The first is for the debt on which garnishment is based, since if it’s too late to sue, it is by definition too late to garnish. This will vary by cause of action; however, for common consumer debts in Oklahoma, the limitations periods are:
- Three years, for an oral (or verbal) contract or an open account (e.g. credit card)
- Five years, for written contracts and promissory notes
These periods are more-or-less comparable to those in other states.
Once an Oklahoma creditor has obtained a favorable judgment, the creditor has 5 years to enforce it by garnishment—only three years if the creditor is trying to enforce a judgment which had rendered by a non-Oklahoma court. There are circumstances in which the creditor can renew or extend the time to enforce a judgment issued by an Oklahoma court, but even allowing for that, creditors have less time to enforce judgments in Oklahoma than they would in most other states—which is clearly good for their debtors.
Writ of Garnishment in Oklahoma
The original lawsuit on a debt or cause of action which resulted in a judgment in creditor’s favor was between the creditor and the debtor. The subsequent effort to enforce the judgment via garnishment is primarily between the creditor and the “garnishee,” which is the person, business, or institution which has money belonging or owed to the debtor. The debtor will be given notice of the garnishment and can request a hearing, which would provide an opportunity to challenge the garnishment (see below—“Getting Legal Help”); however, since in theory the debtor already had its day in court and chance to contest the debt during the original lawsuit, the debtor’s role in garnishment is limited. For the most part, unless there was some mistake, error, or flaw in the original judgment or in the garnishment itself, garnishment is a fairly straightforward and “mechanical” process in which—
- The creditor requests garnishment, citing the judgment in its favor, the fact that the debt created by the judgment has not been paid, and the belief that garnishment is necessary to secure payment of the debt.
- Papers are served on the garnishee, which is then examined (either by deposition or written questions called “interrogatories”) as to the facts alleged regarding the garnishment: e.g. that it has such and such amount of money belonging or owed to the debtor.
- The garnishee can challenge the factual basis of the garnishment; for example, it does not have to send money for the creditor’s benefit if it doesn’t actually owe anything to the debtor (e.g. debtor no longer works there, so he or she is not earning any wages or salary). However, if the judgment was valid and the factual basis for garnishment is correct, garnishee will typically be instructed to pay the appropriate portion of the money it owes debtor to the creditor instead.
Getting Legal Help
While stopping wage garnishment in Oklahoma is difficult, with legal help, it is possible to fight your case. As mentioned above, since there was a previous opportunity (the earlier litigation) to dispute the debt—and the debtor presumably failed to dispute it, since a judgment was rendered against the debtor—it’s rare that a garnishment can be fought on substantive grounds. Usually by the time garnishment is being invoked, it’s been established that the debtor owes money. That said, there still are bases on which a garnishment can be challenged, such as:
Mistake: is the wrong person being garnished? Was the debt already paid but not credited? Etc.
Procedural invalidity: was the judgment granted in error—for example, by “default,” when the reason the debtor never showed up to court was that the creditor never properly provided notice.
Jurisdictional: is there some reason, such as where the debtor now resides, that the court does not have power or authority over him or her?
Statute of limitations: was either the original lawsuit or the garnishment action brought too late?
Less or no disposable income: is much, most, or all of the debtor’s income derived from protected or exempt sources? Since there are a number of different exemptions scattered throughout Oklahoma’s statutes, identifying which ones a given debtor may be eligible for is one of main ways an attorney can help.
Debtor is already garnished at the maximum level: are there other garnishments or obligations (e.g. child support) already on the debtor, so the debtor is paying the most he or she could be required?
For more information:
FAQ sheet about Federal garnishment rules[http://www.dol.gov/whd/regs/compliance/whdfs30.pdf]
Social security and garnishment[http://www.ssa.gov/deposit/DDFAQ898.htm]