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This memorandum addresses the trustee's objection to a debtor's claim of exemption for $140,000 in accounts receivable under Tenn. Code Ann. § 26-2-106. The debtor, a podiatrist, argued that the state statute, which limits garnishment of earnings, constitutes an exemption recognizable in bankruptcy. The trustee contended that the statute only limits garnishment outside bankruptcy and that the accounts receivable do not qualify as earnings. The court analyzed the Tennessee garnishment statute and its federal counterpart, the Consumer Credit Protection Act (CCPA), concluding that neither was intended to create a general wage exemption in bankruptcy. The court found that the statute primarily regulates the process of garnishment in the hands of a third party, rather than permanently sequestering funds from creditors within a bankruptcy proceeding. Consequently, the court sustained the trustee's objection, denying the debtor's claim of exemption.
In Re Lawrence is a workers' compensation case decided in United States Bankruptcy Court, E.D. Tennessee. This case addresses legal issues related to compensation claims, benefits, and court rulings.
It is commonly referenced in legal research involving workers' compensation laws in United States Bankruptcy Court, E.D. Tennessee.
Full Decision Text1 Pages
This memorandum addresses the trustee's objection to a debtor's claim of exemption for $140,000 in accounts receivable under Tenn. Code Ann. § 26-2-106. The debtor, a podiatrist, argued that the state statute, which limits garnishment of earnings, constitutes an exemption recognizable in bankruptcy. The trustee contended that the statute only limits garnishment outside bankruptcy and that the accounts receivable do not qualify as "earnings." The court analyzed the Tennessee garnishment statute and its federal counterpart, the Consumer Credit Protection Act (CCPA), concluding that neither was intended to create a general wage exemption in bankruptcy. The court found that the statute primarily regulates the process of garnishment in the hands of a third party, rather than permanently sequestering funds from creditors within a bankruptcy proceeding. Consequently, the court sustained the trustee's objection, denying the debtor's claim of exemption.
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