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Access over workers' compensation decisions, including En Banc, Significant Panel Decisions, and writ-denied cases.

Case No. M2017-02434-COA-R3-CV
Regular Panel Decision
Oct 18, 2018

Julie Ann Kendle v. Matthew Davis Kendle

This appeal addresses a dispute over wage garnishment to enforce spousal and child support obligations. The central issue is whether an employer, Blue Shield EMS, has an affirmative duty to consider an obligor's (Matthew Davis Kendle's) wages and existing garnishments from other employers (WEMA) when served with a new garnishment order. The trial court had ruled that Blue Shield EMS failed to provide a valid legal reason for not withholding wages and ordered them to pay the un-garnished amount and continue garnishments. The Court of Appeals affirmed this decision, clarifying that Tennessee statutes do not impose a duty on a garnishee employer to consider other employers' withholdings. The court also addressed the appropriate percentage for garnishment, affirming that Tenn. Code Ann. § 36-5-501(a)(1) sets a maximum limit of 50%, not a minimum, and found no error in the trial court's 25% withholding order.

Garnishment LawWage AssignmentChild Support EnforcementSpousal Support EnforcementEmployer ResponsibilitiesStatutory ConstructionAppellate ProcedureDisposable Earnings LimitsFederal Consumer Credit Protection ActJudgments
References
11
Case No. MISSING
Regular Panel Decision

In Re Lawrence

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.

Bankruptcy LawExemption ClaimGarnishment StatuteAccounts ReceivableDisposable EarningsTennessee State LawFederal Bankruptcy CodeConsumer Credit Protection ActStatutory InterpretationDebtor-Creditor Relationship
References
22
Case No. MISSING
Regular Panel Decision
Jul 22, 2014

Suntrust Bank v. Walter Joseph Burke a/k/a Walter Joseph Burke, Jr.

The Tennessee Court of Appeals reversed a trial court's judgment against Crye-Leike, Inc., a realty company. SunTrust Bank had sought to continuously garnish commissions paid by Crye-Leike to its debtor, Walter Burke, citing Tennessee Code Annotated Section 26-2-214. Crye-Leike argued that this statute, which mandates continuous garnishment, only applies to "employer garnishees" and not to entities with an independent contractor relationship, as was the case with Mr. Burke. The appellate court agreed, interpreting the statute's plain language and legislative intent to limit its application strictly to employers, thereby concluding that Crye-Leike was not subject to continuous garnishment for an independent contractor's earnings. Consequently, the trial court's award of judgment to SunTrust Bank was reversed.

GarnishmentIndependent ContractorEmployer-Employee RelationshipStatutory InterpretationCommissionsDebtor-Creditor LawAppellate ReviewTennessee LawPlain Meaning RuleLegislative Intent
References
7
Case No. 05-08-01293-CV
Regular Panel Decision
Jun 22, 2010

In Re Cat

The Office of the Attorney General (OAG) appealed a trial court's order dissolving a writ of garnishment against a self-employed father's bank account, which was levied to satisfy child support arrears. The trial court had concluded that garnishment of the father's disposable earnings violated Texas Family Code section 157.312(g) and the prior child support judgment, as the father was current on agreed payments. The Court of Appeals, Dallas, reversed this decision, holding that section 157.312(g) does not prohibit garnishment of a self-employed obligor's bank account because the obligor is not an "employer." Furthermore, the court found the OAG's actions did not violate the earlier judgment, which explicitly allowed other collection methods. The case was remanded for further proceedings consistent with this opinion.

Child Support LienGarnishmentSelf-Employment IncomeDisposable EarningsStatutory InterpretationTexas Family CodeChild Support ArrearageFinancial Institution LevyEmployer DefinitionContract Interpretation
References
17
Case No. MISSING
Regular Panel Decision

In the Interest of C.A.T.

The Office of the Attorney General (OAG) appealed a trial court's order dissolving a writ of garnishment against Father's bank account, which contained his disposable earnings as a self-employed carpenter. The trial court had ruled that Father was his own employer, and thus garnishment of his account violated Texas Family Code section 157.312(g), which prohibits liens directed to an employer to attach to disposable earnings. The trial court also found Father was current on his child-support arrears payments as per an agreed judgment. On appeal, Justice Murphy's opinion clarified that section 157.312(g) does not apply to self-employed individuals' bank accounts because the lien is directed to a financial institution, not an "employer" as defined by the code. Furthermore, the appellate court determined that the prior child-support judgment, which included a payment schedule, did not preclude the OAG from using other lawful collection methods, regardless of whether Father was current on his monthly payments. Consequently, the appellate court reversed the trial court's order dissolving the writ of garnishment and remanded the case for further proceedings.

Child SupportGarnishmentSelf-EmploymentTexas Family CodeStatutory InterpretationLien EnforcementDisposable EarningsJudgment on ArrearsAppellate ReviewContract Interpretation
References
17
Case No. MISSING
Regular Panel Decision
Dec 31, 1990

Orange County v. Ware

Justice Mauzy, in a dissenting opinion joined by Justices Doggett and Gammage, strongly criticizes the majority's decision to effectively abolish the constitutional protection against wage garnishment in Texas, enshrined in Article 16, Section 28. Mauzy argues that allowing a creditor to assign a debt to the debtor's employer, enabling the employer to withhold wages, is an unconstitutional indirect circumvention of the garnishment ban. He highlights that this ruling disregards a century of jurisprudence consistently holding such actions unlawful and undermines the provision's original intent to protect debtors from destitution. Mauzy warns that the decision will force debtors into 'abject dependence and want,' contrary to the framers' intentions.

Wage GarnishmentConstitutional LawTexas ConstitutionDebtors' RightsJudicial DissentStatutory InterpretationLegal PrecedentArticle 16 Section 28Employer-Employee RelationsCreditor-Debtor Law
References
9
Case No. 10-07-00019-CR
Regular Panel Decision
Jun 06, 2007

in Re Roger L. Keeling

Relator Roger L. Keeling sought mandamus relief challenging a trial court's June 14, 2006 order that assessed court costs from a 1992 conviction and directed withdrawals from his inmate trust account. Keeling argued he was denied procedural due process, as no notice or opportunity to be heard was provided before his funds were garnished. The Tenth Court of Appeals, aligning with Abdullah v. State, found that the trial court failed to follow proper garnishment or turnover procedures. Consequently, the appellate court ruled the supplemental order void due to the lack of due process. Mandamus relief was conditionally granted, ordering the trial court to vacate its order and return the removed funds to Keeling's account.

MandamusDue ProcessInmate Trust AccountCourt CostsGarnishmentVoid OrderProcedural Due ProcessTexas Government CodeCivil Practice and Remedies CodeAppellate Review
References
18
Case No. MISSING
Regular Panel Decision

In re Voll

The debtors, Patrick L. Voll and Linda P. Voll, filed for Chapter 13 bankruptcy. The New York State Department of Taxation and Finance ("Tax Department") willfully violated the automatic stay by continuing to garnish Mrs. Voll's wages post-petition, despite receiving notice of the bankruptcy filing. The garnishment ceased, and the improperly deducted funds were returned after the Debtors filed a motion for sanctions. The court found that the Tax Department willfully violated the automatic stay. However, the court denied the Debtors' claim for emotional distress damages, finding they failed to provide clear and convincing evidence of significant emotional harm distinct from the general stressors of bankruptcy and other life events. The court awarded the Debtors $13,625.00 in attorneys' fees as actual damages for the willful violation of the stay.

Bankruptcy LawAutomatic Stay ViolationWage GarnishmentSanctions MotionAttorneys' Fees AwardChapter 13 BankruptcyTaxation and FinanceActual DamagesEmotional Distress ClaimsWillful Violation
References
28
Case No. MISSING
Regular Panel Decision

Gulf States Utilities Co. v. McMillon

Lemuel R. McMillon, Jr. sued his employer, Gulf States Utilities Company, alleging breach of an employment contract due to unlawful wage garnishment, violating Texas statutes and the state constitution. McMillon claimed Gulf States withheld wages to circumvent Texas Workers' Compensation Law, despite a collective bargaining agreement with Local Union 2286, International Brotherhood of Electrical Workers, which included a coordination plan for injured employees' salaries. The court determined that McMillon failed to exhaust the mandatory grievance and arbitration procedures outlined in the collective bargaining agreement, which is preempted by federal labor law. Additionally, the court found that McMillon had previously released this cause of action in a settlement against Southwestern Bell Telephone Company and that there was no evidence of actual garnishment. Consequently, the appellate court reversed the trial court's judgment, ruling that McMillon take nothing against Gulf States Utilities Company.

Breach of ContractWage GarnishmentWorkers' CompensationCollective Bargaining AgreementGrievance ProceduresArbitrationFederal PreemptionLabor LawRelease AgreementSettlement
References
8
Case No. MISSING
Regular Panel Decision

Kennedy v. Kennedy

This case addresses whether income from a noncompetition agreement is subject to the 65% cap for income executions under CPLR 5241 (g) (1) (ii) in support obligations. Petitioner Nancy E. Kennedy sought to garnish 100% of respondent Kenneth E. Kennedy's noncompetition income from Signet Advertising, Inc., arguing the statutory cap applies only to employer-employee earnings. After initial differing decisions by a Hearing Examiner and Family Court, the Court determined that CPLR 5241, mirroring its federal counterpart, Title III of the Consumer Credit Protection Act, intended the garnishment limitations to apply exclusively to income derived from an employer-employee relationship. The Court concluded that payments for "refraining from rendering personal services" do not constitute "earnings" as commonly defined in legislative contexts. Therefore, the income from the noncompetition agreement is not protected by the CPLR 5241 limitations, leading to the reversal of the Family Court's order and reinstatement of the Hearing Examiner's decision.

noncompetition agreementincome executionCPLR 5241spousal supportchild supportdisposable earningsemployer-employee relationshipgarnishmentFederal Consumer Credit Protection Actpersonal services
References
14
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