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13.5.6 Debtor Has a Right to a Prompt Hearing

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  3. Chapter 13 Enforcement of Judgments: General Principles, Constitutional Issues
  4. 13.5 Due Process Protections from Garnishment or Execution on Exempt Property
  5. 13.5.6 Debtor Has a Right to a Prompt Hearing

13.5.6 Debtor Has a Right to a Prompt Hearing

Due process also requires that debtors have the right to obtain a hearing to contest a garnishment or execution within a reasonable period after it has occurred.284 The courts have widely recognized that delays can impose severe hardship on debtors and that a statute allowing a significant delay prior to a hearing is unconstitutional. As with the timing of notice of garnishment or execution, however, no particular reasonable time before a hearing has been agreed upon. The Third Circuit held that a court rule allowing fifteen days before a hearing on a debtor’s petition allowed too much time to elapse,285 and cases rejecting longer periods are common.286 One district court required a hearing within two days of garnishment.287

Several courts have strongly criticized statutory provisions which allow discretionary continuances or pre-hearing delays pending discovery.288 At least one court has ruled that such provisions violate due process.289 That court did not cite any evidence that the provisions were actually invoked, but other courts have required proof that the debtor was excessively delayed in their attempt to obtain a hearing to contest the garnishment or execution.290 To be safe, the consumer’s attorney should develop a full factual record before challenging the statute on this ground, such that the existence in actual practice of unconstitutional delays will be unquestioned. Procedures that unduly limit the debtor’s participation in the hearing may also be subject to challenge.291

Footnotes

  • 284 See, e.g., Dionne v. Bouley, 757 F.2d 1344 (1st Cir. 1985); Finberg v. Sullivan, 634 F.2d 50 (3d Cir. 1980); Brown v. Liberty Loan Corp., 539 F.2d 1355 (5th Cir. 1976); Blach v. AFLAC, Inc., 2016 WL 676430 (M.D. Ga. Feb. 18, 2016) (three days after first payment is garnished is prompt enough); Strickland v. Alexander, 153 F. Supp. 3d 1397, 1414–1415 (N.D. Ga. 2015), as amended by 154 F. Supp. 3d 1347 (N.D. Ga. 2015) (statute did not provide prompt procedure for resolving exemption claims when the only available procedure allowed an exemption claim only thirty to forty-five days after seizure, and there was no requirement that garnished funds be promptly returned to debtor who prevailed on claim); Kirby v. Sprouls, 722 F. Supp. 516 (C.D. Ill. 1989) (constitutional right to opportunity for hearing “within a meaningful time”); Jones v. Marion Cty. Small Claims Ct., 701 F. Supp. 1414 (S.D. Ind. 1988) (state statute for garnishment of bank accounts violated due process requirements of prompt notice and hearing); Neeley v. Century Fin. Co., 606 F. Supp. 1453 (D. Ariz. 1985); Reigh v. Schleigh, 595 F. Supp. 1535 (D. Md. 1984), rev’d on other grounds, 784 F.2d 1191 (4th Cir. 1986); Dorwart v. Caraway, 966 P.2d 1121 (Mont. 1998). See also Jordan v. Fox, Rothschild, O’Brien & Frankel, 20 F.3d 1250 (3d Cir. 1994) (absent prejudgment waiver, obtaining execution on confessed judgment without providing any means of securing pre-deprivation hearing or prompt post-seizure relief deprives debtor of due process); Alaska Dep’t of Revenue v. Maxwell, 6 P.3d 733 (Alaska 2000) (child support order void for denial of due process when obligor was given no opportunity to be heard on issue of paternity before issuance of administrative order); Collection Prof’ls, Inc. v. Logan, 695 N.E.2d 1344 (Ill. App. Ct. 1998) (right to hearing on postjudgment garnishment within twenty-one to thirty days is sufficient); Bundy v. Wetzel, 184 A.3d 551 (Pa. 2018) (applying Matthews balancing to conclude that prisoner has a right to notice and a meaningful—even if informal—opportunity to be heard before funds are garnished from his inmate account). Cf. McCahey v. L.P. Inv’rs, 774 F.2d 543 (2d Cir. 1985) (absence of mandatory time limit for hearing did not violate due process without evidence that debtor could not, in fact, receive prompt hearing); Montanez v. Beard, 2012 WL 6917775 (M.D. Pa. Aug. 10, 2012) (inmate grievance process was adequate opportunity to be heard as to removal of funds from inmate accounts for fines, fees, or restitution; pre-deprivation hearing not required); Porter Dev. L.L.C. v. First Nat’l Bank, 837 N.E.2d 558 (Ind. Ct. App. 2005) (interpleader statute, which allowed freezing of bank account that was subject of debtor-creditor dispute, provided due process; no pre-freeze hearing, but usual summary judgment procedure allowed debtor to be heard at meaningful time and in meaningful manner), aff’d, remanded on other grounds, 866 N.E.2d 775 (Ind. 2007). But see Ortiz v. Valdez, 971 P.2d 1076 (Colo. App. 1998) (finding Colorado’s postjudgment garnishment scheme acceptable, even though it resulted in freezing of non-debtor’s exempt Social Security funds for at least five weeks). But cf. Sommer v. Maharaj, 854 N.E.2d 441 (Mass. 2006) (through his contumacious actions, facilitated by his wife, judgment debtor forfeited his right to hearing on wife’s claims that assets were hers).

  • 285 Finberg v. Sullivan, 634 F.2d 50 (3d Cir. 1980). But see Reigh v. Schleigh, 595 F. Supp. 1535 (D. Md. 1984) (court should not specify exact timetable), rev’d on other grounds, 784 F.2d 1191 (4th Cir. 1986).

  • 286 Strickland v. Alexander, 153 F. Supp. 3d 1397, 1414–1415 (N.D. Ga. 2015), as amended by 154 F. Supp. 3d 1347 (N.D. Ga. 2015) (procedure that allowed an exemption claim only thirty to forty-five days after seizure insufficient); Neeley v. Century Fin. Co., 606 F. Supp. 1453 (D. Ariz. 1985) (thirty-four days with possible continuance); Clay v. Fisher, 584 F. Supp. 730 (S.D. Ohio 1984) (five weeks); Harris v. Bailey, 574 F. Supp. 966 (W.D. Va. 1983) (two months). But see Green v. Harbin, 615 F. Supp. 719 (D. Ala. 1985) (consent decree apparently allowing up to three weeks before hearing a contested motion to dissolve garnishment); Ortiz v. Valdez, 971 P.2d 1076 (Colo. App. 1998) (finding Colorado’s postjudgment garnishment scheme acceptable, even though it resulted in freezing of non-debtor’s exempt Social Security funds for at least five weeks); Collection Prof’ls, Inc. v. Logan, 695 N.E.2d 1344 (Ill. App. Ct. 1998) (right to hearing on postjudgment garnishment within twenty-one to thirty days is sufficient).

  • 287 Betts v. Tom, 431 F. Supp. 1369 (D. Haw. 1977).

  • 288 Finberg v. Sullivan, 634 F.2d 50 (3d Cir. 1980); Neeley v. Century Fin. Co., 606 F. Supp. 1453 (D. Ariz. 1985). See also Green v. Harbin, 615 F. Supp. 719 (D. Ala. 1985).

  • 289 Neeley v. Century Fin. Co., 606 F. Supp. 1453 (D. Ariz. 1985).

  • 290 McCahey v. L.P. Inv’rs, 774 F.2d 543 (2d Cir. 1985) (refusing to find statute that did not specify time for hearing unconstitutional on its face, when a prompt hearing was allowed and the debtor failed to use proper procedure to contest the garnishment); Reigh v. Schleigh, 595 F. Supp. 1535 (D. Md. 1984), rev’d on other grounds, 784 F.2d 1191 (4th Cir. 1986).

  • 291 See, e.g., Highsmith v. Dep’t of Pub. Aid, 803 N.E.2d 652 (Ill. App. Ct. 2004) (administrative hearing on attachment of investment account for child support arrears inadequate where departmental rule excluded non-documentary proof of ownership).