Can I Garnish Security Deposit?

[Cobbscout]

What is the name of your state (only U.S. law)? GEORGIA

I am a judgment creditor who holds a judgment against a debtor that rents an apartment.

Can I garnish his security deposit from his landlord or is it exempt from garnish by Georgia Code?

If it is exempt, what is the Code number?

Thanks for your assistance.

 

[latigo]

What is the name of your state (only U.S. law)? GEORGIA

I am a judgment creditor who holds a judgment against a debtor that rents an apartment.

Can I garnish his security deposit from his landlord or is it exempt from garnish by Georgia Code?

If it is exempt, what is the Code number?

Thanks for your assistance.

Generally speaking, and with some statutory limitations as to amount and depending upon the source of the credit, monies due and owing a judgment debtor are subject to garnishment. But a security deposit is not per se "due and owing"! By definition the deposit is subject to offsets. It is a conditional credit.

I suppose that if the notice of garnishment were served the moment the landlord was about to cut a check to the tenant, thus making it "due and owing", it would be effective. But you might have a better chance with a lottery ticket.

 

[BL]

Generally speaking, and with some statutory limitations as to amount and depending upon the source of the credit, monies due and owing a judgment debtor are subject to garnishment. But a security deposit is not per se "due and owing"! By definition the deposit is subject to offsets. It is a conditional credit.

I suppose that if the notice of garnishment were served the moment the landlord was about to cut a check to the tenant, thus making it "due and owing", it would be effective. But you might have a better chance with a lottery ticket.

I'm in for drawings. What's the odds ?

 

[OK-LL]

What is the name of your state (only U.S. law)? GEORGIA

I am a judgment creditor who holds a judgment against a debtor that rents an apartment.

Can I garnish his security deposit from his landlord or is it exempt from garnish by Georgia Code?

If it is exempt, what is the Code number?

Thanks for your assistance.

Without looking at GA law, the security deposit being held by a landlord falls into the same category as funds being held in a bank. They are the property of the debtor at all times, being held in custody of another. If you can garnish a bank account, you can likely garnish the security deposit. Seems I read something about this being done successfully a couple of years ago, with the landlord disputing it because it left him with nothing to assure the tenant's performance under the lease, but the court told him tough noogies, the security deposit belongs to the tenant and can be claimed by a judgment creditor.

 

[Gail in Georgia]

In order to garnish this, the creditor would need the landlords bank account information and, as a landlord in Georgia it would be a cold day in a hot spot before I'd provide that information to the creditor (Georgia law does not require a landlord to provide specific account information to a tenant on where their security deposit is being held during the tenancy).

Gail

 

[BL]

In order to garnish this, the creditor would need the landlords bank account information and, as a landlord in Georgia it would be a cold day in a hot spot before I'd provide that information to the creditor (Georgia law does not require a landlord to provide specific account information to a tenant on where their security deposit is being held during the tenancy).

Gail

Do not the banks in that State first freeze a bank account - then the account holder able to dispute that garnishment ( if the garnishment was even awarded ) ?

In other words the deposit is still considered the tenant's ..

 

[Zigner]

Do not the banks in that State first freeze a bank account - then the account holder able to dispute that garnishment ( if the garnishment was even awarded ) ?

In other words the deposit is still considered the tenant's ..

Yes, but how will the creditor obtain the bank and account information? (That's the point that was being made.)

 

[BL]

Yes, but how will the creditor obtain the bank and account information? (That's the point that was being made.)

Yes , I know .

It was just in case of kind of a response , not nessesarily of Gails post , but the prior .

 

[Zigner]

Upon further review of GA law, it appears that the money is held in an escrow account on behalf of the tenant. In other words, it is held in trust for the tenant. As such, the money is NOT the tenant's until such time as it would become due to the tenant (ie: at the end of the lease), and would not be available for garnishment.

 

[OK-LL]

Without looking at GA law, the security deposit being held by a landlord falls into the same category as funds being held in a bank. They are the property of the debtor at all times, being held in custody of another. If you can garnish a bank account, you can likely garnish the security deposit. Seems I read something about this being done successfully a couple of years ago, with the landlord disputing it because it left him with nothing to assure the tenant's performance under the lease, but the court told him tough noogies, the security deposit belongs to the tenant and can be claimed by a judgment creditor.

Georgia Code 18-4-20(c) says all money of the defendant in possession or control of the Garnishee is subject to garnishment, except collateral securities in the hands of a creditor. Since security deposits remain the tenant's money until settled against damages, this would indicate a security deposit can be garnished.

 

[Zigner]

Georgia Code 18-4-20(c) says all money of the defendant in possession or control of the Garnishee is subject to garnishment, except collateral securities in the hands of a creditor. Since security deposits remain the tenant's money until settled against damages, this would indicate a security deposit can be garnished.

The problem is that the money doesn't remain the tenant's money in the way that you are thinking.

 

[OK-LL]

In order to garnish this, the creditor would need the landlords bank account information and, as a landlord in Georgia it would be a cold day in a hot spot before I'd provide that information to the creditor (Georgia law does not require a landlord to provide specific account information to a tenant on where their security deposit is being held during the tenancy).

Gail

I suspect the judgment creditor would only need the landlord's name, not the bank's. When garnishing an employer, only the employer's name/address is needed, not the bank the employer's funds reside in.

 

[OK-LL]

The problem is that the money doesn't remain the tenant's money in the way that you are thinking.

I read a bankruptcy case last year in which the Trustee seized a rental security deposit because it was among the bankrupting tenant's assets. The landlord objected, but did not prevail.

 

[BL]

Georgia Code 18-4-20(c) says all money of the defendant in possession or control of the Garnishee is subject to garnishment, except collateral securities in the hands of a creditor. Since security deposits remain the tenant's money until settled against damages, this would indicate a security deposit can be garnished.

It's not tecnically in the LL's possesion .but held in the bank as the tenant's SD,by the LL.

That's the argument here. The LL could not legaslly use that deposit for themselves personally.

 

[Zigner]

I read a bankruptcy case last year in which the Trustee seized a rental security deposit because it was among the bankrupting tenant's assets. The landlord objected, but did not prevail.

We're not talking about a BK case.