Blach v. Diaz-Verson

In a case of first impression for the Georgia Supreme Court, the United States District Court for the Middle District of Georgia certified a question of Georgia law to the Georgia Supreme Court. The matter at the federal court turned on the interpretation of the 2016 amendment to Chapter 4 of Title 18 relating to garnishment proceedings. Specifically, the federal court asked whether an insurance company is a “financial institution” under the Georgia garnishment statute when the insurance company is garnished based on earnings that it owes the defendant as the defendant’s employer. Harold Blach filed a garnishment action against AFLAC to collect a $158,343.40 judgment that he obtained against Sal Diaz-Verson.He sought to garnish funds that AFLAC periodically pays to Diaz-Verson based on Diaz-Verson’s former employment with the company. Since December 2015, Blach has regularly filed summonses of garnishment against AFLAC, and AFLAC has deposited more than $140,000 into the court’s registry. Diaz-Verson filed motions to dismiss all garnishments filed after May 12, 2016, arguing that because Blach used the general form instead of the form for financial institutions, a portion of the funds in the court’s registry had to be released back to Diaz-Verson. The Georgia Supreme Court answered the federal court’s question in the negative: “viewing the garnishment statutory scheme as a whole, it is clear that ‘financial institution’ in OCGA 18-4-1 (4),for purposes of garnishments served on a financial institution subject to the five-day garnishment period, is limited to entities that are “held out to the public as a place of deposit of funds or medium of savings or collective investment’ and are garnished in that capacity. . . . therefore, an insurance company is not a ‘financial institution’ for purposes of OCGA 18-4-4 (c) (2) when the insurance company is garnished based on earnings that it owes the defendant as the defendant’s employer.” View "Blach v. Diaz-Verson" on Justia Law