Execution Against Intangible Personal Property

Question 1

When does a lien on intangible property attach?

Answer 1

Upon delivery of a writ of fi fa to the sheriff, but can’t be enforced by levy

Question 2

How long does a lien on intangible property attach?

Answer 2

1 year

Question 3

How is the lien enforced?

Answer 3

By garnishment or creditor’s bill–not levy

Question 4

What parties are entitled to protection for execution against intangible personal property?

Answer 4

Purchases of choses in action (usually accounts receivable) who pay value to the debtor without prior notice of the writ of execution, as do debtors of judgment debtor who pay their obligation to debtor prior to receiving written notice of judgment and writ of execution

Question 5

What is a writ of garnishment?

Answer 5

A writ that allows enforcement of liens in personal property held by a third party

Question 6

To whom is a writ of garinshment issued?

Answer 6

To the granishee–the third party who owes money to the debtor

Question 7

What are the options of the granishee?

Answer 7

(1) Admit liability and surrender money or property to the court
(2) Assert any defenses that it has against the judgment-debtor
(3) Fail to appear, and a default judgment is issued

Question 8

What happens once the writ is served to the granishee?

Answer 8

They can’t pay debtor or a third party to the extent that will impede payment to pursuant to original writ of garnishment to creditor

Question 9

What property is subject to garnishment?

Answer 9

Debts and tangible property of the debtor in the possession of third parties (e.g., contents of safe deposit boxes at a bank)

Question 10

What property is not subject to garnishment?

Answer 10

• For marital bank accounts, there is rebuttable presumption that the non-debtor spouse contributed half of the contents (can only granish half unless they can rebut)
• For marital bank accounts held in tenancy by the entirety, not subjec to garnishment
• A joint bank account generally is subject to garnishment to the extent of the debtor’s interest
• Negotiable instruments and negotiable stock certificates can’t be garnished; must be levied upon (seized by sheriff)