Setting aside garnishing orders

WHAT THIS FACTSHEET IS ABOUT

This factsheet will help you if you want to:

1. Apply to set aside a Garnishing Order Before Judgment;
2. Apply to set aside a Garnishing Order After Judgment and substitute for it, an order to pay the amount owed by way of installments; or
3. Apply to increase the amount of your wages which will be exempt from garnishment.

SOME DEFINITIONS

Before going further, some words need to be defined. These words appear on the forms used to get a Garnishing Order.

A “Claimant” is the person who starts a lawsuit in Small Claims Court.

A “Defendant” is the person being sued.

“A Garnishing Order Before Judgment” is a Garnishing Order issued by the court before the Claimant has won the lawsuit.

“A Garnishing Order After Judgment” is a Garnishing Order issued by the Court after the lawsuit is over and the Court has declared money is owed.

A “Judgment Creditor“, who is also called a “Creditor by Judgment (or Order)”, is a person who has obtained a Court Order for money against another person.

A “Judgment Debtor“, who is also called a “Debtor by Judgment (or Order)”, is the person who has been declared by a Court Order to owe money to the Judgment Creditor.

A “Garnishee” is someone who owes money to a Defendant or Judgment Debtor.

“Attachment Proceedings” is another term used for garnishment.

WHAT LAW APPLIES

The law governing garnishment is set out in the Court Order Enforcement Act, particularly sections 4 and 5, and in decisions made by judges in prior lawsuits.

1) APPLYING TO SET ASIDE A GARNISHMENT BEFORE JUDGMENT

If a Claimant garnished money owed to a Debtor before Judgment, there are two general bases for setting aside the garnishment. These are:

1. The Claimant did not follow the exact procedure required by law. For example, the Claimant may have incorrectly filled out the Affidavit in Support of a Garnishing Order Before Judgment.
2. A Judge can be asked to exercise the discretion granted by s. 5 of the Court Order Enforcement Act to release the Garnishment Order.

THE TEST APPLIED BY A JUDGE TO RELEASE THE GARNISHMENT

The test that the Judge must apply is: “Is it just in all the circumstances to release the garnishment?” A Court has wide discretion in considering what is just. Prior judicial decisions have held that the Court, in considering what is just in the circumstances, should look at:

1. The strength of the Claimant’s case;
2. The strength of the Defendant’s case;
3. The need to have the money in Court to protect the Claimant against a future inability to collect money owed by the Defendant. This could be because of the Defendant’s circumstances or a past history of unwillingness to pay; and
4. The harm which might come to the Defendant whose money is tied up in Court by the Garnishment Order.

OVERVIEW OF THE PROCEDURE

To set aside a Garnishing Order a Debtor will have to do the following things:

1. Prepare an Application to a Judge.
2. Prepare a Statement of Facts.
3. Make four photocopies of the Statement of Facts.
4. File the Application to a Judge and the Statement of Facts at the Small Claims Registry and obtain a date to appear in Court.
5. Consider whether to serve the Application to a Judge and a copy of the Statement of Facts on the Claimant if the application is not urgent.
6. Appear in Court and ask for an Order to release the Garnishing Order.

PREPARE AN APPLICATION TO A JUDGE

Click here to view a sample of a completed Application to a Judge form.
Click here to obtain a blank Application to a Judge form which you can use.

If you refer to that form you will see that there are only two parts of the form which may be difficult to fill in. The first is the part that asks you for details of the Order you are asking for. The second is the facts upon which your application is based.

The words to use to describe the Order you want are as follows:

“That the Garnishing Order granted on (insert date) be released and that the money paid into Court as a result of that Garnishing Order be paid out to the Defendant, (insert your name).”

After the words on the form “The facts on which the application is based are as follows:” you should write in the words “See the attached Statement of Facts.”

THE STATEMENT OF FACTS

The Statement of Facts which you must prepare should contain the following:

1. A statement that you are the Defendant in the lawsuit.
2. A statement that a Garnishment Order was served on a Garnishee.
3. A statement of the amount paid into the Court Registry by the Garnishee.
4. A statement of the particular hardship the Garnishing Order is causing to you, your family, or your business.
5. A statement of your income, assets, expenses and debts.
6. A statement of the facts on which your defence to the lawsuit is based.
7. A statement of why the Statement of Facts has been prepared.

FILLING IN YOUR OWN STATEMENT OF FACTS

Click here to view a sample of a completed Statement of Facts.
Click here for a blank form of a Statement of Facts which you can use to prepare your own Statement of Facts.
Click here to view a Statement of Facts with numbers on it.

Where the numbers appear in brackets like this ( ), fill in the following information on your own Statement of Facts:

1. The action number is the same number which is in the upper right corner of the Notice of Claim.
2. The name of the Registry is the same as appears on the Notice of Claim.
3. The names of the Claimant or Defendant (as required), spelled as they appear on the Notice of Claim.
4. Fill in the name of the Defendant.
5. Fill in the day, month and year on which the Garnishment Order was issued.
6. The name of the Garnishee.
7. The amount the Garnishee paid to the Court Registry.
8. A summary of the Claimant’s claim (based on what is written in the Notice of Claim).
9. A summary of the defence to the Claim (based on what is written in the Reply you prepared for the lawsuit).
10. A summary of the hardship that has been caused by having your money paid into Court.
11. In the spaces provided on the Statement of Finances fill in your income, expenses, assets and debts.

SWEAR THE STATEMENT OF FACTS

The Court Order Enforcement Act says that an application to a Judge must be in writing and verified under oath. Once you have completed the Statement of Facts you should take it to a notary public or a lawyer, or an authorized person at the Small Claims Court Registry so that it may be sworn. There will be a fee for swearing the Statement. Lawyers and notaries are listed in the Yellow Pages. Telephone first to find out the fee for this service. Some people charge much more than others do for the same service.

After swearing the Statement of Facts you should make three photocopies of it and the three photocopies of the Application.

FILE THE APPLICATION

After you have photocopied the completed Application to a Judge form and the Statement of Facts, both should be filed at the Small Claims Court Registry.

At the time of filing the Application the Clerk at the Registry will fill in on the Application form the date and time of the hearing.

SERVE THE APPLICATION

The Court Order Enforcement Act says it is possible for a Court to make an Order to release a Garnishing Order without giving notice to the Claimant. But a Court is only likely to do that in really urgent situations. Therefore, it may be better to serve the Claimant with the Application and Statement of Facts.

You can serve the Application and Statement of Facts in three ways:

1. Leave a copy with the Claimant.
2. Mail them by ordinary mail to the Claimant’s address.
3. Mail them by registered mail.

If they are mailed, they are presumed to have been delivered fourteen days after being sent, unless there is evidence of earlier delivery. Such evidence would be the Delivery Notification – for registered mail – which you can download from the Canada Post website showing that the registered mail has been delivered.

HOW LONG BEFORE THE HEARING?

The Defendant should receive the Application seven days before the hearing. Thus, the earliest the hearing could take place would be eight days after the Application is filed. (To have the application so soon would require the Court Clerk to have made the Court date eight days after filing the Application form and the Defendant would have to be given a copy of the Application form on the same day it was filed.)

APPEARING BEFORE A JUDGE

Be sure to arrive on time. Your opportunity to speak to the Judge will usually occur early in the Court session. When you arrive, you should take a seat in the Courtroom.

After Court is called to order the Judge or Court Clerk will usually read through the whole list of the day’s cases. When your case is called, stand up and inform the Judge that you are present. After the Judge or Court Clerk reads through the list once, the Judge will begin to go through the list a second time. When your case is called you should go to the front of the Courtroom. Stand when you speak to the Judge and address the Judge as “Your Honour.”

You should say the following: “Your Honour, I am making an application to release a Garnishing Order. The facts are in the statement I filed.”

The Judge may require you to swear or affirm to tell the truth and then ask you some questions. If the Claimant is present the Judge will listen to the position of the Claimant as to whether the Garnishing Order should be released.

OPTIONS FOR THE JUDGE

According to the Court Order Enforcement Act a Judge can:

1. Grant the Order you are seeking and release all of the money paid into Court as a result of the garnishment; or
2. Grant an Order releasing only some of the money; or
3. Refuse to grant your Order.

PREPARE AN ORDER

If the Judge decides to grant the Order, then the Order must be put in writing.

The bottom of the Application Form is used for that purpose. Sometimes the Judge (or Clerk) will fill in the form. Other times, you will be ordered to fill in the form. In both cases, the Court must sign the Order in the box containing the words “By the Court”.

The Order must then be filed in the Court Registry.

2) APPLYING TO RELEASE A GARNISHING ORDER AFTER JUDGMENT

If an application is made to release a Garnishing Order After Judgment a Court can only release a Garnishing Order if it imposes an Order requiring the debt owed to the Creditor be paid by the Debtor in installments.

As long as the installment payments ordered by the Court are made, no further Garnishing Orders can be issued. However, if your financial circumstances improve it may be possible for a Creditor to apply to the Court to increase the amount to be paid on each installment.

The procedure to apply to have a Garnishing Order After Judgment released is almost the same as applying to release a Garnishing Order Before Judgment. The procedure can be used where wages or bank accounts have been garnished or where someone who owes you money has been garnished.

OVERVIEW OF THE PROCEDURE

To set aside a Garnishing Order a Debtor will have to do the following things:

1. Prepare an Application to a Judge.
2. Prepare a Statement of Facts.
3. Make four photocopies of the Statement of Facts.
4. File the Application to a Judge and the Statement of Facts at the Small Claims Registry and obtain a date to appear in Court.
5. Consider whether to serve the Application to a Judge and a copy of the Statement of Facts on the Claimant if the application is not urgent.
6. Appear in Court and ask for an Order to release the Garnishing Order.

PREPARE AN APPLICATION TO A JUDGE

An Application is required. It is the same form (Application to a Judge) as that used to apply to release a Garnishing Order before Judgment. However, because a Judge must impose a installment payment if the application is successful, the words used on the Application to describe the order you want will be different. The words to use to describe the Order you want are as follows:

“That the Garnishing Order granted on (insert date) be released and replaced by an Order to pay the Judgment in this lawsuit by way of installments.”

THE TEST

After Judgment, the way the Court applies the test to decide whether to release the Garnishment Order is different.

The test is still this question: “Is it just in all the circumstances to release the Garnishment?”

However, since that Garnishment took place after Judgment the Court has already decided that the Defendant owes money to the Claimant. So the Court is not interested in taking into consideration the strength of the Claimant’s case or the Defendant’s defence. Rather, the Court is more interested in the following things:

1. The harm that will result to the Defendant from having the money in Court paid to the Claimant;
2. The income and assets of the Defendant;
3. The debts owed to and by the Defendant;
4. Any assets the Defendant has disposed of since the claim arose;
5. The means that the Defendant has or may have in the future of paying the amount owed.

THE STATEMENT OF FACTS

The Statement of Facts which you must prepare should contain the following:

1. A statement that you are the Defendant in the lawsuit.
2. A statement that a Garnishment Order was served on a Garnishee.
3. A statement of the amount paid into the Court Registry by the Garnishee.
4. A statement of the particular hardship the Garnishing Order is causing to you, your family, or your business.
5. A statement of your income, assets, expenses and debts.
6. A statement of the assets disposed of since the claim arose.
7. A statement debts owed by other people to the Defendant.
8. A statement of why the Statement of Facts has been prepared.

Click here to view a sample of the Statement of Facts to be used to Release a Garnishing Order After Judgment.
Click here for a blank form of a Statement of Facts which you can use to prepare your own Statement of Facts.

 

SWEAR THE STATEMENT OF FACTS

The Court Order Enforcement Act says that an Application to a Judge must be in writing and verified under oath. Once you have completed the Statement of Facts you should take it to a notary public or a lawyer, or an authorized person at the Small Claims Court Registry so that it may be sworn. There will be a fee for swearing the Statement. Lawyers and notaries are listed in the Yellow Pages. Telephone first to find out the fee for this service. Some people charge much more than others do for the same service.

THE ORDER

A Judge can:

1. Release all of the money paid into Court as a result of the garnishment.
2. Release part of the money.
3. Refuse to release any money.
4. If all or part of the money is released, an Order requiring payments of the Judgment by installments must be made. That Order usually requires a certain amount of money to be paid weekly, biweekly or monthly.

FAILURE TO COMPLY

If an installment is late by more than five days a Claimant could obtain a new Garnishing Order.

3) APPLYING TO INCREASE THE AMOUNT OF WAGES THAT ARE EXEMPT

Normally, 70% of the wages due to a Debtor from an employer are exempt from garnishment. However, where wages are being garnished for failure to make maintenance payments required by a Court Order or Separation Agreement, only 50% of the wages are exempt if the wages do not exceed $600 per month. Above $600 a month only 33-1/3% of the wages are exempt.

If your wages have been garnished (and the garnishment is not for unpaid maintenance) you can apply to a Judge to increase the amount of your wages which are exempt from garnishment. The maximum exemption is 90% of wages due.

OVERVIEW OF PROCEDURES

Section 5 of the Court Order Enforcement Act sets out the procedure to be followed to increase the amount of wages which are exempt from garnishment. This is what you must do:

1. Prepare an Application to a Judge and an Affidavit.
2. Have the Affidavit sworn and make 4 copies of it.
3. File the Application to a Judge and Affidavit to the Court Registry.
4. Within three days of the receipt of your Application, the Registry must notify the person who has garnished your wages that you have made an application.
5. Within seven days of the date of your Application you should appear before a Judge who may make (or deny) the Order you are requesting.

PREPARE AN APPLICATION

Click here to view a sample of a completed Application to a Judge form.
Click here to obtain a blank Application to a Judge form which you can use.

If you refer to that form you will see that there are only two parts of the form which may be difficult to fill in. The first is the part that asks you for details of the Order you are asking for. The second is the facts upon which your application is based.

The words to use to describe the Order you want are as follows: “To increase the percentage of wages payable to the Defendant which are exempt from the attachment under a Garnishing Order.”

After the words on the form “The facts on which the application is based are as follows:” you should write in the words “see attached Affidavit.”

PREPARE AN AFFIDAVIT

An Affidavit is a document which sets out certain facts which you swear under oath to be true. The Affidavit which you must prepare must contain the following:

1. A statement that you are the Defendant in the lawsuit.
2. A statement that a Judgment was made against you.
3. A statement that your wages were garnished.
4. A statement of your income, expenses, assets and debts.
5. A statement of why the Affidavit has been prepared.

Click here to view a sample of a completed Affidavit.
Click here to obtain an Affidavit form with blanks for you to fill in to prepare your own affidavit.
Click here to view is an Affidavit form with numbers on it.

Where the numbers appear, fill in the following information on your own affidavit.

1. The action number is the same number which is in the upper right corner of the Notice of Claim.
2. The name of the Registry is the same as appears on the Notice of Claim.
3. The names of the Claimant or Defendant (as required), spelled as they appear on the Notice of Claim.
4. After the word “I”, fill in your name, occupation and address, in that order.
5. Fill in “Default Order” or “Payment Order”, whichever is applicable according to the form of Judgment which was served on you.
6. Fill in the day, month and year when the “Default Order” or “Payment Order” was made by the Court.
7. Fill in the name of your employer.

SWEAR THE AFFIDAVIT

After completing the Affidavit you should take it to a notary public or a lawyer, or an authorized person at the Small Claims Court Registry so that it may be sworn. There will be a fee for swearing the Affidavit. Lawyers and notaries are listed in the Yellow Pages. Telephone first to find out the fee for this service. Some people charge much more than others do for the same service.

Then make three (3) photocopies of the Affidavit and the Application to a Judge Form.

FILE THE APPLICATION AND AFFIDAVIT

After you have photocopied the completed the Application to a Judge form and the sworn Affidavit, both should be filed at the Small Claims Court Registry.

At the time of filing the Application form, the Clerk will fill in on that form the date and time of the hearing.

APPEARING BEFORE THE JUDGE

The description of what will happen in Court is described above. When you speak to the Judge you should say: “I am making an application to increase the percent of my wages to be exempt from garnishment.”

A Judge can grant or refuse your request. If the Judge grants the request the Judge will decide just how much of your wages (up to 90%) should be exempt.

If you are successful, a written Order will have to be prepared.

Prepared by Glenn Gallins
Revised April 2008, links checked 2019
Funded by the PLE Program of the Legal Services Society