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Family Law Rules – Rule 29: Garnishment

Angela Princewill

November 21, 2015

RULE 29:  GARNISHMENT

ISSUE OF NOTICE OR NOTICES OF GARNISHMENT

29. (1) The clerk shall issue as many notices of garnishment (Form 29A or 29B) as a recipient requests if the recipient files,

(a) a request for garnishment (Form 29) or an extra-provincial garnishment process referred to in section 50 of the Family Responsibility and Support Arrears Enforcement Act, 1996; and

(b) a statement of money owed (subrules 26 (5) and (6)).  O. Reg. 114/99, r. 29 (1); O. Reg. 544/99, s. 14 (1).

ONE RECIPIENT AND ONE GARNISHEE PER NOTICE

(2) Each notice of garnishment shall name only one recipient and one garnishee.  O. Reg. 114/99, r. 29 (2).

SERVICE ON PAYOR AND GARNISHEE

(3) The notice of garnishment shall be served on the payor and on the garnishee but the payor shall, in addition, be served with the documents filed under subrule (1).  O. Reg. 114/99, r. 29 (3).

EFFECT OF NOTICE OF GARNISHMENT

(4) A notice of garnishment attaches,

(a) every debt that is payable by the garnishee to the payor at the time the notice is served; and

(b) every debt that is payable by the garnishee to the payor,

(i) after the notice is served, or

(ii) on the fulfilment of a condition after the notice is served.  O. Reg. 114/99, r. 29 (4).

DURATION

(5) The notice of garnishment continues in effect from the time of service on the garnishee until it is withdrawn or stopped under this rule or until the court orders otherwise under this rule.  O. Reg. 114/99, r. 29 (5).

FINANCIAL INSTITUTION

(6) If the garnishee is a financial institution, the notice of garnishment and all further notices required to be served under this rule shall be served at the branch of the institution where the debt to the payor is payable, unless subrule (6.1) applies.  O. Reg. 56/03, s. 5.

FEDERALLY REGULATED FINANCIAL INSTITUTION — GARNISHMENT RE SUPPORT

(6.1) If the garnishee is a financial institution to which the Bank Act (Canada), the Cooperative Credit Associations Act (Canada) or the Trust and Loan Companies Act (Canada) applies and the garnishment enforces a support order, the notice of garnishment and all further notices required to be served under this rule,

(a) shall be served at the designated office of the institution established for this purpose; and

(b) shall be accompanied by a statement to garnishee financial institution re support (Form 29J).  O. Reg. 56/03, s. 5.

NEW ACCOUNTS

(6.2) Subrules (4) and (5) do not apply to money in an account opened after a notice of garnishment is served as described in subrule (6) or (6.1).  O. Reg. 56/03, s. 5.

JOINT DEBTS GARNISHABLE

(7) Subrules (4) and (5) also apply to debts owed to the payor and another person jointly.  O. Reg. 114/99, r. 29 (7).

PROCEDURE WHEN JOINT DEBT GARNISHED

(8) If a garnishee has been served with a notice of garnishment and the garnishee owes a debt to which subrules (4) and (5) apply to the payor and another person jointly,

(a) the garnishee shall pay, in accordance with subrule (11), half of the debt, or the larger or smaller amount that the court orders;

(b) the garnishee shall immediately send the other person a notice to co-owner of debt (Form 29C) by mail, fax or email, to the person’s address in the garnishee’s records; and

(c) the garnishee shall immediately serve the notice to co-owner of debt on the recipient or the Director, depending on who is enforcing the order, and on the sheriff or clerk if the sheriff or clerk is to receive the money under subrule (11) or (12).  O. Reg. 114/99, r. 29 (8); O. Reg. 140/15, s. 4.

JOINT DEBT — MONEY TO BE HELD

(9) Despite subrule (12), if served with notice under clause (8) (c), the sheriff, clerk or Director shall hold the money received for 30 days, and may pay it out when the 30 days expire, unless the other person serves and files a dispute within the 30 days.  O. Reg. 114/99, r. 29 (9).

PAYMENT OF ARREARS DOES NOT END GARNISHMENT

(10) A notice of garnishment continues to attach future periodic payments even though the total amount owed when it was served is fully paid up.  O. Reg. 114/99, r. 29 (10).

PERSONS TO WHOM GARNISHEE MAKES PAYMENTS

(11) A garnishee who has been served with a notice of garnishment shall make the required payments to,

(a) the Director, if the notice of garnishment relates to an order being enforced by the Director;

(b) the clerk, if the notice of garnishment does not relate to an order being enforced by the Director.  O. Reg. 114/99, r. 29 (11).

CLERK OR DIRECTOR TO PAY OUT MONEY

(12) On receiving money under a notice of garnishment, the Director or clerk shall, even if a dispute has been filed, but subject to subrules (9) and (13), immediately pay,

(a) to the recipient, any part of the money that comes within the priority created by subsection 2 (3) of the Creditors’ Relief Act, 2010; and

(b) to the sheriff, any part of the money that exceeds that priority.  O. Reg. 114/99, r. 29 (12); O. Reg. 322/13, s. 17.

ORDER THAT SUBRULE (12) DOES NOT APPLY

(13) The court may, at a garnishment hearing or on a motion to change the garnishment under this rule, order that subrule (12) does not apply.  O. Reg. 114/99, r. 29 (13).

CHANGE IN GARNISHMENT, INDEXED SUPPORT

(14) If a notice of garnishment enforces a support order that indexes periodic payments for inflation, the recipient may serve on the garnishee and on the payor a statutory declaration of indexed support (Form 29D) setting out the new amount to be paid under the order, and file the declaration with the court.  O. Reg. 114/99, r. 29 (14).

EFFECT OF STATUTORY DECLARATION OF INDEXED SUPPORT

(15) A statutory declaration of indexed support requires the garnishee to pay the new amount set out in the declaration from the time it is served on the garnishee.  O. Reg. 114/99, r. 29 (15).

GARNISHMENT DISPUTE

(16) Within 10 days after being served with a notice of garnishment or a statutory declaration of indexed support, a payor, garnishee or co-owner of a debt may serve on the other parties and file a dispute (Form 29E, 29F or 29G).  O. Reg. 114/99, r. 29 (16).

NOTICE OF GARNISHMENT HEARING

(17) The clerk shall, on request, issue a notice of garnishment hearing (Form 29H),

(a) within 10 days after a dispute is served and filed; or

(b) if the recipient says that the garnishee has not paid any money or has not paid enough money.  O. Reg. 114/99, r. 29 (17).

SERVICE OF NOTICE

(18) The clerk shall serve and file the notice not later than 10 days before the hearing.  O. Reg. 114/99, r. 29 (18).

GARNISHMENT HEARING

(19) At a garnishment hearing, the court may make one or more of the following temporary or final orders:

1. An order dismissing the dispute.

2. An order that changes how much is being garnished on account of a periodic payment order.  The court may make an order under this paragraph even if it does not have the authority to change the payment order itself.

2.1 An order that changes how much is being garnished on account of a periodic payment order and that, at the same time, changes the payment order itself.  The court may make an order under this paragraph only if,

i. the payment order is one that the court has the authority to change, and

ii. the parties to the payment order agree to the change, or one of those parties has served and filed notice of a motion to have the change made.

3. An order changing how much is being garnished on account of a non-periodic payment order.

4. An order suspending the garnishment or any term of it, while the hearing is adjourned or until the court orders otherwise.

5. An order setting aside the notice of garnishment or any statutory declaration of indexed support.

6. An order that garnished money held or received by the clerk, Director or sheriff be held in court.

7. An order that garnished money that has been paid out in error to the recipient be paid into and held in court, returned to the garnishee or sent to the payor or to the co-owner of the debt.

8. An order that garnished money held in court be returned to the garnishee or be sent to the payor, the co-owner of the debt, the sheriff, the clerk or the Director.

9. An order deciding how much remains owing under a payment order that is being enforced by garnishment against the payor or garnishee.

10. If the garnishee has not paid what was required by the notice of garnishment or statutory declaration of indexed support, an order that the garnishee pay all or part of what was required.

11. An order deciding who is entitled to the costs of the garnishment hearing and setting the amount of the costs.  O. Reg. 114/99, r. 29 (19); O. Reg. 544/99, s. 14 (2).

CHANGING GARNISHMENT AT OTHER TIMES

(20) The court may also use the powers listed in subrule (19), on motion or on its own initiative, even if the notice of garnishment was issued by another court,

(a) on a motion under section 7 of the Wages Act;

(b) if the court replaces a temporary payment order with a final payment order;

(c) if the court indexes or changes a payment order; or

(d) if the court allows an appeal.  O. Reg. 114/99, r. 29 (20).

CHANGING GARNISHMENT WHEN ABILITY TO PAY CHANGES

(21) If there has been a material change in the payor’s circumstances affecting the payor’s ability to pay, the court may, on motion, use the powers listed in subrule (19).  O. Reg. 114/99, r. 29 (21).

GARNISHEE’S PAYMENT PAYS DEBT

(22) Payment of a debt by a garnishee under a notice of garnishment or statutory declaration of indexed support pays off the debt between the garnishee and the payor to the extent of the payment.  O. Reg. 114/99, r. 29 (22).

NOTICE BY GARNISHEE — PAYOR NOT WORKING OR RECEIVING MONEY

(23) Within 10 days after a payor stops working for or is no longer receiving any money from a garnishee, the garnishee shall send a notice as subrule (27) requires,

(a) saying that the payor is no longer working for or is no longer receiving any money from the garnishee;

(b) giving the date on which the payor stopped working for or receiving money from the garnishee and the date of the last payment to the payor from the garnishee; and

(c) giving the name and address of any other income source of the payor, if known.  O. Reg. 114/99, r. 29 (23).

NOTICE BY GARNISHEE — PAYOR WORKING OR RECEIVING MONEY AGAIN

(24) Within 10 days after the payor returns to work for or starts to receive money again from the garnishee, the garnishee shall send another notice as subrule (27) requires, saying that the payor has returned to work for or started to receive money again from the garnishee.  O. Reg. 114/99, r. 29 (24).

NOTICE BY PAYOR — WORKING OR RECEIVING MONEY AGAIN

(25) Within 10 days after returning to work for or starting to receive money again from the garnishee, the payor shall send a notice as subrule (27) requires, saying that the payor has returned to work for or started to receive money again from the garnishee.  O. Reg. 114/99, r. 29 (25).

NOTICE BY PAYOR — NEW INCOME SOURCE

(26) Within 10 days after starting to work for or receive money from a new income source, the payor shall send a notice as subrule (27) requires, saying that the payor has started to work for or to receive money from the new income source.  O. Reg. 114/99, r. 29 (26).

NOTICE SENT TO CLERK AND RECIPIENT OR DIRECTOR

(27) A notice referred to in subrule (23), (24), (25) or (26) shall be sent to the clerk, and to the recipient or the Director (depending on who is enforcing the order), by mail, fax or email.  O. Reg. 114/99, r. 29 (27); O. Reg. 140/15, s. 4.

NOTICE BY CLERK

(28) When the clerk receives a notice under subrule (26), the clerk shall immediately notify the recipient or the Director (depending on who is enforcing the order) by mail, fax or email.  O. Reg. 114/99, r. 29 (28); O. Reg. 140/15, s. 4.

NEW NOTICE OF GARNISHMENT

(29) If no written objection is received within 10 days of the clerk notifying the recipient or the Director that a notice under subrule (26) was received, the clerk shall,

(a) issue a new notice of garnishment directed to the new garnishee, requiring the same deductions as were required to be made, under the previous notice of garnishment or statutory declaration of indexed support, on the day that the notice under subrule (26) was received; and

(b) send a copy of the new notice of garnishment to the payor and the new garnishee, by mail, fax or email.  O. Reg. 114/99, r. 29 (29); O. Reg. 76/06, s. 7; O. Reg. 140/15, s. 4.

EFFECT OF NEW NOTICE OF GARNISHMENT

(30) Issuing a new notice of garnishment under clause (29) (a) does not cancel any previous notice of garnishment or statutory declaration of indexed support.  O. Reg. 114/99, r. 29 (30).

NOTICE TO STOP GARNISHMENT

(31) The recipient shall immediately send a notice to stop garnishment (Form 29I), by mail, fax or email, to the garnishee and payor and file it with the clerk if,

(a) the recipient no longer wants to enforce the order by garnishment; or

(b) the requirement to make periodic payments under the order has ended and all other amounts owing under the order have been paid.  O. Reg. 114/99, r. 29 (31); O. Reg. 544/99, s. 14 (3); O. Reg. 140/15, s. 4.

OLD ORDERS

(32) This rule applies, with necessary changes, to,

(a) an attachment order made under section 30 of the Family Law Reform Act (chapter 152 of the Revised Statutes of Ontario, 1980); and

(b) a garnishment order issued by the court under the rules that were in effect before January 1, 1985.  O. Reg. 114/99, r. 29 (32).

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