A garnishee is a person or organization which holds assets belonging to a debtor and is asked to retain those assets so that they can be given to a creditor in accordance with a court judgment. The garnishee is given a writ issued by a judge describing the assets in question and how they should be handled. The writ is a binding legal order and evidence that a garnishee failed to comply with the writ or helped the debtor move or hide assets can be used against the garnishee in a court of law.
In a simple example of a situation which might create a garnishee, a creditor could take a debtor to court and the judge could rule that the debtor must indeed pay. Evidence could be presented to show that the debtor has money in the bank, and the judge could issue an order to the bank indicating that the bank must freeze the debtor's accounts, remove the money owed to the creditor, and submit the funds to the creditor. The bank in this case becomes the garnishee; it is a third party, but it becomes involved in the case because it is holding assets on behalf of the debtor.
Wage garnishment is another situation in which a garnishee can be used to recover monies owed to a creditor. In wage garnishment, employers are ordered to withhold part of an employee's wages and to submit the funds to a creditor. It may require months or even years of wage garnishment to satisfy the debt.
The types of creditors involved can vary. Garnishment proceedings are often initiated to withhold monies owed to tax agencies or to ensure that child support and alimony payments reach their intended recipients. Individual creditors such as landlords may also be able to initiate garnishment proceedings once they have satisfactorily demonstrated their case in court. If someone feels that a garnishment is unlawful or unjust, a lawyer can be consulted to discuss options.
Once a garnishee receives a garnishment order, there is a legal obligation to act. However, it can sometimes take time for changes to propagate through a system, and debtors sometimes take advantage of this. For example, if a garnishment order is sent to a bank's head office, the debtor might empty out accounts at a branch before the message is transmitted. For this reason, the exact date and time when the order will be issued are often concealed to reduce the risk that the debtor will attempt to evade the garnishment order.