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Author Topic: Creditors' and Debtors' Practice-PREJUDGMENT REMEDIES  (Read 23615 times)
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The Florida Bar


Creditors' and Debtors' Practice in Florida
Chapter 4

PREJUDGMENT REMEDIES FOR UNSECURED CREDITORS


I. [§4.1] SCOPE OF CHAPTER

II. ATTACHMENT

A. [§4.2] In General
B. [§4.3] Property Subject To Attachment
C. [§4.4] Property Exempt From Attachment
D. [§4.5] Property Held As Tenancy By The Entireties
E. [§4.6] Grounds
F. Procedure
1. [§4.7] In General
2. [§4.8] Verified Complaint Or Separate Affidavit
3. [§4.9] Motion
4. [§4.10] Jurisdiction
5. [§4.11] Bond
6. [§4.12] Execution Of Writ
7. [§4.13] Levy
8. [§4.14] Return Of Writ
G. [§4.15] Debtor's Recovery Of Attached Property
H. [§4.16] Debtor's Challenge Of Attachment

III. GARNISHMENT

A. [§4.17] In General
B. [§4.18] Property Subject To Garnishment
C. Procedure
1. [§4.19] Verified Motion
2. [§4.20] Bond
3. [§4.21] Attorneys' Fee Deposit
4. [§4.22] Issuance And Service Of Writ
5. [§4.23] Notice To Defendant And Other Interested Persons
6. [§4.24] Notice To Individual Defendant For Claim Of Exemption For Garnishment; Procedure For Hearing (F.S. 77.041)
D. Contest Of Garnishment
1. [§4.25] By Defendant
2. [§4.26] By Garnishee
3. [§4.27] Effect Of Writ Of Garnishment

IV. TEMPORARY INJUNCTIONS AND RECEIVERS

A. [§4.28] In General
B. [§4.29] Temporary Injunctions
C. [§4.30] Receivers

V. INVOLUNTARY BANKRUPTCY PETITIONS

A. [§4.31] In General
B. [§4.32] Who May File
C. [§4.33] Persons Subject To Involuntary Petition
D. [§4.34] Appropriate Type To File
E. Procedure
1. [§4.35] Petition And Summons
2. [§4.36] Answer Or Default
3. [§4.37] Interim Operations
F. [§4.38] Grounds
G. [§4.39] Risks Of Filing

VI. FORMS

A. Attachment
1. [§4.40] Complaint
2. [§4.41] Motion For Prejudgment Writ Of Attachment
3. [§4.42] Sample Affidavit In Support Of Motion For Prejudgment Writ Of Attachment
4. [§4.43] Order For Prejudgment Writ Of Attachment
5. [§4.44] Attachment Bond
6. [§4.45] Writ Of Attachment
B. Garnishment
1. [§4.46] Verified Motion For Issuance Of Prejudgment Writ Of Garnishment
2. [§4.47] Order For Prejudgment Writ Of Garnishment
3. [§4.48] Garnishment Bond
4. [§4.49] Prejudgment Writ Of Garnishment
5. [§4.50] Notice To Defendant
6. [§4.51] Notice Of Garnishment
7. [§4.52] Certificate Of Service
C. Involuntary Bankruptcy
1. [§4.53] Involuntary Petition (Official Form 5)
2. [§4.54] Summons To Debtor In Involuntary Case (Official Form B 250E)

I. [§4.1] SCOPE OF CHAPTER

Unsecured creditors always seem to rank low in priority for payment. Although they are owed money, they have no liens or special rights to any of the debtor's property until a judgment is obtained and perfected. Occasionally, however, aggressive action is required to ensure the collection of an eventual judgment. Whether because the debtor is secreting assets or preferring other similarly situated creditors, extraordinary prejudgment remedies are available to unsecured creditors. This chapter is a guide to some of the more common prejudgment collection remedies and discusses strategies available to unsecured creditors before judgment.

II. ATTACHMENT

A. [§4.2] In General

Attachment is a statutory prejudgment remedy for creditors who fear that an eventual judgment will be uncollectible. (A prejudgment writ of attachment is also available to a secured creditor in aid of foreclosure of a mortgage on personal property. F.S. 76.11. However, this chapter is limited to remedies available to unsecured creditors.) The remedy is ancillary to the primary lawsuit on the obligation owed to the creditor. It is designed to preserve real and personal property of the debtor during the pendency of the litigation.
A prejudgment writ of attachment is requested by motion, usually at the same time the complaint is filed with the court. The writ of attachment, once issued and levied upon, creates a lien against the debtor's property in favor of the creditor. When the creditor completes its primary lawsuit and obtains a final judgment, the property is then available to satisfy the judgment. Like a judgment lien, however, the lien created by attachment may be vulnerable to attack as a preference in the event of a bankruptcy if it attaches within the applicable preference period under 11 U.S.C. §547. See, e.g., In re Omni Development & Services Inc., 31 B.R. 482 (Bankr. S.D. Fla. 1983).
The procedures and grounds for attachment are governed by F.S. Chapter 76. Generally, attachment is appropriate only in extraordinary circumstances or when legal remedies are inadequate and the right to recover is clear. See Cohen v. Hardman, 416 So.2d 498 (Fla. 5th DCA 1982).
Attachment is used primarily by an unsecured creditor to prevent the removal or fraudulent transfer of the debtor's property. Indeed, the enactment of Florida's Uniform Fraudulent Transfer Act (UFTA), F.S. 726.101 et seq., expressly codifies the remedy of attachment for this purpose. The UFTA provides that a creditor may obtain "[a]n attachment or other provisional remedy against the asset transferred or other property of the transferee in accordance with applicable law." F.S. 726.108(1)(b).

B. [§4.3] Property Subject To Attachment

F.S. 76.01 prescribes attachment for "goods and chattels, lands and tenements" of the debtor. A writ of attachment generally is inappropriate against money. Instead, a writ of garnishment should be used to reach money held by a third person. In re Emerald Plaza West, Inc., 47 B.R. 590 (Bankr. S.D. Fla. 1985). See §§4.17-4.27.
The statute authorizes the actual dispossession of personal property during the pendency of the underlying litigation. F.S. 76.13(1), 76.22.
Attachment of real property is authorized, but it does not operate to transfer possession of the property. F.S. 76.14; Florida Insurance Exchange v. Adler, 174 So.2d 75 (Fla. 3d DCA 1965). The attachment simply operates as a lien against the real property and protects the creditor's rights against the property vis->-vis subsequent lienors.
Shares of corporate stock are subject to attachment under F.S. 76.02. To obtain an effective levy on shares on stock, however, it is necessary that the sheriff actually obtain possession of the stock certificates. Seizure of securities is governed by F.S. 678.1121, which also authorizes application to the court to assist with the seizure.
Perishable goods may be attached, and when they are susceptible to rapid deterioration, or the cost of storage outweighs the value of the property, the court may order the sale of the property. The proceeds of the sale are deposited in the registry of the court pending a final judgment. F.S. 76.22.

C. [§4.4] Property Exempt From Attachment

Florida has developed a complex constitutional and statutory scheme that renders certain assets of individual debtors exempt from attachment or levy by creditors.
The Florida Constitution provides for homestead and personal property exemptions. Every natural person may claim an exemption for $1,000 of personal property, and a homestead of one half acre of land within a municipality or 160 acres of contiguous property outside a municipality, including improvements. Art. X, §4(a), Fla. Const. F.S. 222.061 and 222.07 set forth the procedure by which a debtor may designate and select the $1,000 of personal property to be exempt from the claims of creditors. Upon receipt of a levy of attachment, the debtor has 15 days to file a sworn inventory of all personal property owned in Florida and the fair market value of the property, designating the property claimed to be exempt from levy. Any objection to the inventory must be filed within five days after service of the inventory or the creditor is deemed to admit the inventory. If an objection is filed, the court will set an evidentiary hearing to assess the validity of the objection and will appoint a disinterested appraiser to value the property, unless the debtor and creditor agree to waive the appointment. F.S. 222.01 and 222.02 govern the designation of homestead property sought to be exempt from creditors. The homestead exemption applies only to the debtor's actual residence. The test to determine the applicability of the homestead exemption is whether the debtor intended to make the property the debtor's permanent residence (or the permanent residence of the debtor's family) and whether the property is actually occupied. Hillsborough Inv. Co. v. Wilcox, 152 Fla. 889, 13 So.2d 448 (1943); In re Cooke, 683 F.2d 130 (5th Cir. 1982).
Although a creditor generally would not use the remedy of attachment for wages and bank accounts anyway, Florida law exempts the wages of a head of household from attachment or garnishment, including wages deposited in any bank account maintained by the debtor when the funds can be traced as wages. F.S. 222.11.
Florida law dealing with exemptions from attachment and garnishment was amended in the 1993 legislative session, effective October 1, 1993. Under the amended statute, "[a]ll of the disposable earnings of a head of family whose disposable earnings are less than or equal to $500 per week are exempt from attachment or garnishment." F.S. 222.11(2)(a). Disposable earnings of a head of family in excess of $500 per week may not be attached or garnished unless the person has agreed otherwise in writing. In no event, however, may the amount attached or garnished exceed the amount allowed under the Consumer Credit Protection Act, 15 U.S.C. §1673. F.S. 222.11(2)(b).
A "head of family" is defined to include "any natural person who is providing more than one-half of the support for a child or other dependent." F.S. 222.11(1)(c). "Disposable earnings" is defined as "that part of the earnings of any head of family remaining after the deduction from those earnings of any amounts required by law to be withheld." F.S. 222.11(1)(b). The statute further provides that disposable earnings of a person other than a head of family cannot be attached or garnished in excess of the amount allowed under the Consumer Credit Protection Act, 15 U.S.C. §1673. F.S. 222.11(2)(c). The Consumer Credit Protection Act limits garnishments to the lesser of 25% of disposable earnings or the amount by which disposable earnings exceed 30 times the federal minimum wage (set forth at 29 U.S.C. §206(a)(1)).
The exemption for wages that are credited or deposited in a financial institution (and can be traced and properly identified as earnings) is limited to a period of six months after the earnings are received by the financial institution. F.S. 222.11(3). Commingling of earnings with other funds does not by itself defeat the ability of the head of family to trace earnings.
A debtor may exempt an interest in a single motor vehicle, not to exceed $1,000 in value, F.S. 222.25(1); an interest in health aids professionally prescribed for the debtor or a debtor's dependent, F.S. 222.25(2); and an "interest in a refund or a credit received or to be received, or the traceable deposits in a financial institution of a debtor's interest in a refund or credit," pursuant to 26 U.S.C. §32 (unless the debt is child or spousal support), F.S. 222.25(3).
Under the 1993 amendments, an exemption from attachment, garnishment, or legal process provided under F.S. Chapter 222 is not effective if it results from a fraudulent transfer. F.S. 222.29. This clarified a significant ambiguity under the statute. See §6.4, §§6.49-6.50, and Chapter 7 of this manual for further discussion of fraudulent transfers.
Funds in an individual retirement account or qualified pension or profit-sharing plan are exempt from attachment or garnishment. F.S. 222.21.
The cash surrender value of life insurance policies and the proceeds of annuity contracts are exempt from attachment and garnishment. F.S. 222.14.
Other miscellaneous exemptions recognized in Florida include unemployment compensation (F.S. 443.051), crime victims' compensation (F.S. 960.14), workers' compensation benefits (F.S. 440.22), deferred compensation plans for government employees (F.S. 112.215(10)(a)), Social Security benefits, and veterans' benefits.
See Chapter 6 of this manual for further discussion of exempt property.

D. [§4.5] Property Held As Tenancy By The Entireties

Property held as a tenancy by the entireties is real or personal property jointly owned by a husband and wife. In re Estate of Cleeves, 509 So.2d 1256 (Fla. 2d DCA 1987). Although tenancy by the entireties property is not technically "exempt" property, it may not be seized to satisfy the debt of only one spouse. It may be attached, however, to satisfy the debts of both spouses. See First National Bank of Leesburg v. Hector Supply Co., 254 So.2d 777 (Fla. 1971). When real property is acquired in the name of a husband and wife, there is a presumption that the property is held as a tenancy by the entireties. Losey v. Losey, 221 So.2d 417 (Fla. 1969). This presumption also extends to personal property such as bank accounts held by a husband and wife. Beal Bank, SSB v. Almand & Associates, 780 So.2d 45 (Fla. 2001).

E. [§4.6] Grounds

The grounds for attachment depend on whether the debt owed by the debtor is actually due, in which case the grounds for relief are slightly more lenient, or whether the debt is not yet due, in which case the grounds are more stringent.
Attachment is available as a remedy for debts that are actually due if the creditor can establish that the debtor
(1) Will fraudulently part with the property before judgment can be obtained against him or her.
(2) Is actually removing the property out of the state.
(3) Is about to remove the property out of the state.
(4) Resides out of the state.
(5) Is actually moving himself or herself out of the state.
(6) Is about to move himself or herself out of the state.
(7) Is absconding.
(Cool Is concealing himself or herself.
(9) Is secreting the property.
(10) Is fraudulently disposing of the property.
(11) Is actually removing himself or herself beyond the limits of the judicial circuit in which he or she resides.
(12) Is about to remove himself or herself out of the limits of such judicial circuit.
F.S. 76.04.
Attachment is also available for debts that are not yet due. However, the creditor must establish that the debtor
(1) Is actually removing the property out of the state.
(2) Is fraudulently disposing of the property to avoid the payment of his or her debts.
(3) Is fraudulently secreting the property to avoid payment of his or her debts.
F.S. 76.05.

F. Procedure

1. [§4.7] In General

The remedy of attachment is obtained by motion. The creditor must file a motion along with the complaint on the debt that is due. Of course, if the debtor is aware of the action and the attachment is predicated on a fraudulent transfer or improper removal of the property, the disposition of the collateral will be expedited to the detriment of the creditor. In such circumstances it is advisable to obtain a writ of attachment by ex parte motion when the complaint is filed and to serve the writ on the debtor along with the complaint. It is also appropriate to seek a writ of attachment by motion if the lawsuit on the claim due is by counterclaim or crossclaim.

2. [§4.8] Verified Complaint Or Separate Affidavit

The complaint on the underlying debt must be verified or supported by a separate affidavit. F.S. 76.08. The allegations of the affidavit or verified complaint must be specific and must provide clear evidence to satisfy all the statutory requirements for issuance of the writ. A hearsay affidavit based entirely on the creditor's subjective belief that the debtor is removing property from the state is insufficient to support issuance of a writ. See Hordis Brothers, Inc. v. Sentinel Holdings, Inc., 562 So.2d 715 (Fla. 3d DCA 1990).

3. [§4.9] Motion

If the motion for attachment is based on a debt that is actually due, the motion must state the amount of the debt actually due and that the movant has reason to believe that one or more of the special circumstances set forth in F.S. 76.04 exist. F.S. 76.09. Under prior attachment law, a supporting affidavit was not required if the debt was actually due. This was held unconstitutional in Unique Caterers, Inc. v. Rudy's Farm Co., 338 So.2d 1067 (Fla. 1976).
If the debt is not yet due, the creditor's motion must state the amount of the debt or demand, disclose that the sum is actually an existing debt or demand, and affirmatively allege one or more of the three special requirements in F.S. 76.05. F.S. 76.10.

4. [§4.10] Jurisdiction

Jurisdiction for the writ of attachment lies with the court having jurisdiction over the amount claimed by the creditor. If the property to be attached is actually being removed from the state, any judge may issue the writ. F.S. 76.03.

5. [§4.11] Bond

Because of the prejudgment nature of the writ of attachment, an attachment bond is a prerequisite for issuance of the writ. The bond must be in an amount at least double the debt or the sum demanded by the plaintiff, including principal and interest. The bond must be payable to the defendant and conditioned to pay all costs and damages the defendant may sustain as a result of the plaintiff improperly obtaining the writ. F.S. 76.12. A prevailing defendant is entitled to recover against the bond. Florida Transportation Co. v. Dixie Sightseeing Tours, Inc., 139 So.2d 175 (Fla. 3d DCA 1962).

6. [§4.12] Execution Of Writ

The writ of attachment is directed to the sheriff and commands the sheriff to take into custody as much property as is necessary to satisfy the sum due to the creditor, plus costs. F.S. 76.13. The form of the writ is specified in Fla.R.Civ.P. Form 1.905. Under certain circumstances it may be necessary to obtain an alias writ to attach property removed from the county where the original writ was issued.

7. [§4.13] Levy

A writ of attachment is not effective until levy or service of the writ. In re Emerald Plaza West, Inc., 47 B.R. 590 (Bankr. S.D. Fla. 1985). Moreover, an effective levy requires that the sheriff take actual or constructive possession of the personal property described in the writ. See generally Ex parte Fuller, 99 Fla. 1165, 128 So. 483 (1930).
The levy does not operate to dispossess a tenant of real property. Rather, the levy binds the property, except as against any preexisting liens. F.S. 76.14. A levy binds real estate as against subsequent creditors or purchasers from the time the clerk of the court records the notice of levy with a description of the property.
If the property is in the defendant's possession when the writ is issued but is delivered to a third party before execution and levy, the sheriff may still levy on the property by serving the writ on the defendant and the third party. The action then continues against the third party. F.S. 76.151. See, e.g., Estudios, Proyectos e Inversiones de Centro America, S.A. (EPICA) v. Swiss Bank Corp. (Overseas) S.A., 507 So.2d 1119 (Fla. 3d DCA 1987) (applying attachment against debtor's alter ego); Cerna v. Swiss Bank Corp. (Overseas), S.A., 503 So.2d 1297 (Fla. 3d DCA 1987) (recognizing applicability of prejudgment writ of attachment against third person who has received fraudulent transfer of debtor's property).
If the property is removed from the county, the statute directs the sheriff to make return of the fact of the removal. The plaintiff then may file a motion indicating the county to which the property has been moved. An alias writ is then issued and delivered to the sheriff of the county to which the property was removed. F.S. 76.17.
Notice of the levy is made with the clerk of the court for the county in which the property is located. F.S. 76.16(2).

8. [§4.14] Return Of Writ

The sheriff will return the writ when it has been fully executed or if the sheriff determines that there is no property to be attached. If property is seized pursuant to the writ, the writ will be returned after the sheriff delivers the property back to the debtor or to third persons. F.S. 76.251.

G. [§4.15] Debtor's Recovery Of Attached Property

Florida law provides a mechanism for the debtor to recover property seized by attachment. The debtor may post a bond equal to the lesser of 125% of the value of the property seized or 125% of the value of the creditor's claim. The bond does not secure payment of the debt. Rather, it ensures that the property will be returned when the creditor obtains a final judgment. F.S. 76.18. The debtor also has the option of posting a bond to secure payment of the debt. F.S. 76.19. When a debtor exercises this option, the bond rather than the property acts as security for payment of the debt. The amount of the bond is for the amount of the debt plus costs.
If the property has been improperly attached or is not subject to attachment, the debtor may replevy the property. See, e.g., Florida Insurance Exchange v. Adler, 174 So.2d 75 (Fla. 3d DCA 1965).

H. [§4.16] Debtor's Challenge Of Attachment

The debtor has the option of challenging the writ by filing a motion to dissolve it. The court will set a hearing on a motion to dissolve a writ of attachment immediately. At that point, the burden is on the plaintiff to establish the statutory requirements of attachment. F.S. 76.24.

III. GARNISHMENT

A. [§4.17] In General

Garnishment is a statutory remedy used to reach tangible or intangible personal property of a debtor while that property is in the hands of a third party. When the creditor seeks to recover money, a writ of garnishment is appropriate. F.S. Chapter 77 governs garnishments, both pre- and post-judgment. Postjudgment garnishment is discussed in Chapter 10 of this manual.
This remedy is available only after the creditor has filed an action against the debtor. F.S. 77.01. If a creditor seeks a writ of garnishment before entry of judgment, a verified motion for issuance of a prejudgment writ normally is filed with the complaint. F.S. 77.031(2). Prejudgment garnishments, like attachments, are not permitted in connection with tort actions. F.S. 77.02. Significantly, prejudgment garnishment is available only if the debt for which the plaintiff sues is actually due. F.S. 77.031(2). This is a stricter standard than for attachment.
Prejudgment garnishment is available only to a plaintiff who believes that the defendant will not have enough property, subject to levy in the county where the action is pending, to satisfy the creditor's claim after judgment is entered and execution is issued. F.S. 77.031(2).
As a general proposition, garnishment statutes are in derogation of common law and must be strictly construed. Paz v. Hernandez, 654 So.2d 1243 (Fla. 3d DCA 1995).

B. [§4.18] Property Subject To Garnishment

A writ of garnishment may be used to reach "any debt due... or any debt not evidenced by a negotiable instrument that will become due... to the defendant by a third person, and any tangible or intangible personal property of defendant in the possession or control of a third person." F.S. 77.01. Service of the writ makes the garnishee liable for "all debts due by him or her to defendant and for any tangible or intangible personal property of defendant in the garnishee's possession or control at the time of the service of the writ or at any time between the service and the time of the garnishee's answer." F.S. 77.06(1).
One of the most attractive targets of a writ of garnishment is a bank account. Because a savings or checking account represents a debt owed by the bank to the account holder, bank accounts are subject to writs of garnishment. Other rights to payment, such as a matured contract debt or an account receivable, may also be reached by a garnishing creditor. See Peninsula State Bank v. United States, 211 So.2d 3 (Fla. 1968). When, however, the debt due to the defendant cannot be ascertained or is contingent, garnishment is not permissible. Cobb v. Walker, 144 Fla. 600, 198 So. 324 (1940); Tomlin v. Anderson, 413 So.2d 79 (Fla. 5th DCA 1982). Garnishment is also inappropriate against the maker of a promissory note, unless the garnishor has possession of the note. Universal C.I.T. Credit Corp. v. Broward National Bank of Fort Lauderdale, 144 So.2d 844 (Fla. 2d DCA 1962). As with attachment and postjudgment writs of garnishment, however, wages of a "head of family" are exempt from prejudgment garnishment, even if they have been deposited into a bank account, if the funds "can be traced and properly identified as earnings." F.S. 222.11. The exemption applies for a period of only six months after the earnings are received by the financial institution. Even if the debtor is not eligible for this exemption, a continuing writ of garnishment against salary or wages is available only after a judgment has been entered. F.S. 77.0305. Other exemptions discussed in reference to attachment apply equally to writs of garnishment. See §4.4. In particular, careful attention should be paid to accounts held in the names of a husband and wife. After the Supreme Court's decision in Beal Bank, SSB v. Almand & Associates, 780 So.2d 45 (Fla. 2001), most such accounts are presumed to be held as tenants by the entireties and not subject to garnishment by the creditor of only one spouse.
The assertion of an exemption from garnishment may precede the filing of an answer to a writ of garnishment. Rudd v. First Union National Bank of Florida, 761 So.2d 1189 (Fla. 4th DCA 2000).
Any type of nonexempt personal property, including stocks, promissory notes, and inventory, may be subject to a writ of garnishment.
Money or property in the hands of a legal custodian, such as a receiver, clerk of court, assignee for the benefit of creditors, or bankruptcy trustee, generally is not subject to garnishment or attachment. Kusens v. Johannesburg, 182 So.2d 468 (Fla. 3d DCA 1966).
Funds held in an escrow account may not be reached by a garnishing creditor unless all conditions of the escrow have been completed and the funds are indisputably owed the defendant. Florida Public Service Commission v. Pruitt, Humphress, Powers & Munroe Advertising Agency, Inc., 587 So.2d 561 (Fla. 1st DCA 1991).
Garnishment may be used to reach funds held in a spendthrift trust only under extraordinary circumstances. Bacardi v. White, 463 So.2d 218 (Fla. 1985) (interest from spendthrift trust may be reached as last resort to enforce alimony and child support orders). When the defendant is both the settlor and the sole beneficiary of a spendthrift trust, however, the assets of the trust are not exempt from garnishment. Fehlhaber v. Fehlhaber, 850 F.2d 1453 (11th Cir. 1988).

C. Procedure

1. [§4.19] Verified Motion

The plaintiff must file a verified motion or an affidavit alleging
the nature of the cause of action; the amount of the debt and that [it] is just, due, and unpaid; that the garnishment is not sued out to injure either the defendant or the garnishee; and that the plaintiff believes that the defendant will not have in his or her possession, after execution is issued, tangible or intangible property... in the county in which the action is pending on which a levy can be made sufficient to satisfy the plaintiff's claim.
F.S. 77.031(2).

2. [§4.20] Bond

Unless an attachment writ has already been issued, the plaintiff must post a bond in at least double the amount of the debt demanded before a prejudgment writ will be issued. F.S. 77.031(3). The bond protects a defendant whose property has been the subject of an improper prejudgment writ of garnishment. It must be conditioned to pay all costs, damages, and attorneys' fees sustained by the defendant.

3. [§4.21] Attorneys' Fee Deposit

In addition to the filing fee, the party seeking a writ of garnishment must deposit $100 into the registry of the court to pay the garnishee's attorneys' fees. F.S. 77.28. The garnishee's attorney is entitled to receive this fee upon demand, and the demand usually is made in the garnishee's answer. Once the writ has been served, the garnishee has a right to the attorneys' fees. When final judgment on the garnishment proceeding is entered, the court determines the garnishee's costs and expenses, including reasonable attorneys' fees. The garnishee is entitled to an offset in this amount before paying a prevailing plaintiff the money that the garnishee owed the defendant. F.S. 77.28.

4. [§4.22] Issuance And Service Of Writ

A prejudgment writ may be issued only by the court or by the clerk on order of the court. F.S. 77.031(1). See Alejandre v. Republic of Cuba, 64 F.Supp.2d 1245 (S.D. Fla. 1999). The form of the writ contained in Fla.R.Civ.P. Form 1.907(a) must be modified to include a notice to the defendant that there is a right to an immediate hearing for dissolution of the writ pursuant to F.S. 77.07, and the clerk must mail a copy of the writ to the defendant as soon as it is issued. F.S. 77.031(2).
Because the defendant will learn of the existence of the writ soon after it is issued, it is important to ensure that the writ is served on the garnishee immediately after issuance. If the defendant learns of the writ before it has been served on the defendant's bank, for example, there usually will be no funds in the account by the time the writ is served.

5. [§4.23] Notice To Defendant And Other Interested Persons

When preparing the documents to obtain issuance of the writ, plaintiff's counsel should also prepare a notice of garnishment. See §4.51. Within five days after service of the garnishee's answer or after the time period for service of the answer has expired, the plaintiff must serve the defendant by mail with "a copy of the garnishee's answer, and a notice advising the [defendant] that he or she must move to dissolve the writ... within 20 days after the date indicated on the certificate of service... if any allegation in the plaintiff's motion for writ of garnishment is untrue." F.S. 77.055. See §10.56 of this manual for a form for this notice. These documents also must be served "on any other person disclosed in the garnishee's answer to have an ownership interest in the deposit, account, or property" described in the answer. Id.

6. [§4.24] Notice To Individual Defendant For Claim Of Exemption For Garnishment; Procedure For Hearing (F.S. 77.041)

F.S. 77.041 was added to the garnishment law effective July 1, 2000. It requires that a detailed notice titled "Notice to Defendant" be attached to a writ of garnishment directed to an individual defendant. A complete copy of the required notice is included in §4.50. The notice gives the defendant information regarding which assets are exempt from garnishment, and how to claim an exemption and request a hearing to determine the validity of the claimed exemption. It provides a form for claiming exemptions, which the defendant can complete and file with the court.
F.S. 77.041(2) provides:
The plaintiff must mail, by first class, a copy of the writ of garnishment, a copy of the motion for writ of garnishment, and, if the defendant is an individual, the "Notice to Defendant" to the defendant's last known address within 5 business days after the writ is issued or 3 business days after the writ is served on the garnishee, whichever is later. However, if such documents are returned as undeliverable by the post office, or if the last known address is not discoverable after diligent search, the plaintiff must mail, by first class, the documents to the defendant at the defendant's place of employment.
The plaintiff must also file with the clerk a certificate of service. Id.
If the defendant completes the claim of exemption form and files it with the court with a request for hearing, the court must hold a hearing as soon as practical "to determine the validity of the claimed exemptions." F.S. 77.041(3).
If the defendant files and serves a claim of exemption and request for hearing, the plaintiff must file a sworn written statement contesting the claim of exemption. The plaintiff's sworn statement must be filed within two business days after hand delivery of the claim and request for hearing, or within seven business days if the claim and request were served by mail. If the plaintiff fails to file a timely sworn contest of the exemption claim, "no hearing is required and the clerk must automatically dissolve the writ and notify the parties of the dissolution by mail." Id.

D. Contest Of Garnishment

1. [§4.25] By Defendant

Although a defendant may use the procedures in F.S. 222.12 to protest a garnishment of funds in a bank account that are wages of a "head of family," all other situations are governed by F.S. 77.07. The defendant may file a motion to dissolve the writ of garnishment within 20 days after the notice of garnishment is served, F.S. 77.07(2), and this motion will be set down "for an immediate hearing," F.S. 77.07(1). At the hearing the plaintiff has the burden of proving the grounds on which the prejudgment writ was issued and that there is a reasonable probability that the plaintiff will prevail in the underlying action. Id.

2. [§4.26] By Garnishee

Because garnishing creditors "stand in the shoes" of a debtor, they may not obtain greater rights against a garnishee than the debtor would have in a proceeding against the garnishee. See WNJU-TV, Inc. v. Barnett Bank of Broward County, N.A., 739 So.2d 1213, 1215 (Fla. 4th DCA 1999). See also United Presidential Life Insurance Co. v. King, 361 So.2d 710 (Fla. 1978); Carpenter v. Benson, 478 So.2d 353 (Fla. 5th DCA 1985). Therefore, the garnishee may assert setoff rights, contractual defenses, or any other matter that would excuse or reduce the garnishee's obligation to the defendant. Ebsary Foundation Co. v. Barnett Bank of South Florida, N.A., 569 So.2d 806 (Fla. 3d DCA 1990); Coyle v. Pan American Bank of Miami, 377 So.2d 213 (Fla. 3d DCA 1979). Unless a default is entered against the garnishee, a creditor may not obtain entry of judgment against the garnishee in an amount exceeding the amount actually owed by the garnishee to the defendant. See F.S. 77.081, 77.083; Carpenter.

3. [§4.27] Effect Of Writ Of Garnishment

Service of the writ makes the garnishee liable for all debts he or she owes to the defendant, "and for any tangible or intangible personal property of defendant in the garnishee's possession or control at the time of the service of the writ or at any time between the service and the time of the garnishee's answer." F.S. 77.06(1).
Service of the writ also "creates a lien in or upon any such debts or property at the time of service or at the time such debts or property come into the garnishee's possession or control." Id. The timing of the lien, which was clarified in a recent amendment to F.S. 77.06(1), becomes very important in the event of a subsequent bankruptcy of the defendant. If the lien is created by service of the writ within 90 days of the defendant's bankruptcy petition, the lien would be vulnerable to avoidance as a preference under 11 U.S.C. §547. However, if service of the writ was made more than 90 days before the filing of the petition, the plaintiff will have to be a secured creditor in the defendant's bankruptcy vis->-vis the personal property subject to the writ of garnishment.

IV. TEMPORARY INJUNCTIONS AND RECEIVERS

A. [§4.28] In General

Prejudgment unsecured creditors often attempt to obtain a temporary injunction or the appointment of a receiver to preserve assets pending the entry of a judgment. Although often attempted, such efforts rarely are successful.

B. [§4.29] Temporary Injunctions

The elements of an injunction are "first, clear legal right or interest in the subject matter of the suit; second, likelihood of irreparable harm because of the unavailability of an adequate remedy at law; and third, substantial likelihood of success on the merits." Diamond v. Interstate Trading Corp., 606 So.2d 631, 632 (Fla. 3d DCA 1992). The procedures and requirements for a temporary injunction are set forth in Fla.R.Civ.P. 1.610. The requirements include affidavits or verified pleadings and a bond.
There is no judicial authority for an order requiring a debtor to deposit an amount in controversy into the registry of the court before judgment. CMR Distributors, Inc. v. Resolution Trust Corp., 593 So.2d 593 (Fla. 3d DCA 1992). Indeed, a civil complaint that alleges that a defendant corporation, through its officers, defrauded a plaintiff and is about to remove its assets beyond the court's jurisdiction generally does not warrant the issuance of a temporary injunction. Supreme Service Station Corp. v. Telecredit Service Center, Inc., 424 So.2d 844 (Fla. 3d DCA 1983). As explained by one appellate court, "The law is unequivocally established that an injunction against the disposition of a defendant's assets simply may not be granted upon the ground that their preservation is required to satisfy a subsequent money judgment." Leight v. Berkman, 483 So.2d 476, 477 (Fla. 3d DCA 1986).
"Potential" judgment creditors likewise have no right to a preliminary injunction. In denying injunctions to protect future judgments, courts reason that "a contingent and disputed claim for money damages does not, by itself, constitute a sufficient right or interest for the granting of injunctive relief." Diamond, 606 So.2d at 632. Moreover, the judicial test to determine the adequacy of the remedy at law is whether a judgment could be obtained in a proceeding at law. The test is not whether the judgment will procure pecuniary compensation. See Stewart v. Manget, 132 Fla. 498, 181 So. 370 (1938); Diamond.
For an extensive discussion of injunctions in a commercial setting, see Chapter 5 of BUSINESS LITIGATION IN FLORIDA (Fla. Bar CLE 4th ed. 2001).

C. [§4.30] Receivers

Receivers are governed by Fla.R.Civ.P. 1.620, and the appointment of a receiver requires the same notice as a temporary injunction. However, as with temporary injunctions, attempts to appoint a receiver on a prejudgment basis have generally been unsuccessful when sought by an unsecured prejudgment creditor. A contract creditor that has not reduced its claim to judgment generally has no standing to apply for a receiver. Moreover, the appointment of a receiver for a going corporation is a last-resort extraordinary remedy that should be used only when no other adequate remedy is available. Recarey v. Rader, 320 So.2d 28 (Fla. 3d DCA 1975) (even minority shareholders not entitled to appointment of receiver).

V. INVOLUNTARY BANKRUPTCY PETITIONS

A. [§4.31] In General

One way to preserve the remaining assets of a debtor is to file an involuntary bankruptcy petition under Chapter 7 or 11 of the Bankruptcy Code.
An involuntary bankruptcy petition is appropriate if the creditor has information that the debtor is making payments to some creditors at the expense of others or if the debtor is making fraudulent transfers. By filing an involuntary bankruptcy petition, the creditor can effectively stop the dissipation of the debtor's assets. In addition, a bankruptcy trustee can recover preferential payments and fraudulent transfers for the benefit of all of the debtor's creditors. 11 U.S.C. §§544, 547-548. The filing of the petition fixes the date from which to compute preference and fraudulent transfers. The filing of an involuntary petition also results in imposition of an automatic stay, which precludes the enforcement of claims against the debtor, including acts of secured creditors against their collateral. 11 U.S.C. §362(a).
The process of filing and litigating an involuntary petition, however, can be expensive and may give rise to certain risks and potential liabilities. Accordingly, the following issues should be considered carefully in deciding whether to file an involuntary petition against a financially troubled debtor:
• Whether the debtor is operating its business or affairs in such a way as to prejudice the rights of creditors.
• Whether a secured creditor is about to foreclose on collateral in which the debtor may have equity.
• Whether the IRS has levied on the debtor's property.
• Whether the filing creditor has a claim in an amount sufficient to justify the expense and effort of an involuntary petition.
• Whether the filing creditor has received any potential preferences.
Involuntary bankruptcy petitions are governed generally by 11 U.S.C. §303 and Bankruptcy Rules 1003 and 1018, as well as by the general bankruptcy rules governing adversary proceedings.

B. [§4.32] Who May File

Three creditors may file an involuntary petition if the claims are not contingent or subject to bona fide dispute and the total unsecured aggregate of the claims is at least $11,625. 11 U.S.C. §303(b)(1) (see Adjustment of Dollar Amounts notes to 11 U.S.C. §303). The test to determine whether an involuntary debtor's unpaid debts are the subject of a "bona fide dispute" is whether any legitimate legal or factual basis exists for the debtor not to pay the debt. In re Axl Industries, Inc., 127 B.R. 482, 485 (S.D. Fla. 1991), aff'd in part, dism. in part 977 F.2d 598.
If the debtor has fewer than 12 creditors (excluding employees, insiders, and those who have received a transfer that is voidable under the Bankruptcy Code), one claimholder that has at least a $11,625 unsecured claim against the debtor may file an involuntary petition.11 U.S.C. §303(b)(2).
In the case of a partnership, fewer than all general partners may file. If all general partners are in bankruptcy, the trustee of a general partner or a holder of a claim against the partnership may file an involuntary petition. 11 U.S.C. §303(b)(3).
A foreign representative in a foreign bankruptcy proceeding may file an involuntary petition. 11 U.S.C. §303(b)(4).

C. [§4.33] Persons Subject To Involuntary Petition

Generally, an involuntary bankruptcy petition may be filed against any person eligible to be a debtor under Chapter 7 or 11 of the Bankruptcy Code. 11 U.S.C. §303(a). A "person" includes an individual, partnership, or corporation. 11 U.S.C. §101(41). A debtor need not be an operating company to be subject to an involuntary petition. In re R. V. Seating, Inc., 8 B.R. 663 (Bankr. S.D. Fla. 1981).
An involuntary petition, however, may not be filed against a farmer, a family farmer, or a not-for-profit corporation. 11 U.S.C. §303(a). See In re Caucus Distributors, Inc., 83 B.R. 921 (Bankr. E.D. Va. 1988); In re United Kitchen Associates, Inc., 33 B.R. 214 (Bankr. W.D. La. 1983). Stockbrokers and commodity brokers are not eligible for Chapter 11 involuntary filings. 11 U.S.C. §109(d).

D. [§4.34] Appropriate Type To File

A creditor has the option of filing an involuntary petition as a Chapter 7 liquidation or a Chapter 11 reorganization.
Chapter 7 affords a mechanism for the liquidation of the debtor's assets by an independent trustee. The amounts recovered by the trustee are then distributed in accordance with the Bankruptcy Code's established priorities. In most cases, Chapter 7 is the most practical and efficient avenue for an involuntary petition.
Chapter 11 may be appropriate under certain limited circumstances. When, for example, the debtor's financial difficulties can be traced to burdensome contracts, foreclosure, or other matters that can be effectively handled or cured in a Chapter 11 case, a reorganization offers the possibility of greater recovery for creditors. Moreover, in cases of gross mismanagement and fraud, it may even be possible to secure the appointment of a Chapter 11 trustee to take possession and control of the debtor's assets or business.
Creditors should be warned, however, that the time and expenses associated with a Chapter 11 proceeding are far greater than under Chapter 7. Moreover, because the debtor has the option of converting between the two chapters, and the debtor usually retains control of the assets in a Chapter 11 proceeding, it generally is preferable to file a Chapter 7 involuntary petition.

E. Procedure

1. [§4.35] Petition And Summons

The filing of an involuntary petition is very much like the filing of a complaint. The petition itself is Official Bankruptcy Form 5, a copy of which appears at §4.53. The petition must be verified and signed. Bankruptcy Rule 1008. The petition is served on the debtor along with a summons that conforms to Official Bankruptcy Form B 250E (see §4.54). The summons must be served within 10 days of issuance and may be served by first class mail within the United States. Issuance of the summons is governed by Rule 7004.

2. [§4.36] Answer Or Default

The debtor must file an answer to the petition or a default will be entered. In formulating an answer, the debtor must decide whether to consent to the petition or to contest it. Defenses to the petition may include a challenge to the eligibility of the debtor, the number of petitioning creditors, the nature and amount of the petitioning creditors' claims, the grounds asserted for the petition, or the motive of the petitioning creditors. If the debtor contests the petition, the matter will go to trial in the bankruptcy court and will be governed by the 7000 series of the Bankruptcy Rules of Procedure. In a contested involuntary petition, the order for relief will not be entered until the validity of the petition is resolved.

3. [§4.37] Interim Operations

Except to the extent that the bankruptcy judge orders otherwise, the debtor may continue to do business as usual until the court rules on the petition and enters an order for relief. Prior to the order for relief, however, the bankruptcy court may order the United States Trustee to appoint an interim trustee to take possession of the property of the estate and to operate the debtor's business. This will be done upon request by a party in interest, after notice to the debtor and a hearing, and upon a showing that the trustee is needed to prevent loss to the estate. 11 U.S.C. §§303(f)-(g).

F. [§4.38] Grounds

The bankruptcy court will order relief against the debtor only if the debtor is an eligible debtor (i.e., not a farmer or not-for-profit corporation) and
(1) the debtor is generally not paying [its] debts as they become due unless such debts are the subject of a bona fide dispute; or
(2) within 120 days before the date of the filing of the petition, a custodian, other than a trustee, receiver, or agent appointed or authorized to take charge of less than substantially all of the property of the debtor for the purpose of enforcing a lien against such property, was appointed or took possession.
11 U.S.C. §303(h).
Whether the debtor is paying its debts as they become due is evaluated as of the date of the filing of the petition. In re Better Care, Ltd., 97 B.R. 405 (Bankr. N.D. Ill. 1989); In re Win-Sum Sports, Inc., 14 B.R. 389 (Bankr. D. Conn. 1981). The test is to be applied with flexibility so as not to limit or restrict the involuntary process. The court will consider not only the normal business affairs of the debtor but also the relative maturity of the debts and the number of bills actually paid. In re Leek Corp., 52 B.R. 311 (Bankr. M.D. Fla. 1985).

G. [§4.39] Risks Of Filing

If a bankruptcy judge dismisses an involuntary petition as unfounded, the petitioning creditors may be liable for the debtor's costs and attorneys' fees. 11 U.S.C. §303(i). A petitioner found to have filed the petition in bad faith may also be liable for compensatory or punitive damages, or both. 11 U.S.C. §303(i)(2); In re Camelot, Inc., 25 B.R. 861 (Bankr. E.D. Tenn. 1982).
Bad faith can be found under varying circumstances. It may exist if the involuntary petition is filed for an "improper purpose." Bad faith has been found when the petition is motivated by ill will or malice or for the purpose of harassing or embarrassing the debtor. See, e.g., In re Camelot, Inc. An "improper use" of the Bankruptcy Code likewise may support a finding of bad faith when the involuntary petition is used as a substitute for usual collection procedures. See In re Nordbrock, 772 F.2d 397 (8th Cir. 1985); In re SBA Factors of Miami, Inc., 13 B.R. 99 (Bankr. S.D. Fla. 1981). It is a proper purpose to file an involuntary petition "to protect against other creditors obtaining a disproportionate share of the debtor's assets." In re Better Care, Ltd., 97 B.R. 405, 411 (Bankr. N.D. Ill. 1989). It is improper, however, to use an involuntary bankruptcy to obtain a disproportionate advantage, In re Better Care, Ltd., or as a means of obtaining corporate control, In re Wavelength, Inc., 61 B.R. 614 (9th Cir. 1986); In re F.R.P. Industries, Inc., 73 B.R. 309 (Bankr. N.D. Fla. 1987). Indeed, some courts have analyzed the concept of bad faith in terms of the requirements of Bankruptcy Rule 9011(b)(1), which prohibits the presenting of any pleading or other paper to the court "for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation." See, e.g., In re Turner, 80 B.R. 618 (Bankr. D. Mass. 1987).
To protect against an improper filing, 11 U.S.C. §303(e) provides that, for cause and after notice and hearing, the court may require the petitioner to file a bond to indemnify the debtor for any damages the court may later award to the debtor under 11 U.S.C. §303(i). See generally In re Reed, 11 B.R. 755 (Bankr. S.D. W.Va. 1981).
Finally, the bankruptcy judge always has the option to abstain from considering the involuntary proceeding pursuant to 11 U.S.C. §305(a). Abstention may be appropriate when the debtor has no assets for distribution or when nonbankruptcy proceedings may afford a fair and adequate distribution to creditors. See, e.g., In re Axl Industries, Inc., 127 B.R. 482 (S.D. Fla. 1991), aff'd in part, dism. in part 977 F.2d 598; In re Barker-Chadsey Co., 28 B.R. 308 (Bankr. D. R.I. 1983); In re Sun World Broadcasters, Inc., 5 B.R. 719 (Bankr. M.D. Fla. 1980). An order of abstention results in effective dismissal of the involuntary petition and a return to state court collection remedies.

VI. FORMS

A. Attachment

1. [§4.40] Complaint

IN THE CIRCUIT COURT FOR
.................... COUNTY, FLORIDA
Case No. ...............
....................,
Plaintiff,
vs.
....................,
Defendant.
COMPLAINT

Plaintiff, ...................., sues defendant, ...................., and alleges:
1. This is an action for damages that exceed $15,000 exclusive of interest, costs, and attorneys' fees.
2. Plaintiff is a Florida corporation with its principal place of business in .................... County, Florida.
3. Defendant is a Florida corporation with its principal place of business in .................... County, Florida.
4. On or about ...................., defendant made, executed, and delivered to plaintiff a promissory note evidencing a loan from plaintiff to defendant in the principal amount of $.......... A true and correct copy of the promissory note is attached hereto as Exhibit A.
5. Plaintiff is the owner and holder of the note.
6. The promissory note fully matured on .................... and is actually due and payable.
7. Defendant has ceased operating and is in the process of moving all of its property outside the state of Florida.
8. Defendant has refused to make payment on the promissory note. As a result of its default on the promissory note, defendant owes plaintiff the sum of $.........., plus interest, costs, and attorneys' fees.
9. Plaintiff has employed the law firm of .................... to represent it in this action and has agreed to pay the firm a reasonable fee for legal services.
WHEREFORE, plaintiff demands judgment against defendant for $.......... plus interest, costs, attorneys' fees, and such other relief as the court finds just and proper.
_____
Attorney for Plaintiff
.....(address and phone number).....
Florida Bar number ....................

2. [§4.41] Motion For Prejudgment Writ Of Attachment

(Party Designation) (Title of Court)
PLAINTIFF'S MOTION FOR PREJUDGMENT WRIT OF ATTACHMENT

Plaintiff moves pursuant to F.S. 76.04 for an order directing the clerk of the circuit court to issue a prejudgment writ of attachment against defendant, and states:
1. Plaintiff has filed a complaint against defendant for damages in the principal amount of $...........
2. Defendant is actually moving out of the state and is secretly or fraudulently disposing of its property.
3. The debt owed by defendant to plaintiff is actually due and unpaid.
4. In support of this motion, plaintiff submits the affidavit of .....................
_____
Attorney for Plaintiff
.....(address and phone number).....
Florida Bar number ....................

3. [§4.42] Sample Affidavit In Support Of Motion For Prejudgment Writ Of Attachment

IN THE CIRCUIT COURT
HILLSBOROUGH COUNTY, FLORIDA
Case No. XYZ-123
Truthful Corporation,
Plaintiff,
vs.
Johnson Industries, Inc.,
Defendant.
AFFIDAVIT OF I.M. TRUTHFUL IN SUPPORT OF PLAINTIFF'S MOTION FOR PREJUDGMENT
WRIT OF ATTACHMENT

STATE OF FLORIDA COUNTY OF HILLSBOROUGH

Before me, the undersigned authority, personally appeared I.M. Truthful, who was sworn and says:
I am a chief operating officer of plaintiff, and I am authorized to execute this affidavit on behalf of plaintiff. I base this affidavit on my actual knowledge.
1. In my position as chief operating officer of plaintiff, I have access to and control of all of the books and records relating to the transaction between plaintiff and defendant that is the subject of the complaint herein, and I am the person most knowledgeable about the relationship between plaintiff and defendant.
2. I have carefully reviewed the allegations of the complaint filed by plaintiff against defendant and those allegations are true and correct.
3. Pursuant to the promissory note, a true and correct copy of which is attached as Exhibit A to the complaint, defendant owes plaintiff $20,000 plus interest, late charges, and attorneys' fees.
4. The promissory note matured on January 1, 2002, and has been in default since that date.
5. Defendant's obligation to plaintiff is actually due and is unpaid.
6. Between February 1, 2002, and February 28, 2002, I attempted to place at least ten phone calls to defendant's president, Bruce Samuel ("B.S.") Johnson. When I was unable to reach him on February 28, 2002, I visited defendant's office at 1234 Main Street, Tampa, Florida.
7. When I arrived at defendant's office, no one was on the premises and the door was locked. The time of my visit was 11:00 a.m.
8. At 3:00 p.m. I returned to the office, and once again no one was there.
9. When no one answered the door, I went around to the back of the office where I found a moving crew for the ACE Moving Company moving out defendant's inventory and equipment. I asked a member of the crew, Joey Heman, where they were moving defendant's inventory and equipment. Mr. Heman advised that he had been instructed to move everything to a warehouse on the outskirts of Las Vegas, Nevada. Mr. Heman also showed me the transport instructions directing movement of all of defendant's inventory and equipment to Las Vegas, Nevada.
10. Later in the afternoon I spoke to Tom Honest, the accountant for the defendant. Mr. Honest advised me that he had been terminated, defendant had ceased operating, and it was his understanding that defendant's inventory and equipment were being moved into storage somewhere near Las Vegas, Nevada.
_____
I.M. TRUTHFUL
Sworn to and subscribed before me on March 1, 2002, by I.M. Truthful, who has produced a Florida driver's license as identification.
_____
John Doe
Notary Public - State of Florida
Commission No.: 654321
My commission expires: March 31, 2004
(SEAL)

4. [§4.43] Order For Prejudgment Writ Of Attachment

(Party Designation) (Title of Court)
ORDER FOR PREJUDGMENT WRIT OF ATTACHMENT

This case came before the court ex parte on .................... The court considered the complaint, plaintiff's motion for prejudgment writ of attachment, and the affidavit of ...................., and heard the argument of counsel, and
IT IS ADJUDGED that:
1. The claim of plaintiff, based on a duly executed promissory note, has probable validity.
2. Plaintiff has demonstrated the existence of grounds for prejudgment attachment, as specified in F.S. 76.04.
3. The clerk of the court is directed to execute a writ of attachment against defendant .................... upon plaintiff's proof that it has posted a deposit of cash in the registry of the court, which may be replaced by a bond at a later date, in the amount of $.........., which the court finds to be twice the amount of the debt demanded. The bond shall secure the payment of damages that defendant may sustain if the attachment is shown to have been obtained wrongfully.
4. Defendant may apply for dissolution of the writ of attachment pursuant to F.S. 76.24. Any such motion shall be set down for immediate hearing.
ORDERED at ...................., Florida, on .....(date)......
_____
Circuit Judge
Copies furnished to: Plaintiff's Attorney

5. [§4.44] Attachment Bond

(Party Designation) (Title of Court)
ATTACHMENT BOND

We, plaintiff, as principal, and .....(name of insurance company)....., as surety, are bound to the above-named defendant in the sum of $.........., for the payment of which we bind ourselves and our heirs, personal representatives, successors, and assigns, jointly and severally.
WHEREAS plaintiff has obtained from the Circuit Court of the .................... Judicial Circuit in and for .................... County, Florida, an order for prejudgment writ of attachment against defendant on condition that plaintiff execute and file a good and sufficient bond for the payment of such costs and damages as may be incurred or suffered by defendant if the writ is found to have been wrongfully obtained,
THE CONDITION OF THIS BOND is that if plaintiff pays any costs or damages that may be sustained by the above-named defendant if plaintiff is found to have wrongfully obtained the order for prejudgment writ attachment, this obligation will be void; otherwise it will remain in full force and effect.
SIGNED AND SEALED on .....(date)......
_____
Plaintiff
By:
_____
.....(name of insurance company).....
By: Attorney in Fact

6. [§4.45] Writ Of Attachment

(Party Designation) (Title of Court)
WRIT OF ATTACHMENT

STATE OF FLORIDA:

To Each Sheriff of the State:
YOU ARE COMMANDED to levy on the land, tenements, goods, and chattels of defendant, ...................., at ...................., .................... County, Florida, as is sufficient to satisfy the sum of $.......... with interest at .....% a year from .....(date)....., and costs.
Dated on .....................
.....(name of clerk).....
As Clerk of the Court
By
_____
As Deputy Clerk
Address of Defendant:
....................
....................

B. Garnishment

1. [§4.46] Verified Motion For Issuance Of Prejudgment Writ Of Garnishment

(Title of Court)
....................,
Plaintiff,
vs.
....................,
Defendant,
and
....................,
Garnishee.
PLAINTIFF'S VERIFIED MOTION FOR ISSUANCE OF PREJUDGMENT WRIT OF GARNISHMENT

Plaintiff, ...................., pursuant to F.S. 77.031, moves for the issuance of a prejudgment writ of garnishment and states:
1. Plaintiff has filed a complaint against defendant for damages in the principal amount of $...........
2. [Set forth allegations regarding the nature of the cause of action.]
3. Defendant owes plaintiff the sum of $..........., and this debt is just, due, and unpaid.
4. This garnishment is not sued out to injure either the defendant or the garnishee.
5. Plaintiff does not believe defendant will have in its possession, after execution is issued, tangible or intangible property in .....(name of county in which action is pending)....., Florida, on which a levy can be made sufficient to satisfy plaintiff's claim.
WHEREFORE, plaintiff moves for entry of an order directing the clerk to issue a writ of garnishment against .....(name of defendant)..... and directed to .....(name of garnishee)....., as garnishee, upon plaintiff's posting of a bond in accordance with F.S. 77.031.
Dated on .....................
_____
Attorney for Plaintiff
.....(address and phone number).....
Florida Bar number ....................
VERIFICATION

STATE OF FLORIDA
COUNTY OF ....................
Under penalty of perjury I, .....(name of individual plaintiff or corporate plaintiff's representative)....., hereby depose and state that I have read the foregoing verified motion for issuance of prejudgment writ of garnishment and know its contents and that, to the best of my actual knowledge, the allegations stated therein are true and correct.
_____
.....Plaintiff/Plaintiff's Representative.....
(Jurat)

2. [§4.47] Order For Prejudgment Writ Of Garnishment

(Party Designation) (Title of Court)
ORDER FOR PREJUDGMENT WRIT OF GARNISHMENT

This case came before the court ex parte on plaintiff's verified motion for issuance of prejudgment writ of garnishment and
IT IS ADJUDGED that:
1. The claim of plaintiff, based on [describe nature of claim], has probable validity.
2. Plaintiff has demonstrated the existence of grounds for prejudgment garnishment, as specified in F.S. 77.031.
3. The clerk of the court is directed to issue a prejudgment writ of garnishment against defendant ...................., and directed to garnishee ...................., upon plaintiff's proof that it has posted a bond, with surety to be approved by the clerk, payable to the defendant in the amount of $.........., which the court finds to be twice the amount of the debt demanded. The bond shall secure the payment of costs, damages, and attorneys' fees that defendant may sustain if the garnishment is shown to have been improperly obtained.
4. Defendant may apply for dissolution of the writ of garnishment pursuant to F.S. 77.07. Any such motion will be set down for immediate hearing.
ORDERED at ...................., Florida, on .....(date)......
_____
Circuit Judge
Copies furnished to: Plaintiff's Attorney

3. [§4.48] Garnishment Bond

(Party Designation) (Title of Court)
GARNISHMENT BOND

We, plaintiff, as principal, and .....(name of insurance company)....., as surety, are bound to the above-named defendant in the sum of $.....(double the amount of the debt demanded)....., for the payment of which we bind ourselves and our heirs, personal representatives, successors, and assigns, joint
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« Reply #1 on: August 23, 2006, 11:21:41 PM »

other property belonging to you have been garnished to pay a court judgment against you. HOWEVER, YOU MAY BE ABLE TO KEEP OR RECOVER YOUR WAGES, MONEY, OR PROPERTY. READ THIS NOTICE CAREFULLY.
State and federal laws provide that certain wages, money, and property, even if deposited in a bank, savings and loan, or credit union, may not be taken to pay certain types of court judgments. Such wages, money, and property are exempt from garnishment. The major exemptions are listed below on the form for Claim of Exemption and Request for Hearing. This list does not include all possible exemptions. You should consult a lawyer for specific advice.
TO KEEP YOUR WAGES, MONEY, AND OTHER PROPERTY FROM BEING GARNISHED, OR TO GET BACK ANYTHING ALREADY TAKEN, YOU MUST COMPLETE A FORM FOR CLAIM OF EXEMPTION AND REQUEST FOR HEARING AS SET FORTH BELOW AND HAVE THE FORM NOTARIZED. YOU MUST FILE THE FORM WITH THE CLERK'S OFFICE WITHIN 20 DAYS AFTER THE DATE YOU RECEIVE THIS NOTICE OR YOU MAY LOSE IMPORTANT RIGHTS. YOU MUST ALSO MAIL OR DELIVER A COPY OF THIS FORM TO THE PLAINTIFF AND THE GARNISHEE AT THE ADDRESSES LISTED ON THE WRIT OF GARNISHMENT.
If you request a hearing, it will be held as soon as possible after your request is received by the court. The plaintiff must file any objection within 2 business days if you hand delivered to the plaintiff a copy of the form for Claim of Exemption and Request for Hearing, or within 7 days if you mailed a copy of the form for claim and request to the plaintiff. If the plaintiff files an objection to your Claim of Exemption and Request for Hearing, the clerk will notify you and the other parties of the time and date of the hearing. You may attend the hearing with or without an attorney. If the plaintiff fails to file an objection, no hearing is required, the writ of garnishment will be dissolved, and your wages, money, or property will be released.
YOU SHOULD FILE THE FORM FOR CLAIM OF EXEMPTION IMMEDIATELY TO KEEP YOUR WAGES, MONEY, OR PROPERTY FROM BEING APPLIED TO THE COURT JUDGMENT. THE CLERK CANNOT GIVE YOU LEGAL ADVICE. IF YOU NEED LEGAL ASSISTANCE YOU SHOULD SEE A LAWYER. IF YOU CANNOT AFFORD A PRIVATE LAWYER, LEGAL SERVICES MAY BE AVAILABLE. CONTACT YOUR LOCAL BAR ASSOCIATION OR ASK THE CLERK'S OFFICE ABOUT ANY LEGAL SERVICES PROGRAM IN YOUR AREA.
CLAIM OF EXEMPTION AND REQUEST FOR HEARING

I claim exemptions from garnishment under the following categories as checked:
_____ 1. Head of family wages. (You must check a or b below.)
_____ a. I provide more than one half of the support for a child or other dependent and have net earnings of $500 or less per week.
_____ b. I provide more than one half of the support for a child or other dependent, have net earnings of more than $500 per week, but have not agreed in writing to have my wages garnished.
_____ 2. Social Security benefits.
_____ 3. Supplemental Security Income benefits.
_____ 4. Public assistance (welfare).
_____ 5. Workers' Compensation.
_____ 6. Unemployment Compensation.
_____ 7. Veterans' benefits.
_____ 8. Retirement or profit-sharing benefits or pension money.
_____ 9. Life insurance benefits or cash surrender value of a life insurance policy or proceeds of annuity contract.
_____ 10. Disability income benefits.
_____ 11. Prepaid College Trust Fund or Medical Savings Account.
_____ 12. Other exemptions as provided by law. ....................................... (explain)
I request a hearing to decide the validity of my claim. Notice of the hearing should be given to me at:
Address: ....................
Telephone number: ....................
The statements made in this request are true to the best of my knowledge and belief.
__________________________
(Defendant's signature)
Date: ....................
STATE OF FLORIDA
COUNTY OF ....................
Sworn and subscribed to before me on .....(date)....., by .....(name)......
_____________________________
Notary Public/Deputy Clerk
.....(name, typed or printed).....
Personally Known _____
OR
Produced Identification _____
Type of Identification Produced ....................
COMMENT: This is essentially the form for notice set forth at F.S. 77.041(1).

6. [§4.51] Notice Of Garnishment

(Party Designation) (Title of Court)
NOTICE OF GARNISHMENT

TO: .....(name of defendant).....
.....(last known address of defendant).....
YOU ARE HEREBY NOTIFIED that .....(name of plaintiff)....., plaintiff in this action, has commenced garnishment proceedings against your property in the possession or control of .....(name of garnishee)....., as specified in the prejudgment writ of garnishment attached hereto and served with this notice.
A prejudgment writ of garnishment means that a court may order your money in a bank, sums owed to you, or other property belonging to you to be paid into court to satisfy a judgment against you.
You must move to dissolve the writ within 20 days after the date indicated in the certificate of service attached to this notice or you will be in default and will forfeit your right to contest the garnishment. Pursuant to F.S. 77.07(1), you have the right to an immediate hearing on a motion for dissolution of the writ of garnishment.
Laws of the state of Florida and of the United States provide that in some circumstances certain money and property may not be taken to pay certain types of court judgments because that money or property is "exempt" from garnishment. Under these laws, you may have the right to exemptions from the garnishment proposed in the attached prejudgment writ of garnishment. You must assert any right to exemption of property as a defense in your motion to dissolve.
Dated on .....................
_____
Attorney for .....(name of party).....
.....(address and phone number).....
Florida Bar number ....................

7. [§4.52] Certificate Of Service

(Party Designation) (Title of Court)
CERTIFICATE OF SERVICE

I HEREBY CERTIFY that copies of the writ of garnishment, garnishee's answer, a notice of garnishment, and this certificate of service were served by U.S. Mail on .....(name and address of defendant)..... and .....(name and address of garnishee or garnishee's attorney)..... on .....(date)......
_____
Attorney for .....(name of party).....
.....(address and phone number).....
Florida Bar number ....................

C. Involuntary Bankruptcy

1. [§4.53] Involuntary Petition (Official Form 5)

2. [§4.54] Summons To Debtor In Involuntary Case (Official Form B 250E)
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