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In re Perkins (Case No. 10-63148) 03/31/2011

            The chapter 7 trustee moved for the turnover of funds held in the debtor’s bank account.  The funds were deposited prior to the filing of the petition.  The debtor argued that the trustee was not entitled to the funds on the grounds that they were wages designated for expenditures on Schedules I and J and that the debtor spent the funds prior to the filing of the motion.  The Court concluded that the funds were not funds which were subject to garnishment and thus not partially exempt under Virginia Code § 34-29.

            Section 34-29 of the Virginia Code only applies to earnings that are subject to garnishment.  The funds were not earnings subject to garnishment because they were not the subject of a judicial or equitable proceeding.  Because the funds were not the subject of garnishment on the date of petition, the chapter 7 trustee’s objection to the debtor’s claim of exemption under Section 34-29 was sustained.

Date: 
Thursday, March 31, 2011
Category: 
Chapter 7 Issues
Exemptions
Garnishment
Turnover
Chapter: 
7