Appendix — Schleigh v. Reigh

EDITOR'S NOTE

THE FOLLOWING PAGES WERE POOR HARD CoPy

AT THE TIME OF FILMING. IF AND WIEN A

BETTER COPY CAN BE OBTAINED, A NEW FICHE

WILL BE ISSUED,

Supreme Court of the United States

Ocroser TERM, 1987

CHARLES L. SCHLEIGH, er at.,

Petitioners,

Vv.

ESTHER V. REIGH, er At.,

Respondents.

On Perrrion ror A Wrir or CERTIORARI TO THE

Unrrep Srates Court or APPEALS

FOR THE “ourTH CixcuIT

APPENDIX TO PETITION FOR WRIT

OF CERTIORARI

J. JosepH CurRRAN, JR.,

Attorney General of Maryland,

Assistant Attorneys General,

7 N. Calvert Street, 2nd Floor

Baltimore, Maryland 21202,

(301) 576-6342,

* Counsel of Record

December 30, 1987

—————

SL LT.

The Daily Record Co., baltimore, MD 21202

4g

TABLE OF CONTENTS

Page

Fourth Circuit Attorney Fee Opinion

829 F.2d 1334 (4th Cir. 1987)........la

District Court Attorney Fee Memorandum

and Order, Civil No. M-83-245,

(D.Md. Nov. 28, 1986)(unpublished)...5a

District Court Memorandum, Order and

Judgment, Civil No. S-83-245

(D.Md. Dec. 18, 1986) (unpublished)...39a

Fourth Circuit Opinion on the Merits,

784 F.2d 1191 (4th Cir. 1986)........4la

Supreme Court Order Denying Certiorari,

EOF BGs FOr CEOOO Reb ese cwceccccccs 448

District Court Memorandum and Order on

the Merits, 595 F.Supp. 1535

(D.Md. ee esc e ot ee

District Court Permanent Injunction

and Final Order, (D.Md. Nov. 27,

1984) (unpublished)... .cccsccccccccce 1658

IN THE UNITED STATES COURT OF APPEALS

FOURTH CIRCUIT

ESTHER V. REIGH, et al.

v. : Nos. 87-1007(L)

87-1026

CHARLES L. SCHLEIGH, et al. :

Before WINTER, Chief Judge, and RUSSELL and

WIDENER, Circuit Judges

Decided October 2, 1986 (829 F.2d 1334)

PER CURIAM:

Although ¢+fendants prevailed in the

judicial aspects of plaintiffs' claim that

Maryland's attachment procedures were uncon-

stitutional because they did not afford

procedural due process to a debtor and did

not provide a sufficiently prompt hearing,

Reigh v. Schleigh, 784 F.2d 1191 (4th Cir.)

(reversing Reigh v. Schleigh, 595. F.Supp.

1535 (D.Md.1984), cert. denied, U.S. :

107 S.Ct. 167,. 93 L.Ed.2d 105 (1986), the

result stemmed from Maryland's amendment of

its rules while the litigation was pending.

The district court found, however, that to a

-la-

limited extent, plaintiffs were "prevailing

Parties" because their lawsuit caused Mary-

land to correct the-constitutional deficien-

cies in its attachment procedures and they

were therefore entitled to an award of

counsel fees under 42 U.S.C. §1988. The

district court awarded $2,409.20. Plaintiffs

had requested $12,000.

Both parties appeal. Plaintiffs contend

that the final order terminating the litiga-

tion entered by the district court on remand

from us is deficient because it contains no

findings as to disputed issues and it fails

to enter judgment for plaintiffs on _ the

issues on which they prevailed. The signif-

icance of the contention lies in its effect

on the extent to which plaintiffs prevailed.

Maryland does not contest the reasonableness

of the attorney's fees that were awarded, but

it contends that plaintiffs were not prevail-

ing parties to any extent so that no award

-2a-

should have been made.

We affirm in both appeals.

We think that the final judgment entered

by the disteiei court was entirely consonant

with our decision. We also think that plain-

tiffs did not gain victories, not reversed on

appeal, that should have been included in the

final order.

The fact, however, that plaintiffs did

not obtain a favorable final judgment does

not foreclose all of their claim to attor-

ney's fees. See Smith v. Univ. of North

Carolina, 632 F.2d 316, 346 (4 Cir. 1980).

Smith recognizes that an award may be made

even if plaintiff does not obtain a favorable

judgment if it is found that plaintiff's

actions caused defendant to remedy his errant

ways. The recent decision in Hewitt v.

Helms, U.S. ~ SOT B.60. Seea. 08

L.Ed.2d 654 (1987), does not displace Smith;

it confirms it. In Hewitt, the Court said:

-3a-

It is settled law, of course, that relief

need not be judicially decreed in order

to justify a fee award under §1988. A

lawsuit somethimes produces voluntary

action by the defendant that affords the

plaintiff all or some of the relief he

sought through a judgment -- e.g., a

monetary settlement or a change in con-

duct that redresses the plaintiff's

grievances. When that occurs, the plain-

tiff is deemed to have prevailed despite

the absence of a formal judgment in his

favor.

U.S. , 107 S.Ct. at 2676.

Here the district court found that

plaintiffs' suit "did achieve a_ limited

change in the notice actually given to

judgment debtors in postjudgment garnish-

ments" and to that extent plaintiffs were

"prevailing parties." The district court

also found that only 20% of the attorneys'

time was expended in accomplishing that

limited change.

Our review of the record satisfies us

that these factual findings are not clearly

erroneous and that the judgment is correct.

AFFIRMED.

-4a-

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

ESTHER V. REIGH, et al. :

CIVIL ACTION

NO. M-83-245

Vv.

CHARLES L. SCHLEIGH, et al. :

MEMORANDUM AND ORDER

On October 31, 1984, this court granted

the plaintiffs' motion for summary judgment

(Paper No. 31). Plaintiffs then moved for

attorneys' fees (Paper No. 33). Defendants

filed a notice of appeal (Paper No. 34).

Defendants submitted an opposition to an

immediate award of attorneys' fees (Paper No.

36). Plaintiffs replied (Paper No. 37).

On April ll, 1986, the United States

Court of Appeals for the Fourth Circuit

vacated this court's judgment and remanded

the case to this court for “the entry of an

appropriate order. . ." censistent with the

-5a-

Fourth Circuit's opinion. Reigh v. Schleigh,

784 F.2d 1191, 1199 (4th Cir. 1986) (Paper

No. 28 of this action). Defendants then

filed a motion for entry of final judgment

(Paper No. 39). Plaintiffs opposed and

cross-moved for final judgment (Paper No.

41). Defendants responded (Paper No. 40).

Plaintiffs then supplemented their motion for

attorneys' fees to include a request for fees

for hours spent on the appeal (Paper No. 42).

Defendants submitted an opposition (Paper No.

43). Julia M. Freit submitted an affidavit

concerning the proposed changes to the Mary-

land District Rules (Paper No. 44). Plain-

tiffs' Petition for Writ of Certiorari was

denied by the United States Supreme Court

(Paper No. 45). Plaintiffs then filed a

response to defendants’ opposition (Paper No.

46) and a supplement to their response to

defendants' motion for entry of _ § final

judgment (Paper No. 47). No hearing is

needed to decide this matter. Local Rule

6(G).

I. Factual Background

On July 24, 1983, the plaintiffs insti-

tuted this action to challenge the constitu-

tionality of several of the rules applicable

to post-judgment garnishment proceedings in

Maryland District Courts (Paper No. 2). Some

of the challenged rules were changed while

this suit was pending. The somewhat confus-

ing recent history of the challenged rules,

as they existed at the time the suit was

filed, as amended on October 21, 1983 and as

amended effective July 1, 1984, was recounted

in this court's Memorandum and Order in Reigh

v. Schleigh, 595 F. Supp. 1535 (D. Md. 1984)

as follows:

"Under the challenged Maryland Dis-

trict Court garnishment rules in exis-

tence at the time this suit was insti-

tuted, in order for a writ of attachment

by way of garnishment to issue the judg-

ment creditor filed instructions to the

sheriff as to the description and loca-

tion of the debtor's property to be

-Ta-

attached. M.D.R. Fl, G42d. The writ was

then served on the garnishee, the person

having property or credits belonging to

the defendant. M.D.R. Fl, G47a. The

writ of attachment was required to notify

each person upon whom it was served,

i.e., the garnishee(s), to file in writ-

ing a defense, G52, within thirty days

after service of the writ. If a claim of

total exemption was filed by the garni-

shee, the creditor, within thirty days,

must have either dismissed or requested a

hearing. If a hearing was requested, the

matter was set for trial. M.D.R. F2. If

some other initial pleading by the garni-

shee or the debtor was filed, the case

was also set for trial. M.D.R. F2b.

Alternatively, the judgment debtor

could obtain the dissolution of the writ

by giving a bond in an amount equal to

the attached property. M.D.R. Fl, G57.

- A final alternative under the former

rules was for the garnishee or the debtor

to file a motion to quash the writ. Such

a motion must have been filed within

thirty days of the service of the writ on

the garnishee. M.D.R. GSla. The court

then, upon notice to the creditor, was

required to hear the motion to quash

'forthwith.' M.D.R. Fl, G51l(b). The writ

of attachment by way of garnishment

remained in effect until it was quashed.

M.D.R. Fl, G5dic.

If no defense was filed within the

thirty-day period after service of the

writ, the judgment creditor could prove

the amount of the debtor's assets in the

hands of the garnishee, and a Judgment of

Condemnation Absolute would thereupon be

-8a-

entered against the garnishee. M.D.R.

F3. If the garnishee filed a Confession

of Assets, the court could enter a Judg-

ment of Condemnation Absolute. M.D.R.

F4, Execution of Judgments of Condem-

nation Absolute could be awarded by the

court at any time. M.D.R. F5.

At the December 2, 1983 hearing,

this court observed that on October 21,

1983, the Maryland Court of Appeals had

ordered the adoption of amendments to the

Maryland District Rules, Chapter 1100,

Subtitle G and Subtitle F. These changes

were subsequently printed in the Maryland

Register. Md.Admin.Reg. Vol. 10, Issue

23 (Nov. 11, 1983). The majority of

these changes dealt with amendments to

the G Rules, the statutory procedures

governing attachment before judgment.

Because, however, the post judgment gar-

nishment procedures contained in Subtitle

F incorporate by reference some of the G

Rule procedures, Rule Fl was amended to

incorporate the changes in the G Rule

references. The only substantive change,

as of October 21, 1983, in the post judg-

ment garnishment procedures which are

challenged in this suit is the change in

Rule G51. The former Rule G51, providing

the procedure for filing a motion to

quash the writ, was deleted to accommo-

date the adoption of a new Rule G5l, a

comprehensive rule covering release of

property and dissolution of attachment.

The specific change in the procedures

challenged by the plaintiffs and con-

tained in the new Rule G51, as of October

21, 1983, was that now a hearing on a

motion to release property or to dissolve

the attachment pursuant to Rule G51 must

be required by a party, and once reques-

-9a-

ted, the hearing shall be held '‘promp-

Soy," rather than ‘forthwith, ' as

required by the former Rule G5l(b). The

remaining procedures or iack thereof

challenged by the plaintiffs remained un-

changed in the October 21, 1983 change in

the rules.

IV. Latest Changes in the Maryland Dis-

trict Rules

In their motions before this court,

the defendants asserted that the changes

in the Maryland District Rules that the

plaintiffs sought were then currently

under consideration and were expected to

be put into effect in the next several

months after the December, 1983 hearing.

The defendants referred to the Tentative

Draft of the Revised Maryland Rules of

Procedure, published in November, 1982,

by the Rules Committee of the Judiciary

of Maryland. (Preface, Tentative Draft).

As the plaintiffs accurately pointed

out, the proposed rules contained in the

Tentative Draft revised only the proce-

dures of the Circuit Courts of Maryland

and did not affect or attempt to alter

the District Rules which contain the pro-

cedures challenged in the present case.

At the December 2, 1983 hearing,

however, the defendants submitted to the

court -a copy of the proposed Eighty-

Eighth Report of the Standing Committee

on Rules of Practice & Procedure. In

that report, which was later submitted to

the Court of Appeals on December 9, 1983,

the Rules Committee proposed amendments

to the Maryland District Rules. (Defen-

dants' Exhibit No. 4). Md.Admin.Reg.

-10a-

Vol. 10, Issue 25 (Dec. 9, 1983). Three

specific prop sed rules were called to

the court's attention, 3-311, 3-643, and

3-645. 5

These proposed changes to the Mary-

land District Rules were later adopted by

the Maryland Court of Appeals on April 6,

1984, effective July 1, 1984. Md.Admin.

Reg. Vol. 11, Issue 9 (Apr. 27, 1984).

The new Maryland District Rules pro-

vide that the judgment debtor will be

mailed a copy of the writ at his last

known address by the party serving that

writ on the garnishee. The writ shall

contain notice to the judgment debtor

that federal and state exemptions may be

available, anc of his right to contest

the garnishment by filing a _ motion

asserting a defense or objection. M.D.R.

3-645. A motion for exemption filed by

the judgment debtor must be filed within

thirty days of service of the writ.

M.D.R. 3-643. Finally, the new rules

provide that a party desiring a hearing

on a filed motion must file a timely

request within five days of service of

the motion. M.D.R. 3-311(d)."

(Id. at 1542-48) (footnotes omitted) .1/

1/ The three versions of the Rules will be

referred to in this Memorandum and Order as

follows: 1) the rules in effect at the time

this suit was filed ("the Old Rules"); 2) the

rules as amended October 21, 1983 ("the Old

Rules as amended"); and 3) the rules amended

effective July 1, 1984 ( the New Rules”).

-lla-

This court found that the Old Rules, as

amended, did not satisfy the requirements of

due process, because there was no guarantee

that the judgment debtor would receive notice

of a garnishment sufficient to allow him to

obtain a meaningful judicial determination of

his right to an exemption. Id. at 1554.

This court concluded, however, that New Rule

3-645(d), while somewhat ambiguous, appeared

to provide for the timing of notice to the

judgment debtor in a manner sufficient to

satisfy the requirements of fairness inherent

in the Due Process Clause. Id.

This court next found that the content

of the notice was insufficient in that it did

not advise the debtor of the procedure for

protesting the garnishment or the grounds on

which the garnishment could be challenged.

Id. at 1555-56. This court finally found

that the Old and New Rules, which did not

provide for a particular period of time with-

-l2a-

in which a motion asserting an exemption must

be heard, were too easily abused and provided

the opportunity for constitutional depriva-

tion. Id. at 1556-57. This court cone luded

that, if a hearing is requested, it must take

place within two weeks of the request, and,

if no hearing is requested, the claim of

exemption must be resolved within two weeks

of the date of its filing. Id. at 1557.

There is evidence in the record that

comments from the Legal Aid Bureau to the

Maryland Court of Appeals Standing Conmittee

on Rules of Practi¢e and Procedure ("the

Rules Committee") may have been influential

in bringing about some of the rule changes

that occurred during the pendency of this

suit (see Paper No. 43, Jan. 25, 1984 letter

of John F. McAuliffe and attachment thereto;

Paper No. 48, Exh. F at 28, 30-33; Paper No.

48, Exh. E at 2).

-l3a-

On May 21 and 22, 1982, before this suit

was filed, the Rules Committee partially

accepted the recommendation of the Legal Aid

Bureau that the garnishment procedure provide

for notice to the debtor and that such notice

advise the debtor of the availability of

exemptions (Paper No. 48, Exh. F at 30-33).

The Committee, at one of its May, 1982 work

sessions, agreed to change section (ce) of

Rule 2-668 to read as follows:

"After the garnishee is served, the

individual making service shall promptly

mail a copy of the writ to the debtor's

last known address and shall file proof

of service and mailing in the manner pro-

vided by Rule 2-126."

(Id., Exh. F at 33).

After this court issued the October 29,

1984 Memorandum and Order, the Rules Conmmit-

tee met on November 16 and 17, 1984 to con-

sider what, if any, changes to the District

Rules were mandated by this court's decision

(Paper No. 48, Exh. J). During those meet-

ings, it was suggested by a Committee member

~l4a-

that the time limit for a hearing date be

permanently changed to 14 days, consistent

with this court's Memorandum and Order (id.,

Exh. J at 16). This suggestion was rejected

(id., Exh. J at 17). Instead, the Committee

approved the passing of an administrative

order requiring that the hearing be held in

14 days. This measure was adopted, on a tem-

porary basis, to keep the system operating

while an appeal was pending (id.). The word

"promptly" was left in the rule (id.). The

members also discussed this court's sugges-

tion that a list of exemptions be included in

the notice, but rejected that suggestion as a

permanent change in the Rules (id., Exh. J at

9-10).

The Committee decided to approve the

passage of an administrative court order to

require the garnishment writ to contain a

notice of a right to demand a hearing on a

garnishment (id., Exh. J at 13). That deci-

-l5a-

sion was in accord with this court's ruling

that the notice did not comport with due pro-

cess when it did not advise the debtor of,

inter alia, the procedure for protesting the

attachment of his bank account.

This court subsequently on November 27, —

1984 issued a judgment order and injunction

which included a form of notice which the

court found acceptable under due _ process

standards (Paper No. 32).

On appeal, the Fourth Circuit vacated

this court's decision and remanded the case

for the entry of an order in conformity with

the Fourth Circuit decision. Reigh v.

Schleigh, 784 F.2d 1191, 1199 (4th Cir.

1986).

The Fourth Circuit held that the laundry

list of exemptions suggested by this court

was unnecessary. Id. at 1197. The court

noted that the provision of New Rule 3-

645(c)(4) providing that the writ of attach-

-l16a-

ment served on the debtor "notify the judg-

ment debtor that federal and state exemptions

may be available," was sufficient. Id. at-

1197 n.4.

The Fourth Circuit also held that there

was no evidence of undue delay in these

cases, and absent evidence of undue delay,

the mere possibility that the term "promptly"

was "too easily abused" in practice or

fraught with "the opdortunity for constitu-

tional violation" was insufficient to impose

such an inflexible procedural rule as the 14-

day rule on the administration of the state

courts. Id.

The Fourth Circuit did not discuss this

court's requirement that there be notice

given of a right to a hearing. While the

judgment of this court was vacated, no indi-

cation was contained in the Fourth Circuit's

opinion that this court was in error in that

regard.

-l17a-

Il. Prevailing Party

A. The Legal Standard

The Fourth Cireuit rule for deciding

whether a party is a “prevailing party" for

the purposes of 42 U.S.C. § 1988 was set

forth in Bonnes_v. Long, 599 F.2d 1316 (4th

Cir. 1979). Under Bonnes, the initial step

is to determine “the precise factual/legal

condition the fee claimant has sought <*v

change or affect so as to gain a benefit or

be relieved of a burden." Id. at 1319. Once

this "benchmark" condition is established,

the court must then determine whether "the

outcome, in whatever form it is realized, is

one to which the plaintiff fee claimant's

efforts contributed in a significant way,

coce” 5G. A party may be deemed to have

"prevailed" even though it has not won all of

the relief it requested. Disabled in Action

v. Mayor & City Council of Baltimore, 685

F.2d 881, 886 (4th Cir. 1982); Bonnes, 599

-18a-

F.2d at 1318. Where a case is mooted because

of administrative, legislative or private

action towards which it may be reasonably

determined that the lawsuit has contributed

in a significant way, the plaintiff is a

prevailing party. Disabled in Action, 685

F.2d at 885; Young v. Kenley, 641 F.2d 192,

195 (4th Cir. 1981).

If, however, the substantive relief

sought by the plaintiff is obtained by legis-

lative or other action which is not shown to

have resulted from the judicial proceeding,

the plaintiffs are not entitled to attorneys'

fees. Bly v. McLeod, 605 F.2d 134, 138-39

(4th Cir. 1979).

In Young v. Ker‘ey, Judge Butzner ex-

plained the causation requirement and how it

required different results in Young and

Bly. 641 F.2d at 195. In Young, the plain-

tiff Willie E. Young was a black woman who

had been hired as a nurse by the Central Vir-

-19a-

ginia Health District. Id. at 193. Young

was hired at a lower pay level (level "A")

than recommended, because her nursing school

had not been accredited by the National

League of Nursing. Id. Young filed a com-

plaint with the EEOC, after which the

employer notified Young that she was quali-

fied for level "B," a slightly higher pay

level. Id. at 194. Young then filed several

claims in the federal district court. Before

her trial was completed, the parties reached

a settlement agreement, which provided for,

inter alia, a raise to the highest pay level,

level °C." Id. In reversing a denial of

attorneys' fees, Judge Butzner wrote:

"This case is readily distinguish-

able from Bly v. McLeod, 605 F.2d 134

(4th Cir. 1979). In that case a statu-

tory amendment to Soutr Carolina's absen-

tee ballot provision mooted plaintiffs'

case. This court found that plaintiffs

were not prevailing parties and denied

attorneys' fees. We observed, ‘In order

to recover. attorneys' fees and costs,

plaintiffs must show at least some suc-

cess on the merits.' 605 F.2d at 137.

The substantive relief in Bly was

-20a-

obtained by legislative enactment which

was not shown to have resulted from the

judicial proceeding. Here, in contrast,

settlement in the midst of trial demon-

strates the lawsuit and the benefits

obtained are causally related.

Moreover, Young has clearly demonstrated

success on the merits."

Id. at 195.

This court, therefore, concludes that in

order for the plaintiffs to receive reason-

able attorneys' fees in a case where the

ultimate disposition of the case, by appeal

or otherwise, is unfavorable to the plain-

tiffs, the burden is on the plaintiffs to

prove some causal connection between the

plaintiffs' efforts in the litigation itself -

and the change in condition.

The Supreme Court has held that attor-

neys' fees may be recovered for time spent

pursuing extra-judicial administrative pro-

eoodings if the work is “useful and of the

type ordinarily necessary to secure the final

result obtained from the litigation." Penn-

-2la-

sylvania v. Delaware Valley Citizens' Council

for Clean Air, 106 S.Ct. 3088, 3096 (1986)

(quoting Webb v. Board of Education of Dyer

County, 105 S.Ct. 1923, 1929 (1985)).

B. Discussion

In deciding whether the plaintiffs are

prevailing parties, the court has considered

the precise factual/legal conditions sought

to be changed, determined to what extent, if

any, those conditions were changed and deter-

mined to what extent, if any, the plaintiffs'

actions in this lawsuit cause? such changes

to occur.

he The Benchmark

The conditions existing at the time this

suit was filed and sought to be changed were:

1) The Old Rules contained no require-

ment that the judgment debtor be given notice

of anything. See 595 F. Supp. at 1554.

2) Under the Old Rules, if the debtor or

garnishee filed a motion to quash the writ,

-22a-

the court, upon notice to the creditor, was

required to hear the motion "forthwith." Id.

at 1543.

The plaintiffs sought to change those

conditions as follows:

1) Require that a timely notice be

served upon the judgment debtor prior to, or

immediately subsequently to, the service of

the Order of Attachment upon the garnishee.

2) Require that such notice state the

available state and federal exemptions and

describe the procedure whereby the judgment

debtor could challenge the attachment.

3) Require a prompt hearing, when

requested by the judgment debtor, to contest

an attachment.

The Rules as they exist today are as

follows:

1) A copy of the writ must be mailed to

the judgment debtor at his last known address

by the party serving the writ.

-23a-

2) The writ shall contain notice to the

judgment debtor that federal and state exemp-

tions may be available and that the debtor

has a right to contest the garnishment by

filing a motion asserting a defense or

objection.

3) If a hearing is requested, a hearing

must be held “promptly.”

In addition, the form of notice, now

required by administrative court’ order,

contains a notice to the judgment debtor that

the debtor may request a hearing on a motion

claiming an exemption of property from gar-

nishment. :

Some of the changes sought by the plain-

tiffs have in fact occurred. The next in-

quiry, therefore, is whether as a practical

matter, the plaintiffs' efforts in this law-

suit contributed in a material way to those

changes. Most of the changes in the rules

occurred while this suit was pending before

-24a-

this court although in part they were under

consideration before this suit was filed.

There is evidence that the extrajudicial

efforts of the Legal Aid Bureau, plaintiffs'

attorneys, may have contributed to some of

those changes (Paper No. 43, Letter of John

F. McAuliffe dated January 25, 1984; Paper

No. 48, Exh. E at 2; Paper No. 48, Exh. F. at

28, 30-33).

The efforts of the Legal Aid Bureau

before the Rules Committee are not the type

of efforts compensable under § 1988. Plain-

tiffs argue that these efforts fall into the

category of administrative efforts "useful

and of the type ordinarily necessary" to

secure the final result obtained from the

litigation, Pennsylvania v. Delaware Valley

Citizens' Council for Clean Air, 106 S.C.

3088, 3096 (1986) (quoting Webb v. Board of

Education of Dyer County, 105 S.Ct. 1923,

1929 (1985).

-25a-

A brief analysis of the Webb-= and

Delaware Valley cases shows that the Legal

Aid Bureau's extrajudicial efforts are not of

the type for which credit may be given.

In Webb, the Court held that fees were

not recoverable for attorneys' services dur-

ing school board hearings at which Mr. Webb

challenged the termination of his employment

as a school teacher. Id. at 1925. Webb then

filed a 1983 suit, which was settled. Both

parties agreed that Webb was the "prevailing

party" in the 1983 suit. Id. at 1926. Webb

sought attorneys' fees for the services of

his counse!] at the administrative hearings in

front of the school board on the basis that

those hearings constituted proceedings to en-

force a provision of §1983, within the mean-

ing of §1988. Id. Webb alternatively argued

that the time was reasonably expended in

preparation for the litigation.

-26a-

The Court rejected both of these argu-

ments, distinguishing Webb's situation from

that involved in New York Gas Lioht Club,

Inc. v. Carey, 447 U.S. 54 (1980). In Carey,

the Court held fees recoverable for attorney

services pursuing state administrative reme-

dies required by Title VII. Section 1983

does not require the exhaustion of remedies.

The administrative proceedings pursued in

Webb were independent from the suit, the

Court held.

In Pennsylvania v. Delaware Valley Citi-

zens' Council, 106 S.Ct. 3088 (1986), the

Supreme Court allowed attorneys' fees for

extrajudicial administrative work to enforce

the provisions of a consent decree. Id. at

3094-96. Plaintiffs argue that the various

letters to the Maryland Rules Committee were

necessary to effect a rule change because the

suit was brought against court clerks, who do

not have the power to change the rules. This

-27a-

argument appears to undermine plaintiffs'

claim that the suit was the impetus for the

rule changes. On one hand, the plaintiffs

argue’ that they should be deemed to have

prevailed in the litigation because’ the

litigation caused the rule changes. On the

other hand, they argue that the litigation

alone could not have caused the rule changes.

The injunction issued by this court caused at

least some change and would have caused more

had it not been vacated.

The plaintiffs' efforts before the Rules

Committee were neither: required by statute,

as in Carey, nor required to enforce any

decree or order of this court, as in DeJaware

Valley. Because those efforts are not con-

sidered a part of the litigation for the pur-

poses of fees, those efforts cannot be con-

sidered a part of the litigation for the pur-

pose of determining if the litigation caused

the rule changes. This court, therefore,

-28a-

finds that the plaintiffs' efforts in this

litigation did not cause the changes between

the Old Rules and the New Rules.

The Rules Committee did meet, however,

on November 16 and 17, 1984 and approved some

changes in administrative court orders to

supplement the New Rules in response to the

decision in this case.

One change, the change relating to the

wording of the notice describing state and

federal exemptions which may be available,

was not the change sought nor was it the

change recommended by this court. Another

change, the administrative order temporarily

declaring that "promptly" means 14 days, was

merely temporary, and was in fact rendered

moot by the Fourth Circuit decision. A final

change, that the notice to the debtor contain

a provision notifying the debtor of his right

to a hearing, was recommended in this court's

decision and appears from the record to be a

-29a-

permanent change in the implementing admin-

istrative state court order.

It appears from the record, therefore,

that this lawsuit actually caused no change

in the Rules, but did achieve a_ limited

change in the notice actually given to judg-

ment debtors in postjudgment garnishments.

Plaintiffs, therefore, are “prevailing par-

ties" to a very limited extent.

Plaintiffs also claim that they are pre-

vailing parties because they succeeded in

having the Old Rules declared unconstitu-

tional (Paper No. 45 at 18-19). This issue

was mooted by the changes in the rules which

occurred during the pendency of this suit.

Since the changes in the Old Rules were not

brought about by the impetus of this suit,

plaintiffs cannot be prevailing parties as to

matters relating to the Old Rules.

Having determined that the plaintiffs

were prevailing parties to a limited extent

-30a-

in connection with offi@ial court procedures

under’ the New Rules, however, the court

believes that an award of some fees _ is

appropriate.

III. Calculating Attorneys' Fees

Once it has been determined that attor-

neys' fees are warranted, the court must

decide what amount would be "reasonable."

Hensley v. Eckerhart, 461 U.S. 424, 433

(1982). The first step in determining what

amount is reasonable is to determine the

number of hours reasonably spent on the liti-

gation and multiply that by a reasonable

hourly rate. Id.; see also Blum v. Stenson.

465 U.S. 886, 897 (1984). The product of

this process is referred to as the "lodestar"

or guiding figure. See e.g., Vaughn v. Board

of Education of Prince George's County, 770

F.2d 1244, 1246 (4th Cir. 1985).

Once the lodestar figure is obtained,

that figure may be adjusted upward or down-

-3la-

ward depending on several factors, including

the "results obtained." Hensley, 461 U.S. at

434; Barber v. Kimbrell's, Ine., 577 F.2d

216, 226 n.28 (4th Cir.), cert. denied, 439

U.S. 934 (1978). When a plaintiff has pre-

vailed on only some issues, the degree to

which the plaintiff prevailed is particularly

important. Hensley, 461 U.S. at 434.

"If, on the other hand, a plaintiff

has achieved only partial or limited suc-

cess, the product of hours reasonably

expended on the litigation as a whole

times a reasonable hourly rate may be an

excessive amount. This will be true even

where the plaintiff's claims were inter-

related, nonfrivolous, and raised in good

faith. Congress has not authorized an

award of fees whenever it was reasonable

for a plaintiff to bring a lawsuit or

whenever conscientious counsel tried the

case with devotion and skill. Again, the

most critical factor is the degree of

success obtained....

There is no precise rule or formula

for making these determinations. The

district court may attempt to identify

specific hours that should be eliminated,

or it may simply reduce the award to

account for the limited success. The

court necessarily has discretion in mak-

ing this equitable judgment. This dis-

cretion, however, must be exercised in

light of the considerations we have iden-

tified, os."

461 U.S. at 434-37 (citations and footnotes

omitted).

A. The Lodestar

Two attorney:;, Elizabeth Renuart and

Mark J. Davis, who are or were associated

with Legal Aid, represented the plaintiffs in

this case. Between them, they seek compensa-

tion for 130.20 hours work.2/ Defendants

have not argued that any of the time spent on

the trial and post-appeal work is unreason-

able.24 Defendants also have not challenged

the hourly rate of $95.00 per hour sought by

the plaintiffs.

As stated supra, the plaintiffs are not

entitled to fees for the time that their

2/ Plaintiffs had submitted a request for

fees for time spent by Elizabeth Renuart on

the appeal of this case to the Fourth Circuit

(Paper No. 42). Plaintiffs have since with-

drawn that request (Paper No. 45 at 20).

3/ Defendants objected to the award of

attorneys' fees for the appeal (Paper No. 43

at 15). That objection is now moot. (See

note 2 supra).

-33a-

attorneys spent contacting the Maryland Rules

Committee. Upon review of the time reports

submitted, it appears that the time spent by

Elizabeth Renuart on 4/82, 5/7/82, 5/11/82,

and 6/21/82 was all spent in contacting or

attempting to influence the Rules Committee.

That time when aggregated comes to 3.25

hours. These hours will not be considered as

part of the lodestar.

The remaining hours listed in Elizabeth

Renuart's initial affidavit add up to 71.35

hours. The hours listed in Mark J. Davis'

affidavit add up to 21.5 hours .44 The

additional hours listed in Elizabeth

Renuart's affidavit attached to Plaintiffs'

Response to Defendants' Opposition to Motion

for Award of Attorneys' Fees add up to 33.95

4/ The Renuart time (71.35 + 3.25 = 74.6) is

-4 hours short of the 75 hours claimed by

Renuart. This is apparently an addition

error. The Davis time (21.5 hours) is .25

hours more than that claimed by Davis. This

is also apparently an addition error.

-34a-

hours (Paper No. 45, Exh. B.). Total hours

allowable to compute the lodestar are 126.8.

In plaintiffs' Motion for Award of

Attorneys' Fees (Paper No. 33), plaintiffs

state that the rate requested, $95.00 per

hour, is slightly lower than the prevailing

market rate charged by attorneys with five

years' experience (id. at 5). In Renuart's

latest affidavit, plaintiffs request a fee of

$105.00 per hour. Because there is no expli-

cit explanation of why plaintiffs are now

seeking a higher rate than the initial rate

of $95.00 per hour, the court will compute

the lodestar based on the lower rate.

The lodestar figure is 126.8 hours times

$95.00 per hour, or $12,046.00.

B. Adjustment to the Lodestar

As stated above, the plaintiffs pre-

vailed only to a very limited extent. Al-

though some of the rule changes sought by the

plaintiffs were in fact brought about by

-35a-

extrajudicial efforts of the plaintiffs'

counsel, the court has found that’ those

changes were not caused by this litigation.

Plaintiffs' degree of success, therefore, is

limited to the change to the notice form

approved by the Rules Committee in response

to this suit. Those changes were as follows:

1) the notice of state and federal exemptions

was changed, but not in the way requested by

the plaintiffs; 2) the notice form was

changed to include a provision notifying the

debtor of his right to a hearing; 3) the

"promptly" hearing time requirement was tem-

porarily changed by administrative order to

14 days, which latter change was mooted by

the Fourth Circuit's opinion.

In view of this limited degree of suc-

cess as compared to what the plaintiffs were

seeking in the lawsuit, this court will

reduce the lodestar figure by 80%. Plain-

tiffs will be awarded attorneys' fees of

-36a-

$2,409.20.

IV. Motion for Entry of Final Judgment

Defendants have moved for entry of final

judgment (Paper No. 39). Plaintiffs have

responded (Puper No. 41), and defendants have

replied (Paper No. 46). The Fourth Circuit

in Reigh v. Schleigh noted that before entry

of final judgment, this court should inquire

as to whether the form of writ in use by the

Maryland District Court system conforms to

the Rule requiring that the judgment debtor

and the garnishees be informed in writs of

garnishment that federal and state exemptions

may be available. 784 F.2d at 1191 n.4.

The defendants are ordered to produce a

copy of the form of writ now in use in the

District Court system. Entry of final judg-

ment will be deferred until that writ is

reviewed by this court.

Accordingly, it is this 28th day of

November, 1986, by the United States District

-37a-

Court for the District of Maryland, ORDERED:

- That the defendants shall pay the

plaintiffs $2,409.20 in attorneys' fees to be

assigned as follows:

Renuart $2,000.70

Davis 408.50

$2,409.20

2. That within fifteen (15) days of

this Memorandum and Order, defendants submit

a copy of the writ of attachment notice now

used in the Maryland District Courts.

3. That final judgment be deferred

until this court has had an opportunity to

review that notice.

4. That the Clerk mail a copy of this

Memorandum and Order to counsel for the

parties.

James R. Miller, Jr.

United States District

Judge

-38a-

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

ESTHER V. REIGH, et al. :

v. : CIVIL NO.

S 83-245

CHARLES L. SCHLEIGH, et al. :

MEMORANDUM

Pursuant to Judge Miller's Memorandum

and Order dated November 28, 1986 (Paper No.

49), defendants have submitted a copy of the

writ of attachment notice now in use in the

Maryland District Courts. After reviewing

that writ, as directed by the Fourth Cir-

cuit's decision in Reigh v. Schleigh, 784

F.2d 1191, 1197 n. 4 (4th Cir. 1986), this

Court concludes that the writ is in the form

prescribed by Md. Rule 3-645(c)(4). Final

judgment, therefore, will be entered on

behalf of the defendants by separate order.

Frederic N. Smalkin

United States District

Judge

-39a-

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

ESTHER V. REIGH, et al. :

Vv. : Civil No.

.. : § 83-245

LES L. SCHLEIGH, et al.

ORDER AND JUDGMENT

For the reasons stated in the foregoing

Memorandum, IT IS, this 18th day at Meecees.

1986, by the Court, ORDERED and ADJUDGED:

1. That final judgment BE, and the same

hereby IS, ENTERED in favor of the defendant,

against the plaintiffs, on all counts;

2. That this case BE, and the same here-

by IS, DISMISSED, with prejudice;

3. That the parties shall bear their own

costs; and

4. That the Clerk of Court mail copies

of the foregoing Memorandum and of this Order

and Judgment to counsel for the parties.

Frederic N. Smalkin

United States District

Judge

-40a-

IN THE UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

ESTHER V. REIGH. et al. $

Appellees

Vv. : NO. 85-1021

CHARLES L. SCHLEIGH, et al. :

Appellants.

Before WINTER, Chief Judge, and RUSSELL and

WIDENER, Circuit Judges.

Decided March 4, 1986 (784 F.2d 1191)

RUSSELL, Circuit Judge:

This is a suit challenging the constitu-

tionality of Maryland's District Rules gov-

erning post-judgment attachments of property

of a judgment debtor as _ issued by the

Maryland Court of Appeals and_ separately

codified at the time this suit was filed as

the Maryland District Rules, Chapter 1, 100-

700, 1106-1300. Chapter 100, Subtitles G&F

contain the challenged procedures. The four

plaintiffs are judgment debtors whose bank

accounts had been attached in 1982 under

-4la-

writs of attachment which had been issued

under such rules but which had been vacated

before this action was begun. They allege,

and it was not disputed, that their bank

accounts, which had been attached, consisted

exclusively of either Social Security or Aid

to Families with Dependent Children payments.

In all cases, the plaintiffs filed with the

Maryland court exemption claims and _ the

claimed exemptions were sustained by the

court in 1982. It was not until January 24,

1983 after the claims of exemption were

upheld that the plaintiffs filed this action

asserting the unconstitutionality on due

process grounds of the procedures established

under the Maryland Rules for the issuance of

post-judgment writs of attachment.

The Maryland post-judgment attachment

Rules, in force when this action was begun,

made no provision for notice to the judgment

debtors of their possible state or federal

exemptions. The rules did provide that, if

the judgment debtor, after learning of the

garnishment, moved to quash the writ within

thirty days, the court was required to hear

such motion "forthwith." Prior to judgment

below, however, the Rules were amended by the

Maryland Court of Appeals to provide (1) for

notice of the attachment to be given the

judgment debtor by the person serving the

writ upon the judgment debtor "promptly after

service upon the garnishee" and (2) for

notice to the judgment debtor at the same

time as notice of attachment "that federal

and state exemptions may be available" to him

or her. The Rules, also, gave the judgment

debtor notice of the right to file a motion

claiming an exemption or objecting to the

garnishment within thirty (30) days and to

request a hearing on such motion, which, when

requested, must be held "promptly." The

parties seem to have agreed that the action

-43a-

should be determined on the basis of the

Rules as amended and the decision of the

district court from which this appeal is

taken, proceeded on that basis.

After denying the defendants' motion to

dismiss the action for mootness, the district

court reviewed the Rules as revised and con-

cluded that the notice of the issuance and

service of the writ on the judgment debtor,

as provided in the Rules, complied to that

extent with the requirements of due process

but that the procedure in the Rules remained

defective in two respects:

(1) They “do not provide for ade-

quate notice to a judgment debtor of the

claims of exemption which are available";

and

(2) They do not “assure resolution

of a claim of exemption within a reason-

able time," which the district court

fixed as "within two weeks" from the time

the claim of exemption is filed.

In order to correct these perceived defects,

the district court enjoined the issuance of

post-judgment writs of attachment without

-44a-

conforming to a form to be approved by the

court listing all exemptions and setting

forth a procedure for resolving such claims

for exemption by the judgment debtor within

two weeks (later stated as 15 days). Reigh

v. Schleigh, 595 F.Supp. 1535 (D. Md. 1984).

The defendants have appealed from the

judgment entered by the district court.

Their first ground on appeal is the mootness

of plaintiffs' claim. Turning to the merits,

they cite Endicott Johnson Corporation v.

Encyclopedia Press, Inc., 266 U.S. 285 (1924)

as authority for the proposition that there

is no due process right on the part of a

judgment debtor to notice of the issuance of

a writ of attachment, of his entitlement to

state or federal exemptions, or to a right to

contest the writ promptly. Assuming, how-

ever, that due process guarantees’ these

rights to the judgment debtor, the defendants

argue that the amended Rules, which were the

-45a-

sa

rules on which the district court based its

ruling, fully satisfied due process require-

ments and the contrary judgment of the

district court is in error.

While there is much to be said for the

mootness argument since the writs of attach-

ment in the case of all four plaintiffs had

been vacated before this action was com-

menced,t/ we are of opinion that under our

decision in Harris v. Bailey, 675 F.2d 614

(4th Cir. 1982), the facets of which are

almost identical to those in this case, the

claim of mootness by the defendants is with-

out merit. Nor is an issue posed in this

case on the duty of the defendants under due

process grounds to provide notice in a post

judgment proceeding of the fPssuance of the

writ of attachment to the judgment debtor and

to acquaint him of his opportunity to make a

-£ See, the dissenting opinion of Aldisert,

J., in Finberg v. Sullivan, 634 F.2d 50, 68

(3d Cir. 1980).

-466-

timely contest of the writ or of his right to

a "prompt" hearing on request. The amended

Rules give the judgment debtor those rights.

What is challenged in these Rules and only

what is challenged is whether the notice of

the writ must inelude notice of all possible

federal and state exemptions, and whether the

hearing afforded the judgment debtor must be

held "within two weeks" or "fifteen days"

after request therefor.

Addressing the first of these two ques-

tions, we begin by recognizing that there is

a conflict in the decisions on the necessity

for the notice to the judgment debtor of the

writ to inelude a list of all available

federal and state exemptions that might be

available to the judgment debtor. Finberg v.

Sullivan, 634 F.2d 50 (3d Cir. 1980) (en

banc) is generally cited as the recognized

authority for the view that all available

exemptions must be listed in the notice to

-47a-

the judgment debtor, though the actual

holding in that case did not go that far.

For other cases, generally cited to this

effect, see Neeley v. Century Finance Co. of

Arizona, 606 F.Supp. 1453 (D.Ariz. 1985);

McCahey v. L.P. Investors, 593 F.Supp. 319

(E.D.N.Y. 1984); Clay v. Fisher, 584 F.Supp.

730 (D. Ohio 1984); Dionne v. Bouley, 583

F.Supp. 307 (D.R.I. 1984), modified, 757 F.2d

1344 (lst Cir. 1985); Deary v. Guardian Loan

Co., Inc., 534 F.Supp. 1178 (S.D.N.Y. 1982);

Betts v. Tom, 431 F.Supp. 1369 (D. Hawaii

1977). In Finberg the bank account of the

judgment debtor had been seized; the account

consisted of funds "entirely exempt from

attachment and garnishment," representing

deposits of Social Security benefits and

moneys within a general “exemption to a class

of debtors which includes Mrs. Finberg." 634

F.2d at 52. Both of these exemptions were

said to be "designed to protect a debtor's

-48a-

means of purchasing basic necessities" and

failure to recognize such exemptions could

cause "serious, undue hardship" to a debtor

in Mrs. Finberg's situation. The majority in

that case, after declaring that "the content

of the notice depends upon the circumstances

of the particular case," required that the

notice to Mrs. Finberg should expressly iden-

tify those two exemptions but it added this

cautionary note: "Because Mrs. Finberg did

not claim other exemptions under Pennsylvania

law, we need not determine the effect of our

decision on Pennsylvania exemptions’ not

claimed by Mrs. Finberg." 634 F.2d at 62.

Finberg, thus, is not authority for the

proposition that due process requires that

the notice to the judgment debtor include all

possible exemptions; it only declared that,

based on "the circumstances" of Mrs.

Finberg's particular case, two express

exemptions claimed by Mrs. Finberg’ should

-49a-

have been noticed.2/

Many of the decisions which have followe

d Finberg and have been cited in support of a

rule that due process compels a listing of

all exemptions in the notice to the debtor

have generally had the same ambiguity as

Finberg. Thus, in Neeley v. Century Finance

Co., 606 F.Supp. at 1465, the court said

categorically that "[d]ue process does not

require that all exemption-§ statutes. be

identified and set forth in detail" in the

notice given to the judgment debtor in a

2/ This limited construction of the ruling

of the majority in Finberg was recognized by

Judge Aldisert and was ® part of his dissent

(634 F.2d at 82):

Although the majority are unwilling to

provide notice of all exemptions avail-

able under state and federal law, there

is no principled reason for excluding

other exemptions of equal importance in

future cases. It will therefore not be

unexpected for the Community Legal

Services, Inc. to bring a new case in the

district court alleging deprivation of

due process for a creditor's failure to

notify a debtor of other exemptions.

-50a-

post-judgment garnishment or attachment, but

only "[t]hose exemptions that occur fre-

quently should be included in the notice"

and, in that context, the court declared it

was “not deciding, other than for wages,

{under the Arizona statute] what particular

exemptions must be identified." To the same

purport is Harris v. Bailey, 574 F.Supp. 966,

971 (W.D.Va. 1983). There the court expres-

Sly said that "notice of all available

-exemptions," which would represent, in the

court's words, "a potentially confusing

laundry list™ more likely to confuse than to

clarify, was not required by due process.

Its rule was "that the summons served on the

debtor contain .a list of those essential

federal and state exemptions that provide the

basic necessities of life for someone in

Mrs. Harris' position. The Social Security

exemption certainly should be included; such

benefits provide the bare necessities for

-S5la-

many in our society." The New York cases of

Deary v. Guardian Loan Co., Inc., 534 F.Supp.

1178 (S.D.N.Y. 1982), and McCahey v. L.P.

Investors, 593 F.Supp. 319 (E.D.N.Y. 1984)

dealt with a state procedure which by statute

required a notice to the judgment debtor,

giving him what the notice said was "a

partial list of money which may be exempt"

[the statutory list ineluded nine specific

exemptions]. See section 5222 of the New

York statutes as quoted in McCahey in note ]

on pages 321-322. Manifestly, the notice was

defective if it did not comply with the man-

date of the statute: However, the important

fact is that the notice only ineluded nine

exemptions which the legislature found to be

required included in the notice to the judg-

ment debtor.

The contrary view has been expressed in

Dionne v. Bouley, 757 F.2d 1344, 1354 (lst

Cir. 1985), modifying 583 F.Supp. 307; Brown

-52a-

v. Liberty Loan Corp. of Duval, 539 F.2d

1385, (Sth. Cir. 1976), cert. denied, 430

U.S, 949; see also Duranceau v. Wallace, 743

F.2d 709, 712-713 (9th Cir. 1984)3/ ana

particularly, the carefully reasoned dissents

of Judge Aldisert and Judge Weis in Finberg.

634 F.2d at 64 et seg., and 93 et seq. In

his dissent, criticizing the requirement that

the exemptions be listed in the notice to the

judgment debtor, Judge Aldisert said (634

F.2d at 84):

The majority have constructed a

veritable Frankenstein, a complicated

procedure that far exceeds the hurt it is

designed to heal and will, in the end,

prove counterproductive. Given the sheer

numerousness of Pennsylvania exemptions

and the complexity of alternative pro-

cedures to claim them, the majority's

requirement in reality departs substan-

tially from the simple notice the Supreme

3/ The state garnishment law required notice

of the exemption for 50% of the judgment

debtor's wages but imposed no obligation to

notice any other specific exemption. This

case, though arising under the law of the

State of Washington, was apparently similar

to the Arizona case involved in Neeley,

Supra.

-53a-

Court recommended in another context.

See Memphis Light, Gas & Water Div. v.

Craft, 436 U.S. 1, 13-15, 98 S.Ct. 1554,

1562-1563, 56 L.Ed.2d 30 (1978). More-

over, the notice requirement has no ana-

logue in,..the Federal Rules of Civil Pro-

cedure, which were promulgated by the

United States Supreme Court. The brute

fact is that there are so many exemptions

that to set forth this information on a

writ would present a mass of incomprehen-

sible boilerplate reeking with legalese.

Judge Weis, in his dissent on the same

subject, declared (634 F.2d at 93):

I also share Judge Aldisert's mis-

givings about the desirability and effec-

tiveness of the notice required by the

majority. There are simply too many

variations and nuances in the Pennsyl-

vania exemption laws to permit’ the

preparation of a brief yet comprehensive,

and simple yet precise, explanation that

will be of assistance to the average

debtor. The fragmented approach taken by

the majority in this case inevitably will

lead to further litigation and the same

overkill that has characterized the

excrescent | disclosure requirements

created by administrative and judicial

interpretations of the Truth in Lending

Act. 3s

Judge Weis also refers to "the $300 exemption

under Pennsylvania law" and suggests that if

notice of such exemptions were required to be

included it should set out as well the exemp-

-54a-

tions to that exemption under the statute

just as exemptions for certain pension bene-

fits must be ineluded if Social Security

payments are to be declared exempt in the

notice to the judgment debtor. Finally, he

comments that he was "not impressed with the

equities of imposing additional procedural

burdens on a creditor who has already been

put to the trouble and expense of securing a

judgment against a debtor who has failed to

meet his obligations.... Some responsibility

for safeguarding the exemption Ttould be

placed upon the debtor." Id. at 93, 94.

In Dionne v. Bouley, supra, the court

ruled that a decision similar to that under

review in requiring notice to judgment debtor~

of all exemptions at time of the attachment

was in error, saying (757 F.2d at 1354):

We do not agree that, to be constitu-

tional, the notice provided to a judgment

debtor after attachment must inform him

of all, or even close to all, of the

available exemptions. In a somewhat

analogous situation, the Court has said

-55a-

that due process requires notice to be

"reasonably calculated, under all the

cirecurmstances, to apprise interested

parties of the pendency of the action and

afford them an opportunity to present

their objections." .. . In the present

situation we think the debtor must be

informed of the attachment and of the

availability of a prompt procedure to

challenge the attachment, ... together

with the fact, generally stated, that

there are certain exemptions under state

~ and federal law which the debtor may be

entitled to claim with respect to the

attached property. The state, however,

is not required to supply the debtor with

a "laundry list" of statutory exemptions.

The latter requirement, we think, gives

insufficient weight to the state's

interest in avoiding overly burdensome

requirements. . . . We know of no paral-

lel situation where the due process

clause has been held by the Supreme Court

to mandate judicial enactment of a kind

of "truth in lending" provision. We are

persuaded by the dissenters in Finberg v.

Sullivan that a detailed list of state

and federal exemptions is neither re-

quired by the Constitution nor would it,

in the final instance, be useful to the

debtors. ... A detailed requirement of

this type which -would have to be con-

stantly updated whenever state or federal

law was revised--contradicts the spirit

of modern civil procedure which encour-

ages notices to be effected in a single,

concise and direct manner. . . In any

case, while of course the state is free

to adopt such an elaborate requirement if

it wants, we do not think the Constitu-

tion compels it. (citations omitted)

~56a-

We are persuaded by the reasoning in_the

Finberg dissents and in Dionne that due pro-

cess does not mandate that the notice to the

judgment debtor of the attachment’ should

include a list of all the exemptions possibly

available to the judgment debtor; it is suf-

ficient that the notice alert the judgment

debtor "that there are certain exemptions

under state and federal law which the debtor

may be entitled to claim with respect to the

attached property, and that there is avail-

able a prompt procedure for challenging the

attachment."

Even the decisions which require some

specification of exemptions shy away from

requiring a listing of all exemptions. Most

of these decisions, as we have seen, identify

only one or two exemptions which they would

require to be specified in the notice. Such

decisions give diverse reasons for the speci-

fication they require. In Neeley, for

-57a-

instance, the court said those exemptions

"that occur frequently" should be identified

in the notice but the court failed to indi-

cate which exemptions would qualify under

this ruling for specification, leaving that

matter open for other litigation. Harris,

after declaring that a “laundry list" speci-

fication of all exemptions "is not required

by due process" laid down the rule that only

those exemptions which cover moneys "that

provide the basic necessities of life for

someone in. Mrs. Harris' position," a rule

which at least, the court says, should

include Social Security payments. Finberg

established much the same rule, if Mrs.

Finberg claimed such exemptions but only if

she did. All of these standards for deter-

mining which exemptions to be specially

identified in the notice to the judgment

debtor are elusive and indefinite, mere

encouragement to confusion, misunderstanding

-58a-

| and other litigation. Must a judicial

officer determine at his peril whether an

exemption "“occur[s] frequently" or what

exemption was necessary in the case of one

whose condition was like either Mrs. Harris'

or Mrs. Finberg's in order to provide them

with "the basic necessities of life," which

we would assume would be related to the judg->

ment debtor's age, education, financial con-

dition, ete.? A requirement for listing all

exemptions or an abbreviated or "fragmented"

list of such exemptions under the standards

set by Finberg and its progeny would create a

"veritable Frankenstein, a complicated proce-

dure that far exceeds the hurt it is designed

to heal and will, in the end, prove counter-

productive," as Judge Aldisert correctly

observed. We are satisfied that a notice

which advises the judgment debtor that there

are state and federal exemptions that may be

available to him, coupled with notice of the

-59a-

right to contest the attachment, meets the

requirements of due process. The notice

provided in the revised Rules in this case

meets this test. AL

The district court, also, found that a

requirement of a "prompt" hearing on a judg-

ment debtor's claim of exemptions against a

writ of garnishment violated due process. It

held specifically that the Rules would

Al While the revised Rule issued by the

Court of Appeals of Maryland clearly states

that the writ of attachment served on the

judgment debtor shall “notify the judgment

debtor that federal and state exemptions may

-be available" (Rule 3-645 (c)(4)), the appel-

lees have attached in an addenda to their

brief a form of attachment (see pp. 2-3 of

the "Addenda to Brief of Appellees"), which

is not in the form prescribed by the Rule--

which, in fact, does not refer to federal

exemptions at all--and which the appellees

suggest is the form still used by the state

courts. The district court should inquire on

remand whether the form of writ now in use

conforms to the Rule noticing the judgment

debtor that there may be federal and state

exemptions available to him. If the form in

use does not conform, and is in the language

set forth in appellees' "Addenda," the dis-

trict court should require prompt ~evision of

the writ of attachment form.

-60a-

satisfy due process only if they provided

explicitly that the hearing on any challenge

to the writ be heard “within two weeks." It

justified such inflexibility in the statute

because, without such an absolute require-

ment, the rights of the judgment debtor could

be "too easily abused" and there was too much

"opportunity for constitutional deprivation."

We are unable to agree--at least on the pres-

ent record before us.

The Rules issued by the State Court man-

date that the hearing on the judgment deb-

tor's request for a hearing on his exemption

clalm shall be held "promptly." That, inci-

dentally, was all that the plaintiffs in this

case asked for in their prayer for relief

when they commenced this action. Thus, in

their "Statement of Claim" in their complaint

they asserted that the Rules then in force

failed to "require a prompt hearing when

requested by the judgment debtor to contest

-6la-

an attachment." (Italics added). The amended

Rules, however, provide them with a right to

"a prompt hearing." In determining whether,

despite the amendment of the Rules to provide

for the "prompt" hearing that the plaintiffs

had requested in their prayer for relief, the

district judge was correct in promulgating

under due process a specific time limit

within which a hearing to contest an attach-

ment or garnishment should be held under the

Maryland procedure, we begin by noticing, as

did the court in Trans-Asiatic Oil, Ltd. S.A.

v. Apex Oil Co., 743 F.2d 956, 960 (ist Cir.

1984) that "'[t]he very nature of due process

negates any concept of inflexible procedures

universally applicable to every imaginable

situation, '"2/ Further, federal courts

should be loath both on grounds of comity and

federalism to intrude upon the rule-making

57 Quoting from Cafeteria Workers v.

McElroy, 367 U.S. 886, 895 (1961).

-62a-

functions of state courts and, even in those

rare instances when compelled to do so under

their duty to uphold federal constitutional

rights, should act cautiously and with moder-

ation. And this principle has particular

applicability where state judicial procedures

are concerned. See dissenting opinion of

Aldisert,J. in Finberg at 69-70, especially

note 6.

It is a new idea that federal courts

should fetter state courts with inflexible

time frames for the administration of their

courts. Only in Finberg prior to this case

has an appellate court imposed on state

courts under due process a rule requiring

that all challengers to an attachment or

garnishment be heard within two weeks; other

courts have followed a more flexible course,

finding due process satisfied by a require-

ment of a "prompt" or "expeditious" hearing.

In Dionne for instance, the court recognized,

as has the Court of Appeals of Maryland, that

the judgment debtor is entitled to "a prompt

post-attachment hearing," p. 1357, but it

eschewed any attempt at stating that term in

strict mathematical terms (i.e., fifteen

days). In McCahey v. L.P. Investors, 774

P.2d at 552, 553 the court was confronted

with an objection to the New York garnishment

statute which provided for an "expeditious"

or “prompt" hearing on exemption claims by

the judgment debtor. The judgment debtor

asserted the statute was constitutionally

defective because it did "not provide a

mandatory outside time limit on according a

hearing on an exemption claim." The court

refused to find the statute invalid on this

ground, saying that “we are unwilling to

invalidate a statute because it might, but

need not, be applied in an unconstitutional

manner." The Supreme Court itself in North

Georgia Finishing, Ine. v. Di-Chem, Inc., 419

-64a-

U.S. 601, 606 (1975), which was a pre-judg-

ment attachment where a party would be

expected to enjoy greater rights than one who

has already been adjudged judicially liable,

required only an “early hearing," or as

Justice Powell stated in his concurring

opinion, "a prompt and adequate hearing," p.

613. It is true this was an admiralty case

and not one involving a garnishment of an

individual's bank account; but it is impor-

tant to emphasize that it was a pre-judgment

attachment and not, as here, a post-judgment

attachment. Trans-Asiatic, supra, also

invoived a pre-judgment attachment in admir-

alty. It found that "a hearing within four

weeks of [the defendant's] request for an

expedited hearing" on the. validity of the

attachment met the standard for promptness.

743 F.2d at 962. In Deary v. Guardian Loan

Go.,. 894 2. 8epe.. 1178 -18.D.E.Y... 3083) tae

court, though it agreed with Finberg that

-65a-

notice of exemptions should be given the

judgment debtor in state garnishment post-

judgment proceedings because required by

state statute, did not follow Finber on the

requirement of an inflexible standard for the

holding of a hearing on a challenge to the

writ of attachment, saying only (p. 1188):

Assuming without deciding that some

prompt post-enforcement procedure would

satisfy constitutional requirements, the

opportunity to challenge the enforcement

action must not be unnecessarily delayed.

In Brown, supra, the Fifth Circuit indicated

that unless "there [was] an extended delay in

setting the hearing on the exemption in state

courts," there was no occasion for action by

a federal court on due process’ grounds.

(Italics added.)

In this case, there is no evidence of

"extended delay," no "foot-dragging” or dila-

toriness by the state courts in disposing of

challenges to garnishment proceedings. Two

of the claims in this case had the hearing

*

-66a-

set and the contest disposed of within two

weeks after the judgment debtors filed their

claims of exemptions and this occurred when

the judgment debtors were proceeding pro

se. In the third case, the claim of exemp-

tion was disposed of within a month. In that

case, the judgment debtor was represented by

counsel which would suggest that the proceed-

ing may have presented some unusual features.

In any event, there is no basis for a finding

of any "extended delay" or inattention to

these claims of exemptions by the state

courts in these three cases. In fact, there

is no allegation of such a delay in the com-

plaint nor is there any basis in the record

for a finding that the hearings in any of the

three cases were unduly delayea.5/

S/ All three of these cases were disposed of

when the hearing requirement wes "forthwith"

and not "“promptiy"™ as i present Rule.

We seriously question, NWSewer,. whether the

State courts will Decome iess diligent in

disposing of claims of exemptions in garnish-

ment proceedings simply Deceuwse the Rule has

:

The district court, however, found

"promptly" too neutral a term for fixing the

time within which a hearing or the challenge

to the garnishment was to be held, even

though that term was used approvingly by the

Supreme Court in Di-Chem, because, it said,

it was a term "too easily abused" in practice

and fraught with "the opportunity for consti-

tutional violation." We are unable to accept

this as a basis for imposing on the courts of

Maryland an inflexible rule governing proce-

dure in the administration by the courts of

that state of proceedings such as_ those

involved here when, as here, there is no

credible evidence of “extended delay" on the

part of the Maryland courts in disposing of

challenges by vacnisheds to the writ of

attachment. That is not to say that if at

some future date there should be evidence of

substituted "promptly" for "forthwith," and,

therefore, regard the change of little or no

moment.

-68a-

"extended delay” in any other case and some-

thing more than mere hypothetical! scenarios

of possible judicial abuse shown, a federal

court will stay its hand. But, without any

evidence of such delay in this case, the

district court erred in undertaking in this

record to tether the state's proceedings to

any mathematical rule for disposing of the

challenge to the writ of attachment and to

invalidate the state procedure "because it

might, but need not, be applied in an uncon-

stitutional manner." See McCahey.

The judgment of tthe district court

enjoining the state courts of Maryland in

their garnishment proceedings, to include a

list of all federal and state exemptions in

the notice of garnishment’ served on. the

judgment debtor and to provide on request a

hearing on any challenge by a judgment debtor

to the garnishment writ within fifteen days

after the filing of the request is accord-

-69a-

ingly vacated and the cause is remanded to

the district court for the entry of an appro-

priate order in conformity with this deci-

sion.

VACATED AND

REMANDED.

WIDENER, Circuit Judge, dissenting:

I respectfully dissent. I believe that

there is no case or controversy and that we

are without subject matter jurisdiction to

decide the merits.

The majority's reliance upon Harris v.

Bailey, 675 F.2d 614 (4th Cir. 1982), I sug-

gest, is misplaced.t/ The plaintiff in

Harris filed her § 1983 action before her

d/ As 1 indicate, Harris is distinguishable

~ from our case on its facts. If the majority

feels it is not, however, then we _ should

simply decline to follow the 1982 circuit

precedent in favor of the 1983 Supreme Court

precedent.

-70a-

a

state garnishment proceeding was decided.

675 F.2d at 616. Traditional doctrines of

mootness were held to be applicable because

there was at least an actual controversy

existing regarding the accounts which had

been garnished at the time the federal case

was filed. Here all three of the state

garnishment proceedings were concluded in the

plaintiffs' favor before this § 1983 action

was filed. Plaintiff Esther Reigh's account

was held exempt from attachment by a state

court ruling on July 29, 1982. Plaintiffs

Ivery Mae Simpkins and David Simpkins

received a state court ruling exempting their

account on December 6, 1982. Plaintiff

Lenora C. Dannie received a state court order

exempting her account on December 29, 1982.

This suit was filed in the district court on

January 24, 1983. Thus no controversy

existed when the federal suit was filed. All

that was present was the fear of future con-

-7Tla-

troversy.

I think City of Los Angeles v. Lyons,

461 U.S. 95 (1983) requires the dismissal of

this action on the ground that no case or

controversy exists. In Lyons the plaintiff

sought an injunction24 against the City

barring the use of choke-holds by police

officers. Lyons had been the victim of such

control hold procedures in the past and

argued that he could again be the subject of

such a procedure in the future absent judi-

cial relief. While the Court did not find

Lyons' claim moot it found that the complaint

did not allege a case or controversy to

satisfy the threshold requirements of Article

III of the Constitution. Relying upon the

language of O'Shea v. Littleton, 414 U.S.

488, 495-6 (1974) the Court said "[plast

2/ Lyons also sought damages against the

City of Los Angeles for past use of the pro-

cedure. The Court's cpinion does not effect

[sic] that portion of Lyons' claim.

-72a-

i aman

exposure to illegal conduct does not in

itself show a present case or controversy

regarding injunctive relief . .. . if

unaccompanied by any continuing, present

adverse effects." Lyons, supra at 102.

Plaintiffs here sought to have the state

post-judgment attachment procedure declared

unconstitutional and its enforcement

enjoined. They have alleged no more than

Lyons did, that is that they were exposed to

illegal conduct in the past. Their belief

that their bank accounts may again be

attached does not create a case or contro-

versy that must be present to invoke federal

court jurisdiction. Lyons, supra at 104.

I would therefore vacate the judgment

below and remand with instructions that the

district court dismiss the action for want of

@ case or controversy under Article III of

the Constitution.

-73a-

IN THE UNITED STATES SUPREME COURT

Esther V. REIGH and Ivery Mae Simpkins and

Lenora C. Dannie, petitioners, v. Charles

L. SCHLEIGH, ete., et al. No. 85-7231.

Case below, 595 F.Supp. 1535; 784 F.2d

1191.

Petition for writ of certiorari to the

United States Court of Appeals for the Fourth

Circuit.

October 6, 1987. Denied.

Justice SCALIA took no part in the

consideration or decision of this petition.

-74a-

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

ESTHER V. REIGH,

IVERY MAE SIMPKINS,

DAVID MICHAEL SIMPKINS,

and LENORA C. DANNIE

v. CIVIL ACTION

NO. M-83-245

CHARLES L. SCHLEIGH, in his

official capacity as Principal:

Clerk of the District Court

for Washington County;

NANCY E. MUELLER, in her

official capacity as Clerk of

the District Court for Howard

County; and WILLIAM A. DORSEY,:

in his official capacity as

Administrative Clerk of the

District Court of Baltimore

City

Filed: October 29, 1984. (595 F.Supp.

1535).

MILLER, District Judge.

MEMORANDUM AND ORDER

On January 24, 1983, the plaintiffs,

Esther V. Reigh, Ivery Mae Simpkins, David

Michael Simpkins, and Lenora C. Dannie, filed

-75a-

this suit against Charles L. Schleigh, in his

official capacity as Principal Clerk of the

District Court for Washington County; Nancy

E. Mueller, in her official capacity as Clerk

of the District Court for Howard County, and

William A. Dorsey, in his official capacity

as Administrative Clerk of the District Court

of Baltimore City. Plaintiffs allege that

the defendants, in issuing orders of attach-

ment pursuant to the post judgment procedures

in Rules Fl through F5 of the Maryland Dis-

trict Rules, have deprived the plaintiffs of

property without due process of law by fail-

ing (a) to cause a timely notice to be served

upon the judgment debtor prior to, or immedi-

ately subsequent to, service of the Order of

Attachment upon the garnishee; (b) to serve

notice which would inform the judgment debtor

of the available state and federal exemptions

and the procedure whereby he or she can

obtain a hearing to contest the attachment;

-76a-

and (¢c) to require a hearing within a speci-

fied number of days to resolve a contested

attachment when requested by the judgment

debtor. The plaintiffs prayed for a judgment

declaring the then current Maryland District

Rules governing post judgment attachment

unconstitutional; the permanent enjoining of

the issuance of post judgment orders for

attachments by defendants until the Maryland

District Rules are revised to require timely,

adequate notice and timely opportunity for a

hearing; an award of reasonable costs and

attorney's fees; and such other and further

relief as this court deems just and proper

(Paper No. 2).

The defendants filed a Motion to Dismiss

asserting that (1) no case or controversy

existed, and (2) the plaintiffs had failed to

state a claim upon which relief could be

granted (Paper No. 9). Thereafter, with the

consent of counsel for defendants, plaintiffs

-77a-

amended their complaint asserting as an addi-

tional cause of action, based on the same

acts underlying the original complaint, a

violation of the Supremacy Clause of the

United States Constitution (Paper No. 12).

On May 6, 1983, the plaintiffs filed a

Motion for Summary Judgment, incorporating

their memorandum in support of their Opposi-

tion to the defendants' Motion to Dismiss and

submitting affidavits of the plaintiffs

(Paper Nos. 13-15, 22). The defendants filed

a Cross Motion for Summary Judgment and a

response to the plaintiffs' Motion for Sum-

mary Judgment on July 1, 1983 (Paper No. 18),

in which they reasserted contentions made in

their Motion to Dismiss and also asserted

that (1) the rule changes sought by the

plaintiffs were then under consideration for

adoption by the Maryland Court of Appeals,

mooting this case, and (2) that the Maryland

District Rules, as then currently codified,

-78a-

did not violate the plaintiffs' due process

rights or the Supremacy Clause of the United

States Constitution. The plaintiffs filed a

response to defendants' Cross Motion (Paper

No. 19). A hearing was held on the motions

on December 2, 1983.

I. Factual Background

A. Plaintiff Reigh

Plaintiff Esther Reigh is a seventy-year-

old woman whose monthly income consists of

$380.00 in Social Security and $43.14 from a

pension from Fairchild Republic. Both checks

are directly deposited into her account with

the First National Bank of Maryland (FNB).

On September 23, 1981, the C & P Tele-

phone Company obtained a judgment against

plaintiff Reigh in the District Court for

Washington County. On July 6, 1982, an Order

of Attachment on Judgment was issued by an

rr

agent of the defendant Schleigh and, on July

7, 1982, was served on FNB. FNB immediately

-79a-

froze the plaintiff's bank account on the

same day and also mailed her notice informing

her that it had been served with a writ of

attachment and enclosing a copy of the Order

for Attachment. On July 13, 1982, FNB mailed

the plaintiff a copy of the garnishee's Con-

fession of Assets.

On or about July 15, 1982, plaintiff

Reigh, acting pro se, asked the District

Court in Washington County to exempt her

account at FNB from attachment. Her request

was granted on July 29, 1982.

Plaintiff Reigh continues to be a judg-

ment debtor to the C & P Telephone Company

(Paper No. 2, @%] 11-15; Paper No. 15, Reigh

Affidavit).

B. Plaintiffs Ivery Mae and _ David

Simpkins

Plaintiffs Ivery Mae and David Simpkins

are mother and son. Ivery Mae Simpson is 52

years old and disabled. Her sole source of

monthly income is $421.50 from Social Secur-

-80a-

ity. Although married to a member of the

merchant marine, she seldom receives any

support from him and has received none from

him since her bank account was attached in

May of 1982. David Simpkins is 21 years old

and attends Towson State University on a

grant. His sole source of monthly income is

$162.00 from Social Security.

On August 11, 1982, a judgment was

entered in the District Court for Howard

County against these plaintiffs in favor of

the American Express Company. On October 7,

1982, an agent of the defendant Mueller

issued an Order for Attachment on the plain-

tiffs' checking and savings accounts at Union

Trust Company of Maryland (UT). The plain-

tiffs learned of the attachment on or about

October 21, 1982 when they received copies of

two letters from UT to the attorneys for UT

which revealed that the plaintiffs had four

bank accounts, two checking and two savings,

-8la-

containing $426.20 with UT. A Garnishee's

Confession of Assets was served on the plain-

tiffs on October 27, 1982 by UT. “

On November 5, 1982, through counsel,

Ivery Mae and David Simpkins filed a claim of

exemption with the District Court for Howard

County. On December 6, 1982, the exemption

was granted.

These plaintiffs continue to be judgment

debtors to the American Express Company

(Paper No. 2, @% 17-23; Paper No. 13,

Simpkins Affidavit).

S. Lenora C. Dannie

Plaintiff Lenora C. Dannie is 26 years

old and lives with three dependent chil-

dren. Her sole source of income is $355.00 a

month from the Aid to Families with Dependent

Children (AFDC) program.

On November 3, 1979, the Equitable Trust

Bank obtained a judgment against the plain-

tiff and on December 13, 1982, an Order for

-82a-

Attachment was issued. On December 13, 1982,

her checking account containing $24.11 from

AFDC at FNB was frozen. On December 14,

1982, FNB mailed a letter to the plaintiff,

informing her that they had received the

Order for Attachment.

On December 17, 1982, a claim of exemp-

tion was filed with the District Court of

Baltimore City. The exemption was granted on

December 29, 1982.

Dannie continues to be a judgment debtor

to the Equitable Trust Bank (Paper No. 2, 4%

25-30; Paper No. 13, Dannie Affidavit).

II. Existence of a Case of Controversy

The defendants assert that each plain-

tiff, who was subjected to the garnishment

procedures outlined in Maryland District

Rules, F1-F5, has since had the attachments

quashed pursuant to Rule G51, Maryland Dis-

trict Rules. Therefore, since none of these

plaintiffs have funds currently frozen under

-83a-

the Maryland Post Judgment Attachment sta-

tute,- defendants contend iene is no case or

controversy in existence as required by

Article III of the United States Constitution

and thet the case must be dismissed.

Those who seek to invoke the jurisdiction

of the federai courts must satisfy the

threshold requirement imposed by Article III

of the Constitution by alleging a case or

controversy, Sierra Club v. Morton, 405 U.S.

727, 732 (1972); Flast v. Cohen, 392 U.S. 83,

94-101 (1968); Jenkins v. McKeithen, 395 U.S.

411, 421-25 (1969), for the courts are pre-

cluded from issuing advisory opinions,

Muskrat v. United States, 219 U.S. 346

(1911), and may only decide questions that

can affect the rights of litigants in the

case before them. North Carolina v. Rice,

404 U.S. 244, 246 (1971). Plaintiffs must

demonstrate a “personal stake in the outcome"

in order to ensure that concrete adverseness

-84a-

which sharpens ‘the presentations of the con-

stitutional issues to be resolved. Baker v.

Carr, 369 U.S. 186, 204 (1962). A plaintiff

must show that he has sustained or is immedi-

ately in danger of sustaining some direct

injury as the result of the challenged offi-

cial conduct, policy or statute and that the

injury or threat thereof is real and immedi-

ate, not conjectural or hypothetical. See,

e.g., City of Los Angeles v. Lyons, 461 U.S.

95 (1983); Boyle v. Landry, 401 U.S. 77

(1971); Golden v. Zwickler, 294 U.S. 103,

109-10 (1969); Massachusetts v. Mellon, 262

U.S. 447 (1923). An actual controversy must

exist at all stages of review. United States

v. Munsingwear, Inc., 340 U.S. 36 (1950).

The law, however, is not so rigid as to deny

review in those instances in which the con-

clusion of the adjudication of the claims

cannot occur before the facts underlying the

claim must necessarily change. See, e.g.,

-85a-

Super Tire Engineering v. McCorkle, 416 U.S.

115 (1974) (strikes); Storer _v. Brown, 415

U.S. 724, 737 n.8 (1974) (state election

laws); Roe v. Wade, 410 U.S. 113, 125 (1973);

Doe v. Bolton, 410 U.S. 179 (1973) (preg-

nancy).

In Finberg v. Sullivan, 634 F.2d 50 (3d

Cir. 1980) (en banc), the Third Circuit

considered a motion to dismiss a _ lawsuit

brought by plaintiff Finberg contesting the

validity of Pennsylvania's post judgment gar-

nishment proceedings. During the pendency of

the state court garnishment proceedings, the

plaintiff filed suit in federal court under

42 U.S.C. § 1983, asserting violations of the

Due Process and Supremacy Clauses of the

United States Constitution. Prior to _ the

completion of the federal proceedings, and

five months after initiating her claims of

exemption ‘in the state courts, the plaintiff

recovered all of the money which had been

-86a-

attached. The defendants asserted that,

because the plaintiff had had her money

returned, she no longer had a personal stake

in the outcome, and the case should be dis-

missed as moot.

Judge Seitz, writing for the court, con-

cluded that the vase was one challenging

"short term orders, capable of repetition,

yet evading review," Southern Pacific Termi-

nal Co., v. ICC, 219 U.S. 498 (1911), and,

therefore, was not moot. He reasoned that

the plaintiff had demonstrated a reasonable

expectation that she would experience the

reoccurrence of the activity:

"In the present case, Mrs. Finberg

does have some reason to fear that she

will suffer another attachment of her

bank accounts. She remains a judgment

debtor. As the record indicates that she

is an elderly widow with a modest income,

this judgment could- remain unsatisfied

for some time. Future efforts to execute

the judgment are therefore likely.

Sterling might repeat its attempt to gar-

nish the accounts. For example, when new

funds accumulate in the accounts, Ster-

ling might find that the garnishment pro-

cess is the most efficient way of deter-

-87a-

mining whether any of the new funds are

exempt. We also cannot disregard the

possibility that a successor to Ster-

ling's interest, such as a collection

agency, could make such an attempt.

Furthermore, Mrs. Finberg's modest

income and the difficulties that she had

demonstrated in this case in meeting the

demands of a creditor indicate that she

may incur. another money judgment and

suffer an attempted garnishment to exe-

cute it."

Finberg, 634 F.2d at 55-56.

More recently, the- Fourth Circuit has

considered a similar challenge and concluded

that the case was not moot. Harris v.

Bailey, 675 F.2d 614 (4th Cir. 1982). The

plaintiff, a Social Security recipient,

brought an action under 42 U.S.C. § 1983,

alleging that the Virginia garnishment pro-

cedure violated the Due Process Clause of the

Fourteenth Amendment and 42 U.S.C. § 407,

exempting paid Social Security benefits from

garnishment procedures. The district court

dismissed her suit when her monies were

returned prior to its adjudication. The

Fourth Circuit reversed.

Judge Ervin, speaking for the panel,

found the Harris facts to be similar to those

of a previous case before the Court of

Appeals for the Fourth Circuit, Hammond vy.

Powell, 462 F.2d 1053 (4th Cir. 1972). In

Hammond, the plaintiff had challenged a South

Carolina repossession statute on due process

and equal protection grounds. Although the

state repossession action was concluded

before the federal case had been tried, the

Fourth Circuit, after noting that "due to her

poverty, appellant will likely again be sub-

jected to the challenged statutory proce-

dure," id. at 1055, and that the public

interest was substantial, concluded that the

case was not moot.

In Harris, after concluding that the

procedure there _ involved, like that of.

Hammond, was of brief duration but one that

is capable of repetition, yet evading review,

-89a-

and finding the reasoning in Finberg to be

persuasive, the Fourth Circuit held that the

general rule, which denies judicial review

when the principal cause becomes moot, did

not apply. See Roe, 410 U.S. 113; Moore v.

Ogilvie, 394 U.S. 814 (1969).

In the present case, the defendants point

out that each of the above-discussed cases

involved federal suits filed before’ the

controversy had been settled and that the

"capable of repetition" exception was used by

those courts to conclude that the prior con-

troversy was not mooted by the change in the

plaintiffs' circumstances. In contrast, this

case involves plaintiffs who filed suit after

the Orders for Attachment had been quashed in

state proceedings, a situation chien defen-

dants contend means that there has never

existed a case or controversy in this suit.

The plaintiffs contend that the “capable

of repetition" exception should apply to

cases in which the plaintiffs reasonably

expect to be subject to the challenged pro-

cedures in the future, regardless of whether

they are suffering actual injury at the time

they file suit in federal court.

In the Supreme Court's most recent case

on the subject, it concluded that the dis-

trict court was without jurisdiction to

entertain a plaintiff's claim for injunctive

relief due to the failure to satisfy the

"case or controversy" requirement of Article

III. Lyons, 461 U.S. 95. The Court's con-

clusion that the plaintiff had no standing to

challenge the Los Angeles police department's

chokehold policy was based on the Court's

determination that the nature of his claim

was speculative in that it was unlikely that

the plaintiff would suffer future injury from

the use of chokeholds by police officers.

For the same reason, the "capable of repeti-

tion" doctrine was held not to apply.

-9la-

In reaching this conclusion, the Supreme

Court reiterated the observations it had made

in earlier cases. In O'Shea v. Littleton,

414 U.S. 488 (1974), particular members of

the plaintiff class alleging the discrimina-

tory enforcement of criminal law by state

officials had actually suffered from the

alleged unconstitutional practices. The

Court observed that "[p]last exposure to

illegal conduct does not in itself show a

present case or controversy regarding injunc-

tive relief . . . if unaccompanied by any

continuing present adverse effects," although

past wrongs were evidence bearing on "whether

there is a real and immediate threat of

repeated injury." Id. at 495-96. Since it

was to be assumed that the plaintiffs in

O'Shea would conduct themselves in a lawful

_ manner, the possibility of threatened injury

from the practice sought to be stopped was

remote and a case or controversy did not

-92a-

EEE

- —

therefore exist. See also Asheroft vv.

Mattis, 431 U.S. 171 (1977); Rizzo v. Goode,

423 U.S. 362 (1976); Golden, 394 U.S. 103.

In an earlier case, Juidice v. Vail, 430

U.S. 327 (1977), although the issue was not

raised by either party, the Supreme Court

examined the standing of all appellees to

determine whether the case or controversy

requirement associated with Article III of

the United States Constitution had been met,

thereby entitling the appellees to an oppor-

tunity to seek the injunction requested. The

appellees sought to challenge the constitu-

tionality of New York statutes authorizing a

finding of contempt against judgment debtors.

All but two of the appellees had, at the time

the lawsuit commenced, already been impris-

oned and released after payment of the court

imposed fine. Id. at 331-32. Because the

periods of incarceration had been served, the

underlying judgment satisfied, or the fines

-93a-

paid by some of the appellees, the effect of

the orders imposing those fines no longer

existed. The Supreme Court concluded that no

case or controversy existed as to those

appellees.

In reviewing the facts as to each of the

appellees in Juidice v. Vail, the Court

indicated that "the prospect of further con-

tempt orders in the underlying action could

have given Vail [the one appellee who had not

satisfied the underlying judgment in addition

to the court imposed fine for contempt] the

requisite constitutional standing to seek to

enjoin the contempt processes as unconstitu-

tional." Id. at 333 n.9. Although the claims

of this appellee were also dismissed because

the complaint did "not allege the likelihood,

or even the possibility, of future contempt

orders," id., the Supreme Court’ indicated

that standing may be present, under a plead-

ing making appropriate allegations, despite

-94a-

the absence of pending state proceedings at

the time the suit in federal court is com-

menced challenging those proceedings.

Article III's requirement of the exis-

tence of a case or controversy is met by a

demonstration of an injury or the threat of

injury. Baker, 369 U.S. 186. The question

of standing, whether at the outset or after

litigation has begun, is the same: is there

an injury or a threat of injury? The "“cap-

able of repetition" exception to the mootness

doctrine is the label applied to a court's

determination that there continues to be a

threat of injury so that standing still

exists. As the Supreme Court opinions in

Vail, O'Shea, Lyons, and Baker reveal, a

threat of injury, if real, is sufficient to

fulfill Article III's requirement of the

existence of a case or controversy at the

outset of the federal litigation. See

-95a-

Kolender v._Lawson. 461 U.S. 352 (1983).1/

The threat of injury was not present in

O'Shea, Lyons, and Golden because the facts

of those cases revealed that future injuries

from challenged conduct were possibilities

which were too speculative to ensure the

"concrete adverseness" necessary for proper

resolution of constitutional issues. Lyons,

461 U.S. 95. In Vail, the appellee's com-

plaint did not even allege a future injury.

The facts which gave rise to those determi-

1/ tn Kolender, the Supreme Court examined

the constitutionality of a criminal statute

which required persons who loiter or wander

on the street to provide a "credible and

reliable" identification and to account for

their presence when so requested by a peace

officer. Although the appellee, Lawson, had

been detained or arrested on approximately 15

occasions, he was not being detained at the

time he brought his civil action challenging

the validity of the statute. The Court noted

that the appellants had never challenged

Lawson's standing to seek relief but went on

to conclude that, in view of the number of

previous stops, there was "a _ ‘credible

threat' that Lawson might be detained again"

and, therefore, found the existence of a case

or controversy. 461 U.S. 352, , B53, 398

S.Ct. 1855, 1857 n.3.

-96a-

nations of speculative injury are vastly

different from the situation in the present

case.

Although no longer’ suffering present

injury from the challenged conduct, the

plaintiffs in the case sub judice, like the

one appellee in Vail, continue to be indebted

on the underlying debts and have no assurance

or indication that their present creditors

will not again attempt collection of the

debts. The plaintiffs in this case, in con-

trast to the Vail appellee, have alleged in

their complaint and affidavits2/ that their

underlying judgment debts continue. They

further alleged that, because of _ their

poverty, all may be subjected to repeated —

attachment of their bank accounts 24

2/ See Paper Nos. 13 (Simpkins and Dannie

Affi its), 15 (Reigh Affidavit).

3/ The Second Amended Complaint of the

plaintiffs reads in pertinent part:

"a. Because of the fact that they are

-97a-

As the Supreme Court in Vail indicated,

and the Fourth and Third Circuits in Harris

and Finberg recognized, a plaintiff's poverty

and continued status as a judgment debtor

make very real the threat of injury from pro-

cedures ‘disiguad to permit collection of a

debt. Unlike the Lyons, O'Shea, or Ashcroft

cases, where the facts indicated reoccurrence

of the injury was unlikely, here the plain-

tiffs, because of their poverty, will prob-

ably be injured again by the challenged pro-

cedures due to the actions of present or

future creditors. For these reasons, the

court concludes that these plaintiffs have

standing to challenge Maryland's District

judgment debtors and because of their

poverty, all Plaintiffs may again be sub-

jected to an attachment of their bank

accounts or other-personal property under

the procedures in question.

b. The Plaintiffs' federal constitu-

tional claims could not have been fully

litigated in federal court before the

state court proceedings ended and their

bank accounts were released."

Paper No. 20.

-98a-

Rules permitting post judgment orders of

attachment to be _ issued. See Grimes Vv.

Miller, 429 F. Supp. 1350, 1354 (M.D.N.C.

1977) 44

III. The Maryland District Rules

In Maryland, the procedural rules for the

governance of the District Courts of Maryland

at the time this suit was filed were sepa-

rately codified as the Maryland District

Rules, Chapters F 100-700, 1100-1300.

Chapter 100, Subtitles G & F contained the

herein challenged procedures to be followed

by a judgment creditor seeking to obtain an

attachment on a judgment .24

Al In Grimes, the District Court concluded

that a case or controversy existed when the

plaintiff did not file suit challenging the

constitutionality of the North Carolina post-

judgment body execution statute until after

he had been released from imprisonment.

5/~ The challenged rules provided as follows:

Rule Fl. Service - Subsequent Procedure.

-99a-

Under the challenged Maryland District

Where an attachment on a judgment shall

have been issued pursuant to_this Subtitle,

it shall be served pursuant to M.D.R. (G47)

(Service of Writ - Garnishment) but no trial

date shall be assigned at the time of issuing

the writ. The procedure shall conform to the

provisions of Section d of M.D.R. (G42)

(Documents to Be Filed - Instructions to the

Sheriff) and M.D.R. (G51) (Motion to Quash),

M.D.R. (G52) (Appearance of Garnishee) M.D.R.

(G56) (Interrogatories to Garnishee - Notice

Failure to Answer), M.D.R. (G57) (Dissolution

of Attachment), M.D.R. (G58) (Claimant of

Property Attached), and M.D.R. (G60) (Sale of

Attached Property).

Rule F2. Appearance - Assignment _ for

Trial.

a. Nulla Bona - Reouest for Hearing -

Dismissal.

When a garnishee files a plea of

nulla bona or a claim of total exemption, the

plaintiff, within thirty days of the service

of a copy of the plea or claim upon him,

shall either dismiss the action or file a

request for hearing. In the latter event the

action shall be assigned for trial. In the

absence of dismissal or request the court may

assign the action for trial or dismiss the

action without trial.

b. Other Appearances - Trial Date.

If a defendant, garnishee’ or

claimant files an initial pleading, other

than a plea of nulla bona or a claim of total

exemption, the action shall be assigned for

trial. ‘

Rule F3. Default - Judgment of Condem-

-100a-

Court garnishment rules in existence at the

nation Absolute.

If no defendant, garnishee, or claimant

of the property attached by way of garnish-

ment shall file his initial pleading within

thirty days after service of the writ, the

plaintiff may pursuant to M.D.R. 648 (De-

fault) prove the amount of assets of the

defendant in the hands of the garnishee sub-

ject to attachment; thereupon, judgment of

condemnation absolute shall be entered

against the garnishee.

Rule F4. Confession of Assets - Judgment

of Condemnation Absolute.

Upon the filing of a confession of assets

by the garnishee, the court may enter a

judgment of condemnation absolute for the

assets confessed, provided, however, that no

claimant files his initial pleading within

thirty days after service of the writ.

Rule F5. Execution.

The court may award execution upon a

judgment of condemnation absolute at any

time.

M.D.R. F6 concerned the post judgment

garnishment of wages and is not relevant to

the question presently before the court.

The following rules were’ incorporated

into the post judgment garnishment proce-

dures:

Rule G42. Documents to Be Filed.

-10la-

time this suit was instituted, in order for a

d. Instructions to the Sheriff.

Instructions to the sheriff as to the

description and location of the property of

the defendant to be attached.

Rule G47. Service of Writ - Garnishment.

a. Service on Garnishee.

A writ of attachment by way of garnish-

ment may be served upon a person having pro-

perty or credits belonging to the defendant.

b. Notice to Garnishee.

A writ of attachment by way of garnish-

ment shall comply substantially with section

e of M.D.R. 103 (Process - Issuance Return)

and shall notify each person upon whom it is

served to file in writing a defense pursuant

to M.D.R. (G52) (Appearance of Garnishee)

within thirty days after service of the writ,

showing cause why the property or credits so

attached should not be condemned.

Rule G51. Motion to Ouash.

a. Procedure.

A defendant or garnishee may file a

motion within thirty days after service of

the writ praying that the writ be quashed and

set aside, and thereupon the court may order

the sheriff to produce the writ and the pro-

ceedings thereunder in court.

b. Hearing.

The court shall upon notice to the

adverse party hear the motion to quash

forthwith.

Cc. Effect of Motion to Ouash _ Uoon

-102a-

writ of attachment by way of garnishment to

Attachment.

The motion to quash shall not prevent

further proceedings until the court shall

order the writ of attachment quashed.

d. Attachment Quashed - Stay by Filing

Bond.

the writ of attachment is quashed and

an appeal is taken, the writ of attachment

shall :emain in force pending the decision on

appeal, provided that within 10 days of the

decision by the court a bond shall be given

conditioned -upon the prosecution of such

appeal with effect, or in default thereof to

pay such costs and damages as the defendant

or other person interested in such property

or credits may incur or suffer by reason of

such attachment and appeal. The amount of

and the surety on such bond shall be deter-

mined and approved by the court.

Rule G52. Appearance of Garnishee.

a. Pleas.

The garnishee may file a pleading assert-

ing on behalf of the defendant any defense

which the defendant could assert, and also

any defense on his own behalf.

b. Confession of Assets - Payment Into

Court. :

The garnishee may confess such assets

including money, as he has in his hands, and

may pay into court the money in his hands to

be awarded to the party having a legal right

thereto.

e. Confession of Assets - Proceedings.

If the plaintiff shall claim a larger

-103a-

issue the judgment creditor filed instruc-

tions to the sheriff as to the description

and location of the debtor's property to be

attached. M.D.R. Fl, G42d. The writ was

then served on the garnishee, the person

having property or credits belonging to the

defendant. M.D.R. Fl, G47a. The writ of

attachment was required to notify each person

upon whom it was served, i.e., the garni-

shee(s), to file in writing a defense, G52,

within thirty days after service of the writ.

amount than the assets confessed, the garni-

shee shall be allowed the costs of the action

and an attorney's fee to be fixed by the

court, unless the plaintiff shall recover

judgment against the garnishee in excess of

the assets confessed.

d. Plea of Nulla Bona.

If upon a plea of nulla bona contested by

the attaching creditor, judgment shall be

entered for the garnishee, the plaintiff

shall be adjudged to pay to the garnishee an

attorney's fee to be fixed by the court and

the costs of the action.

The remaining six Rules, formerly incor-

porated by reference into the post judgment

proceedings, do not concern the issues pre-

sented in the present case.

-104a-

If a claim of total exemption was filed by

the garnishee, the creditor, within thirty

days, must have either dismissed or requested

a hearing. If a hearing was requested, the

matter was set for trial. M.D.R. F2. If

some other initial pleading by the garnishee

or the debtor was filed, the case was also

set for trial. M.D.R. F2b.

Alternatively, the judgment debtor could

obtain the dissolution of the writ by giving

a bond in an amount equal to the attached

property. M.D.R. Fl, G57.

A final alternative under the _ former

rules was for the garnishee or the debtor to

file a motion to quash the writ. Such a

motion must have been filed within thirty

days of the service of the writ on the garni-

shee. M.D.R. Fl, GSla. The court then, upon

notice to the creditor, was required to hear

the motion to quash "forthwith." M.D.R. Fl,

G51(b). The writ of attachment by way of

-105a-

garnishment remained in effect until it was

quashed. M.D.R. Fl, G5dle.

If no defense was filed, within’ the

thirty-day period after service of the writ,

the judgment creditor could prove the amount

of the debtor's assets in the hands of the

garnishee, and a Judgment of Condemnation

Absolute would thereupon be entered against

the garnishee. M.D.R. F3. If the garnishee

filed a Confession of Assets, the court could

enter a Judgment of Condemnation Absolute.

M.D.R. F4. Execution of Judgments of Condem-

nation Absolute could be awarded by the court

at any time. M.D.R. F5.

At the December 2, 1983 hearing, this

court observed that on October 21, 1983, the

Maryland Court of Appeals had ordered the

adoption of amendments to the Maryland Dis-

trict Rules, Chapter 1100, Subtitle G and

‘Subtitle F. These changes were subsequently

printed in the Maryland Register. Md. Admin.

-106a-

ee ee On eee ee

Reg. Vol. 10, Issue 23 (Nov. 11, 1983).8/

S/ The Maryland District Rules regarding

post judgment garnishment proceedures are set

forth below as amended by the October 21,

1983 Order of the Maryland Court of Appeals.

The matter contained in the brackets is

deleted from the former Maryland District

Rules. The matter which is underlined is any

new material added by the October 21, 1983

amendments:

CHAPTER 1100 - SPECIAL PROCEEDINGS

SUBTITLE F - ATTACHMENT ON JUDGMENT

- PROCEDURE

AMEND Rule Fl to correct the rule refer-

ences, as follows:

M.D.R. Fl. Service - Subsequent Procedure.

Where an attachment on a judgment shall

have been issued pursuant to this Subtitle,

it shall be served pursuant to M.D.R. G[47]50

(Service of Writ - Garnishment) but no trial

date shall be assigned at the time of issuing

the writ. The procedure shall conform to the

provisions of [Section d] subsection b 4 of

M.D.R. G[42]40 (Documents to Be Filed

Instructions to the Sheriff) and M.D.R. G5l

[(Motion to Quash)] (Release of Propert

Dissolution of Attachment), M.D.R. GSa

(Appearance of Garnishee), M.D.R. G56 (Inter-

rogatories to Garnishee Notice - Failure to

Answer), [M.D.R. G57 (Dissolution of Attach-

ment),] M.D.R. G58 (Claimant of Property

Attached), and M.D.R. G60 (Sale of Attached

Property).

The amended G Rules referenced in Fl of

the M.D.R. post garnishment procedures are

set forth below:

-107a-

The majority of these changes dealt with

M.D.R. G40. [Against Whom] When Available -

[M.D.R. G42.]

Documents To Be filed

a. Availability

An attachment on original process or

while an action is pending may issue against

any property or credits, whether matured or

unmatured, belonging to the debtor upon the

application of [any person who has the right

to become] a plaintiff [in an action in this

State in any of the following instances:] who

is entitled by statute to attachment before

judgment.

a. Nonresident Debtor.

Where the debtor is a nonresident indi-

vidual or if a corporation, where the cor-

poration does not have a resident agent.

b. Resident Defendant Evading Service.

Where a resident individual defendant or an

agent authorized to accept process for a cor-

poration has acted to evade service.

ec. Absconding Debtor.

Where the debtor has absconded or is

about to abscond from this State, or if an

individual has removed, or is about to

remove, from his place of abode in this State

with intent to defraud his creditors.

d. Fraud.

Where the debtor is about to assign, dis-

pose of, conceal or remove his property or

some portion thereof from the State with

intent to defraud his creditors, or where

such debtor has done any of such acts or

fraudulently contracted the debt or incurred

the obligation respecting which the action is

brought.

e. Nonresident Heir and Devisee.

Where an adult nonresident is entitled by

descent or devise to any land or tenement

-'08a-

amendments to the G Rules, the _ statutory

lying within this State, and the person from

whom such land or tenement descended or by

whom the same were devised was indebted to

any person, an attachment may issue against

the land or tenement held by descent or

devise from the person so indebted.] Cross

Reference: Code, Courts Article, §§ 3-302, 3-

303, 3-304, 3-305.

b. Documents to be Filed.

Attachment proceedings shall be commenced

by filing with the clerk the following:

[all. [Statement of Claim] Request for

Writ.

tatement of the plaintiff's claim)

. request for an order directing the issuance

of a writ of attachment.

[b] 2. Affidavit

An affidavit by the plaintiff or by some

person on the plaintiff's behalf, setting

forth facts upon which plaintiff claims he is

entitled to the issuance of attachment [on

original process] on one or more of the

grounds in [M.D.R. G40 (Against Whom Avail-

able)}] Code, Courts Article. § 3-303, and

except in an action for unliquidated damages,

that the debtor is bona fide indebted to the

plaintiff in the amount claimed. In an

action for unliquidated damages the facts

recited in the statement of claim shall be

verified by the plaintiff or someone on his

behalf.

[e]3. Statement of Claim and Documentary

Evidence of Claim. When attachment on

original process is requested, a statement of

the plaintiff's claim and_— either the

original, or sworn, certified or photostatic

copies of all material papers or parts there-

of which constitute the basis of the claim,

unless the absence thereof is explained in

-109a-

procedures governing attachment before

the affidavit.

[d]4. Instructions to the Sheriff.

Instructions to the sheriff as to the

description and location of the property of

the defendant to be attached.

[e. Bond When Necessary ~ Amount.

In an attachment on original process for

fraud under section d of M.D.R. G40 (Against

Whom Available), and in an action ex con-

tractu for unliquidated damages, and in an

action ex delicto under sections a and ec of

M.D.R. G40 (Against Whom Available), a bond

to the State shall be filed with such surety

as may be approved by the clerk and condi-

tioned upon the satisfaction of costs and

such damages as may be awarded to such defen-

dant or a claimant of the property attached.

The amount of the bond shall be the sum

alleged to be due from the defendant.]

M.D.R. G[47]50. Service of Writ -

Garnishment.

a. Service on Garnishee.

A writ of attachment by way of

garnishment may be served upon a person

having property or credits belonging to the

defendant.

b. Notice to Garnishee.

A writ of attachment by way of garnish-

ment shall comply substantially with section

e of M.D.R. 103 (Process - Issuance - Return)

and shall notify each person upon whom it is

served to file in writing a defense pursuant

to M.D.R. G52 (Appearance of Garnishee)

within thirty days after service of the writ,

showing cause why the property or credits so

attached should not be condemned.

[M.D.R. G51. Motion to Quash.

-110a-

judgment. Because, however, the post

a. Procedure.

A defendant or garnishee may file a

motion within thirty days after service of

the writ praying that the writ be quashed and

set aside and thereupon the court may order

the sheriff to produce the writ and the pro-

ceedings thereunder in court.

b. Hearing.

The court shall upon notice to _ the

adverse party hear the motion to quash forth-

with.

c. Effect of Motion to Quash Upon Attach-

ment.

The motion to quash shall not prevent

further proceedings until the court shall

order the writ of attachment quashed.

d. Attachment Quashed - Stay by Filing

Bond.

If the writ of attachment is quashed and

an appeal is taken, the writ of attachment

shall remain in force pending the decision on

appeal, provided that within 10 days of the

decision by the trial court a bond shall be

given conditioned upon the prosecution of

such appeal with effect, or in default there-

of to pay such costs and damages as_ the

defendant or other person interested in such

property or credits may incur or suffer by

reason of such attachment and appeal. The

amount of and the surety on such bond shall

be determined by the court.]

M.D.R. G{[57]51. Release oof Property -

Dissolution of Attachment

~ e

A defendant who has appeared may [dis-

solve an attachment] obtain release of the

attached property by giving bond in an amount

equal to the value of the property as deter-

-llla-

judgment garnishment procedures contained in

mined by the court, or in the amount of the

plaintiff's claim, whichever is less, with

such surety as may be approved by the clerk

to satisfy any judgment that may be recov-

ered.

Upon motion of a defendant who has

appeared, the court may release some or all

of the attached property if it finds that (1)

the claim has been dismissed or settled, (2)

the plaintiff has failed to comply with the

provisions of this Rule or an order of court

regarding these proceedings, (3) property of

sufficient value to satisfy the claim and

probable costs will remain subject to_ the

attachment after the release, or (4) _ the

attachment of the specific property will

cause undue hardship to the defendant and the

defendant -has delivered to the sheriff or

made available for. levy alternative property

sufficient in value to satisfy the claim and

probable costs.

Upon motion of a defendant or garnishee,

the court may release some or all of the

attached property on the ground that_ the

property its exempt or it may dissolve the

attachment on the ground that the plaintiff

is not entitled to attachment before judg-

ment. If the motion is filed before the

defendant's Notice of Intention to Defend is

due pursuant to M.D.R. 302, its filing shall

be treated as an appearance for that purpose

only.

A party desiring a hearing on a motion

filed pursuant to this section shall _ so

request in the motion or response and if

requested, a hearing shall be held promptly.

M.D.R. G56. Interrogatories to Garnishee -

Notice - Failure to Answer.

-l112a-

Subtitle F incorporate by reference some of

the G Rule procedures, Rule Fl was amended to

incorporate the changes in the G Rule refer-

ences.

The only substantive change, as of

October 21, 1983, in the post judgment gar-

nishment procedures which are challenged in

this suit is the change in Rule G5l. The

former Rule G51, providing the procedure for

filing a motion to quash the writ, was dele-

Interrogatories may be served by _ the

plaintiff upon the garnishee pursuant. to

M.D.R. 417 (Discovery by Interrogatories to

Party). They shall contain a notice to the

garnishee that, unless answers are _ filed

within thirty (30) days after service of the

interrogatories [judgment may be entered

against him in the full amount of the plain-

tiff's claim] the garnishee may be held in

contempt of court. If a garnishee shall fail

to answer interrogatories, within the time

allowed by section b of Rule 417 (Discovery

by Interrogatories to Party), then upon proof

of service of the interrogatories the court

on motion [and notice] may enter [a judgment

against the garnishee for the full amount of

the plaintiff's claim] an order in compliance

with Rule P4 treating the failure to answer

as _a contempt and may require the garnishee

to pay reasonable attorney's fees and costs.

-ll3a-

ted to accommodate the adoption of a new Rule

G51, a comprehensive rule covering release of

property and dissolution of attachment. The

specific change in the procedures challenged

by the plaintiffs and contained in the new

Rule G51, as of October 21, 1983, was that

now a hearing on a motion to release property

or to dissolve the attachment pursuant to

Rule G51 must be requested by a party, and

once requested, the hearing shall be held

"promptly," rather than "forthwith," as

required by the former Rule G5l(b). The

remaining procedures or lack thereof chal-

lenged by the plaintiffs remained unchanged.

in the October 21, 1983 change in the rules.

IV. Latest Changes _in_the Maryland District

Rules

In their motions before this court, the

defendants asserted that the changes in the

Maryland District Rules that the plaintiffs

sought were then currently under considera-

tion and were expected to be put into effect

-l1l4a-

in the next several months after the Decem-

ber, i983 hearing. The defendants referred

to the Tentative Draft of the Revised Mary-

land Rules of Procedure, published in Novem-

ber, 1982, by the Rules Committee of the

Judiciary of Maryland. (Preface, Tentative

Draft).

As the plaintiffs accurately pointed out,

the proposed rules contained in the Tentative

Draft revised only the procedures of the Cir-

cuit Courts of Maryland and did not affect or

attempt to alter the District Rules which

contain the procedures challenged in_ the

present case. re

At the December 2, 1983 hearing, however,

the defendants submitted to the court a copy

of the proposed Eighty-Eighth Report of the

Standing Committee on Rules of Practice &

Procedure. In that report, which was later

submitted to the Court of Appeals on December

9, 1983, the Rules Committee proposed amend-

-ll5a-

ments to the Maryland District Rules.

(Defendants' Exhibit No. 4). Md. Admin. Reg.

Vol. 10, Issue 25 (Dec. 9, 1983). Three

specific proposed rules were ealied to the

court's attention, 3-311, 3-643, and 3-645.2/

1/ The pertinent proposed rules submitted by

the Rules Committee are set forth below:

Rule 3-311. MOTIONS

(a) Generally

An application to the court for an

order shall be by motion which, uniess made

during a hearing or trial, shall be made in

writing, and shall set forth the relief or

order sought.

(b) Statement of Grounds

A written motion and any response to

a motion shall state with particularity the

grounds.

(c) Hearing - Motions for New Trial or to

Amend the Judgment

When a motion is filed pursuant to

Rule 3-533 or 3-534, the court shall deter-

mine in each case whether a hearing will be

held, but it may not grant the motion without

a hearing.

(d) Hearing - Other Motions

A party desiring a hearing on a

motion, other than a motion filed pursuant to

Rule 3-533 or 3-534, shall file a timely

written request. The request of the moving

party shall be included in the motion under

-116a-

These proposed changes to the Maryland

the heading "Request for Hearing," and the

request of a party served with a motion shall

be made by filing a “Request for Hearing"

within five days after service. Upon a timely

request, a hearing shall be held except as

provided in Rule 3-421(g). The court may

hear and decide the motion before or at

trial. If no hearing is requested, the court

may decide the motion without a hearing at

any time.

Rule 3-643. RELEASE OF PROPERTY FROM LEVY

(a) Upon Satisfaction of Judgment

Property is released from a levy

when the judgment has been entered as satis-

fied and the costs of the enforcement pro-

ceedings have been paid.

(b) Upon Posting Bond

The judgment debtor may also obtain

release of property from a levy by filing a

bond in an amount sufficient to satisfy the

judgment and enforcement costs.

(c) Upon Motion of Judgment Debtor

Upon motion of the judgment debtor,

the court may release some or all of the pro-

perty from a levy if it finds that (1) the

judgment has been vacated, has expired, or

has been satisfied, (2) the property is

exempt from levy, (3) the judgment creditor

has failed to comply with these rules or an

order of court regarding the enforcement

proceedings, (4) property sufficient in value

to satisfy the judgment and enforcement costs

will remain under the levy after the release,

(5) the levy upon the specific property will

cause undue hardship to the judgment debtor

-117a-

District Rules®/ were later adopted by the

and the judgment debtor has delivered to the

sheriff or made available for levy alterna-

tive property sufficient in value to satisfy

the judgment and enforcement costs, or (6)

the levy has existed for 120 days without

sale of the property, unless the court for

good cause extends the time.

The motion and any response to the

motion may be accompanied by a request for

court review of the sheriff's appraisal made

at the time of the levy.

(d) Upon Election of Exemption by Judg-

ment Debtor

By motion filed within 30 days after

a levy, the judgment debtor may elect to

exempt from execution of the judgment selec-

ted items of property or cash not exceeding

in amount the cumulative value permitted by

law. The motion and any response to the

motion may be accompanied by a request for

court review of the sheriff's appraisal made

at the time of the levy. The court shall

release from the levy items of cash or pro-

perty selected by the debtor to the extent

required by law.

(e) Upon Claim of a Third Person

A person other than the judgment

debtor who claims an interest in property

under levy may file a motion requesting that

the property be released. The motion shall

be served on the judgment creditor and, if

reasonably feasible, on the judgment debtor.

If the judgment debtor is not served and does

not voluntarily appear, the claimant shall

file an affidavit showing that reasonable

efforts have been made to ascertain. the

whereabouts of the judgment debtor and to

-118a-

Maryland Court of Appeals on April 6, 1984,

provide the judgment debtor with notice of

the motion. The court may require further

attempts to notify the judgment debtor. The

judgment creditor or the judgment debtor may

file a response to the motion.

Rule 3-645. GARNISHMENT OF PROPERTY -

GENERALLY

(a) Availability

This Rule governs garnishment of any

property of the judgment debtor, other than

wages [subject to Rule 3-646] and a partner-

ship interest subject to a charging order, in

the hands of a third person for the purpose

of satisfying a money judgment. Property

includes any debt owed to the judgment

debtor, whether immediately payable, un-

matured, or contingent.

(b) Issuance of Writ

The judgment creditor may obtain

issuance of a writ of garnishment by filing

in the same action in which the judgment was

entered a request that contains (1) the cap-

tion of the case, (2) the amount owed under

the judgment, (3) the name and last known

address of the judgment debtor, and (4) the

name and address of the garnishee. Upon the

filing of the request, the clerk shall issue

a writ of garnishment directed to the gar-

nishee.

(ce) Content

The writ of garnishment shall:

(1) contain the information in the

request, the name and address of the person

requesting the writ, and the date of issue,

(2) direct the garnishee to hold the

-119a-

effective July 1, 1984. Md. Admin. Reg. Vol.

property of the judgment debtor subject to

further proceedings,

(3) notify the garnishee of the time

within which the answer must be filed and

that failure to do so may result in judgment

by default against the garnishee,

(4) notify the judgment debtor and

garnishee that federal and state exemptions

may be available,

(5) notify the judgment debtor of

the right to contest the garnishment by fil-

ing a motion asserting a defense or objec-

tion.

(d) Service

The writ shall be served on _ the

garnishee in the manner provided by Chapter

100 of this Title for service of process to

obtain personal jurisdiction and may be

served in or outside the county. Promptly

after service upon the garnishee, the person

making service shall mail a copy of the writ

to the judgment debtor's last known address.

Proof of service and mailing shall be filed

as provided in Rule 3-126. Subsequent plead-

ings and papers shall be served on the credi-

tor, debtor, and garnishee in the manner pro-

vided by Rule 1-321.

(e) Answer of Garnishee

The garnishee shall file an answer

within 30 days after service of the writ.

The answer shall admit or deny that the gar-

nishee is indebted to the judgment debtor or

has possession of property of the judgment

debtor and shall specify the amount and

nature of any debt and describe any property.

The garnishee may assert any defense that the

garnishee may have to the gernishment, as

-120a-

11, Issue 9 (Apr. 27, 1984).

well as any defense that the judgment debtor

could assert. After answering, the garnishee

may pay any garnished indebtedness into court

and may deliver to the sheriff any garnished

property, which shall then be treated as if

levied upon by the sheriff.

(f) When No Answer Filed

If the garnishee fails to file a

timely answer, the judgment creditor may pro-

ceed pursuant to Rule 3-509 for a judgment by

default against the garnishee.

(g) When Answer Filed

If the garnishee files a _ timely

answer, the matters set forth in the answer

shall be treated as established for the pur-

pose of the garnishment proceeding unless the

judgment creditor files a reply contesting

the answer within 30 days after its filing.

If a timely reply is not filed, the court may

enter judgment upon request of the judgment

creditor, the judgment debtor, or the garni-

shee. If a timely reply is filed to the

answer of the garnishee, the matter shall

proceed as if it were an original action

between the judgment creditor as plaintiff

and the garnishee as defendant and shall be

governed by the rules applicable to civil

actions.

(h) Interrogatories to Garnishee

The judgment creditor may file

interrogatories directed to the garnishee

pursuant to Rule 3-421. The interrogatories

shall contain a notice to the garnishee that,

unless answers are filed within 30 days after

their service or within the time for filing

an answer to the writ, whichever is later,

-12la-

The new Maryland District Rules provide

the garnishee may be held in contempt of

court. If the garnishee fails to file timely

answers to interrogatories, the court, upon

motion of the judgment creditor and proof of

service of the interrogatories, may enter an

order in compliance with Rule P4 treating the

failure to answer as a contempt and may

require the garnishee to pay reasonable

attorney's fees and costs.

(i) Release of Property; Claim by Third

Person

Before entry of judgment, the judg-

ment debtor may seek release of the garnished

property in accordance with Rule 3-643,

except that a motion under Rule 3-643(d)

shall be filed within 30 days after service

of the writ of garnishment on the garnishee.

Before entry of judgment, a third person

claimant of the garnished property may

proceed in accordance with Rule 3-643(e).

(j) Judgment

A judgment against the garnishee

shall be limited to the property of the judg-

ment debtor established by the judgment cred-

itor to be in the hands of the garnishee or

to the amount owed under the creditor's judg-

ment against the debtor and enforcement

costs, whichever is less.

8/ Proposed Maryland District Rule 3-643, as

adopted on April 6, 1984, added a subsection

(f) which provides:

"Hearing. - A party desiring a

hearing on a motion filed pursuant to

this Rule shall so request pursuant to

Rule 3-311(d) = and, if requested, a

hearing shall be held promptly."

-122a-

that the judgment debtor will be mailed a

copy of the writ at his last known address by

the party serving that writ on the garnishee.

The writ shall contain notice to the judgment

debtor that federal and state exemptions may

be available, and of his right to contest the

garnishment by filing a motion asserting a

defense or objection. M.D.R. 3-645. A

motion for exemption filed by the judgment

debtor must be filed within thirty days of

service of the writ. M.D.R. 3-643. Finally,

the new rules provide that a party desiring a

hearing on a filed motion must file a timely

request within five days of service of the

motion. M.D.R. 3-311(d).

V. The Due Process Claims

The plaintiffs assert that they have a

property interest in their bank accounts,

North Georgia Finishing. Inc. v. Di-Chem, 419

U.S. 601 (1975); Sniadach v. Family Finance

Corp., 395 U.S. 337 (1969), which were

-123a-

attached by the defendants under procedures

set forth in former M.D.R. F1-F5. The defen-

dants do not dispute the existence of the

property interest. The issue is whether due

process is provided by-~the Maryland District

Rules as they now exist, and, if not, what

process is due.

Almost sixty years ago, the Supreme Court

addressed the issue of the process which is

due in post judgment proceedings in Endicott

Johnson Corp. v. Encyclopedia Press, Inc.,

266 U.S. 285 (1924). The judgment creditor,

Endicott Johnson, brought suit to compel the

judgment debtor's employer, the Encyclopedia

Press, Ine., to pay over 10% of the debtor's

wages each week to the creditor pursuant to a

duly awarded execution by the Supreme Court

of New York. The employer asserted that the

New York Code authorizing such garnishment

violated the debtor's right of due process

under the Fourteenth Amendment because the

-124a-

ites

si PEE se) § 5 25 Se RTT bers

ine. Sea DS a EGR Wh Se en a ti]

—

execution was authorized without notice to

the judgment debtor or without affording him

an opportunity to be heard.

Justice Sanford, writing for the Court,

upheld the ex parte application of the

judgment creditor reasoning that,

"in the absence of a statutory require-

ment, it is not essential that he [the

debtor] be given notice before the issu-

ance of an execution against his tangible

property; after the judgment he must take

"notice of what will follow,' no further

notice being necessary to advance

justice."

Id. at 288. ,

Subsequent federal decisions applied the

holding in Endicott Johnson and concluded

that post garnishment statutes that did not

provide notice to the debtor were constitu-

tional anc did not deprive the debtor of due

process. See, e.g., Halpern v. Austin, 385

F. Supp. 1009 (N.D. Ga. 1974); Katz v. Ke Nam

Kim, 379 F. Supp. 65, 68-69 (D. Haw. 1974);

Langford v. State of Tennessee, 356 F. Supp.

-125a-

1163 (W.D. Tenn. 1973) (per curiam); Moya v.

DeBaca, 286 F. Supp. 606, 607-08 (D.N.M.

1968), appeal dismissed, 395 U.S. 825 (1969).

See also Wanex v. Provident State Bank of

Preston, 53 Md. App. 409 (1983) (per curiam)

(citing Endicott Johnson with approval, but

simply holding that the Maryland rules as

then currently codified did not require

notice to the debtor before garnishment).

The continuing applicability of Endicott

Johnson to the more recent cases, which

involve the garnishment of bank accounts

which may contain exempt property, is ques-

tionable in light of the fact that the Court

in Endicott Johnson did not consider any

possibility that the judgment debtor might be

deprived of exempt property. This issue,

which does not arise until the judgment

creditor seeks to subject. specific assets of

the judgment debtor to satisfaction of the

judgment, cannot be resolved in the under-

-126a-

Ftd Kear perme roo

lying action. Furthermore, the New York

statute, which was upheld. in Endicott

Johnson, authorized garnishment of only ten

percent of a judgment debtor's wages and only

that percentage was sought by the judgment

creditor. In contrast, the garnishment of

bank accounts may deprive the judgment debtor

of his sole source of income when retirement

or welfare benefits are directly deposited

into those accounts. See M. Greenfield, A

Constitutional Limitation on the Enforcement

of Judgments--Due Process and _ Exemptions,

Wash. Univ. L. Q. 877, 887-88, 896-98 (1975).

Moreover, other courts have questioned

the continuing validity of the Endicott

Johnson holding in light of the Supreme

Court's decision in Griffin v. Griffin, 327

U.S. 220 (1946). In Griffin, the plaintiff

wife sought to enforce in the District of

Columbia a 1938 New York judgment for support

arrearages based on a 1926 New York alimony

decree. The 1938 judgment was obtained in an

ex parte proceeding without notice to the

husband. A 1936 judgment for arrearages, the

court proceedings having been attended by the

husband, was also unsatisfied. Id. at 223.

The Supreme Court held the 1938 judgment

to be invalid to the extent it cut off any

defenses the husband debtor might have raised

with respect to arrearages accruing after

1936. The Court recognized the argument that

the 1926 decree gave the husband notice that

further proceedings might be taken which

might result in a judgment on the obligation,

but reasoned that there was "no ground for

saying that due process does not require fur-

ther notice of the time and place of such

further proceedings, inasmuch as they under-

took substantially to affect his rights in

ways in which the 1926 decree did not." Id.

at 229.

While this rationale conflicts with that

-128a-

@ i

in Endicott Johnson, the fact that’ the

Supreme Court did not refer in Griffin to

that former decision has caused difficulty in

determining what impact Griffin had. Courts

have alternately refused to conclude that

Griffin undercuts Endicott Johnson, Brown v.

Liberty Loan Corp. of Duval, 539 F.2d 1355,

1363-65 (5th Cir. 1976), questioned the con-

tinuing validity of the Endicott Johnson

decision, First Nat'l Bank v. Hasty, 410 F.

Supp. 482, 489 n.8 (E.D. Mich. 1976); Betts

v. Tom, 431 F. Supa. 1369, 1373 (D. Haw.

1977), or have noted the contradiction but

not relied on it in reaching their decision.

Phillips v. Robinson Jewelers, No. 81-~-190-BT

(W.D. Okla., Feb. 15, 1982). Ina later dis-

sent on the dismissal of a writ of certiorari

as improvidently granted, at least some of

the justices on the Supreme Court indicated

that they believed that the Endicott Johnson

rationale was no longer viable in light of

-129a-

Griffin. Hanner v. DeMarcus, 390 U.S. 736

(1968) 24

A series of recent Supreme Court cases

concerning prejudgment deprivations reveal a

shift in the Court's view of due process from

that of the Court during the period when

Endicott Johnson was decided. In 1969, the

Supreme Court held unconstitutional in

Sniadach v. Family Finance Corp., 395 U.S.

337 (1969), a Wisconsin prejudgment garnish-

ment statute, which allowed a creditor to

freeze the wages of a debtor in the hands of

an employer pending the outcome of the action

on the creditor's claim of indebtedness. The

Court said that the garnishment of wages is

such a severe deprivation that due process

$/ at least two early commentators on this

subject suggest that Endicott Johnson may be

questionable authority in light of Moya and

Hanner. Countryman, The Bill of Rights & the

Bill Collector, 15 Ariz. L. Rev. ,

(1973); Levy, Attachment, Garnishment and

Garnishment Execution: some American Problems

Considered in Light of the English Experi-

ence, 5 Conn. L. Rev. 399 (1973).

-130a-

requires that it be preceded by notice to the

debtor and an opportunity for a hearing. Id.

at 340.

In Fuentes v. Shevin, 407 U.S. 67 (1972),

the Supreme Court struck down Florida and

Pennsylvania prejudgment replevin statutes

which did not require advance showing by the

applicants that the chattels in question were

wrongfully detained. The Court concluded

that the failure to provide the debtor with

prior notice and an opportunity to dispute

the creditor's claim deprived the debtor of

due process in that "a hearing must take

place when deprivation can still be pre-

vented." Id. at 81.

In the third recent prejudgment case

before the Court, Justice White, writing for

the majority, after balancing the interests

of the parties, concluded that a Louisiana

sequestration statute, which failed to pro-

vide prior notice and a hearing, was consti-

tutional where other measures, such as a

required creditor affidavit and the issuance

of the writ by a judge, minimized the risk

that the ex parte procedure would lead to a

wrongful taking. Mitchell v. W. T. Grant &

Co., 416 U.S. 600, 616-17 (1974).

In North Georgia Finishing, Ine. v. Di-

Chem, Inec., 419 U.S. 601 (1975), Justice

White, again writing for the majority, inval-

idated a Georgia prejudgment garnishment pro-

cedure which allowed the freezing of a cor-

poration's bank account without either notice

and a hearing before the freeze, or the

alternate safeguards similar to those in

Mitchell.

Following the prejudgment deprivation

cases, the Supreme Court reviewed the concept

of due process in an anaiogous context. In

Mathews v. Eldridge, 424 U.S. 319 (1976),

when examining the process due a Social

Security recipient prior to termination of

-132a-

ot) ee

“er

‘er ew Oe

ram mr o>

her benefits, the Court observed that its

former cases, including Di-Chem, Snaidach,

and Fuentes,

"tunderscore the truism that ‘due pro-

cess,' unlike some legal rules, is not a

technical conception with a fixed content

unrelated to time, place and circum-

stances.' Cafeteria Workers v. McElroy,

367 U.S. 886, 895 (1961). ‘Due Process is

flexible and calls for such procedural

protections as the particular situation

demands.' Morrissey v. Brewer, 408 U.S.

St, 2: ee. cs Accordingly,

resolution of the issue whether the

administrative procedures provided here

are constitutionally sufficient requires

analysis of the governmental and private

interests that are affected. Arnett v.

Kennedy, supra, [416 U.S. 134], at 167-

168 (Powell, J., concurring in part);

Goldber - Kelly, [367 U.S. 254], supra,

at 363-866; Cafeteria Workers v. McElroy,

supra, [397 U.S.J], at 895. More pre-

cisely, our prior decisions indicate that

identification of the specific dictates

of due process generally requires consid-

eration of three distinct factors; first,

the private interest that will be affec-

ted by the official actions; second, the

risk of an erroneous deprivation of such

interest through the procedures used, and

the probable value, if any, of additional

or substitute procedural safeguards; and

finally, the Government's interest, in-

cluding the function involved and the

fiscal and administrative burdens that

the additional or substitute procedural

requirement would entail. See, e.g.,

Goldberg v. Kelly, supra, [367 U.S.] at

-l33a-

263-271."

Mathews, at 334-35.

In contrast to the categorical analysis

of Endicott Johnson, the balancing of

interest approach to due _ process, first

recognized in the creditor-debtor situation

in Mitchell, and distilled in Mathews, has

been applied by courts and commentatorsl0/

10/ See Note, Due Process, Postjudgment

Garnishment, and "Brutal- Need" Exemptions,

Duke L.J. 192 (1982); Greenfield, A Constitu-

tional Limitation on the Enforcement of Judg-

ments --Due > Process and Exemptions, 1975 Wash.

U.L.Q. 877; Note, “Due Process ‘Requires Notice

of Exemptions and a Prompt Post-seizure Hear -

for Postjudgment Garnishment, 46 Mo. L.

oR 857 (1981); Note, Pennsylvania's Post-

judgment Garnishment Procedures Violate The

Due Process and Supremacy Clauses, 26 Vill.

L. Rev. 579 (1980-81); Comment, Postjudgment

Wage Garnishment Procedure that Gives Debtor

No Notice or Opportunity to Assert ~ Statutory

Exemption Prior to Garnishment is Unconsti-

tutional, 3 Fla.St.U. L. Rev. 626 (1975);

Alderman, Default Judgments & Postjudgment

Remedies Meet the Constitution: Effectuating

Sniadach_ and Its Progeny, 65 Geo. L.J. 1

(1976); Dunham, Post Judgment Seizures: Does

Due Process Require Notice and Hearing, 21

.... bs meee 73 (1976); Note, A Due es

Analysis of New York's Postjudgment Garnish-

ment Procedure, 44 Alb. L. Rev. 849 (1980).

-134a-

RE

analyzing post judgment garnishment and exe-

cution procedures. See Finberg v. Sullivan,

634 F.2d 50 (3d Cir. 1980) (en banc); Brown

v. Liberty Loan Corp. of Duval, 539 F.2d 1355

(Sth Cir. 1976), cert. denied, 430 U.S. 949

(1977); Deary v. Guardian Loan Co., Inc., 534

F. Supp. 1178 (S.D.N.Y. 1982); Betts v. Tom,

431 F.Supp. 1369 (D. Haw. 1977); First Nat'l

Bank v. Hasty, 410 F.Supp. 482 (E.D. Mi.

1976); Harris _v. Bailey, 574 F.Supp. 966

(W.D. Va. 1983); Phillips v. Robinson

Jewelers, No. 81-190-BT (W.D. Okla., Feb. 16,

1982); Simler v. Jennings. 23 0. Op. 3d 554

(S.D. Ohio 1982).

In Finberg, 634 F.2d 50, the Third Cir-

cuit concluded that the Pennsylvania re-

straint and enforcement procedures, which

resulted in freezing the plaintiff's bank

account, failed to provide notice and a

Prompt post seizure hearing, denied the judg-

ment debtor due process of law, and violated

-135a-

the Supremacy Clause of the United States

Constitution. Id. at 59-63. Notice was

insufficient because it failed to inform the

judgment debtor of the exemptions which might

have been available or the procedures by

which to assert an exemption. A prompt hear-

ing was not available where the creditor had

fifteen days to respond to an exemption peti-

tion before the debtor could request a hear-

ing 14

ii/ Similarly, in Deary _v. Guardian Loan

Co., Inc., 534 F. Supp. 1178 (S.D.N.Y. 1982),

the district court held that the failure to

afford judgment debtors notice of and an

opportunity to challenge New York's postjudg-

ment enforcement procedures violated both due

process and the Supremacy Clause, even though

the enforcement procedures did include post-

seizure means for asserting exemptions. In

particular, the Deary court required that the

debtors be apprised of the exemptions avail-

able to them and the procedures by which such

a claim could be asserted. Id. at 1187-88.

Compare Cole _ v. vio oe tae Pederson &

Hochron, 10 N.Y.S. Sup. Ct., Broome

City 1978) (holding New York enforcement pro-

cedures unconstitutional because of a lack of

notice) with Warren v. Delaney, No. 1155318

(N.Y.Sup.Ct., Westchester Cty., June 11,

1981) (holding New York procedures constitu-

tional on the basis of Endicott Johnson.

-136a-

By contrast, in Brown, 539 F.2d 1355, the

In Betts v. Tom, 431 F. Supp. 1369 (D.

Haw. 1977), the judgment creditor of the

plaintiff had a garnishment summons issued to

a local bank where the plaintiff maintained

an account. The sole funds in the plain-

tiff's account were Hawaiian state welfare

funds, exempt under Hawaiian law. The bank

froze the plaintiff's funds for four weeks

when she was successful in quashing the writ

of garnishment. The Hawaii statute requires

no affidavit from the judgment creditor that

the property to be garnished is nonexempt and

the writ will be furnished by the clerk of

the court after a form is filled in by the

judgment creditor. The court found that Haw.

Rev. Stat. Section 652-1(b) was unconstitu-

tional insofar as it allowed the issuance of

ex parte writs of garnishment to be served on

personal checking accounts belonging to judg-

ment debtors which may or do contain funds

traceable to AFDC benefits. Although the

court limited its holding to the facts before

it, it required that the statute henceforth

incorporate a procedure similar to that in

Mitchell, 416 U.S. 600, and Fuentes, 407 U.S.

67, of the presentation of an affidavit set-

ting forth facts that the funds to be gar-

nished are not exempt funds, to be reviewed

by a judicial officer, and the entitlement of

notice and a quick, two working days' review

of any AFDC exemption claim.

In Simler v. Jennings, 23 0. Cy. 3d 554

(S.D. Ohio 1982), a magistrate, pursuant to

28 U.S.C. § 636(b)(4) and (c)(1) held Ohio's

postjudgment garnishment procedure unconsti-

tutional. The Ohio Law set out a single sys-

tem of postjudgment garnishment for the

-137a-

Fifth Circuit, after balancing the interests

various types of garnishments available to

judgment creditors. A garnishment action was

commenced by filing an affidavit in which it

is stated that the creditor does not believe

that the property sought to be attached was

exempt. The order is served on the garnishee

who is directed to deliver a copy to the

debtor. No hearing either before or after

the seizure is required. An ad hoc hearing

will be provided upon request by the debtor

after an answer time of 21 days is given the

judgment creditor. The notice received by

the debtor concerns only the actions to be

taken by the garnishee, with no language

informing the debtor that he may challenge

the garnishment or of the possible defenses.

Consequently, the court ordered that future

procedures should provide, at a minimun,

notice of the garnishment on the debtor, a

notice explaining the defenses, a description

of the procedure for asserting those defen-

ses, and a prompt disposition of the issues.

In Phillips v. Robinson, Inc., No. Civ.-

81-190-BT (W.D. Okla. 1983), the District

Court held that Oklahoma's postjudgment gar-

nishment statutes were unconstitutional in

that notice of the garnishment proceedings

was not served on the debtor, did not inform

the gebtor of the particular grounds or pro-

cedures for challenging the garnishment

actions, and no prompt hearing was provided.

In Harris v. Bailey, 574 F.Supp. 966

(W.D. Va. 1983), the plaintiff Harris, a

Social Security recipient, filed an action

seeking declaratory and injunctive relief

pursuant to 42 U.S.C. § 1983 to invalidate

the postjudgment garnishment procedures per-

-138a-

of the parties, concluded that a Florida post

judgment wage garnishment statute, which did

not provide for prior notice or a hearing,

satisfied due process. This decision was

reached in part because the plaintiff was

provided with an expeditious review of his

claim. 124

mitted by Va. Code §§ 8.01-511 to 525 (1977 &

Supp. 1983) as violative of the Due Process

and Supremacy Clauses of the United States

Constitution. After an appeal in which the

Fourth Circuit held that there was a justifi-

able controversy despite the fact that her

garnished benefits had been returned to her,

the District Court on remand held that the

Virginia postjudgment garnishment procedures

were constitutionally deficient in that the

statute provided no requirement that the

notice to the judgment debtor be served in a

timely manner, there was no notice of the

possible exemptions available to the judgment

debtor or the process for contesting the gar-

nishment, and finally, there was no require-

ment of an expeditious hearing.

12/ Similar to Brown, in First Nat'l Bank v.

Hasty, 410 F. Supp. 482 (1976), where the

defendant judgment debtor failed to demon-

strate that his notice of proceedings from

the garnishee defendant in accordance with

the Michigan Rule had been inadequate or

impaired his ability to object, there was no

deprivation of due process. Judgment

debtor's rights of due process were further

-139a-

A. Identification of the Interests Involved

and Risk of Erroneous Deprivation

The post judgment creditor has a strong

interest in prompt and inexpensive satisfac-

tion of the debt owed by the judgment debtor.

Deary, 534 F. Supp. at 1186. More weight is

to be accorded this interest in a post judg-

ment context than in prejudgment situations,

because there is no question as to the deb-

tor's liability. Delay or added expense to

the creditor will only diminish the ultimate

value of the recovery on the debt. Finberg,

634 F.2d at 58; Brown, 539 F.2d at 1365;

Betts, 431 F. Supp. at 1376. The ability to

seize swiftly monetary assets, such as bank

accounts, which are easily liquidated, is in

protected by the Michigan requirement that

before any writ of garnishment is issued an

affidavit must be presented to the clerk of

the court showing that the plaintiff is

justly apprehensive of loss unless the writ

is issued. The court did not consider the

question of whether the notice must inform

the debtor of the procedures or the defenses

available to him, or the question of the

timing of the hearing to be provided to him.

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the creditor's interest since it is faster

and less expensive than enforcement against

other types of personal property. Finberg,

634 F.2d at 58; Brown, 539 F.2d at 1366;

Deary, 534 F. Supp. at 1186. The creditor's

fear that liquid assets held in bank accounts

can quickly disappear if notice is given is

real and further suggests the need for the

ability to attach these funds without advance

notice to the judgment debtor. Phillips,

slip op. at 13 (Paper No. 22, Exh. A).

The debtor's interest in the uninter-

rupted use of his bank accounts is not insub-

stantial.

"A bank account may well contain the

money that a person needs for _ food,

shelter, health care, and other basic

requirements of life."

Finberg, 634 F.2d at 58. Freezing a bank

account may deprive a debtor of all his

income when those funds represent the total

monthiy benefits of the disabled, the elderly

or the mother with dependent children. In

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contrast to situations involving the garnish-

ment of wages where, as in Brown, a statute

usually imposes a limit on the portion of the

wages which may be frozen and obtained, the

garnishment of a debtor's bank account, which

may contain most of his money, can be catas-

trophic. The attachment of bank accounts,

therefore, increases the probability that the

judgment creditor may deprive debtors of all

means for providing for’ themselves. The

legitimacy of the debtor's need for at least

a portion of the funds in these accounts is

underscored by the legislatures‘ determina-

tions that an exemption is necessary to safe-

guard the debtor's ability to purchase the

basic necessities. Finberg, 634 F.2d at 58;

Deary, 534 F. Supp. at 1186; Betts, 431

F.Supp. at 1375.

For the most part, the interests of the

government coincide with the interests of the

debtor and the creditor. The government's

-142a-

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interests include insuring the enforcement of

judgments and the use of efficient procedures

to do so, maintenance of the integrity of the

judicial process by preventing asset dissipa-

tion which would frustrate judicial deci-

sions, and the provision to judgment debtors

of the means to subsist and to obtain the

basie necessities of life. In addition, the

government's concern with minimizing the bur-

den on its courts and other agencies must

also be considered.

In the present case, the interests of the

judgment creditors and judgment debtors are

those recognized by courts which have previ-

ously examined these issues. The American

Express Company, the C & P Telephone Company,

and the Equitable Bank all had an interest in

recovering efficiently and quickly the debt

owed them by the judgment debtors. The

plaintiffs had their sole sources of income

placed beyond their reach for the period of

-143a-

time between the issuance of the writ until

their claims of exemptions were resolved by

the district courts. Plaintiff Dannie, a

mother of three, had her sole source of

income, AFDC benefits, deposited directly in

her bank account, frozen. Plaintiff Reigh

had her pension and Social Security retire-

ment benefits, directly deposited in her bank

account, frozen. The Simpkins had their dis-

ability and dependent's disability funds from

Social Security frozen. Each plaintiff,

relying solely for sustenance on benefits

which are statutorily exempt from garnish-

ment, was deprived of those benefits until

the district courts ruled on the respective

motions to quash.

B. Notice

The Maryland District Rules in

effect when this suit was filed and as

amended on October 21, 1983 contained no

assurance that the judgment debtor would ever

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™ er terse or

2 i -

receive notice that his bank account had been

attached and the funds’ therein’ frozen.

M.D.R. Fl provided for service of the writ

only on the garnishee, not on the debtor.

While the back of the Order for Attachment,

which was served on the garnishees holding

the property of these plaintiffs, stated that

the garnishee should notify the debtor, there

was no requirement that the garnishee do so

(Paper No. 13, Dannie Affidavit, Order for

Attachment attached thereto; Paper No. 15,

Reigh Affidavit, Order of Attachment attached

thereto).

At the December 2, 1983 hearing, the

defendants submitted to the court for its

consideration copies of two types of forms

then being used by the District Courts of

Maryland in post judgment garnishment

cases.t3/ Defendants’ Hearing Exhibit No. 2

13/ At the hearing, the defendants also

submitted a copy of the constable's manual,

printed by the District Courts of Maryland.

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is the Petition for Attachment on Judgment

containing also the Writ of Attachment (here-

inafter referred to as Petition/Writ). This

Petition/Writ replaced the Order for Attach-

ment form used by the Maryland District

Courts to notify the garnishees of the plain-

tiffs' property. The Petition/Writ was

printed in June of 1983. Although the new

Petititon/Writ stated that the debtor may

claim a cumulative $3,000 exemption of any

judgment as set forth in Md. Cts. & Jud.

Proc. Code Ann. § 11-504, the Petition/Writ

no longer informed the garnishee that it

should mail a copy of the order to the deb-

tor. Thus, there was still no requirement by

(Defendants' Exhibit No. 3). This manual was

in effect at the time the plaintiffs in this

case had their accounts frozen. Although the

manual § 2.33 states that the sheriff must

notify the judgment debtor that a writ has

been served on his property held by a third

person, this was ot done for any of the

plaintiffs in this case; as the manual is not

strictly followed, it does not provide the

judgment debtors with the due process rights

they should have been provided by law.

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statute or rule nor any longer a suggestion

in the forms used that the garnishee inform

the judgment debtor of the attachment of his

or her bank account, in order to provide the

judgment debtor with notice of his right to

assert a claim of exemption.

Defendants' Hearing Exhibit No. 1 is a

copy of the Garnishee's Confession of Assets

form. This form is completed by the garni-

shee and it indicates the property of the

judgment debtor that is held by the garni-

shee. Once a Confession of Assets was filed

by the garnishee, the district court could

enter a judgment of condemnation absolute for

the assets confessed, provided that no claim-

ant filed a pleading within thirty days after

service of the writ on the garnishee. M.D.R.

F4. This form, which went into use in

September, 1983, contains on it a certifi-

cation, to be completed by the garnishee,

that a copy of the confession of assets form

hes been mailed to, among others, the defen-

dant, judgment-debtor. The reverse side of

the confession of assets form lists those

items which are exempt from execution on

judgment as provided for in Md. Cts. & Jud.

Proc. Code Ann. § 11-504(b) & (ce), and

informs the judgment debtor that if he or she

wishes to claim the $3,000 exemption set

forth in § 11-504(b)(5), the judgment debtor

may fill out and return a Motion to Elect

Exemption form set forth below.

While the new M.D.R. 3-645(d) seems to

require that the answer of the garnishee be

served on the judgment debtor as well as the

creditor, there is no requirement in the post

judgment garnishment rules that a copy be

received by the debtor or filed by the garni-

shee within the thirty-day period the judg-

ment debtor has to assert his claim of exemp-

tions. M.D.R. 3-645(e) and (i). With the

old form, which also contained a certificate

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of service to the judgment debtor, (Paper No.

13, Simpkins Affidavit, Garnishee's Confes-

sion of Assets form), the Simpkins did not

receive a copy of the Confession of Assets

form until almost three weeks after their

bank account had been frozen and the writ had

been served. Thus, the possibility exists

that judgment debtors will not receive a copy

of the Confession of Assets form until after

their time to file their defenses to the

attachment has run.

Although, as _ the plaintiffs rightly

pointed out, the law prior to July 1, 1984

did not require that the judgment debtor be

given notice of anything, the new M.D.R. 3-

645(d) requires that the judgment debtors be

mailed a copy of the writ "“[p]romptly after

service upon the garnishee."

The old procedure, under the rules as

they existed when this suit was filed, and as

the rules were amended on October 21, 1983,

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was a violation of due process in that a

judgment debtor was not guaranteed notice of

an attachment sufficient to allow him to

obtain a meaningful judicial determination of

his right to an exemption of property under

state and federal law.

The new rule, however, appears to the

court to provide for the timing of notice to

the judgment debtor in a manner sufficient to

satisfy the concepts of fairness inherent in

the Due Process Clause. While the timing of

the notice under the new M.D.R. 3-645(d) is

somewhat ambiguous se that t€ te. freekired

"promptly" after service upon the garnishee,

this court is reluctant to conclude, in the

absence of state court rulings on the meaning

of that term in this context, that the notice

would be deemed to be "prompt" if not sent at

the first possible opportunity after service

upon the garnishee was achieved. Only if the

notice is sent immediately to the judgment

’ -150a-

debtor after service upon the garnishee will

the debtor have a reasonable opportunity to

take action to obtain a meaningful judicial

determinationl4/ of his rights to 060 oa

exemption of the seized property.

C. Content of Notice

The second result of a lack of notice

from the District Courts of Maryland to the

debtors, alleged by the plaintiffs, is the

likelihood of ignorance on the part of judg-

ment debtors of the exemptions which are

availablel5/ and the process by which a claim

14/ professor Alderman has argued that all

postjudgment summary-seizure procedures

should provide for notice and an opportunity

to be heard before any deprivation occurs.

Alderman, 65 Geo. L. J. at 23. As Mitchell

reveals that such protections are not neces-

sarily required in a prejudgment attachment

process, this court does not believe that in

a postjudgment context there is an absolute

need for resolution of the claim of exemption

before the initial attachment where other

protections assure that the risk of a wrong-

ful deprivation will be slight and any wrong-

ful deprivation will be brief.

is/ A partial listing of federal and

Maryland exemptions available to judgment

-l5la-

of exemption can be made.

The notice requirement by due process

must be "reasonably calculated, under all the

circumstances, to . . . afford [interested

parties] an opportunity to present their

objections." Mullane v. Central Hanover Bank

& Trust Co., 339 U.S. 306, 314 (1950); Green

v. Lindsey, 456 U.S. 444 (1982). See Memphis

Light, Gas & Water Div. v. Craft, 436 U.S. l,

13-15 (1978) (publie utilities notice to its

debtors is identified by the plaintiffs in

Paper No. 14, Exh. B. The benefits received

by the plaintiffs in this case were exempt

under 42 U.S.C. § 407 (exempts the payment of

benefits available under the Social Security

Act (Reigh and Simpkins), 29 U.S.C. §

1056(d)(1) (exempts ERISA pensions) (Reigh),

Md. Cts. & Jud. Proc. Code Ann. §§ 11-504

(general exemption for a certain amount of

cash) (Reigh and Simpkins), and Md. Ann.

Code, Art. 88A, § 73 (exempts all benefits

available under state public assistance

programs).

A further examination of the exemptions

available to debtors is set forth in _ two

articles. See Vukovich, Debtor's Exemption

Rights, 62 Geo. L. J. 779, 797-832 (1974);

Glenn, Property Exempt from Creditor's Rights

of Realization, 26 Va. L. Rev. 127, 128

(1939).

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customers of the termination of their gas an

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