Dennis Garner v. Gregory Stewart Kempf and Vanderburgh County Clerk
2017 Ind. App. LEXIS 34
| Ind. Ct. App. | 2017Background
- Garner obtained a $20,600 civil judgment against Kempf in 2013 and has been unable to collect.
- Kempf posted a $5,000 cash bond in a criminal case; Garner filed a motion for proceedings supplemental in the civil court naming the county clerk as garnishee and served the clerk with the motion and a letter asserting an equitable lien on the bond proceeds.
- Garner did not file anything in the criminal case or notify the criminal court directly; the clerk did not note the lien on the criminal case CCS and the criminal court was unaware of the lien.
- The criminal court released the $5,000 bond proceeds to Kempf’s criminal defense attorney before the civil court held its supplemental hearing.
- The civil trial court denied Garner’s proceedings supplemental motion and declined to enter judgment against the clerk, reasoning Garner should have ensured the lien was entered on the criminal CCS; Garner appealed.
Issues
| Issue | Plaintiff's Argument (Garner) | Defendant's Argument (Clerk) | Held |
|---|---|---|---|
| Whether a judgment creditor’s service of process in proceedings supplemental creates an equitable lien on third-party-held bond proceeds | Service of the supplemental process and serving the clerk created an equitable lien on the bond proceeds upon service | Bond proceeds in a criminal case are not subject to garnishment in unrelated civil cases (relying on O’Laughlin) or, alternatively, clerk had no liability when following criminal-court release order | Held for Garner: service on the clerk created an equitable lien; the clerk, as garnishee, was liable for releasing funds inconsistent with that lien |
| Whether the clerk had an obligation to protect the garnished funds absent a CCS notation or direct notice to the criminal court | Garner: garnishee duty arises on service of garnishment; clerk was required to preserve funds (e.g., note CCS, alert criminal court) | Clerk: responsibility fell on Garner to ensure criminal court notice (trial court memo) | Held for Garner: statutory garnishment scheme imposed duty on clerk once served; trial court erred relying on an internal memo placing extra burden on creditor |
| Whether statutes or case law bar garnishment of bond proceeds in unrelated criminal matters | Garner: general garnishment law and bailment principles allow attachment when bond not forfeited | Clerk: O’Laughlin and bail statutes limit garnishment to bonds related to same transaction or occurrence | Held for Garner: O’Laughlin is limited to forfeited bonds; statutes protecting bond from forfeiture when civil claim arises from same transaction do not preclude garnishment by unrelated creditors |
| Proper forum for proceedings supplemental affecting bond proceeds (civil court vs. criminal court) | Garner: proceedings supplemental properly filed in the civil court where judgment was entered under Trial Rule 69(E) | Clerk/dissent: bail proceedings and bond disposition are matters for the criminal court under I.C. § 35-33-8-7(c) | Held for Garner: Trial Rule 69(E) controls where conflict exists, so civil-court supplemental filing was proper |
Key Cases Cited
- Fifth Third Bank v. Peoples Nat’l Bank, 929 N.E.2d 210 (Ind. Ct. App. 2010) (service in proceedings supplemental creates equitable lien on third-party funds)
- Radiotelephone Co. of Ind., Inc. v. Ford, 531 N.E.2d 238 (Ind. Ct. App. 1988) (third party is liable for paying out funds inconsistent with a creditor’s lien)
- O’Laughlin v. Barton, 549 N.E.2d 1040 (Ind. 1990) (addresses forfeiture and disposition of bail proceeds to state when bond is forfeited)
- Germann v. Tom’s 24-Hour Towing, Inc., 776 N.E.2d 932 (Ind. Ct. App. 2002) (recognizes that bail bond proceeds can be subject to garnishment)
- Turner v. Clary, 606 N.E.2d 878 (Ind. Ct. App. 1993) (applies bailment law to cash bail deposits and explains depositor’s continuing interest absent forfeiture)