We have had several bank clients contact us regarding the handling of a “naked” writ of fieri facias that is not accompanied by a garnishment. This article defines the Writ of Fieri Facias (the “Writ”) and provides a general outline of the minimal requirements or procedures for a bank to follow when it is served with a Writ. As always, should any questions arise, a bank should immediately confer with its legal counsel.
A Writ is an order to a sheriff to obtain the monetary amount of a judgment out of the non-exempt monies, bank notes and/or goods and chattels of a judgment debtor. As relevant to banks, a Writ will direct a sheriff to go to a particular bank to obtain the judgment debtor’s property found therein to satisfy the judgment.
The lien of the Writ attaches to both the judgment debtor’s tangible and intangible property.
The Writ becomes a lien on the judgment debtor’s intangible property as soon as the Writ is received by the sheriff. However, the lien on the intangible property is not perfected or binding on third parties until notice is given to the third party (the bank) of its existence. A bank could receive notice of the lien pursuant to the Writ either by service of a Notice of Lien or by service of the actual Writ by the sheriff.
The execution of the Writ is completed when the money is transferred to the creditor via the sheriff or the property is sold by the sheriff to satisfy the debt.
Upon service by the sheriff of either a Writ or Notice of Lien, a bank should immediately identify the judgment debtor whose assets are being levied upon. If a bank is unable to determine the identity of the judgment debtor, the bank should promptly respond (by letter to the Clerk of Court, the judgment creditor and the judgment debtor) that it cannot properly identify the judgment debtor and therefore it cannot determine if it holds any assets that are subject to the Writ.
If able to identify the judgment debtor, the bank should review the Writ to determine which of the judgment debtor’s assets the Writ covers. For example, a Writ could be narrow and identify a single account number or it could be broad and cover “any and all accounts held by the bank, including but not limited to all contents of any safety deposit box.” If there is any doubt about the assets to which the Writ is directed, the best course of action (after consultation with bank counsel) may be to assume it is broad and briefly hold all assets of the judgment debtor while communicating with the judgment creditor, judgment debtor and Clerk of Court regarding the scope of the assets covered by the Writ.
The Writ will have a “Return Date” of not more than 90 days from the date it is issued. The bank should provide a written response, on or before the Return Date, identifying the property that is being held and any information about other persons who may have an interest in or claim to the property. This response should be returned to the court that issued the Writ, with a copy to the creditor and judgment debtor.
The Writ extends to all property described in the Writ that the bank holds for the judgment debtor during the period between service of the Writ and the Return Date. Therefore a bank will need to continue to hold covered assets during this period and may need to supplement its response to the Writ as additional assets are held or identified.
In addition, a bank may receive the Writ after a traditional garnishment or prior Writ is already in place. The bank should respond to the Writ by again identifying what property of the judgment debtor is being held, and additionally responding that a prior garnishment/Writ is in place. A court may then determine the priorities of any liens. If a prior garnishment or Writ ends earlier than the Return Date identified on the Writ, the bank must hold those assets subject to the new Writ for that period between the expiration of the prior garnishment or Writ and the Return Date of the new Writ.