Eleventh Circuit Holds Standing Exists and Claim for Injunctive and Declaratory Relief from Garnishment of Exempt Funds Not Moot Despite Reimbursement

In Strickland v. Alexander, No.  13-15483 (Nov. 20, 2014), the Eleventh Circuit addressed whether a judgment debtor could maintain a suit for injunctive and declaratory relief for the wrongful garnishment of exempt worker’s compensation funds despite the dismissal of the garnishment proceeding and reimbursement of exempted funds.  The Court held that the plaintiff debtor had standing, and his constitutional challenge to Georgia’s post-judgment garnishment statute, O.C.G.A. § 18-4-60, et seq., was not moot.

Tony Strickland and his wife had a modest income, consisting only of Social Security disability payments and funds obtained from a worker’s compensation settlement.  Strickland kept his worker’s compensation funds in a Chase bank account. As Strickland’s heath declined, he was unable to work as much and defaulted on his Discover credit card.  Discover, represented by Green & Cooper, sued Strickland, obtained a default judgment, and filed a garnishment action against Strickland’s Chase bank account funds.  These funds, however, were exempt from garnishment under O.C.G.A. § 34-9-84.  Despite this, the court clerk, Alexander, issued a garnishment summons.  Chase answered the summons by paying the court the funds from Strickland’s account. Strickland could not access his funds for four months and was unable to pay for critical healthcare services. Discover dismissed the action and filed a satisfaction of judgment after conceding the funds were exempt. The court returned Strickland’s funds.  As a result, Strickland sued Discover, Chase, G&C, and Alexander, claiming that they unconstitutionally deprived him of his property in violation of the Due Process Clause of the Georgia Constitution and the Fourteenth Amendment.  Strickland requested a declaration that part of Georgia’s post-judgment garnishment statute was unconstitutional, injunctive relief to prevent future freezing of exempt funds, and monetary damages for injuries.

The trial court dismissed the claims for injunctive and declaratory relief for lack of standing and found that Strickland had not met the burden of proof for his constitutional claims. On appeal, the Eleventh Circuit addressed these issues: (1) whether Strickland had standing to pursue injunctive and declaratory relief; (2) whether repayment of the funds and the satisfaction of Discover’s claim mooted Strickland’s claim; and (3) whether Georgia’s post judgment garnishment statute fulfilled the federal and state constitutional due-process requirements.

The Court found that Strickland had standing to seek injunctive and declaratory relief.  Analogous to Finberg v. Sullivan, 634 F.2d 50 (3d Cir. 1980), Strickland alleged that he and his wife were judgment debtors, unlikely to satisfy any outstanding debt.  Further, Strickland stored his Social Security benefits in a separate account.  For these reasons, the court found that Strickland had satisfied the injury-in-fact requirement since the facts suggested “a substantial likelihood that he [would] suffer garnishment proceedings in the future.”  Strickland, No.  13-15483, at *13. Strickland’s complaint also met the causation requirement as Strickland’s “injury [was] fairly traceable to Alexander’s conduct.” Id. at 20. Lastly, the Court found that Strickland’s claim was not moot as the “capable of repetition, yet evading review” exception applied. Id. at 21.  Since Strickland would face a future garnishment proceeding, any constitutional claim would evade review if the release of funds and satisfaction of debt in the garnishment proceeding mooted such claim. Thus, the Court reversed the district court’s dismissal.

Finally, the Court deferred analysis of the constitutionality of Georgia’s post-judgment garnishment statute. The Court noted that Georgia’s Attorney General might want to join and remanded the issue to allow all parties to present evidence before a final ruling on appeal.

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