Honoring order or instructions of depositor; liability
Sec. 2. Except as provided in sections 3 and 4 of this chapter, and notwithstanding IC 34-25-3-3 or any other rule or doctrine of law that:
(1) would cause a depository financial institution to be accountable to an adverse claimant for any portion of any deposit account; or
(2) would create or impose in favor of an adverse claimant a lien, charge, encumbrance, or other right with respect to a deposit account;
a depository financial institution may, without being liable in damages to any person, honor the order or instructions of a depositor or an agent of a depositor who is authorized under records maintained by the depository financial institution to control the depositor's deposit account.
As added by P.L.258-1989, SEC.2. Amended by P.L.1-1998, SEC.156.
Adverse claim by one who is not a money judgment creditor of a depositor; accountability of depository financial institution; actions required of adverse claimant
Sec. 3. (a) This section applies to an adverse claimant who is not a money judgment creditor of a depositor.
(b) A depository financial institution may not be held accountable to an adverse claimant for funds in a deposit account that are claimed by the adverse claimant unless the adverse claimant:
(1) serves on the depository financial institution written verified notice of the adverse claim stating in detail:
(A) the nature of the adverse claim, including the facts from which the adverse claim arose;
(B) that an action has been instituted in a court having jurisdiction in Indiana, or will be instituted within three (3) working days after receipt by the depository financial institution of the notice; and
Adverse claim by money judgment creditor attempting to garnish deposit account; accountability of depository institution; interrogatories; actions required of adverse claimant
Sec. 4. (a) This section applies to an adverse claimant who is a money judgment creditor attempting to garnish a deposit account.
(b) A depository financial institution may not be held accountable to an adverse claimant for funds in a deposit account that are claimed by the adverse claimant unless the adverse claimant has complied with subsection (d).
(c) A depository institution is not required to respond to interrogatories regarding deposit accounts at the depository financial institution unless the adverse claimant has complied with subsection (d).
(d) An adverse claimant shall do all of the following:
(1) Provide the depository financial institution notice of garnishment proceedings, the unpaid amount of the judgment, and sufficient identifying information about the judgment
defendant to enable the depository financial institution
reasonably to verify the judgment defendant as the depositor.
(2) Serve or cause to be served upon the depository financial institution an order to answer interrogatories.
(3) If the judgment defendant is an individual, serve or cause to be served upon the depository financial institution a copy of a notice, or an apparently valid order containing a notice, issued by a court that is directed to the judgment defendant (which is to be used by the depository financial institution to comply with IC 28-9-4-2(a)(3)) and that:
(A) states that the adverse claimant has or may have served or caused to be served upon one (1) or more depository financial institutions notice that may result in the placing of a hold on deposit accounts maintained by the judgment defendant, either individually or jointly with another person, in such depository financial institutions;
(B) states that under federal and state law certain funds are exempt from garnishment, including Social Security, Supplemental Security Income, veterans benefits, and certain disability pension benefits, and that there may be other exemptions from garnishment under federal or state law;
(C) states that if the judgment defendant or another person who maintains a deposit account jointly with the judgment defendant believes that some or all of the funds in the deposit account on which a hold may have been placed are exempt, such person is entitled to a prompt hearing for the purpose of presenting evidence to establish exemptions and seeking removal of the hold; and
(D) has attached to it a preprinted detachable form that may be used by the judgment defendant or other person maintaining a deposit account jointly with the judgment defendant in requesting the prompt hearing specified in clause (C) and that generally instructs such person as to how the form should be used in requesting this hearing.
(4) Serve or cause to be served upon the depository financial institution an apparently valid order issued by a court that expressly directs the depository financial institution to place a hold on a deposit account identified in the order whenever the conditions under subdivisions (1) through (3) are met.
(5) Pay to the depository financial institution five dollars ($5) for each judgment defendant identified by the adverse claimant under subdivision (1). This fee may not be assessed as a cost to the judgment defendant in the action.
(e) An order issued under subsection (d)(4):
(1) is subject to the limitations under IC 28-9-4-2 concerning the duration of the restriction and the amount to be restricted; and
(2) may be terminated or modified to reflect valid exemptions of a depositor that the court has considered.
(f) A depository financial institution is not required to pay funds
in a deposit account to an adverse claimant unless the adverse
claimant serves the depository financial institution with a final order
in garnishment directing the payment of the lesser of:
(1) the unpaid amount of the judgment specified by the documents and process; or
(2) the balance in the account at the time of receipt of the documents and process.
As added by P.L.258-1989, SEC.2. Amended by P.L.197-1991, SEC.1; P.L.198-1991, SEC.1; P.L.1-1992, SEC.157; P.L.89-1998, SEC.1.
Garnishment of deposit account; notice requirements
Sec. 5. (a) The information specified in section 4(b)(3)(B) through 4(b)(3)(C) of this chapter and the legend set forth in subsection (c) must be printed more conspicuously than the other information specified in section 4(b)(3) of this chapter. The information specified in section 4(b)(3)(B) through 4(b)(3)(C) of this chapter and the legend set forth in subsection (c) may be made more conspicuous in any way that highlights it in relation to the other information specified in section 4(b)(3) of this chapter, including, but not limited to, any of the following:
(1) Capitalization, when the other information is printed in capitals and lower case.
(2) Printing in larger type, boldface print, or differentiated typeface.
(3) Printing in a contrasting color.
(b) Use of the following forms will constitute compliance with the notice requirements of section 4(b)(3) of this chapter:
THAT ALL OR SOME OF THE FUNDS IN THESE
ACCOUNTS ARE EXEMPT, YOU OR YOUR JOINT
DEPOSITOR ARE ENTITLED TO A PROMPT HEARING IN
THIS COURT TO PRESENT EVIDENCE TO ESTABLISH
EXEMPTIONS AND TO SEEK REMOVAL OF THE HOLD.
To obtain such a hearing, fill in the form marked "Exemption Claim and Request for Hearing" attached hereto and return it to this court either by mail or by personally bringing it to the court. A copy of that form should also be sent to plaintiff's attorney or to the plaintiff, if the plaintiff is not represented by an attorney, at the address set forth below. A prompt hearing will be scheduled by the court as soon as possible, but generally no later than 5 days (excluding Saturdays, Sundays, and legal holidays) after the completed form is received by the court. Please call the court at (___) __________ to find out when the hearing is scheduled. When calling the court, please have the cause number handy. The cause number is located at the top of the right-hand side of this document. After the hearing, the court will decide whether all or part of the funds in each account on which a hold has been placed or other accounts in which you have an interest may be taken by the plaintiff.
If a joint depositor or you do not request an early hearing, there will be a hearing at the time when you are ordered to appear. At that hearing, you and a joint depositor are entitled to assert any exemptions. However, if a joint depositor or you do not request an early hearing, each account on which a hold has been placed may not be released until the time you are ordered to appear.
EXEMPTION CLAIM AND REQUEST
THE HONORABLE JUDGE OF THE
COURT OF ___________ COUNTY
ROOM NO. ___________
(City, State, Zip)
side for important information concerning your exemption and other
rights.". However, in any case, the adverse claimant or an attorney
representing the adverse claimant must serve or cause to be served
this notice upon the judgment defendant in accordance with the
applicable rules of court before or promptly after the notice is served
upon the depository financial institution.
As added by P.L.258-1989, SEC.2. Amended by P.L.197-1991, SEC.2.