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Unrepresented litigants don't forfeit exemptions even if not pleaded

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The Indiana Supreme Court has ruled in favor of a couple who were ordered in small claims court to pay $100 a month toward judgments and look for work each week. The couple’s only income is exempt under the general wage and the Social Security Income exemptions.

Quincy and Shannon Branham were unrepresented by counsel when the trial judge ordered them to pay on two separate garnishment actions. They did not assert that their income was exempt and the judge did not assert the two applicable statutory exemptions – general wage and Social Security Income – on their behalf. Quincy only made $100 a week working at a salvage yard; his wife Shannon receives $674 a month in SSI. After paying for rent, their car, food, and utilities, they said they have no money left over each month.

They appealed the order in each case, which also included that Quincy submit five job applications a week and show proof to the plaintiff’s attorney. The judge also scheduled a status conference to check on Quincy’s job situation.

The Indiana Court of Appeals was divided over whether Mims v. Commercial Credit Corp., 261 Ind. 591, 307 N.E.2d 867 (1974), requires a trial court to assert exemptions in garnishment actions on behalf of debtors who aren’t represented by counsel. The majority held the trial court shouldn’t assert those exemptions. The appellate court unanimously agreed the judge shouldn’t have ordered Quincy to submit five job applications a week.

In two opinions released Tuesday, the Supreme Court reversed the trial court, holding that entitlement to the statutory exemptions at issue in the case is not forfeited by the failure of an unrepresented litigant to plead them as an affirmative defense “in the course of purposefully informal small claims proceedings.”

Chief Justice Randall T. Shepard authored Quincy Branham & Shannon Branham v. Rodney Varble & Norman Chastain, No. 62S01-1103-SC-141, and the companion opinion, Quincy Branham & Shannon Branham v. Rodney Varble & Carol Varble, No. 62S04-1103-SC-139.

Citing Mims, the chief justice wrote that the Supreme Court held if a debtor-defendant isn’t represented by an attorney, the trial court must determine whether the debtor is a resident-householder, and, if so, which exemption would be least burdensome on the debtor.  The Branhams argued that Indiana Code 24-4.5-5-105(2)(b) exempts their income, as it limits the amount that can be garnished from any single workweek to the lesser of 25 percent of that week’s disposable earnings – the part of the earnings remaining after required deductions such as taxes – or  the amount of that week’s disposable income that exceeds 30 times the federal minimum hourly wage. The Branhams haven’t had to pay federal or state income taxes since 2003 and Quincy doesn’t have any money withheld from his wages.

Using Quincy’s weekly wages, 25 percent would be $25 a week. The federal minimum wage at the time of the proceedings supplement was $7.25 an hour. Thirty times the minimum wage is $217.50. Since Quincy’s weekly wages don’t exceed that amount, all of his wages are protected from garnishment, wrote the chief justice. Shannon’s SSI income is not subject to garnishment.

“The facts of this case suggest why holding unrepresented litigants to account on appeal for affirmatively pleading particular exemptions may often prove too harsh,” wrote the chief justice. “We finish by emphasizing that a judicial officer hearing small claims is not charged with identifying and applying the entire gamut of exemptions. The two involved here — the general wage exemption and the SSI exemption — are the stuff of everyday life in collections work. We cannot say on appeal that they are lost through failure of formal pleading.”

In addition to reversing the order that Branhams pay $50 a month in each case, the justices held that a court doesn’t err when it orders a party to return for status checks a limited number of times, even if an information of contempt hasn’t been filed.  The high court also agreed with the Court of Appeals that the trial court erred in ordering Quincy to submit five job applications a week, as orders to seek employment or better employment aren’t a proper part of a proceeding supplemental.
 

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  1. Where may I find an attorney working Pro Bono? Many issues with divorce, my Disability, distribution of IRA's, property, money's and pressured into agreement by my attorney. Leaving me far less than 5% of all after 15 years of marriage. No money to appeal, disabled living on disability income. Attorney's decision brought forward to judge, no evidence ever to finalize divorce. Just 2 weeks ago. Please help.

  2. For the record no one could answer the equal protection / substantive due process challenge I issued in the first post below. The lawless and accountable only to power bureaucrats never did either. All who interface with the Indiana law examiners or JLAP be warned.

  3. Hi there I really need help with getting my old divorce case back into court - I am still paying support on a 24 year old who has not been in school since age 16 - now living independent. My visitation with my 14 year old has never been modified; however, when convenient for her I can have him... I am paying past balance from over due support, yet earn several thousand dollars less. I would contact my original attorney but he basically molest me multiple times in Indy when I would visit.. Todd Woodmansee - I had just came out and had know idea what to do... I have heard he no longer practices. Please help1

  4. Yes diversity is so very important. With justice Rucker off ... the court is too white. Still too male. No Hispanic justice. No LGBT justice. And there are other checkboxes missing as well. This will not do. I say hold the seat until a physically handicapped Black Lesbian of Hispanic heritage and eastern religious creed with bipolar issues can be located. Perhaps an international search, with a preference for third world candidates, is indicated. A non English speaker would surely increase our diversity quotient!!!

  5. First, I want to thank Justice Rucker for his many years of public service, not just at the appellate court level for over 25 years, but also when he served the people of Lake County as a Deputy Prosecutor, City Attorney for Gary, IN, and in private practice in a smaller, highly diverse community with a history of serious economic challenges, ethnic tensions, and recently publicized but apparently long-standing environmental health risks to some of its poorest residents. Congratulations for having the dedication & courage to practice law in areas many in our state might have considered too dangerous or too poor at different points in time. It was also courageous to step into a prominent and highly visible position of public service & respect in the early 1990's, remaining in a position that left you open to state-wide public scrutiny (without any glitches) for over 25 years. Yes, Hoosiers of all backgrounds can take pride in your many years of public service. But people of color who watched your ascent to the highest levels of state government no doubt felt even more as you transcended some real & perhaps some perceived social, economic, academic and professional barriers. You were living proof that, with hard work, dedication & a spirit of public service, a person who shared their same skin tone or came from the same county they grew up in could achieve great success. At the same time, perhaps unknowingly, you helped fellow members of the judiciary, court staff, litigants and the public better understand that differences that are only skin-deep neither define nor limit a person's character, abilities or prospects in life. You also helped others appreciate that people of different races & backgrounds can live and work together peacefully & productively for the greater good of all. Those are truths that didn't have to be written down in court opinions. Anyone paying attention could see that truth lived out every day you devoted to public service. I believe you have been a "trailblazer" in Indiana's legal community and its judiciary. I also embrace your belief that society's needs can be better served when people in positions of governmental power reflect the many complexions of the population that they serve. Whether through greater understanding across the existing racial spectrum or through the removal of some real and some perceived color-based, hope-crushing barriers to life opportunities & success, movement toward a more reflective representation of the population being governed will lead to greater and uninterrupted respect for laws designed to protect all peoples' rights to life, liberty & the pursuit of happiness. Thanks again for a job well-done & for the inevitable positive impact your service has had - and will continue to have - on countless Hoosiers of all backgrounds & colors.

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