Researcher: DC Page 1 5/18/23
OLR Bill Analysis
sHB 6786 (as amended by House "A")*
AN ACT CONCERNING SERVICE OF BANK EXECUTIONS, WAGE
EXECUTIONS AND TAX WARRANTS BY STATE MARSHALS AND
AUTHORIZED SERVICE OF PROCESS BY INDIFFERENT
PERSONS.
SUMMARY
This bill makes various changes in the laws on service of process.
For executions against financial institution accounts, the bill allows
officers serving certain accounts by certified mail to collect actual
postage costs and requires the institutions to respond to the execution
within seven business days. It also adds requirements for institutions
and creditors to notify the serving officer about certain information.
Additionally, the bill:
1. expands the instances for which levying officers may mail
executions on wages after judgment and allows them to collect
actual postage costs incurred,
2. limits when an indifferent person may serve process to specific
instances authorized by law,
3. reconciles two differing minimum fees for serving tax warrants,
and
4. allows any officer of any precinct to serve process on the
comptroller in any action where process is allowed.
The bill also makes technical and conforming changes.
*House Amendment “A” (1) for executions against financial
institutions, (a) extends how much time a financial institution has to
respond to an execution from five business days, as under the 2023HB-06786-R010784-BA.DOCX
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underlying bill, to seven business days; (b) modifies what an institution
must give in response to a serving officer depending on the action it took
when responding to the execution; and (c) adds requirements for
institutions and creditors to notify the serving officer; (2) for wage
executions after judgments, requires creditors to pay the levying
officer’s fee and actual postage costs in instances where the debt is paid
directly; (3) adds the provision allowing any officer of any precinct to
serve process on the comptroller; and (4) makes various minor and
conforming changes.
EFFECTIVE DATE: October 1, 2023
§§ 1 & 2 — EXECUTION AGAINST FINANCIAL I NSTITUTION
ACCOUNTS
By law, a person who has a court judgment against someone may
apply to the court clerk to have an execution served on a financial
institution (e.g., a state or federal bank or credit union) for payment of
the debt from the debtor’s deposit account (see BACKGROUND).
Actual Costs and Fees
For executions at out-of-state financial institutions that lack a main or
branch office in Connecticut, but conduct transactions online or by other
electronic means, the law allows serving officers to serve the execution
by certified mail, return receipt requested. The bill allows the serving
officer to collect the actual postage costs incurred, in addition to the
serving officer’s fee, from the amount removed from the judgment
debtor’s account, if any.
For executions where the judgment debtor is a natural person (i.e., an
individual), current law requires financial institutions to receive an $8
fee from the serving officer as representative of the judgment creditor.
The bill instead requires the financial institution to deduct the fee from
the amount that is paid to the serving officer. The bill specifies that this
fee is not a deposit account charge. As under existing law, the fee may
be recoverable by the judgment creditor as a taxable cost of the action.
Financial Institution Duty to Respond 2023HB-06786-R010784-BA.DOCX
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Under existing law, the serving officer must only serve one financial
institution for each debtor at a time and not serve the same execution on
another financial institution until receiving confirmation from the
original institution that the judgment debtor had insufficient funds to
satisfy the execution.
The bill requires financial institutions to respond to the serving
officer about the execution by the seventh business day after the
execution is served. Specifically, an institution must send the serving
officer by first class mail, postage prepaid, notice on whether the
institution removed funds from the judgment debtor’s account under
the execution with the amount of funds removed and referencing the
docket number, if it was on the execution.
If the judgment debtor is not indebted to the financial institution or if
the institution has not removed funds from the debtor’s account under
the execution, the institution must return to the serving officer by first
class mail, postage prepaid, a complete set of all the documents the
serving officer served including the cover page, with endorsements
from other financial institutions, as the case may be, and the original
true and attested copy of the execution. For executions where the
judgment debtor is a natural person, it must also include the affidavit
and exemption claim form. The institution’s response must note on the
serving officer’s cover page, or if it chooses, on a separate document it
prepares, that the debtor has no account with the institution or that no
funds were removed from the account. The separate document must be
affixed to or enclosed with the institution’s return of the required
material. The bill requires the institution to maintain reasonable
procedures to prevent the resubmission of a response to the serving
officer.
The bill also makes a conforming change by eliminating a provision
for executions where the judgment debtor is not a natural person, that
allows a serving officer to assume that sufficient funds are unavailable
for collection and proceed to serve another institution if the institution
does not respond within 25 days after being served the demand. 2023HB-06786-R010784-BA.DOCX
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Natural Person Judgment Debtor
For executions where the natural person is the judgment debtor,
existing law requires the financial institution to notify judgment debtors
and any secured party that is party to the control agreement between
the financial institution and the secured party if any funds are removed
from the judgment debtor’s account. The bill also allows institutions to
note that funds were removed from a debtor’s account on any account
records available to debtor, including electronic ones. But it prohibits
institutions from displaying or giving the debtor the serving officer’s
name or contact information.
Under the bill, if the debtor asks the institution about the execution,
the institution may direct the debtor to the creditor or the creditor’s
attorney at the telephone number on the execution or to the applicable
court clerk also identified on the execution form.
Existing law requires a judgment debtor to give notice of an
exemption claim to the financial institution to prevent the institution
from paying the serving officer. Upon receiving this notice, the
institution must, within two business days, send a copy of it to the court
clerk who issued the execution. The bill also requires the institution to
send a copy of the notice, or a separate one the institution prepares, to
the serving officer stating that the debtor submitted an exemption claim.
Non-natural Person Judgment Debtor
For executions where the judgment debtor is not a natural person, if
the court clerk receives a written claim for determining property
interests from another secured party, existing law requires the clerk to
(1) enter the appearance of the secured party and (2) send copies of the
written claim to the creditor, debtor, and financial institution where the
execution was served with a notice that the disputed funds are being
held until there is a court order for fund disposition. The bill requires
the creditor to send a copy of the written claim to the serving officer.
§ 3 — EXECUTION ON WAGES AFTER JUDGMENT
Under current law, an officer empowered to serve process must levy
on all earnings that are due or become due to the judgment debtor, to 2023HB-06786-R010784-BA.DOCX
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the extent specified in the wage execution plus the officer’s fees and
costs. The bill specifies that the levy for costs is for actual postage costs
incurred.
Under the bill, if the levying officer served the judgment debtor’s
employer and the debt is later satisfied in whole or in part by payment
directly to the creditor or his or her agent instead of the levying officer,
the creditor or agent must pay the levying officer’s fee or portion of it,
and the actual postage costs.
Generally, the law allows state marshals and other proper officers to
serve process in their precincts (a state marshal’s precinct is the county
for which he or she is appointed). But they may serve process outside
their precincts in certain circumstances. The bill expands the instances a
levying officer may mail executions by allowing him or her to mail
service to an address within the officer’s precinct or extension of
precinct if done following the laws on serving process outside an
officer’s precinct, instead of just in the officer’s appointed precinct.
Current law also allows these officers to serve process by mail in cases
involving an employer whose address is not within the officer’s
appointed jurisdiction to the address the employer designates. The bill
specifies that the address must be outside Connecticut with an out-of-
state payroll address.
In these instances, the bill requires service to be made by certified
mail, return receipt requested, and the officer may first collect the actual
postage costs incurred under the levy.
§ 4 — INDIFFERENT PERSON
The bill limits when an indifferent person may serve process to
specific instances authorized by law. It does this by eliminating the
authority for them to do so (1) if multiple defendants living in different
counties in the state are named in the process or (2) in the case of a writ
of attachment (an order to seize or attach property), when a plaintiff, or
his or her agent or attorney, makes an oath before the authority signing
the order that he or she is in danger of losing the debt or demand unless 2023HB-06786-R010784-BA.DOCX
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an indifferent person is authorized to serve process immediately.
By law, an indifferent person is someone who is not a proper officer
and is not involved in the case. The law authorizes an indifferent person
to serve process in various instances, like delivering notice of special
and convened sessions to legislators, serving notice to quit possession
or occupancy of premises, and carrying out a bench warrant of arrest
(CGS §§ 2-7, 47a-23 & 54-64b).
§ 5 — TAX WARRANT MINIMUM AMOUNT
The bill reconciles two differing minimum fees for serving tax
warrants. In the tax warrant statute, the minimum amount a serving
officer must receive is $30 while the service officer fees and expenses
law has a minimum of $50. The bill eliminates the $30 minimum fee.
Under existing law, a state marshal or constable who executes a
warrant and collects delinquent municipal taxes receives, in addition to
expenses otherwise allowed, 15% of the taxes collected under the
warrant (CGS § 52-261).
§ 6 —SERVING THE COMPTROLLER
Current law allows any officer of any precinct to serve process, in any
action where process is allowed, on the Secretary of the State, motor
vehicles or insurance commissioners, or the attorney general. The bill
also allows any officer to serve process on the comptroller. By law, this
service is considered to be within the officer’s precinct.
BACKGROUND
Law on Execution Against Financial Institution Accounts
Under this law, the procedures differ in some respects depending on
whether the debtor is a natural person (i.e., an individual) or an entity.
Among other things, the law generally provides that:
1. when a judgment debtor is a natural person, he or she has certain
protections and exemptions from execution;
2. serving officers may not serve the same execution on a second
institution until they get confirmation from the first institution 2023HB-06786-R010784-BA.DOCX
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that there are insufficient funds to satisfy the judgment;
3. if another party has a security interest in an account that is also
subject to an execution, the financial institution must notify the
secured party, who can submit to the court a claim for a hearing
to determine the relative interests;
4. a similar hearing procedure applies if the debtor is a natural
person who claims an exemption;
5. if no claim for interest determination or exemption is made, the
financial institution pays the serving officer, and the officer pays
the sum, minus his or her fees, to the judgment creditor unless a
court orders otherwise; and
6. a financial institution that fails or refuses to pay the execution
amount to the serving officer is liable in an action to the judgment
creditor and the amount is applied to the amount due on the
execution.
COMMITTEE ACTION
Judiciary Committee
Joint Favorable Substitute
Yea 37 Nay 0 (03/28/2023)