Texas House Bill HB4122

Texas 2019 - 86th Regular

Caption

Relating to the award of attorney's fees to a financial institution that answers a writ of garnishment.

Impact

The implications of HB4122 are significant for both financial institutions and individuals facing garnishment. By clarifying the conditions under which attorney's fees can be awarded, the bill may help reduce unnecessary litigation costs for financial institutions when they are not at fault in garnishment cases. It could contribute to a more equitable legal process in garnishment cases, ensuring that attorney's fees are only awarded in cases that merit legal challenge. This change could also discourage frivolous contests to financial institutions' answers to writs of garnishment, streamlining the overall process.

Summary

House Bill 4122 aims to amend the Finance Code regarding the awarding of attorney's fees to financial institutions when responding to a writ of garnishment. This change specifies that a court cannot award attorney's fees to a financial institution unless the entity contesting the garnishment (the garnishor) unsuccessfully contests the institution's answer to the writ. This means that if a bank or financial institution complies with the writ and provides a timely answer, they will only be entitled to attorney's fees if the garnishor challenges the answer and does so unsuccessfully. This bill seeks to create a clear guideline for financial institutions regarding the costs associated with responding to legal garnishment requests.

Contention

Notable points of contention surrounding HB4122 may arise from concerns about the implications for consumers and the fairness of legal representation in garnishment cases. Critics might argue that limiting the awarding of attorney's fees could further disadvantage individuals who are already facing financial hardships, as they may have less incentive to contest a garnishment that they believe is unjust or incorrectly applied. Additionally, discussions among stakeholders may focus on whether this creates an imbalance of power between financial institutions and individual consumers, potentially leading to a higher risk of unfair garnishment practices.