Expert: Mark J. Markus- California Bankruptcy Attorney - 5/21/2009

Question
I filed bankruptcy on April 1st (pro se although I have a  a paralegal who has assisted me). I had a civil judgement that had resulted in wage garnishment. I immediately sent proof of filing to my employer. My employer withheld for the first time in the check I received on April 3rd. They were ordered in the notice of garnishment to withhold funds and not disperse to creditor. My employer is still holding this. My first ? is shouldn't they be releasing this to me or sending to creditor? Surely they cant hold this indefinitely.

Next ?....Today I received a notice from my employer that they received a notice to continue withholding in regard to this issue and they will again start withholding next check. So I called the local court clerks office. Now, bear in mind both my employer and the federal court sent notice to the creditor that I filed. This lady from the court clerks office states that since I did not send the local court clerks office notice they will continue to ask my employer to withhold. My understanding is that my only responsibility is to notify my employer... (Was told its the creditors responsibility to file the court to cease withholding). Can my employer continue to withhold because I didn't notify the local justice court?

And lastly, somehow I had another judgement filed against me on May 7th by a creditor that was listed in my bankruptcy and was notified of my filing by federal court. How is it that they were able to file a judgement against me a good month after I filed bankruptcy? I was never served with anything by either of these creditors or the court at any time. I never received a thing until my employer sent me a copy of notice to withhold. They just went and had it entered...was not even given a chance to dispute... Don't you have to have proof of service to file in most states?

Answer
You need to send notice of the bankruptcy filing to the CREDITOR and the sheriff's office (or clerk, or whoever issued the levy), not to your bank.  The creditor and/or sheriff's office must order the release of the lien and if they do not, you should immediately file a motion with the bankruptcy court for: 1. violation of the automatic stay; and 2. for turnover of the funds.

For the judgment that was entered post-filing, you need to send a stern letter to them demanding that the judgment immediately be set aside, or file a Motion for Violation of the Automatic Stay against them and seek damages.  You need to hire an attorney to deal with these things.