In September, 2011 the Georgia Supreme Court ruled that the common practice of having garnishments processed and answered by clerical staff was impermissible. They ruled that in the future such answers would be considered the practice of law, and therefore garnishments could only be answered by a licensed attorney in the State of Georgia. This caused severe hardships for many companies who process garnishments on a routine basis through the use of clerical staff. As a result, a general outcry was heard from the business community. The State Legislature heard this outcry, and they have now wisely passed a law to overturn the decision of the Georgia Supreme Court. The new law takes effect immediately.
Under the new law which has passed both Houses and which has been signed by the Governor, businesses in Georgia may now process and answer garnishments as before without the use of an attorney. However, there are 2 aspects of the new law of which businessmen should be mindful. The first is that the new law risks being struck down by the Georgia Supreme Court, because there is a question of whether the Georgia Legislature can overturn a decision of the Georgia Supreme Court. This issue arises because the Georgia Supreme Court has the power to regulate the practice of law in Georgia. As a result, the Legislature may not have the power to overrule the Georgia Supreme Court on this issue. Second, the exemption only covers answers to the garnishment, so an attorney must still be hired if a claim is to be filed in response to the garnishment.
For the time being, the Legislature’s actions have returned us to the status quo in this area, but businessmen should keep their eye on this matter, because further changes could be made in the future.
Richard W. Jones is business lawyer and corporate attorney with the Atlanta, Georgia law firm of Jones & Haley, P.C. and he has over 30 years experience representing clients in corporate, and mergers and acquisition matters. See our website at http://www.corplaw.net/.
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