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Garnishment Order Against Licensed Insolvency Trustee

Can a garnishment order be served upon a Trustee who holds the funds of a bankrupt for their Principal Residence Exemption by a Judgment Creditor who the bankrupt owes money from a court judgement?

One Response to “Garnishment Order Against Licensed Insolvency Trustee”

Jillian Taylor-Mancusi, Trustee | B.A. | C.I.R.P said...

Automatically upon the filing of an Assignment in bankruptcy a Stay of Proceedings comes into operation that prevents creditors from talking any further action for the collection of debts. This includes serving garnishment orders. Exempt assets in a bankruptcy are exempt because the exemption is allowed under federal or provincial law. As such these funds would not be subject to a garnishment order notwithstanding the bankruptcy. If the judgement represents a claim for a debt not dischargeable in bankruptcy the creditor may pursue it but would still require the leave of the Court before any action was taken.