HB 6786 — AN ACT CONCERNING SERVICE OF BANK EXECUTIONS, WAGE EXECUTIONS AND TAX WARRANTS BY STATE MARSHALS AND AUTHORIZED SERVICE OF PROCESS BY INDIFFERENT PERSONS.

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6786 into an account in the financial institution shall, if certified as true and accurate by an officer of the financial institution, be admissible as evidence without the presence of the officer in any hearing conducted pursuant to subsection (f) of this section to determine the legitimacy of a claim of exemption made under this section.

Such fee shall not be considered a deposit account sHB6786charge /pursuant Fileto No.section 36a-316.

784 sHB6786 File No.

784 charge pursuant to section 36a-316.

If such financial institution pays exempt moneys from the account of the judgment debtor over to the serving officer contrary to the provisions of this section, such financial institution shall be liable in an action therefor to the judgment debtor for any exempt moneys so paid and such financial institution shall refund or waive any charges or fees by the financialPublic institution,Act including,No. but not limited to, dishonored check fees, overdraft fees or minimum balance service charges and legal process fees, which were assessed as a result of such payment of exempt moneys.

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6786 financial institution, including, but not limited to, dishonored check fees, overdraft fees or minimum balance service charges and legal process fees, which were assessed as a result of such payment of exempt moneys.

sHB6786(q) /Nothing Filein No.this section shall in any way affect any rights of the financial institution with respect to uncollected funds credited to the account of the judgment debtor, which rights shall be superior to those of the judgment creditor.

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784 (q) Nothing in this section shall in any way affect any rights of the financial institution with respect to uncollected funds credited to the account of the judgment debtor, which rights shall be superior to those of the judgment creditor.

(a) As used in this section and section 52-367b, as amended by this act, "financial institution" means any bank, savings bank, savings and loanPublic associationAct orNo. credit union organized, chartered or licensed under the laws of this state or the United States and having its main office in this state, any similar out-of-state institution having a branch office in this state or any similar out-of-state institution having no main office or branch office in this state and where transactions are made via the Internet or electronic means.

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6786 loan association or credit union organized, chartered or licensed under the laws of this state or the United States and having its main office in this state, any similar out-of-state institution having a branch office in this state or any similar out-of-state institution having no main office or branch office in this state and where transactions are made via the Internet or electronic means.

The clerk shall issue such execution containing a direction that theofficer servingsuchexecutionshallmake demand [(1)](A)upon the main office of any financial institution having its main office within the county of the serving officer, [(2)] (B) if such main office is not within sHB6786the /serving Fileofficer's No.county and such financial institution has one or more branch offices within such county, upon an employee of such a branch office, such employee and branch office having been designated by the financial institution in accordance with regulations adopted by the Banking Commissioner, in accordance with chapter 54, or [(3)] (C) only upon demand of a financial institution which does not have any main office or branch office in this state, by certified mail, return receipt requested, for the payment of any debt due to the judgment debtor,and, after having made such demand, shall serve a true and attested copy thereof, with the serving officer's actions thereon endorsed, with the financial institution upon whom such demand is made.

784When sHB6786service Fileis made by the serving officer by certified mail pursuant to subparagraph (C) of this subdivision, the serving officer may collect the actual postage costs incurred, in addition to the serving officer's fee, from the amount Public Act No.

78423-23 the12 serving officer's county and such financial institution has one or more branch offices within such county, upon an employee of such21 aSubstitute branchHouse office,Bill suchNo. employee and branch office having been designated by the financial institution in accordance with regulations adopted by the Banking Commissioner, in accordance with chapter 54, or [(3)] (C) only upon demand of a financial institution which does not have any main office or branch office in this state, by certified mail, return receipt requested, for the payment of any debt due to the judgment debtor,and, after having made such demand, shall serve a true and attested copy thereof, with the serving officer's actions thereon endorsed, with the financial institution upon whom such demand is made.

When6786 service is made by the serving officer by certified mail pursuant to subparagraph (C) of this subdivision, the serving officer may 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, pursuant to subsection (c) of this section.

(2) Not later than the seventh business day after the service of an executionupona financialinstitution,thefinancialinstitutionfinancialinstitution,thefinancialinstitutionshallsend shallsend to the serving officer by first class mail, postage prepaid, (A) if the sHB6786financial /institution Filehas No.removed funds from the judgment debtor's account pursuant to the execution and this section, a notice stating the amount of funds removed from the judgment debtor's account and referencing the docket number, if provided by the judgment creditor on the execution form, or (B) if the judgment debtor is not indebted to the financial institution or if the financial institution has not removed funds from the judgment debtor's account pursuant to the execution and this section, a complete set of all the documents served on the financial institution by the serving officer, including the cover page ofthe serving officer, with endorsements from other financial institutions, as the case may be, and the original true and attested copy of the execution served on the financial institution.

784The sHB6786response Fileof the financial institution Public Act No.

78423-23 financial13 institution has removed funds from the judgment debtor's account pursuant to the execution and this section, a notice stating the amount of funds21 removedSubstitute fromHouse theBill judgmentNo. debtor's account and referencing the docket number, if provided by the judgment creditor on the execution form, or (B) if the judgment debtor is not indebted to the financial institution or if the financial institution has not removed funds from the judgment debtor's account pursuant to the execution and this section, a complete set of all the documents served on the financial institution by the serving officer, including the cover page ofthe serving officer, with endorsements from other financial institutions, as the case may be, and the original true and attested copy of the execution served on the financial institution.

The6786 response of the financial institution pursuant to subparagraph (B) of this subdivision shall include a notation on the serving officer's cover page, or at the financial institution's option, on a separate document prepared by the financial institution, to the effect that the judgment debtor does not have an account with the financial institution or that no funds were removed from the account, provided that such separate document be affixed to, or enclosed contiguous to the financial intuition's return of a particular executiontotheservingofficerpursuanttothissubsection.Thefinancial institution shall maintain reasonable procedures to prevent the resubmission of a response provided to the serving officer pursuant to subparagraph (B) of this subdivision.

Such financial institution shall act upon such execution according to section 42a-4-303 before its midnight sHB6786deadline, /as Filedefined No.in section 42a-4-104.

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784 deadline, as defined in section 42a-4-104.

(d) If the deposit account is subject to a security interest of a secured party, other than the financial institution upon which such execution is served and upon which such demand is made, pursuant to a control agreement between the financial institution and such secured party under article 9 of title 42a, and if any funds are removed from the judgmentPublic debtor’sAct accountNo. pursuant to subsection (c) of this section, the financial institution shall forthwith mail a copy of the execution when received from the serving officer, postage prepaid, to the judgment debtorandtosuchothersecuredpartyatthelast-knownaddressofsuch parties with respect to the affected accounts on the records of the financial institution.

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6786 judgment debtor’s account pursuant to subsection (c) of this section, the financial institution shall forthwith mail a copy of the execution when received from the serving officer, postage prepaid, to the judgment debtorandtosuchothersecuredpartyatthelast-knownaddressofsuch parties with respect to the affected accounts on the records of the financial institution.

(f) Upon receipt of a written claim for determination of interests in property made pursuant to subsection (e) of this section, the clerk of the court shall enter the appearance of the secured party with the address set forthinthewrittenclaim.The clerk shallforthwithsendfile-stamped copies of the written claim to the judgment creditor, the judgment debtor and the financial institution upon which such execution was served with a notice stating that the disputed funds are being held until sHB6786a /court Fileorder No.is entered regarding the disposition of the funds.

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784 a court order is entered regarding the disposition of the funds.

(g) If a written claim for determination of interests in property is made pursuant to subsection (e) of this section, the financial institution shall continue to hold the amount removed from the judgment debtor's account until a court order is received regarding disposition of the funds.Public Act No.

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6786 funds.

(j) If records or testimony are subpoenaed from a financial institution in connection with a hearing conducted pursuant to section 52-356c on awrittenclaimfordeterminationofinterestsinpropertymadepursuant to subsection (e) of this section, the reasonable costs and expenses of the financial institution in complying with the subpoena shall be recoverable by the financial institution from the party requiring such records or testimony, provided the financial institution shall be under no obligation to attempt to obtain records or documentation relating to the account executed against that are held by any other financial sHB6786institution. / File No.

784The sHB6786records Fileof No.a financial institution as to the dates and amounts of deposits into an account in the financial institution shall, if certified as true and accurate by an officer of the financial institution, be admissibleasevidence withoutthepresenceoftheofficerinany hearing conducted pursuant to section 52-356c to determine the legitimacy of a claimofaninterestinpropertymadeundersubsection(e)ofthissection.

784Public institution.Act No.

The23-23 records16 of a21 financialSubstitute institutionHouse asBill toNo. the dates and amounts of deposits into an account in the financial institution shall, if certified as true and accurate by an officer of the financial institution, be admissibleasevidence withoutthepresenceoftheofficerinany hearing conducted pursuant to section 52-356c to determine the legitimacy of a claimofaninterestinpropertymade undersubsection(e)ofthissection.

6786 (k) If such financial institution fails or refuses to pay over to such serving officer the amount of such debt, not exceeding the amount due on such execution, such financial institution shall be liable in an action therefor to the judgment creditor named in such execution, and the amount so recovered by such judgment creditor shall be applied toward the payment of the amount due on such execution.

Subsection (d) of section 52-361a of the general statutes is repealed andthefollowingand issubstitutedthe inlieuthereof(EffectiveOctoberfollowing is substituted in lieu thereof (Effective October 1, 2023):

On receipt thereof, the employer shall forthwith deliver a sHB6786copy /thereof Fileto No.the judgment debtor, or mail such copy postage prepaid to the judgment debtor at his last-known address.

784On sHB6786service Fileof the wageexecutionontheemployer,thewageexecutionshallautomatically be stayed for a period of twenty days and shall thereafter immediately Public Act No.

78423-23 copy17 thereofof to21 theSubstitute judgmentHouse debtor,Bill orNo. mail such copy postage prepaid to the judgment debtor at his last-known address.

On6786 service of the wageexecutionontheemployer,thewageexecutionshallautomatically be stayed for a period of twenty days and shall thereafter immediately become a lien and continuing levy on such portion of the judgment debtor's earnings as is specified in the wage execution, provided if a claim is filed in accordance with subsection (d) of section 52-361b within twenty days of such service on the employer, the stay shall continue until determination of the claim.

Any service of process or other notice required under thissectionmay bemadeinaccordancebemade inaccordance withsection52-57orby certified mail, return receipt requested, provided a levying officer may make such service by mail to (1) an address within such officer's [appointed jurisdiction] precinct or extension of precinct in accordance with section 52-56, as amended by this act, or (2) in a case involving an employer whose [address is not within such levying officer's appointed jurisdiction, to the address designated by the employer] payroll address is outside the state, to the out-of-state payroll address designated by the employer.

(a)All processshallbedirectedto astate marshal,aconstablemarshal, orothera constableorother proper officer authorized by statute, or, subject to the provisions of subsection (b) of this section, to an indifferent person.

sHB6786(b) /Process Fileshall not be directed to an indifferent person unless [more defendants than one are named in the process and are described to Public Act No.

78423-23 sHB678618 Fileof 21 Substitute House Bill No.

7846786 (b) Process shall not be directed to an indifferent person unless [more defendants than one are named in the process and are described to reside in different counties in the state, or unless, in case of a writ of attachment, the plaintiff or one of the plaintiffs, or his or their agent or attorney, makes oath before the authority signing the writ that the affiant truly believes the plaintiff is in danger of losing his debt or demand unless an indifferent person is deputed for the immediate service of the writ or other process.

(d) Service of motions for modification, motions for contempt and wage withholdings in any matter involving child support, including, but not limited to, petitions for support authorized under sections 17b- 745 and 46b-215, and those matters involving a beneficiary of care or assistance from the state, and service of other process in IV-D support cases, as defined in subdivision (13) of subsection (b) of section 46b-231, may be made by a support enforcement officer or support services investigator of the Superior Court.

(e)Boroughbailiffsmay,withintheir respective boroughs,executeboroughs, execute all legal process which state marshals or constables may execute.

sHB6786Public /Act File No.

78423-23 sHB678619 Fileof 21 Substitute House Bill No.

7846786 Sec.

sHB6786Public /Act File No.

78423-23 sHB678620 Fileof 21 Substitute House Bill No.

7846786 ThisApproved actJune shall7, take2023 effectPublic asAct followsNo. and shall amend the following sections:

Section23-23 121 Octoberof 1,21 2023 52-367b Sec.

2 October 1, 2023 52-367a Sec.

3 October 1, 2023 52-361a(d) Sec.

4 October 1, 2023 52-50 Sec.

5 October 1, 2023 12-162(c) Sec.

6 October 1, 2023 52-56(c) sHB6786 / File No.

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784 The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose.

In general, fiscal impacts are based upon a variety of informational sources, including the analyst’s professional knowledge.

Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note State Impact:

None Municipal Impact:

None Explanation The bill does not result in a fiscal impact to the state as the associated costs are the responsibility of the private sector.

House"A" makesvariousclarifyingandtechnicalchangesthatdo not result in a fiscal impact.

The Out Years State Impact:

None Municipal Impact:

None sHB6786 / File No.

784 sHB6786 File No.

784 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 sHB6786 / File No.

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784 institutions, (a) extends how much time a financial institution has to respond to an execution from five business days, as under the underlying bill, to seven business days;

(b) modifies what an institution mustgiveinresponsetoaservingofficerdependingontheactionittook 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 INSTITUTION 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 branchoffice in Connecticut, but conduct transactionsonline 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 sHB6786 / File No.

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784 be recoverable by the judgment creditor as a taxable cost of the action.

Financial Institution Duty to Respond 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 sHB6786 / File No.

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784 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.

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 theserving officer stating that thedebtor submittedanexemptionclaim.

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 sHB6786 / File No.

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784 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 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.

Currentlawalsoallowstheseofficerstoserveprocessbymailincases 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 sHB6786 / File No.

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784 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 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 ofany 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.

sHB6786 / File No.

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784 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 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 theservingofficer isliableinanactionto thejudgment 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) sHB6786 / File No.

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