Author Question: Automatic Stay. David Sisco had about 600 in an account in Tinker Federal Credit Union. Sisco owed ... (Read 54 times)

dmcintosh · **on:** Jun 24, 2018

Automatic Stay. David Sisco had about 600 in an account in Tinker Federal Credit Union. Sisco owed DPW Employees Credit Union a little more than 1,100. To collect on the debt, DPW obtained a garnishment judgment and served it on Tinker. The next day, Sisco filed a bankruptcy petition. Tinker then told DPW that because of the bankruptcy filing, it could not pay the garnishment. DPW objected, and Tinker asked an Oklahoma state court to resolve the issue. What effect, if any, does Sisco's bankruptcy filing have on DPW's garnishment action?

Question 2

Emile owns Emile's Used Car Emporium. Several people work for him at the Emporium. When Emile is gone, he leaves one of his best salespersons, Meg, in charge. Over the years, Emile has given Meg the authority to contract with vendors, negotiate sales, and conclude car sales contracts in his name. One August, Emile takes a long vacation, leaving Meg in charge. While he is gone a hurricane hits Florida where the Emporium is located, causing severe damage. Because Emile is floating down the Amazon, Meg cannot reach him for instructions. She decides that rather than leave the place in shambles, she will hire people to repair the Emporium. Meg hires a carpenter to rebuild a wall that was blown down by the storm. Phil, the carpenter, is busy at work on his scaffold when Meg's Scottish terrier Adam, who she keeps with her at work, plows into the scaffolding while chasing a cat. Phil is knocked off the scaffold and falls ten feet to the ground, suffering a broken leg. Meg was negligent in allowing her dog to run wild at the Emporium, but Emile had never objected to the dog being around. If Meg's negligence is the cause of Phil's harms, then:
a. Meg is personally liable for compensating Phil; Emile could not be held liable
b. Phil may not collect from Meg or Emile because he assumed the risk of working for Emile c. Emile is liable for compensating Phil under the doctrine of respondeat superior
d. Meg is personally liable for compensating Phil under the doctrine of vicarious liability e. Emile is not liable for compensating Phil under the doctrine of non-indemnification

ASDFGJLO · **Reply #1 on:** Jun 24, 2018

Answer to Question 1

Automatic stay
The court entered a judgment for DPW for the amount in Sisco's account, and Tinker appealed. The intermediate state appellate court held in part that the federal bankruptcy automatic stay prevented Tinker from turning the amount in Sisco's account over to DPW. DPW argued that because the garnishment judgment was served the day before the bankruptcy petition was filed, the stay did not apply. The court acknowledged that a garnishment judgment attaches as soon as it is served on the garnishee (Tinker). But the court pointed out that a garnishment service does not transfer title of the debtor's property to the creditor. Because the bankruptcy petition was served the next day, DPW was attempting to enforce the garnishment lien and obtain possession of the funds in Sisco's account from Tinker concurrently with the bankruptcy action. Federal bankruptcy law clearly states that the filing of the petition in bankruptcy operates as a stay' . Because a garnishment proceeding is simply an indirect proceeding or act to collect, assess and recover a claim against the debtor,' it too must be stayed once a bankruptcy petition is filed. The court reversed and vacated the judgment of the lower court, and remanded the case.

Answer to Question 2

c