Perspectives
What You Need To Know: MN’s Emergency Executive Order for Commercial Collections
On May 4th, 2020, an Emergency Executive Order was signed into effect, placing suspensions on a number of collection activities related consumer debtors. The Order suspended “service of a garnishment summons on a consumer debtor or consumer garnishee.”* The order also suspended obtaining “information about a consumer debtor’s assets, liabilities, and personal earnings.”
On January 7th, 2021, Executive Order 21-02 amended Order 20-50 to add levies to the suspended activities as well. Up to that point, only garnishments and formal demands for disclosure of financial information had been suspended. The updates in Order 21-02 added a significant limitation on the suspension of garnishments and levies by adding language limiting the suspension of judgments entered on or after May 4th, 2020 and language allowing for wage garnishments and levies on judgments entered prior to May 4th, 2020. Previously, the suspension was on all judgments old and new.
On May 6th, 2021, the MN Governor issued Executive Order 21-21. This order provides a “sunset” provision on Orders 20-50 and 21-02. Movement on this Order relies on the determination by the Commissioner of Minnesota Department of Health to confirm that seventy percent (70%) of people sixteen years of age and older have received at least one dose of COVID-19 vaccine.
Effective two business days after that confirmation, or on Wednesday, June 30th, 2021 at 11:59 pm, whichever occurs first, Executive Orders 20-50 and 21-02 (as well as others) will be rescinded. Meaning, on July 1, 2021, or perhaps earlier, the suspension of garnishments, levies and demands for disclosure related to consumer debtors will no longer be in effect.
If you have questions about whether you may be effected by any of these changes, please reach out to one of our Commercial Collections attorneys.
*”for the purpose of this Executive Order, the terms ‘consumer debt’ and ‘consumer garnishee’ have the definition of ‘debtor’ and ‘garnishee’ as used in Minnesota Statutes section 571-712, subdivision 2(b) 2(c), when applied to debtors and garnishees who are natural persons and whose debt originated from the purchase of goods or services purchased primarily for a personal, family, or household purpose, and not for a commercial, agricultural, or business purpose.