In Coppie , the court held that, under Indiana law, garnishment of a debtor's wages within the 90 day preference period pursuant to an order issued prior to the 90 day period was not a preference. While the service of a garnishment summons and complaint created a continuing lien, service did not extinguish the debtor's interests. Rather, the issuance of a separate garnishment order extinguished the debtor's interests. However, in Marshall's case, no such order was entered. In order for the Coppie analysis to be applicable, the service of the garnishment summons and complaint must operate to make an employer liable to the garnishing creditor for future wages, thereby divesting the debtor of her interest.
Future wages are contingent debts which an employer owes to an employee.
Garnishment statutes must be strictly construed. Rather, it became liable when the wages were earned. As held in Passmore , when the debtor is subject to a continuing lien, the lien does not arise until the wages are first earned. This is consistent with a great number of courts which have considered the issue. A debtor may exercise the trustee's avoiding powers under limited circumstances.