Wachovia Bank of Georgia, N.A. v. Unisys Finance Corp.

Johnson, Judge,

concurring specially.

The amicus curiae brief submitted by the Georgia Banking Association queries “must a bank, each time it is served with a garnishment on an account which has been denominated a trust or escrow account for a third party on the signature card . . . determine whether or not the funds are in fact held by its customer in a fiduciary capacity?” The short answer to the Georgia Banking Association’s *475question is no.

A bank is not required to determine, upon receipt of a garnishment, whether the funds are in fact held by its customer in a fiduciary capacity. But when a garnishment action is filed naming a bank as garnishee, and the defendant has accounts denominated as a trust or any other type of special account, the bank should avail itself of the provisions of OCGA § 18-4-82 and allow the trial court to determine which funds are subject to garnishment and thereby avoid liability such as that imposed here.

We recognize that conducting discovery to determine whether an account denominated as a trust account is in fact being used as such would create a heavy burden in economic terms to a banking institution which has been served with a garnishment action. However, as pointed out in the majority opinion, OCGA § 18-4-82 provides a simple mechanism by which a bank can protect itself from just the kind of liability imposed in this case. “If the garnishee shall be unable to answer as provided for in this Code section, his inability shall appear in his answer, together with all the facts plainly, fully, and distinctly set forth, so as to enable the court to give judgment thereon.”

In its answer, Wachovia simply stated that the sum of $6,262 is subject to garnishment and gave no indication that other funds were on deposit in the name of Hanover Credit Corporation which may or may not be subject to garnishment. By doing so, it usurped the trial court’s right to determine whether such funds were or were not subject to garnishment. To allow banks to simply rely on the nomenclature requested by the customer when they set up an account could make banks unwitting partners to unscrupulous customers who could open any or all of their accounts as “trust accounts,” thereby defrauding their creditors.

I write separately to emphasize that nothing in the majority opinion changes in any way the general rule that trust accounts are not subject to garnishment, nor would it require the banks of Georgia to undertake the sort of burdensome investigation which the amicus brief suggests is feared by the industry. The process of determining whether the funds are subject to garnishment properly involves only the defendant/debtor, the plaintiff/creditor and the court. Had Wachovia, in its answer, informed the parties and the court that the other accounts existed and that it was not in a position to know whether the funds on deposit therein were subject to garnishment, it would have fully discharged its legal obligation without exposing itself to liability. The burden of proving who was entitled to the funds would have thereby appropriately shifted to Unisys and Hanover, leaving the trial court to decide the matter from the evidence they produced.

*476Decided May 21, 1996 Morris, Manning & Martin, Donald A. Loft, Ann R. Schildhammer, Daniel W. Sweat, Michael E. Ray, Keith W. Smith, for appellant. J. Christopher Simpson, for appellee.