                          STATE OF MICHIGAN

                           COURT OF APPEALS



COMERICA BANK,                                                     UNPUBLISHED
                                                                   July 31, 2018
               Plaintiff-Appellee,

v                                                                  No. 336637
                                                                   Oakland Circuit Court
MICHAEL KELMAN,                                                    LC No. 2012-124821-CK

               Defendant-Appellant,

and

BIRMINGHAM BLOOMFIELD CREDIT
UNION,

               Garnishee Defendant-Appellee.


Before: CAMERON, P.J., and JANSEN and O’CONNELL, JJ.

PER CURIAM.

        Defendant, Michael Kelman, appeals as of right the trial court’s order denying his
objection to the writ of garnishment issued to garnishee-defendant, Birmingham Bloomfield
Credit Union (“BBCU”). Plaintiff, Comerica Bank, issued a writ of garnishment to BBCU after
Kelman defaulted on a home equity loan. Kelman objected to the writ of garnishment, arguing
that the account funds included disability payments that were exempt from garnishment pursuant
to MCL 600.6023(1)(f) and that the garnishment exceeded the statutory maximum under the
federal Consumer Credit Protection Act (“CCPA”), 15 USC 1671 et seq. We vacate the trial
court’s order denying Kelman’s objection to the writ of garnishment and remand for further
proceedings consistent with this opinion.

                                 I. STANDARD OF REVIEW

        We review questions of statutory interpretation de novo and a trial court’s factual
findings for clear error. Hastings Mut Ins Co v Grange Ins Co of Mich, 319 Mich App 579, 583,
587; 903 NW2d 400 (2017). A finding of fact “is clearly erroneous when the reviewing court is
left with a definite and firm conviction that a mistake has been made.” Id (citation and quotation
marks omitted).



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       The primary goal of statutory interpretation is to give effect to the intent of the
       Legislature. The first step is to review the language of the statute. If the statutory
       language is unambiguous, the Legislature is presumed to have intended the
       meaning expressed in the statute. [Briggs Tax Serv, LLC v Detroit Pub Sch, 485
       Mich 69, 76; 780 NW2d 753 (2010) (citation omitted).]

When interpreting a federal statute, Michigan appellate courts follow the same procedure,
applying statutory definitions and the plain meaning of the statutory terms. Walters v Nadell,
481 Mich 377, 381-382; 751 NW2d 431 (2008). “However, if reasonable minds can differ
concerning the meaning of a statute, judicial construction of the statute is appropriate.” Solution
Source, Inc v LPR Assoc Ltd Partnership, 252 Mich App 368, 373; 652 NW2d 474 (2002).

                                  II. STATE LAW GROUNDS

        Kelman contends that the disability payments deposited into his BBCU account were
exempt under MCL 600.6023(1)(f). To the extent that the disability payments were the source of
the account funds, we agree. “As a general rule, all property is subject to execution to satisfy a
judgment.” Cunningham Davison Beeby Rogers & Alward v Herr, 198 Mich App 258, 259; 497
NW2d 575 (1993). MCL 600.6023 provides several exceptions to this rule. MCL
600.6023(1)(f) exempts “from levy and sale under an execution . . . [a]ny money or other
benefits paid, provided, or allowed to be paid, provided, or allowed, by any stock or mutual life
or health or casualty insurance company, on account of the disability due to injury or sickness of
the insured person . . . .”

        Comerica Bank contends that the statute does not apply to a garnishment action. The
statute does not define “execution,” so it is appropriate to consult a dictionary. Salem Springs,
LLC v Salem Twp, 312 Mich App 210, 218; 880 NW2d 793 (2015). Merriam-Webster’s
Collegiate Dictionary (11th ed) defines “execution” to include “the process of enforcing a legal
judgment.” To “levy” is defined, in part, as “to impose or collect by legal authority.” Id.
Further supporting Kelman’s argument that MCL 600.6023(1)(f) applies to a garnishment is
MCL 600.4031(1),1 which states:

              [t]he provisions of the statutes relating to exemptions from execution, and
       the manner of levying upon property belonging to a class or species in which
       exemptions are by law allowed, shall be applicable to the application of property
       and obligations to claims by attachment and garnishment.

Therefore, garnishing funds in Kelman’s account amounts to a levy as used in MCL
600.6023(1).




1
  Although Kelman did not cite this statutory provision in the trial court, it relates to Kelman’s
argument that MCL 600.6023(1)(f) exempts disability payments from garnishment, the primary
issue Kelman raised in the trial court.


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        In addition, Kelman correctly contends that the disability payments were exempt even
after they were deposited into the BBCU account. The plain language of MCL 600.6023(1)(f)
states that the exemption applies to “[a]ny money or other benefits paid.” Accordingly, the
exemption applies even after the disability payment is deposited into an account.

        Comerica Bank counters this conclusion by citing Whitwood, Inc v South Boulevard Prop
Mgt Co, 265 Mich App 651; 701 NW2d 747 (2005). Reliance on this case is at Comerica Bank’s
peril, however. In Whitwood, 265 Mich App at 653, this Court discussed the garnishment of
deposited teacher pension benefits, pursuant to MCL 38.1683, compared to deposited social
security benefits, pursuant to 42 USC 407(a), neither of which are at issue in the present case.
The Whitwood Court held that, in contrast to the social security funds, the teacher pension funds
lost their protection following deposit because MCL 38.1683 did not include the protective
language contained in 42 USC 407(a) exempting “moneys paid.” Id. at 654-655. Accordingly,
because the language of MCL 600.6023(1)(f) closely mirrors the outcome-determinative
language of “moneys paid” in Whitwood, we conclude that the funds deposited at BBCU
maintained their exemption.

      Finally, we must address whether the BBCU account actually contained exempt funds.
Although Kelman states on appeal that most of the funds in the account came from disability
payments, the trial court made no factual findings on this issue, including what amount of the
BBCU account reflected disability payments. Therefore, the trial court must determine what
amount of the BBCU account balance, if any, is subject to garnishment.

                                           III. CCPA

        Kelman contends that the CCPA also prohibits the garnishment of the BBCU account.
We disagree. The CCPA generally limits garnishment to 25% of the individual’s weekly
“disposable earnings.” 15 USC 1673(a)(1). The CCPA defines “earnings” as “compensation
paid or payable for personal services, whether denominated as wages, salary, commission,
bonus, or otherwise, and includes periodic payments pursuant to a pension or retirement
program.” 15 USC 1672(a). In United States v Ashcraft, 732 F3d 860, 864 (CA 8, 2013),2 the
Eighth Circuit Court of Appeals held that employer-funded disability payments constituted
“earnings” as defined in the CCPA. Ashcraft is factually dissimilar from this case in one
significant regard: Kelman’s disability payments were not an employee benefit because he
privately purchased the disability insurance policies. In addition, unlike Ashcraft, 732 F3d at
864, the record in this case does not contain the disability insurance policy or state its purpose.
Therefore, we cannot conclude that the disability policy payments were “earnings” pursuant to
the CCPA.

                                       IV. CONCLUSION




2
 Lower federal court decisions are not binding on this Court. State Treasurer v Sprague, 284
Mich App 235, 241-242; 772 NW2d 452 (2009).


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        We vacate the trial court’s order denying Kelman’s objection to the writ of garnishment
issued to BBCU and remand for further proceedings consistent with this opinion. We do not
retain jurisdiction.

                                                          /s/ Thomas C. Cameron
                                                          /s/ Peter D. O’Connell




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