Part 2: Social Assistance
So, you have located your judgment debtor’s bank account, and served the parties your Notice of Garnishment.
The bank responds: “Sorry, the account funds are social assistance. They’re exempt. ”
As discussed in Part 1 of this garnishment series, certain statutory protections like pensions can legitimately prevent a creditor from recovering money that would otherwise be subject to garnishment per court-approved garnishment notice (Form 20E). For creditors seeking to enforce Ontario judgments, Ontario Works and Ontario Disability Support Program (“ODSP”) payments are also important exemptions to garnishment. However, like with the pension exemption, the fact that a debtor receives social assistance does not, by itself, explain the source of every dollar in their account. Further analysis is often required.
What Does the Social Assistance Exemption Protect?
Section 23(1) of the Ontario Works Act protects basic financial assistance from garnishment, attachment, execution, seizure, or receivership under another Act, and Section 18(1) of the Ontario Disability Support Program Act provides corresponding protection for income support under that Act. Per Section 23(5) and Section 18(5) of these respective laws, the protections are preserved after the money has been deposited into a bank account.
Do Social Assistance Deposits Protect the Entire Account?
Identifying an ODSP deposit, however, or support under an Ontario Works program, does not necessarily mean that the entire account balance is protected from garnishment. Where funds have been mixed, withdrawn, or transferred, the creditor is entitled to a full assessment of why the exemption applies.
Per Rule 20.08 of the Ontario Rules of Small Claims Court, a garnishee (i.e., a bank) disputing garnishment must file a statement (Form 20F) setting out the particulars within 10 days after service of the Notice of Garnishment and serve copies on the other garnishment parties. While the purpose of Form 20F is not open access to the debtor’s records, if important information is not supplied by the garnishee voluntarily, the creditor may need to seek an appropriate production order.
What Documents Should a Creditor Seek?
Does the bank’s response identify the exact source of social assistance? Does it state the specific amount it alleges to be protected? And does it explain why the exemption covers that amount?
A garnishee’s statement merely asserting “social assistance” leaves these questions unanswered.
Depending on the gaps, useful supporting records may include:
- Benefit statements or payment confirmations identifying the program, payment dates, and amounts;
- Bank statements for a relevant period, showing the opening balance, deposits, withdrawals, and transfers;
- Transaction details clarifying deposits whose source is not apparent; and
- Records explaining transfers between accounts, where necessary to assess the source of the funds.
Creditor requests should narrow in on information required to assess the exemption. Medical records or details of the disability underlying an ODSP entitlement, for example, are likely unnecessary to this determination.
The Court Can Resolve a Disputed Claim
While a garnishee bank may be correct to withhold protected funds from garnishment, its response to your garnishment notice is not a judicial determination.
If their alleged exemption remains disputed, a Small Claims Court garnishment hearing (requested through Form 20Q) provides a procedure for bringing the issue before the court. Superior Court enforcement has separate procedural requirements.
As creditor you should narrow in on the issue requiring determination: an unexplained balance, an unidentified transfer, missing records, or disagreement about the legal protection. If the evidence establishes that the targeted funds are protected assistance, you cannot override that protection. However, ultimately, the court has the final say on whether the exemption applies.
What This Means for Ontario Creditors
Ontario Works and ODSP exemptions can materially impact whether a garnishment will produce any recovery.
Before incurring further enforcement costs, establish which benefit is involved, which funds are being withheld, and whether the records support the exemption claimed by the bank.
Need help enforcing an Ontario judgment or addressing a disputed garnishment? Contact Northgate Legal to discuss your options.
