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Despite Judgment Debtor's Failure To Object, IRA Exempted From Garnishment

Lesson.  Indiana law generally protects retirement accounts from post-judgment collection.

Case cite.  Dumka v. Erickson, 70 N.E.3d 828 (Ind. Ct. App. 2017).

Legal issue.  Whether a judgment debtor’s failure to assert a statutory exemption from garnishment necessarily means that the exemption is waived.

Vital facts.  Judgment creditor filed a motion for proceedings supplemental against judgment debtor and named as a garnishee-defendant the institution that held funds in an “inherited traditional individual retirement account” (IRA). The judgment debtor inherited the IRA from her deceased husband. At the hearing on the motion, the debtor appeared pro se (without an attorney) and did not contest the creditor’s efforts to liquidate the IRA.

Procedural history.  Even though the judgment debtor failed to object to the garnishment or to otherwise assert an exemption, the trial court denied the judgment creditor’s motion. The creditor appealed.

Key rules.

Ind. Code 34-55-10-2(c)(6) provides that non-spousal inherited IRAs are not exempt from garnishment but that IRAs inherited by surviving spouses are exempt.

Generally, exemptions must be asserted by the debtor. However, the Indiana Supreme Court has held that, because exemptions “exist to give life to a constitutional right [sheltering certain property and income from attachment],” there should be exceptions to this general rule “consistent with fairness and practical realities.”

Trial courts may take “judicial notice” of statutes at any stage in a proceeding. Ind. Evid. Rule 201(b-d).

Holding.  The Indiana Court of Appeals affirmed the trial court.


A key factor in the Court’s decision was that the judgment debtor was unrepresented by counsel. The undisputed facts established that “the IRA is lawfully exempt from attachment,” and the trial court properly took judicial notice of the exemption. Since the trial court’s order complied with the evidence and the law, the Court of Appeals affirmed the decision.

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I frequently represent creditors and debtors in business-related collection actions. If you need assistance with a similar matter, please call me at 317-639-6151 or email me at john.waller@woodenlawyers.com. Also, don’t forget that you can follow me on Twitter @JohnDWaller or on LinkedIn, or you can subscribe to posts via RSS or email as noted on my home page.