12-708.Deductions and set-offs of garnishee.

Section 12-708 protects a garnishee's own financial position before it hands anything over. The garnishee can assert offsetting claims against the indebtedness it owes the judgment debtor, whether those claims run against the judgment creditor, the judgment debtor, or both. It does not matter whether the claim was due at the time the garnishment summons was served or becomes due later, or whether it is liquidated or unliquidated. The one exception is claims for unliquidated damages in tort actions, which cannot be used as an offset.

The same protection extends to other property. If the debtor's property in the garnishee's hands is pledged to or held by the garnishee in good faith as security, or the garnishee otherwise has a just claim against it, the garnishee can retain that property. The garnishee remains liable only for the balance of the debt after offsetting claims are worked out, and for the balance of property left after deducting what the garnishee has a just claim to; the verdict, finding, or judgment must spell out the amount of offsets or deductions allowed against each party.

The section closes by confirming that the automatic exemption in Section 12-1001.1 does not cut into a garnishee's rights over property pledged to it or held as security.