MORRIS PLAN COMPANY OF TERRE HAUTE INC v. MILBOURN (2026)

MEMORANDUM DECISION

[1] In 2016, The Morris Plan Company of Terre Haute, Inc. (Morris), obtained a judgment against Kristin L. Milbourn for $4,388.11 plus court costs. Six years later, Morris filed a motion for proceedings supplemental against Milbourn in small-claims court. In 2024, the court issued a continuing garnishment order for 25% of Milbourn's disposable earnings.

[2] In November 2025, Milbourn requested a reduction in her 25% wage garnishment, claiming that she was struggling to pay her bills. According to Milbourn, her disposable earnings were $1,300 biweekly. See Appellant's App. Vol. 2 p. 41. Morris agreed to have the garnishment reduced “to the statutory minimum of 10%.” Id. at 55. The small-claims court thought 10% (roughly $130 biweekly) was too much and suggested $50 biweekly. Morris objected, noting that paying $50 biweekly, instead of $130, would take “an additional four (4) years” for the 10-year-old judgment to be paid off. Tr. p. 9. The court sided with Milbourn, vacated the garnishment order, and ordered her “to pay $50 biweekly.” Appellant's App. Vol. 2 pp. 89, 96.

[3] Morris now appeals, arguing that the small-claims court erred in vacating the garnishment order and ordering Milbourn to pay only $50 biweekly, which amounts to about 4% of her disposable earnings, well below the statutory minimum of 10%. Morris claims that the court took this action “for the sole purpose of circumventing the garnishment statute.” Appellant's Br. p. 10. Milbourn did not file an appellee's brief. We therefore apply a less stringent standard of review and will reverse upon a prima facie showing of error. See Trinity Homes, LLC v. Fang, 848 N.E.2d 1065, 1068 (Ind. 2006). Morris has made this showing.

[4] Indiana Code section 37-2-6-4 (formerly Indiana Code section 24-4.5-5-105) addresses the maximum part of a person's disposable earnings that is subject to garnishment:

(b) Except as provided in subsection (h), the maximum part of the aggregate disposable earnings of an individual for any workweek which is subjected to garnishment to enforce the payment of one (1) or more judgments against the individual may not exceed the lesser of the following amounts:

(1) An amount equal to twenty-five percent (25%) of the individual's disposable earnings for that week or, upon a showing of good cause by the individual why the amount should be reduced, an amount equal to:

(A) less than twenty-five percent (25%); and

(B) at least ten percent (10%);

of the individual's disposable earnings for that week.

(2) The amount by which the individual's disposable earnings for that week exceed thirty (30) times the federal minimum hourly wage prescribed by 29 U.S.C. 206(a)(1) in effect at the time the earnings are payable.

(Emphases added). There are two ways a court can order a party to pay less than 10% of their disposable earnings. First, the court can issue a garnishment order for less than 10% if the person's wages are so low that subsection (b)(2) is implicated. Second, a court can order a payment plan for less than 10% if both parties agree. See Oliver v. FLH Mill, LLC, 265 N.E.3d 533, 541 (Ind. Ct. App. 2025), trans. denied. Here, neither option was available to the court. Subsection (b)(2) is not implicated because of the amount of Milbourn's disposable earnings, and Morris did not agree to an amount less than 10%. We therefore reverse the small-claims court and remand with instructions to either enter a payment plan that has the consent of both parties or order a garnishment within the range of 10% to 25% of Milbourn's weekly disposable earnings. See id. (reversing payment plan and remanding with instructions for the trial court “either to enter a payment plan that has the consent of both parties or to direct Jeremy to make weekly payments within the range of 10% to 25% of Jeremy's disposable earnings as set forth in” Section 37-2-6-4).

[5] Reversed and remanded.

Vaidik, Judge.

Altice, J., and Foley, J., concur.