Collar v. Abalux, Inc et al
Filing
183
ORDER denying 121 Defendants' Motion for Continuing Writ of Garnishment. Signed by Magistrate Judge Jonathan Goodman on 9/6/2018. See attached document for full details. (jf00)
Case 1:16-cv-20872-JAL Document 183 Entered on FLSD Docket 09/06/2018 Page 1 of 9
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
MIAMI DIVISION
CASE NO. 16-20872-CIV-LENARD/GOODMAN
JESUS LAZARO COLLAR,
Plaintiff,
v.
ABALUX INC., et al.,
Defendants.
__________________________/
ORDER DENYING DEFENDANTS’ MOTION FOR A CONTINUING WRIT OF
GARNISHMENT AGAINST SALARY OR WAGES AFTER JUDGMENT
In Fair Labor Standards Act cases involving a dispute over the plaintiff’s status,
defendants typically contend that the plaintiff is actually an independent contractor, not
an employee, while the plaintiff contends that he or she is an employee. See, e.g., Hughes
v. Family Life Care, Inc., 117 F. Supp. 3d 1365, 1374 (N.D. Fla. 2015) (granting summary
judgment motion and finding that certified nursing assistant was an employee, rather
than an independent contractor). That’s because independent contractors are exempt
from the FLSA.
But Defendants’ motion for a continuing writ of garnishment is atypical, as
Plaintiff contends that he is now, post-judgment, an independent contractor (even
though his Complaint and summary judgment motion claim that he was an employee.
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[ECF Nos. 1; 58]. To render the motion even more unusual, Defendants now also agree
that Collar is an independent contractor. [ECF No. 181, p. 5]. Therefore, they now say
that their own motion should be denied (so that they can then move for issuance of a
traditional writ of garnishment). [ECF No. 181, p. 9].
After holding a multi-hour evidentiary hearing and reviewing the post-hearing
memoranda based on the hearing transcript, the Undersigned denies Defendants’
motion because Plaintiff is now an independent contractor, not an employee, and a
judgment creditor cannot use Florida’s garnishment statute to continually garnish an
independent contractor’s revenue that is not salary or wages. [ECF Nos. 148; 168; 18081]. As noted, Defendants agree that “Plaintiff is and has been an independent
contractor since 2018” and say that Collar’s self-admitted status as an independent
contractor means “that the motion for writ of continuing garnishment should be
denied.” [ECF No. 181, p. 9]. Although Defendants make this concession, they did not
move to withdraw, vacate, or rescind their motion for a continuing writ of garnishment.
Factual Background
The Court entered a final judgment in Defendants’ favor for taxable costs
($2,146.65), and for non-taxable costs ($425.06). Defendants then moved for issuance of a
writ of continuing garnishment against Plaintiff. [ECF No. 121]. They alleged that Collar
“is employed by Adwave Graphics, Inc.” [ECF No. 121, p. 1]. Plaintiff opposed the writ,
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and submitted a claim for exemption form (“Claim form”). [ECF No. 126]. United States
District Judge Joan A. Lenard referred the motion to the Undersigned. [ECF No. 133].
At the evidentiary hearing, it was established that Plaintiff began working for
Adwave in September 2016 as a sign installer. He was hired as an hourly employee.
[Testimony of Alexander Sosa, TR., pp. 6:13, 11:7-9]. 1 While Plaintiff used his own tools,
Adwave provided everything else he needed to perform his job. [TR., p. 7:2-6]. Collar
wore an Adwave shirt while performing work and he drove a truck owned by Adwave
that bore Adwave’s signage. [TR., p. 10:8-19]. Plaintiff reported to Adwave’s office each
day and received job assignments from Adwave’s owner, Mr. Sosa. [TR., pp. 7:7-8, 9:2410:1].
Plaintiff performed all of his work for Adwave’s customers. [TR., p. 8:11-13]. He
was paid weekly on an hourly basis and he received a W-2 for 2017. [TR., p. 17:6].
In January 2018, Plaintiff approached Mr. Sosa about changing his status as an
employee to an independent contractor. [TR., p. 12:8-9]. 2 He proposed that he would
solicit new jobs in exchange for commissions. Mr. Sosa had no objection. Plaintiff
supplied Mr. Sosa with proof that he had formed his own company called “JC Signs
The transcript from the evidentiary hearing is located at ECF No. 168; however,
the Undersigned will refer to it as “TR.” throughout this Order.
1
At the evidentiary hearing, defense counsel advised that Defendants’ theory, at
that time, was that Plaintiff’s “independent contractor status is a sham designed to
avoid his obligation to pay [the] judgment.” [TR., p. 58:1-9].
2
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Corp.” and that he had elected to exempt himself from worker’s compensation. [ECF
No. 153-3]. 3 While there was no written agreement between Adwave and JC Sign Corp.
concerning the change in status [TR., p. 11:10-12], Mr. Sosa stopped paying worker’s
compensation insurance for Plaintiff and allowed Plaintiff to set his own hours of
service. [TR., p. 12:4-5]. Plaintiff has business cards for JC Sign Corp. [TR., p. 51:1-5].
Plaintiff also opened a business account at a bank for JC Sign Corp. [TR., p. 52:68]. He designated his home address as a business address. [TR., p. 52:3-5]. Mr. Sosa
testified that he permitted Plaintiff to use Adwave’s truck when Plaintiff solicited
business for Adwave through JC Sign Corp. [TR., pp. 45:24-46:4]. JC Sign Corp. has its
own business expenses such as Plaintiff’s auto expenses, meals, and tool costs. [TR., p.
48:4-5]. Plaintiff does not anticipate that Adwave will be his sole source of income. [TR.,
p. 46:20-21]. He works on the weekend to solicit new customers on behalf of Adwave so
that JC Sign Corp. can make a profit. [TR., p. 47:11-13].
Adwave paid Plaintiff $730.10 as wages on 1/13/18 and an additional $336.80
commission to JC Signs Corp. Thereafter, Adwave paid JC Sign Corp. all monies,
At the hearing, the Undersigned pointed out that JC Signs Corp. was incorporated
before the summary judgment was entered in Defendants’ favor (and before the entry of
the related money judgment for costs was entered in their favor). The Undersigned
raised this point in connection with the defense theory that Collar somehow “knew in
advance that he would be getting a judgment [entered against him] and it would make
sense to try to evade the judgment by forming a corporation in advance and somehow
persuading his employer to pay him as an independent contractor.” [TR., pp. 58:15-24,
59:1-3].
3
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including commissions. JC Sign Corp. was paid $1,237.12 on 1/22/18 -- the day the final
judgment was entered against Plaintiff; $1,306.72 on 1/26/18; $1,081.60 on 2/2/18 (plus
$192.72 in commissions); $1,120.00 on 2/9/18; $640.00 on 2/14/18; $708.13 on 2/23/18; and
so on. The payments made to JC Signs Corp. through the date of hearing consistently
ranged from $640.00 to $1,100.00. [ECF No. 153-1].
During the hearing, defense counsel essentially stipulated that Collar is an
independent contractor, and Defendants maintained that position in their post-hearing
memorandum. [Tr., p. 61; ECF No. 181]. Collar, of course, also took the position that he
is an independent contractor (and therefore not susceptible to a continuing writ of
garnishment).
Applicable Legal Principles and Analysis
The parties agree that Florida law governs the issue of whether the procedure
outlined in the state’s continuing writ of garnishment statute enables Defendants to
collect a judgment against Collar through a continuing writ of garnishment. See
generally Fed. R. Civ. P. 69(a)(1) (providing that the procedure on execution “must
accord with the procedure of the state where the court is located”); Salinas v. Ramsay,
234 So. 3d 569, 571 (Fla. 2017) (reviewing question of Florida law certified by the
Eleventh Circuit concerning post-judgment discovery and noting that “the procedure
on execution or in aid of this federal judgment is governed by the rules of Florida”); see
also Odes v. Harris, No. 12-61561-CIV, 2018 WL 3109622, at *1 (S.D. Fla. May 17, 2018)
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(ruling on a motion for a post-judgment continuing writ of garnishment and noting that
the state procedure must be followed and pointing out that Florida Statute § 77.0305
specifically addresses writs of continuing garnishment); Francois v. Washmonbo, Inc., No.
05-23368-civ, 2008 WL 2694752, at *1 (S.D. Fla. July 8, 2008) (“the requirements for
issuing a writ of continuing garnishment under Florida law are governed by statute”).
Pursuant to Fla. Stat. § 77.0305,
if salary or wages are to be garnished to satisfy a judgment, the court shall
issue a continuing writ of garnishment to the judgment debtor’s employer
which provides for the periodic payment of a portion of the salary or
wages of the judgment as the salary or wages become due until the
judgment is satisfied or until otherwise provided by court order.
§ 77.0305 (emphasis added).
As illustrated by the clear and unequivocal terms of Florida’s continuing
garnishment statute, the procedure applies only when the debtor is an employee of the
garnishee and when the money owed is salary or wages. If the money owed is not
salary or wages, then the statute cannot be used to obtain a continuing garnishment.
Hernando Cty. v. George Warner, 705 So. 3d 1053, 1054 (Fla. 5th DCA 1998); cf. DiFrancesco
v. Home Furniture Liquidators, Inc., No. 06-21709-civ, 2009 WL 36550, at *7 (S.D. Fla. Jan.
6, 2009) (holding that “plaintiffs were not entitled to a continuing writ of garnishment
as a matter of law because the amounts sought to be garnished were not wages or salary
as required by Florida’s continuing writ of garnishment statute” and admonishing
plaintiffs because motion practice “could have been avoided” if “counsel [had] not
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(incorrectly) led this Court to believe that the amount sought to be garnished
constituted [the judgment debtor’s] wages or salary”). 4
Both sides now (after the evidentiary hearing) agree that Collar is not now an
Adwave employee and is instead an independent contractor through his own
corporation, JC Sign Corp. In fact, Defendants themselves describe the evidence of
Collar’s independent contractor status as “uncontroverted.” [ECF No. 181, p. 4]. 5
Specifically, Plaintiff incorporated his own business in January 2018 and
requested to be paid as an independent contractor by Adwave. Adwave maintained
control over the terms and conditions of the jobs on which Plaintiff performed services,
but Plaintiff controlled the “when,” “where,” and the amount of time his corporation
provided services, and the types of services it provided. Mr. Soto’s testimony
established that since Plaintiff formed JC Sign Corp., he has called in on business days
The law firm representing the party who incorrectly represented that the
garnishment amount constituted wages or salary in DiFrancesco is the same firm
representing Collar here. But here, the firm is taking the position that the money at
issue is not wages or salary because Collar is an independent contractor, not an
employee.
4
Presumably, Defendants did not withdraw their motion even though they agree
now that Collar is not an employee because they could not be sure that the Court would
agree with the assessment. In their post-hearing memorandum, Defendants argued in
the alternative -- i.e., if the Court were to deem Collar an employee, then he would not
be entitled to the statutory “head of family” exemption, which is an “exemption of
wages from garnishment,” and defines head of family as “any natural person who is
providing more than one-half of the support for a child or other dependent.” Fla. Stat. §
222.11(1)(c).
5
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to notify Mr. Soto that JC Sign Corp. will not be performing services for Adwave. An
employee, on the other hand, would have to request time off.
Mr. Soto testified that he has never disciplined Plaintiff for not reporting to work
since he formed JC Sign Corp. To the contrary, Mr. Soto testified that Plaintiff does not
have to report to Adwave on a daily basis like he did when he formerly was an
employee. Mr. Soto testified that Plaintiff is “free to come and go” because he operates
his own company. [TR., p. 26:7-21].
In addition, there is no non-compete agreement by or among Plaintiff, JC Sign
Corp., and Adwave. [TR., p. 28:22-23]. Plaintiff is autonomous and free to solicit his
own business. Plaintiff solicits new business on weekends as JC Sign Corp. to maximize
his corporation’s profits. He uses JC Sign Corp. to “learn the business” and make sales
with the purpose of growing his company. [TR., p. 55:3-4].
Conclusion
Thus, Collar is an independent contractor and Defendants cannot use Florida’s
continuing garnishment statute against him. He is not an Adwave employee and the
money he receives from Adwave is not wages or salary -- a statutory requirement. The
Undersigned therefore denies Defendants’ motion. See generally Zivitz v. Zivitz, 16 So.
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3d 841, 847 (Fla. 2d DCA 2009) (“garnishment proceedings are statutory in nature and
require strict adherence to the provisions of the statute”) (internal citations omitted).
DONE AND ORDERED in Chambers, in Miami, Florida, on September 6, 2018.
Copies furnished to:
Honorable Joan A. Lenard
All Counsel of Record
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