## Facts

- Di-Chem, Inc., a chemical supplier, claimed North Georgia Finishing, Inc. owed about $51,000 on an open account.
- Di-Chem used Georgia’s prejudgment garnishment procedure to freeze North Georgia’s bank account before judgment.
- Di-Chem’s attorney filed an affidavit asserting, in conclusory terms, that Di-Chem had a claim and that statutory grounds existed for garnishment.
- A court clerk, without a judge’s involvement, issued the writ of garnishment based solely on the affidavit.
- North Georgia received no prior notice and no opportunity to be heard before its bank account was restrained.
- Under Georgia law, the garnishment could be lifted before final judgment only by posting a bond for the claimed amount plus costs; the statute did not provide for a prompt hearing to contest the garnishment’s validity.
- The Supreme Court of Georgia upheld the statute against a due process challenge; the U.S. Supreme Court granted review.

## Issues

1. Whether Georgia’s prejudgment garnishment scheme violated the Fourteenth Amendment Due Process Clause by authorizing ex parte restraint of a debtor’s bank account on conclusory allegations, without judicial participation and without a prompt opportunity to contest the seizure other than posting bond.

## Decision

- The U.S. Supreme Court reversed.
- The Court held Georgia’s prejudgment garnishment procedure violated due process.
- The Court found the statute materially deficient because it permitted issuance on conclusory affidavits, allowed issuance by a clerk rather than a judge, offered bond as the only route to dissolution before final judgment, and provided no prompt hearing to test the creditor’s claim.
- The Court rejected the argument that corporate bank accounts merit less due process protection than wages or consumer property, noting the significant risk of harm from an erroneous freeze.

## Legal Principles

- Due process generally requires meaningful procedural safeguards before, or promptly after, prejudgment restraint of property.
- A prejudgment garnishment procedure is unconstitutional when it:
  - authorizes seizure based only on conclusory affidavits rather than a fact-based showing;
  - permits issuance without judicial evaluation at the outset;
  - fails to provide a prompt post-seizure hearing to challenge the deprivation; and
  - makes posting bond the sole practical means of obtaining immediate relief.
- The constitutionality of prejudgment remedies turns on the presence of safeguards that reduce the risk of erroneous deprivation, including judicial participation and a prompt opportunity to contest the seizure.

## Conclusion

The Court invalidated Georgia’s prejudgment garnishment scheme because it allowed ex parte freezing of a bank account on bare allegations, without judicial oversight and without a prompt hearing, thereby depriving the debtor of property without constitutionally required process.


North Georgia Finishing, Inc. v. Di-Chem, Inc., 419 U.S. 601 (1975)