(a) Subject to Sections 684.115 and 700.160, to levy upon a deposit account, the levying officer shall personally serve a copy of the writ of execution and a notice of levy on the financial institution with which the deposit account is maintained.
(b) The execution lien that arises upon service of a writ of execution and notice of levy reaches only amounts in a deposit account at the time of service on the financial institution, including the amount of any deposit not yet finally collected unless the deposit is returned unpaid to the financial institution.
(c) The levying officer shall serve a copy of the writ of execution and a notice of levy on any third person in whose name any deposit account described therein stands. Service shall be made personally or by mail as follows:
(1) At the time of levy or promptly thereafter, if the party seeking the levy informs the levying officer of the person and his, her, or its residence or business address.
(2) Promptly following the levying officer’s receipt of a garnishee’s memorandum if service was not accomplished pursuant to paragraph (1) if the garnishee’s memorandum identifies the person and his, her, or its residence or business address.
(d) The financial institution shall not honor a withdrawal request or a check or other order for the payment of money from the deposit account if presentment of the withdrawal request or item to the financial institution occurs during the time the execution lien is in effect unless, following the withdrawal or payment, sufficient funds are available to cover the levy. For these purposes, a withdrawal from the deposit account to cover the financial institution’s standard fee or charge for processing the levy shall not be considered a payment of money from the account in violation of this subdivision.
(e) During the time the execution lien is in effect, the financial institution is not liable to any person for any of the following:
(1) Performance of the duties of a garnishee under the levy.
(2) Nonpayment of a check or other order for the payment or transfer of money drawn or presented against the deposit account if the nonpayment is pursuant to the requirements of subdivision (d).
(3) Refusal to pay a withdrawal from the deposit account if the refusal is pursuant to the requirements of subdivision (d).
(f) When the amount levied upon pursuant to this section is paid to the levying officer, the execution lien on the deposit account levied upon terminates.
(g) For the purposes of this section, none of the following is a third person in whose name the deposit account stands:
(1) A person who is only a person named as the beneficiary of a Totten trust account.
(2) A person who is only a payee designated in a pay-on-death provision in an account pursuant to Section 18318.5 of the Financial Code or Section 5140 of the Probate Code, or other similar provision.
(3) A person who is only acting in a representative or custodial capacity with respect to benefits paid or payable by the United States government. Rather, accounts maintained by the representative or custodian shall be deemed to stand in the beneficiary’s name, and the amounts therein shall be covered by a levy against the beneficiary.
(h) For purposes of this section, final payment of a deposit shall be deemed to have occurred in accordance with Section 4215 or 11210 of the Commercial Code or with automated clearinghouse or Federal Reserve System rule, regulation, operating circular, or similar governing document, as applicable to the deposit. If, for any reason, a deposit is returned by the financial institution upon which it is drawn, the deposit shall not be deemed finally collected for purposes of this subdivision regardless of any later payment by the financial institution upon which the deposit is drawn.
(Amended by Stats. 2012, Ch. 484, Sec. 8. (AB 2364) Effective January 1, 2013.)
Last modified: October 25, 2018