Appeal from the Iowa District Court for Buena Vista County, Nancy L. Whittenburg, Judge.
Plaintiff appeals the district court's ruling finding funds Plaintiff sought to garnish in a MetaBank bank account were excepted from garnishment because the funds were for a "special purpose."
Phil C. Redenbaugh and Ryan A. Mohr of Phil Redenbaugh, P.C, Storm Lake, for appellant.
Mitchell A. Peterson of Davenport, Evans, Hurwitz & Smith, L.L.P., Sioux Falls, and Ted Brown of Mack, Hansen, Gadd, Armstrong & Brown, P.C, Storm Lake, for appellee.
Heard by Vogel, P.J., and Vaitheswaran and Doyle and Tabor, JJ.
Spar Incentive Marketing Inc. ("Spar") is a judgment creditor seeking to garnish funds in a MetaBank bank account. Stimulys, Inc. ("Stimulys"), the account titleholder, is Spar's judgment debtor. Following a bench trial, the district court ruled the funds in the bank account were excepted from garnishment because the funds were deposited into that account for a "special purpose." Spar appeals. We affirm.
I. Scope and Standards of Review.
Because garnishment proceedings are actions at law, our review is for errors at law. See Iowa R. App. P. 6.904; Ellefson v. Centech Corp., 606 N.W.2d 324, 330 (Iowa 2000). To the extent this appeal concerns matters of contract construction, our review is also at law. Ellefson, 606 N.W.2d at 330. We are not bound by the district court's legal conclusions, and "we may inquire into whether the district court's ultimate conclusions were materially affected by improper conclusions of law." Id. However, the district court's findings of fact are binding if supported by substantial evidence. Id. Evidence is substantial when a reasonable mind would accept it as adequate to reach a conclusion. Beal Bank v. Siems, 670 N.W.2d 119, 125 (Iowa 2003). We view the evidence in a light most favorable to the district court's judgment. Van Oort Constr. Co. v. Nuckoll's Concrete Serv., Inc., 599 N.W.2d 684, 689 (Iowa 1999).
II. Background Facts and Proceedings.
From the evidence presented at trial, a reasonable jury could have found the following facts.
Meta Payment Systems (MPS) is a division of MetaBank. MPS, the largest issuer of prepaid cards in the nation, has a relationship with some 6000 banks that sell its gift cards. Through MPS, MetaBank issues and manages prepaid cards on behalf its clients.
The prepaid cards "function like a credit card or debit card but the concept is a little bit different . . . . The consumer . . . or a corporate entity prefunds . . . an account, and then a consumer can use the card to make purchases." The prepaid cards are branded, typically VISA® or MasterCard®, and the cards are accepted by merchants that accept that brand of payment. The brands contract with merchants; in exchange for a fee, the ...