BILL NUMBER: SB 1322 CHAPTERED
BILL TEXT
CHAPTER 68
FILED WITH SECRETARY OF STATE JUNE 21, 2002
APPROVED BY GOVERNOR JUNE 20, 2002
PASSED THE ASSEMBLY JUNE 10, 2002
PASSED THE SENATE APRIL 4, 2002
AMENDED IN SENATE MARCH 13, 2002
INTRODUCED BY Senator Ackerman
JANUARY 28, 2002
An act to amend Sections 512.060, 514.020, 515.010, 515.020,
703.580, and 703.610 of the Code of Civil Procedure, relating to
debtor and creditor relations.
LEGISLATIVE COUNSEL'S DIGEST
SB 1322, Ackerman. Debtor and creditor relations.
(1) Existing law permits a plaintiff to apply for a writ of
possession, which must show, among other things, the basis of the
plaintiff's claim and that the plaintiff is entitled to the property
claimed. Existing law requires a hearing on a noticed motion before
the writ of possession may be issued, except as specified, and
prohibits a court from issuing a writ until the plaintiff posts an
undertaking in a value of at least twice the defendant's interest.
Existing law permits a defendant to post an undertaking to prevent
the seizure of the property or reclaim it.
This bill would provide an alternative procedure for writs of
possession if a court finds that a defendant has no interest in the
property. The bill would require, under these circumstances, that a
court waive the requirement of the plaintiff's undertaking and that
the court determine the amount of the defendant's undertaking, as
specified. The bill would also require a levying officer to deliver
to the person in possession of the property a copy of the court order
for issuance of the writ of possession.
(2) Under the existing Enforcement of Judgments Law, a judgment
creditor may levy upon the property of a judgment debtor to satisfy
the judgment, and the judgment debtor may claim that certain property
is exempt from the levy by following a specified procedure. Under
that existing law, a levying officer holds the property until the
final determination of the exemption.
This bill would require that if an exemption of property, as
described above, is not determined within a specified time, the
property claimed to be exempt shall be released, unless otherwise
ordered by the court. The bill would further permit a levying
officer to release the property described above after an appeal is
waived or the time for filing an appeal has expired.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 512.060 of the Code of Civil Procedure is
amended to read:
512.060. (a) At the hearing, a writ of possession shall issue if
both of the following are found:
(1) The plaintiff has established the probable validity of the
plaintiff's claim to possession of the property.
(2) The undertaking requirements of Section 515.010 are satisfied.
(b) No writ directing the levying officer to enter a private place
to take possession of any property shall be issued unless the
plaintiff has established that there is probable cause to believe
that the property is located there.
SEC. 2. Section 514.020 of the Code of Civil Procedure is amended
to read:
514.020. (a) At the time of levy, the levying officer shall
deliver to the person in possession of the property a copy of the
writ of possession, a copy of the plaintiff's undertaking, if any,
and a copy of the order for issuance of the writ.
(b) If no one is in possession of the property at the time of
levy, the levying officer shall subsequently serve the writ and
attached undertaking on the defendant. If the defendant has appeared
in the action, service shall be accomplished in the manner provided
by Chapter 5 (commencing with Section 1010) of Title 14. If the
defendant has not appeared in the action, service shall be
accomplished in the manner provided for the service of summons and
complaint by Article 3 (commencing with Section 415.10) of Chapter 4
of Title 5.
SEC. 3. Section 515.010 of the Code of Civil Procedure is amended
to read:
515.010. (a) Except as provided in subdivision (b), the court
shall not issue a temporary restraining order or a writ of possession
until the plaintiff has filed an undertaking with the court . The
undertaking shall provide that the sureties are bound to the
defendant for the return of the property to the defendant, if return
of the property is ordered, and for the payment to the defendant of
any sum recovered against the plaintiff. The undertaking shall be in
an amount not less than twice the value of the defendant's interest
in the property or in a greater amount. The value of the defendant's
interest in the property is determined by the market value of the
property less the amount due and owing on any conditional sales
contract or security agreement and all liens and encumbrances on the
property, and any other factors necessary to determine the defendant'
s interest in the property.
(b) If the court finds that the defendant has no interest in the
property, the court shall waive the requirement of the plaintiff's
undertaking and shall include in the order for issuance of the writ
the amount of the defendant's undertaking sufficient to satisfy the
requirements of subdivision (b) of Section 515.020.
SEC. 4. Section 515.020 of the Code of Civil Procedure is amended
to read:
515.020. (a) The defendant may prevent the plaintiff from taking
possession of property pursuant to a writ of possession or regain
possession of property so taken by filing with the court in which the
action was brought an undertaking in an amount equal to the amount
of the plaintiff's undertaking pursuant to subdivision (a) of Section
515.010 or in the amount determined by the court pursuant to
subdivision (b) of Section 515.010.
(b) The undertaking shall state that, if the plaintiff recovers
judgment on the action, the defendant shall pay all costs awarded to
the plaintiff and all damages that the plaintiff may sustain by
reason of the loss of possession of the property. The damages
recoverable by the plaintiff pursuant to this section shall include
all damages proximately caused by the plaintiff's failure to gain or
retain possession.
(c) The defendant's undertaking may be filed at any time before or
after levy of the writ of possession. A copy of the undertaking
shall be mailed to the levying officer.
(d) If an undertaking for redelivery is filed and the defendant's
undertaking is not objected to, the levying officer shall deliver the
property to the defendant, or, if the plaintiff has previously been
given possession of the property, the plaintiff shall deliver the
property to the defendant. If an undertaking for redelivery is filed
and the defendant's undertaking is objected to, the provisions of
Section 515.030 apply.
SEC. 5. Section 703.580 of the Code of Civil Procedure is amended
to read:
703.580. (a) The claim of exemption and notice of opposition to
the claim of exemption constitute the pleadings, subject to the power
of the court to permit amendments in the interest of justice.
(b) At a hearing under this section, the exemption claimant has
the burden of proof.
(c) The claim of exemption is deemed controverted by the notice of
opposition to the claim of exemption and both shall be received in
evidence. If no other evidence is offered, the court, if satisfied
that sufficient facts are shown by the claim of exemption (including
the financial statement if one is required) and the notice of
opposition, may make its determination thereon. If not satisfied,
the court shall order the hearing continued for the production of
other evidence, oral or documentary.
(d) At the conclusion of the hearing, the court shall determine by
order whether or not the property is exempt in whole or in part.
Subject to Section 703.600, the order is determinative of the right
of the judgment creditor to apply the property to the satisfaction of
the judgment. No findings are required in a proceeding under this
section.
(e) The court clerk shall promptly transmit a certified copy of
the order to the levying officer. Subject to Section 703.610, the
levying officer shall, in compliance with the order, release the
property or apply the property to the satisfaction of the money
judgment.
(f) Unless otherwise ordered by the court, if an exemption is not
determined within the time provided by Section 703.570, the property
claimed to be exempt shall be released.
SEC. 6. Section 703.610 of the Code of Civil Procedure is amended
to read:
703.610. (a) Except as otherwise provided by statute or ordered
by the court, the levying officer shall not release, sell, or
otherwise dispose of the property for which an exemption is claimed
until an appeal is waived, the time to file an appeal has expired, or
the exemption is finally determined.
(b) At any time while the exemption proceedings are pending, upon
motion of the judgment creditor or a claimant, or upon its own
motion, the court may make any orders for disposition of the property
that may be proper under the circumstances of the case. The order
may be modified or vacated by the court at any time during the
pendency of the exemption proceedings upon any terms that are just.
(c) If an appeal of the determination of a claim of exemption is
taken, notice of the appeal shall be given to the levying officer and
the levying officer shall hold, release, or dispose of the property
in accordance with the provisions governing enforcement and stay of
enforcement of money judgments pending appeal.