BILL NUMBER: AB 929	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 31, 2011

INTRODUCED BY   Assembly Member Wieckowski

                        FEBRUARY 18, 2011

   An act  to amend Sections 703.140 and 704.730 of the Code of
Civil Procedure,   relating to debtor exemptions.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 929, as amended, Wieckowski. Debtor exemptions: bankruptcy.
   Existing law identifies property of a debtor that is exempt from
all procedures for enforcement of a money judgment. Under existing
law, those exemptions are available to a debtor in a federal
bankruptcy case, whether a money judgment is being enforced by
execution sale or other procedure,  or the debtor may instead
elect certain specified exemptions   unless the debtor
elects certain alternative exemptions. Existing law requires the
Judicial Council to, every 3 years   ,   adjust
  the amount of the exemptions applicable to that exempt
property based on the change in the annual California Consumer Price
Index for All Urban Consumers, and to prepare conforming forms for
those adjustments  . 
   This bill would express the intent of the Legislature to enact
legislation to revise the exemption process for debtors in bankruptcy
proceedings.  
   This bill would revise and recast those alternative exemption
provisions and would, among other things, increase the exemption
available for the debtor's interest in motor vehicles; jewelry,
heirlooms, and works of art; and tools and other items used in the
debtor's trade, business, or profession or in the trade, business, or
profession of the debtor's spouse. The bill would revise the
alternative exemption provisions relating to household furnishings,
life insurance contracts, wrongful death and personal injury actions,
unemployment compensation payments, and cemetery plots and would add
to those alternative exemption provisions exemptions for workers'
compensation benefits, specified aid payments and relocation
benefits, and financial aid for higher education.  
   Existing law provides an exemption from enforcement of a money
judgment for a homestead, as defined, in specified amounts. 

   This bill would increase the amounts of the homestead exemption.

   Vote: majority. Appropriation: no. Fiscal committee:  no
  yes  . State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 703.140 of the   Code
of Civil Procedure   is amended to read: 
   703.140.  (a) In a case under Title 11 of the United States Code,
all of the exemptions provided by this chapter, including the
homestead exemption, other than the provisions of subdivision (b) are
applicable regardless of whether there is a money judgment against
the debtor or whether a money judgment is being enforced by execution
sale or any other procedure, but the exemptions provided by
subdivision (b) may be elected in lieu of all other exemptions
provided by this chapter, as follows:
   (1) If a husband and wife are joined in the petition, they jointly
may elect to utilize the applicable exemption provisions of this
chapter other than the provisions of subdivision (b), or to utilize
the applicable exemptions set forth in subdivision (b), but not both.

   (2) If the petition is filed individually, and not jointly, for a
husband or a wife, the exemptions provided by this chapter other than
the provisions of subdivision (b) are applicable, except that, if
both the husband and the wife effectively waive in writing the right
to claim, during the period the case commenced by filing the petition
is pending, the exemptions provided by the applicable exemption
provisions of this chapter, other than subdivision (b), in any case
commenced by filing a petition for either of them under Title 11 of
the United States Code, then they may elect to instead utilize the
applicable exemptions set forth in subdivision (b).
   (3) If the petition is filed for an unmarried person, that person
may elect to utilize the applicable exemption provisions of this
chapter other than subdivision (b), or to utilize the applicable
exemptions set forth in subdivision (b), but not both.
   (b) The following exemptions may be elected as provided in
subdivision (a):
   (1) The debtor's aggregate interest, not to exceed seventeen
thousand four hundred twenty-five dollars ($17,425) in value, in real
property or personal property that the debtor or a dependent of the
debtor uses as a residence,  or  in a cooperative that owns
property that the debtor or a dependent of the debtor uses as a
residence  , or in a burial plot for the debtor or a
dependent of the debtor  .
   (2)  (A)    The debtor's interest, not to exceed
 two thousand seven hundred seventy-five dollars ($2,775) in
value, in one motor vehicle.   four thousand eight
hundred dollars ($4,800) in any combination of the following: 

   (i) The aggregate equity in motor vehicles.  
   (ii) The proceeds of an execution sale of a motor vehicle. 

   (iii) The proceeds of insurance or other indemnification for the
loss, damage, or destruction of a motor vehicle.  
   (B) Proceeds under subparagraph (A) are exempt for a period of 90
days after the proceeds are actually received by the debtor. 

   (C) For the purpose of determining the equity in a motor vehicle,
the fair market value of the vehicle shall be determined by reference
to used car price guides customarily used by California automobile
dealers, unless the motor vehicle is not listed in those price
guides.  
   (D) If the debtor has only one motor vehicle and it is sold at an
execution sale, the proceeds of the sale, up to four thousand eight
hundred dollars ($4,800), are exempt without making a claim. The
levying officer shall consult and may rely upon the records of the
Department of Motor Vehicles in determining whether the debtor has
only one motor vehicle. In a case covered by this subparagraph, the
exemption provided in subparagraph (A) is not available. 
   (3) The debtor's interest, not to exceed four hundred fifty
dollars ($450) in value in any particular item, in household
furnishings, household goods, wearing apparel, appliances, books,
animals, crops, or musical instruments, that are held primarily for
the personal, family, or household use of the debtor or a dependent
of the  debtor   .   debtor
  , subject to the following:  
   (A) (i) The item is ordinarily and reasonably necessary to, and
personally used or procured for use by, the debtor or members of the
debtor's family at the debtor's principal place of residence. 

   (ii) If the debtor and his or her spouse live separate and apart,
the item is ordinarily and reasonably necessary to, and personally
used or procured for use by, the spouse or members of the spouse's
family at the spouse's principal place of residence.  
   (B) To determine whether an item is ordinarily and reasonably
necessary under subparagraph (A), the court shall take into account
both of the following:  
   (i) The extent to which the particular type of item is ordinarily
found in a household.  
   (ii) Whether the particular item has extraordinary value as
compared to the value of items of the same type in other households.
 
   (C) If an item of property for which an exemption is claimed
pursuant to this paragraph is determined to not be exempt because it
has extraordinary value as compared to the value of items of the same
type found in other households, the proceeds obtained at an
execution sale of the item are exempt in the amount determined by the
court to be a reasonable amount sufficient to purchase a replacement
of ordinary value, if the court determines that a replacement is
reasonably necessary.  
   (D) Proceeds exempt under this paragraph are exempt for a period
of 90 days after the proceeds are actually received by the debtor.

   (4) The debtor's aggregate interest, not to exceed  one
thousand one hundred fifty   five thousand  dollars
 ($1,150)   ($5,000)  in value, in jewelry
 , heirlooms, and works of art  held primarily for the
personal, family, or household use of the debtor or a dependent of
the debtor.
   (5) The debtor's aggregate interest, not to exceed in value nine
hundred twenty-five dollars ($925) plus any unused amount of the
exemption provided under paragraph (1), in any property.
   (6)  (A)    The debtor's aggregate interest
 , not to exceed one thousand seven hundred fifty dollars
($1,750) in value, in any implements, professional books, or tools of
the trade of the debtor or the trade of a dependent of the debtor.
  in tools, implements, instruments, materials,
uniforms, furnishings, books, equipment, one commercial motor
vehicle, one vessel, and other personal property are exempt to the
extent that the aggregate equity in those items does not exceed 
 the following   :  
   (i) Six thousand seventy-five dollars ($6,075), if reasonably
necessary to and actually used by the debtor in the exercise of the
trade, business, or profession by which the debtor earns a
livelihood.  
   (ii) Six thousand seventy-five dollars ($6,075), if reasonably
necessary to and actually used by the spouse of the debtor in the
exercise of the trade, business, or profession by which the spouse
earns a livelihood. 
   (iii) Twice the amount of the exemption provided in clause (ii),
if reasonably necessary to and actually used by the debtor and by the
spouse of the debtor in the exercise of the same trade, business, or
profession by which both earn a livelihood. In the case covered by
this clause, the exemptions provided in clauses (i) and (ii) are not
available.  
   (B) If property described in subparagraph (A) is sold at an
execution sale, or if it has been lost, damaged, or destroyed, the
proceeds of the execution sale or of insurance or other
indemnification are exempt for a period of 90 days after the proceeds
are actually received by the debtor or the debtor's spouse. The
amount exempt under this subparagraph is the amount specified in
subparagraph (A) that applies to the particular case less the
aggregate equity of any other property to which the exemption
provided by subparagraph (A) for the particular case has been
applied.  
   (C) Notwithstanding subparagraph (A), a motor vehicle is not
exempt under subparagraph (A) if there is a motor vehicle exempt
under paragraph (2) which is reasonably adequate for use in the
trade, business, or profession for which the exemption is claimed
under this paragraph.  
   (D) Notwithstanding subparagraphs (A) and (B):  
   (i) The amount of the exemption for a commercial motor vehicle
under clause (i) or (ii) of subparagraph (A) is limited to four
thousand eight hundred fifty dollars ($4,850).  
   (ii) The amount of the exemption for a commercial motor vehicle
under clause (iii) of subdivision (A) is limited to twice the amount
of the exemption provided in clause (i) of this subparagraph. 
   (7) Any unmatured life insurance contract owned by the debtor,
other than a credit life insurance  contract 
 .   contract   , subject to the
following:  
   (8) The debtor's aggregate interest, not to exceed in value nine
thousand three hundred dollars ($9,300), in any accrued dividend or
interest under, or loan value of, any unmatured life insurance
contract owned by the debtor under which the insured is the debtor or
an individual of whom the debtor is a dependent.  
   (A) Unmatured life insurance contracts, including endowment and
annuity contracts, but not the loan value of those contracts, are
exempt without making a claim.  
   (B) The aggregate loan value of unmatured life insurance
contracts, including endowment and annuity policies, is exempt in the
amount of nine thousand seven hundred dollars ($9,700). If the
debtor is married, each spouse is entitled to a separate exemption
under this subparagraph and the exemption of the spouses may be
combined, regardless of whether the policies belong to either or both
spouses and regardless of whether the spouse of the debtor is also a
debtor in the case.  
   (C) Benefits from matured life insurance contracts, including
endowment and annuity contracts, are exempt to the extent reasonably
necessary for the support of the debtor and the spouse and dependents
of the debtor.  
   (9) 
    (8)  Professionally prescribed health aids for the
debtor or a dependent of the debtor. 
   (10) 
    (9)  The debtor's right to receive any of the following:

   (A) A social security benefit, unemployment compensation, or a
local public assistance benefit.
   (B) A veterans' benefit.
   (C) A disability, illness, or unemployment benefit.
   (D) Alimony, support, or separate maintenance, to the extent
reasonably necessary for the support of the debtor and any dependent
of the debtor.
   (E) A payment under a stock bonus, pension, profit-sharing,
annuity, or similar plan or contract on account of illness,
disability, death, age, or length of service, to the extent
reasonably necessary for the support of the debtor and any dependent
of the debtor, unless all of the following apply:
   (i) That plan or contract was established by or under the auspices
of an insider that employed the debtor at the time the debtor's
rights under the plan or contract arose.
   (ii) The payment is on account of age or length of service.
   (iii) That plan or contract does not qualify under Section 401(a),
403(a), 403(b), 408, or 408A of the Internal Revenue Code of 1986.

   (F) Public retirement benefits as described in Section 704.110 or
private retirement plan benefits as described in Section 704.115.
 
   (G) Vacation credits as described in Section 704.113.  
   (H) Service of earnings assignment orders for support as described
in Section 704.114.  
   (11) 
    (10)  The debtor's right to receive, or property that is
traceable to, any of the following:
   (A) An award under a crime victim's reparation law. 
   (B) A payment on account of the wrongful death of an individual of
whom the debtor was a dependent, to the extent reasonably necessary
for the support of the debtor and any dependent of the debtor.
 
   (C) A payment under a life insurance contract that insured the
life of an individual of whom the debtor was a dependent on the date
of that individual's death, to the extent reasonably necessary for
the support of the debtor and any dependent of the debtor. 

   (D) A payment, not to exceed seventeen thousand four hundred
twenty-five dollars ($17,425), on account of personal bodily injury,
not including pain and suffering or compensation for actual pecuniary
loss, of the debtor or an individual of whom the debtor is a
dependent.  
   (E) A payment in compensation of loss of future earnings of the
debtor or an individual of whom the debtor is or was a dependent, to
the extent reasonably necessary for the support of the debtor and any
dependent of the debtor.  
   (i) Except as provided in Article 5 (commencing with Section
708.410) of Chapter 6, a cause of action for wrongful death is exempt
without making a claim.  
   (ii) Except as provided in clause (iii), an award of damages or a
settlement arising out of the wrongful death of the debtor's spouse
or a person on whom the debtor or the debtor's spouse was dependent
is exempt to the extent reasonably necessary for support of the
debtor and the spouse and dependents of the debtor.  
   (iii) If an award of damages or a settlement arising out of the
wrongful death of the debtor's spouse or a person on whom the debtor
or the debtor's spouse was dependent is payable periodically, the
amount of the periodic payment that shall not be exempt is the amount
that may be withheld from a like amount of earnings under Chapter 5
(commencing with Section 706.010).  
   (B) (i) Before payment, benefits from a disability or health
insurance policy or program are exempt without making a claim. After
payment, the benefits are exempt. This subparagraph does not apply to
benefits that are paid or payable to cover the cost of health care
if the creditor is a provider of health care whose claim is the basis
on which the benefits are paid or payable.  
   (ii) During the payment of disability benefits described in this
subparagraph to a debtor under a support judgment, the judgment
creditor or local child support agency may seek to apply the benefit
payments to satisfy the judgment by an earnings assignment order for
support, as defined in Section 706.011, or any other applicable
enforcement procedure, but the amount to be withheld pursuant to the
earnings assignment order or other procedure shall not exceed the
amount permitted to be withheld on an earnings assignment order for
support under Section 706.052.  
   (11) (A) Except as provided in Article 5 (commencing with Section
708.410) of Chapter 6, a cause of action for personal injury is
exempt without making a claim.  
   (B) Except as provided in subparagraphs (C) and (D), an award of
damages or a settlement arising out of personal injury is exempt to
the extent necessary for the support of the debtor and the spouse and
dependents of the debtor.  
   (C) Subparagraph (B) does not apply if the judgment creditor is a
provider of health care whose claim is based on the providing of
health care for the personal injury for which the award or settlement
was made.  
   (D) If an award of damages or a settlement arising out of personal
injury is payable periodically, the amount of the periodic payment
that shall not be exempt is the amount that may be withheld from a
like amount of earnings under Chapter 5 (commencing with Section
706.010).  
   (12) Contributions by employees and employers to the Unemployment
Compensation Disability Fund are exempt without making a claim. 

   (A) Before payment, amounts held for payment of the following
benefits are exempt without making a claim:  
   (i) Benefits payable under Division 1 (commencing with Section
100) of the Unemployment Insurance Code.  
   (ii) Incentives payable under Division 2 (commencing with Section
5000) of the Unemployment Insurance Code.  
   (iii) Benefits payable under an employer's plan or system to
supplement unemployment compensation benefits of the employees
generally or for a class or group of employees.  
   (iv) Unemployment benefits payable by a fraternal organization to
its bona fide members.  
   (v) Benefits payable by a union due to a labor dispute.  

   (B) After payment, the benefits described in subparagraph (A) are
exempt.  
   (C) During the payment of benefits described in clause (i) of
subparagraph (A) to a debtor under a support judgment, the judgment
creditor may, through the appropriate local child support agency,
seek to apply the benefit payment to satisfy the judgment as provided
by Section 17518 of the Family Code.  
   (D) During the payment of benefits described in clauses (ii) to
(v), inclusive, of subparagraph (A) to a debtor under a support
judgment, the judgment creditor may, directly or through the
appropriate local child support agency, seek to apply the benefit
payments to satisfy the judgment by an earnings assignment order for
support as defined in Section 706.011 or any other applicable
enforcement procedure. If the benefit is payable periodically, the
amount to be withheld pursuant to the assignment order or other
procedure shall be 25 percent of the amount of each periodic payment
or any lower amount specified in writing by the judgment creditor or
court order, rounded down to the nearest whole dollar. Otherwise the
amount to be withheld shall be the amount the court determines under
subdivision (c) of Section 703.070. The paying entity may deduct from
each payment made pursuant to an assignment order under this
subparagraph an amount reflecting the actual cost of administration
caused by the assignment order up to two dollars ($2) for each
payment.  
   (13) (A) Except as provided by Chapter 1 (commencing with Section
4900) of Part 3 of Division 4 of the Labor Code, before payment, a
claim for workers' compensation or workers' compensation awarded or
adjudged is exempt without making a claim. Except as specified in
subparagraph (B), after payment, the award is exempt.  
   (B) Notwithstanding any other provision of law, during the payment
of workers' compensation temporary disability benefits described in
subparagraph (A) to a support judgment debtor, the support judgment
creditor may, through the appropriate local child support agency,
seek to apply the workers' compensation temporary disability benefit
payment to satisfy the support judgment as provided by Section 17404
of the Family Code.  
   (C) Notwithstanding any other provision of law, during the payment
of workers' compensation temporary disability benefits described in
subparagraph (A) to a support judgment debtor under a support
judgment, including a judgment for reimbursement of public
assistance, the judgment creditor may, directly or through the
appropriate local child support agency, seek to apply the temporary
disability benefit payments to satisfy the support judgment by an
earnings assignment order for support, as defined in Section 5208 of
the Family Code, or any other applicable enforcement procedure. The
amount to be withheld pursuant to the earnings assignment order for
support or other enforcement procedure shall be 25 percent of the
amount of each periodic payment or any lower amount specified in
writing by the judgment creditor or court order, rounded down to the
nearest dollar. Otherwise, the amount to be withheld shall be the
amount the court determines under subdivision (c) of Section 703.070.
The paying entity may deduct from each payment made pursuant to an
order assigning earnings under this subparagraph an amount reflecting
the actual cost of administration of this assignment, up to two
dollars ($2) for each payment.  
   (D) Unless the provision or context otherwise requires, the
following definitions govern the construction of this paragraph and
paragraphs (10) to (12), inclusive.  
   (i) "Judgment debtor" or "support judgment debtor" means a person
who is owing a duty of support.  
   (ii) "Judgment creditor" or "support judgment creditor" means the
person to whom support has been ordered to be paid.  
   (iii) "Support" refers to an obligation owing on behalf of a
child, spouse, or family, or an amount owing pursuant to Section
17402 of the Family Code. It also includes past due support or
arrearage when it exists.  
   (14) Before payment, aid provided pursuant to Division 9
(commencing with Section 10000) of the Welfare and Institutions Code,
or similar aid provided by a charitable organization or a fraternal
benefit society as defined in Section 10990 of the Insurance Code, is
exempt without making a claim. After payment, the aid is exempt.
 
   (15) Before payment, relocation benefits for displacement from a
dwelling which are to be paid pursuant to Chapter 16 (commencing with
Section 7260) of Division 7 of Title 1 of the Government Code or the
federal Uniform Relocation Assistance and Real Property Acquisition
Policies Act of 1970 (42 U.S.C. Sec. 4601 et seq.), as amended, are
exempt without making a claim. After payment, the benefits are
exempt.  
   (16) (A) As used in this paragraph, "institution of higher
education" means "institution of higher education" as defined in
Section 1141(a) of Title 20 of the United States Code, as amended.
 
   (B) Before payment, financial aid for expenses while attending
school provided to a student by an institution of higher education is
exempt without making a claim. After payment, the aid is exempt.
 
   (17) (A) As used in this paragraph:  
   (i) "Cemetery" has the meaning provided by Section 7003 of the
Health and Safety Code.  
   (ii) "Family plot" is a plot that satisfies the requirements of
Section 8650 of the Health and Safety Code.  
   (iii) "Plot" has the meaning provided by Section 7022 of the
Health and Safety Code.  
   (B) A family plot is exempt without making a claim.  
   (C) Except as provided in subparagraph (D), a cemetery plot for
the debtor and the spouse of the debtor is exempt.  
   (D) Land held for the purpose of sale or disposition as cemetery
plots or otherwise is not exempt.  
   (18) Property that is not subject to enforcement of a money
judgment is exempt without making a claim. 
   SEC. 2.    Section 704.730 of the  Code of
Civil Procedure   is amended to read: 
   704.730.  (a) The amount of the homestead exemption is one of the
following:
   (1)  Seventy-five  One hundred fifty 
thousand dollars  ($75,000)   ($150,000) 
unless the judgment debtor or spouse of the judgment debtor who
resides in the homestead is a person described in paragraph (2) or
(3).
   (2)  One hundred   Two   hundred
fifty  thousand dollars  ($100,000)  
($250,000)  if the judgment debtor or spouse of the judgment
debtor who resides in the homestead is at the time of the attempted
sale of the homestead a member of a family unit, and there is at
least one member of the family unit who owns no interest in the
homestead or whose only interest in the homestead is a community
property interest with the judgment debtor.
   (3)  One hundred seventy-five   Three hundred
fifty  thousand dollars  ($175,000)  
($350,000)  if the judgment debtor or spouse of the judgment
debtor who resides in the homestead is at the time of the attempted
sale of the homestead any one of the following:
   (A) A person 65 years of age or older.
   (B) A person physically or mentally disabled who as a result of
that disability is unable to engage in substantial gainful
employment. There is a rebuttable presumption affecting the burden of
proof that a person receiving disability insurance benefit payments
under Title II or supplemental security income payments under Title
XVI of the federal Social Security Act satisfies the requirements of
this paragraph as to his or her inability to engage in substantial
gainful employment.
   (C) A person 55 years of age or older with a gross annual income
of not more than  fifteen   twenty-two 
thousand dollars  ($15,000)   ($22,000) 
or, if the judgment debtor is married, a gross annual income,
including the gross annual income of the judgment debtor's spouse, of
not more than  twenty   twenty-   nine
 thousand dollars  ($20,000)   ($29,000)
 and the sale is an involuntary sale.
                                                              (b)
Notwithstanding any other provision of this section, the combined
homestead exemptions of spouses on the same judgment shall not exceed
the amount specified in paragraph (2) or (3), whichever is
applicable, of subdivision (a), regardless of whether the spouses are
jointly obligated on the judgment and regardless of whether the
homestead consists of community or separate property or both.
Notwithstanding any other provision of this article, if both spouses
are entitled to a homestead exemption, the exemption of proceeds of
the homestead shall be apportioned between the spouses on the basis
of their proportionate interests in the homestead. 
  SECTION 1.    It is the intent of the Legislature
to enact legislation that would revise the exemption process for
debtors in bankruptcy proceedings.