BILL NUMBER: SB 641	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  AUGUST 27, 2015
	AMENDED IN ASSEMBLY  JULY 16, 2015
	AMENDED IN ASSEMBLY  JULY 8, 2015

INTRODUCED BY   Senator Wieckowski

                        FEBRUARY 27, 2015

   An act to add Section 1788.61 to the Civil Code, relating to debt
buying.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 641, as amended, Wieckowski. Debt buying: default judgment.
   (1) Existing law, the Fair Debt Buying Practices Act, regulates
the practice of buying charged-off consumer debt, as defined, sold or
resold on or after January 1, 2014, for collection purposes and
prescribes the circumstances pursuant to which the debt buyer may
bring suit. The act prohibits a court from entering a default or
other judgment in an action initiated by a debt buyer against a
debtor unless business records, authenticated through a sworn
declaration, are submitted by the debt buyer to the court to
establish the facts required to be alleged, as specified.
   This bill would permit a person to serve and file a notice of
motion and motion to set aside a default or default judgment and for
leave to defend an action relating to debt, if service of a summons
did not result in actual notice to the person in time to defend an
action brought by a debt buyer and a default or default judgment has
been entered against the person in the action. The bill would require
the person to make this service and filing within 6 years after
entry of the default judgment or 180 days of the first actual notice
of the action, whichever is earlier, except in cases of identity
theft or mistaken identity, in which case the service and filing is
to be made within 180 days of the first actual notice of the action.
 The bill would prescribe requirements regarding documents to be
submitted to a court in instances of identity theft or mistaken
identity.  The bill would prescribe requirements for the filing,
which would include an affidavit submitted to the court under oath
 showing   stating  that the person's lack
of actual notice in time to defend the action was not caused by his
or her avoidance of service or inexcusable neglect. By expanding the
crime of perjury, the bill would impose a state-mandated local
program. The bill would permit a court to set aside the default or
default judgment on whatever terms as may be just and allow the party
to defend the action. The bill would apply to a judgment entered on
and after January 1, 2010, except as specified.
   (2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


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

  SECTION 1.  Section 1788.61 is added to the Civil Code, to read:
   1788.61.  (a) (1) Notwithstanding Section 473.5 of the Code of
Civil Procedure, if service of a summons has not resulted in actual
notice to a person in time to defend an action brought by a debt
buyer and a default or default judgment has been entered against the
person in the action, the person may serve and file a notice of
motion and motion to set aside the default or default judgment and
for leave to defend the action.
   (2) Except as provided in paragraph (3), the notice of motion
shall be served and filed within a reasonable time, but in no event
exceeding the earlier of:
   (A) Six years after entry of the default or default judgment
against the person.
   (B) One hundred eighty days of the first actual notice of the
action.
   (3)  (A)    Notwithstanding paragraph (2), in
the case of identity theft or mistaken identity, the notice of motion
shall be served and filed within a reasonable time, but in no event
exceeding 180 days of the first actual notice of the action. 
   (B) (i) In the case of identity theft, the person alleging that he
or she is a victim of identity theft shall provide the court with
either a copy of a Federal Trade Commission Identity Theft Victim's
Complaint and Affidavit or a copy of a police report filed by the
person alleging that he or she is the victim of an identity theft
crime, including, but not limited to, a violation of Section 530.5 of
the Penal Code, for the specific debt associated with the judgment.
 
   (ii) In the case of mistaken identity, the moving party shall
provide relevant information or documentation to support the claim
that he or she is not the party named in the judgment or is not the
person who incurred or owes the debt. 
   (b) A notice of motion to set aside a default or default judgment
and for leave to defend the action shall designate as the time for
making the motion a date prescribed by Section 1005 of the Code of
Civil Procedure, and it shall be accompanied by an affidavit 
showing   stating  under oath that the person's
lack of actual notice in time to defend the action was not caused by
his or her avoidance of service or inexcusable neglect. The person
shall serve and file with the notice a copy of the answer, motion, or
other pleading proposed to be filed in the action.  In
contesting the motion to set aside the judgment or default judgment,
a debt buyer may introduce, and the court may consider, evidence
relating to the document retention policies of   Either
party may introduce, and the court may consider, evidence in support
of its motion or opposition, including evidence relating to  the
process server who appears on the proof of service of the summons
and complaint.
   (c) Upon a finding by the court that the motion was made within
the period permitted by subdivision (a) and that the person's lack of
actual notice in time to defend the action was not caused by his or
her avoidance of service or inexcusable neglect, the court may set
aside the default or default judgment on whatever terms as may be
just and allow the party to defend the action. If the validity of the
judgment is not challenged, the court may select an appropriate
remedy other than setting aside the default or default judgment.
   (d) This section shall apply to a default or default judgment
entered on or after January 1, 2010, except in the case of identity
theft or mistaken identity, in which case this section shall apply
regardless of the date of the default or default judgment.
   (e) This section shall not limit the equitable authority of the
court or other available remedies under law.
  SEC. 2.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.