BILL ANALYSIS �
AB 1388
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1388 (Wieckowski)
As Amended June 10, 2011
Majority vote
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|ASSEMBLY: |49-26|(May 2, 2011) |SENATE: |24-13|(August 29, |
| | | | | |2011) |
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Original Committee Reference: JUD.
SUMMARY : Allows the court to grant a judgment debtor's claim of
exemption from wage garnishment in cases where the underlying
debt was incurred for medical care or hospital services rendered
to the judgment debtor or his or her family. Specifically, this
bill deletes the current exception for "common necessaries of
life" to the general rule that exempts from wage garnishment the
portion of the judgment debtor's earnings that he or she proves
is necessary to support himself or herself and his or her
family, and makes other clarifying and conforming changes.
The Senate amendments :
1)Delete the current exception for "common necessaries of life"
to the general rule that exempts from wage garnishment the
portion of the judgment debtor's earnings that he or she
proves is necessary to support himself or herself and his or
her family. In other words, where the exemption from wage
garnishment is currently unavailable for debts incurred for
the "common necessaries of life," under the Senate amendments,
the exemption would be available without regard to this former
exception.
2)Clarify that the above exemption from wage garnishment remains
unavailable for debts incurred pursuant to an order or award
for the payment of attorney's fees in certain divorce,
custody, and support cases (pursuant to Family Code Sections
2030, 3121, and 3557), as specified.
3)Make conforming changes to Government Code Section 68632 to
correct a cross reference in that statute to the use of the
term "common necessaries of life" as used in a paragraph
deleted by this bill.
AB 1388
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EXISTING LAW :
1)Exempts from levy, with certain categorical exceptions, the
portion of a judgment debtor's earnings which the judgment
debtor proves is necessary for the support of the judgment
debtor or his or her family supported in whole or in part by
the judgment debtor.
2)Provides that the above exemption is not available if any of
the following exceptions applies:
a) The debt was incurred for the common necessaries of life
furnished to the judgment debtor or the family of the
judgment debtor;
b) The debt was incurred for personal services rendered by
an employee or former employee of the judgment debtor;
c) The order is a withholding order for support to collect
delinquent amounts payable under a judgment for the support
of a child, or spouse or former spouse, of the judgment
debtor; or,
d) The order is a state tax order, governed by Article 4
(commencing with Civil Code of Procedure (CCP) Section
706.070).
3)Provides that hospital services rendered to a judgment debtor
or his or her family constitute a "common necessary of life"
for which the debtor is not entitled to exemption from levy or
earnings withholding pursuant to CCP Section 706.051. (J.J.
MacIntyre Co. v. Duren (1981) 118 Cal.App.3d Supp. 16.)
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the version approved by the Senate.
FISCAL EFFECT : None
COMMENTS : According to the author, the working poor in
California remain at risk of falling into hunger and
homelessness when they are unable to pay medical bills because
existing case law effectively prevents a judgment debtor from
AB 1388
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obtaining an exemption from wage garnishment for that portion of
his or her earnings needed for the support of the debtor and his
or her family when the underlying debt was incurred for medical
care for the debtor or his family. This bill seeks instead to
make this exemption from wage garnishment available to a
judgment debtor where the underlying debt was incurred for
medical care.
Section 706.051(c) of the Code of Civil Procedure provides that
an exemption from wage garnishment for the support of a judgment
debtor and his or her family "is not available if...�t]he debt
was incurred for the common necessaries of life (emphasis added)
furnished to the judgment debtor or the family of the judgment
debtor." Case law, J.J. MacIntyre Co. v. Duren (1981) 118
Cal.App.3d Supp. 16, explicitly holds that medical care or
hospital services constitute a "common necessary of life" for
the purpose of determining whether the exception for common
necessaries of life should apply to disallow the hardship
exemption. Legal service attorneys contacted by the Judiciary
Committee report that when judgment creditors file a notice of
opposition to the claim of exemption in medical debt cases, they
typically cite the "common necessaries of life" exception and
the J.J. MacIntyre decision as the basis for which the claim of
exemption should be denied by the court.
This bill deletes the existing exception to the hardship
exemption for "common necessaries of life." In other words,
where the hardship exemption from wage garnishment is currently
unavailable for debts incurred for the "common necessaries of
life," under the Senate amendments, the exemption would be
available without regard to this former exception. In effect,
this bill would permit but not require the court to grant a
judgment debtor's claim of exemption from wage garnishment in
cases where the underlying debt was incurred for medical care or
hospital services rendered to the judgment debtor or his or her
family. The bill does not affect the right of a debtor to file
a claim of exemption, nor of a creditor to file a notice of
opposition to the claim to obtain a court hearing to decide the
matter.
Under this bill, the judgment debtor will still have to submit a
detailed financial statement to demonstrate the portion of his
or her earnings that he or she contends should be exempt from
garnishment for the necessary support of his or her family. The
court will still have to determine the merit of the judgment
AB 1388
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debtor's claim of exemption, but it would allow approval of the
claim in cases of medical debt where the court is currently
constrained by the J.J. MacIntyre decision. Importantly, this
bill does not discharge the underlying debt. Regardless of
whether the court approves the claim of exemption or not, the
underlying judgment is still valid and can be collected in the
future, including interest.
The bill also clarifies that the above exemption from wage
garnishment remains unavailable for debts incurred pursuant to
an order or award for the payment of attorney's fees in certain
divorce, custody, and support cases (pursuant to Sections 2030,
3121, and 3557 of the Family Code), as specified. Finally, this
bill makes conforming changes to Section 68632 of the Government
Code (relating to waiver of court fees and costs) to correct a
cross reference in that statute to the "common necessaries of
life" provision deleted by this bill. These changes are
necessary to ensure that current application of those sections
of the Family and Government Codes, in those particular
contexts, remains unchanged by the deletion of the "common
necessaries of life" exception under this bill.
Analysis Prepared by : Anthony Lew / JUD. / (916) 319-2334
FN: 0001444