Bill Text: CA AB1321 | 2011-2012 | Regular Session | Amended
Bill Title: Money judgments: earnings withholdings.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2012-02-01 - Died pursuant to Art. IV, Sec. 10(c) of the Constitution. From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. [AB1321 Detail]
Download: California-2011-AB1321-Amended.html
BILL NUMBER: AB 1321 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JANUARY 12, 2012
AMENDED IN ASSEMBLY JANUARY 4, 2012
INTRODUCED BY Assembly Member Wieckowski
FEBRUARY 18, 2011
An act to amend Section 706.105 of the Code of Civil Procedure,
relating to money judgments.
LEGISLATIVE COUNSEL'S DIGEST
AB 1321, as amended, Wieckowski. Money judgments: earnings
withholdings.
Under existing law, an employer is required to withhold the
amounts provided by an earnings withholding order from all earnings
of the employee payable for any pay period that ends during the
withholding period. Existing law permits a judgment debtor to claim
an exemption from earnings withholding if no prior hearing has been
held concerning the earnings withholding order, or if there has been
a material change in circumstances since the last hearing concerning
the earnings withholding order. A creditor is entitled to a hearing
on a judgment debtor's claim of exemption from earnings withholding
to satisfy a money judgment if the creditor files a notice of
opposition to the claim of exemption.
This bill would require, after a judgment debtor files the claim
of exemption and financial statement with the levying officer, the
levying officer to serve the judgment debtor's employer with a copy
of the original earnings withholding order, a copy of the claim of
exemption unaccompanied by the financial statement , and a
signed instruction ordering the employer to adjust the amount of
earnings withheld to reflect the amount of additional earnings that
the judgment debtor asserts are exempt. If the judgment debtor's
claim of exemption asserts that all of his or her earnings are
exempt, the instruction would order the employer to reduce the amount
of earnings withheld to zero. The bill would further require the
employer to comply with the provisions of the signed instruction.
Under this bill, if the judgment debtor
creditor does not file a timely notice of opposition to the
claim of exemption, the levying officer would be required to serve
notice upon the employer to continue withholding earnings in
compliance with the claim of exemption. This bill would also provide
that if, after a hearing, the court denies the judgment debtor's
claim in whole or in part, the clerk is required to transmit
a certified , or provide by mail, facsimile, e-mail,
or other electronic means, a copy of the court's order to the
levying officer, who must promptly serve a notice to the judgment
debtor's employer detailing the court's order concerning the earnings
withholdings. Additionally, this bill would provide that these
provisions would become operative on July 1, 2013, and would require
the Judicial Council to adopt any necessary revisions to notices,
claims of exemptions, orders, or other specified documents
on or before that date.
By increasing the duties of local ministerial officers relating to
the service of process and notice, this bill would impose a
state-mandated local program.
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, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
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 706.105 of the Code of Civil Procedure is
amended to read:
706.105. (a) A judgment debtor may claim an exemption under
Section 706.051 under either of the following circumstances:
(1) No prior hearing has been held with respect to the earnings
withholding order.
(2) There has been a material change in circumstances since the
time of the last prior hearing on the earnings withholding order.
(b) A claim of exemption shall be made by filing with the levying
officer an original and one copy of (1) the judgment debtor's claim
of exemption and (2) the judgment debtor's financial statement.
(c) Promptly after the judgment debtor files the claim of
exemption and financial statement with the levying officer, the
levying officer shall serve on the employer all of the following:
(1) A copy of the original earnings withholding order.
(2) A copy of the claim of exemption filed by the judgment debtor
, unaccompanied by the financial statement .
(3) An instruction, signed by the levying officer, that the
employer must, until further notice, immediately reduce the amount of
earnings to be withheld under the original earnings withholding
order to reflect the amount of additional earnings claimed to be
exempt in the judgment debtor's claim of exemption, and that the
amount to be withheld shall be reduced to zero if the judgment debtor'
s claim of exemption asserts that all of the judgment debtor's
earnings are exempt.
(d) An employer who is served by the levying officer with the
documents identified in subdivision (c) shall, until further notice,
immediately reduce the amount of additional earnings claimed to be
exempt in the judgment debtor's claim of exemption. If the judgment
debtor's claim of exemption asserts that all of the judgment debtor's
earnings are exempt, the employer shall, until further notice,
immediately cease withholding any earnings whatsoever.
(e) Upon filing of the claim of exemption, the levying officer
shall promptly send to the judgment creditor, at the address stated
in the application for the earnings withholding order, by first-class
mail, postage prepaid, all of the following:
(1) A copy of the claim of exemption.
(2) A copy of the financial statement.
(3) A notice of claim of exemption. The notice shall state that
the claim of exemption has been filed and that the earnings
withholding order will be terminated, or modified to reflect the
amount of earnings claimed to be exempt in the claim of exemption,
unless a notice of opposition to the claim of exemption is filed with
the levying officer by the judgment creditor within 10 days after
the date of the mailing of the notice of claim of exemption.
(f) A judgment creditor who desires to contest a claim of
exemption shall, within 10 days after the date of the mailing of the
notice of claim of exemption, file with the levying officer a notice
of opposition to the claim of exemption.
(g) If a notice of opposition to the claim of exemption is filed
with the levying officer within the 10-day period, the judgment
creditor is entitled to a hearing on the claim of exemption. If the
judgment creditor desires a hearing on the claim of exemption, the
judgment creditor shall file a notice of motion for an order
determining the claim of exemption with the court within 10 days
after the date the levying officer mailed the notice of claim of
exemption. If the notice of motion is so filed, the hearing on the
motion shall be held not later than 30 days from the date the notice
of motion was filed unless continued by the court for good cause. At
the time prescribed by subdivision (b) of Section 1005, the judgment
creditor shall give written notice of the hearing to the levying
officer and shall serve a notice of the hearing and a copy of the
notice of opposition to the claim of exemption on the judgment debtor
and, if the claim of exemption so requested, on the attorney for the
judgment debtor. Service is deemed made when the notice of the
hearing and a copy of the notice of opposition to the claim of
exemption are deposited in the mail, postage prepaid, addressed to
the judgment debtor at the address stated in the claim of exemption
and, if service on the attorney for the judgment debtor was requested
in the claim of exemption, to the attorney at the address stated in
the claim of exemption. The judgment creditor shall file proof of the
service with the court. After receiving the notice of the hearing
and before the date set for the hearing, the levying officer shall
file the claim of exemption and the notice of opposition to the claim
of exemption with the court.
(h) If the levying officer does not receive a notice of opposition
to the claim of exemption within the 10-day period after the date of
mailing of the notice of claim of exemption and a notice of the
hearing not later than 10 days after the filing of the notice of
opposition to the claim of exemption, the levying officer shall serve
upon the employer a notice that the employer shall continue
withholding earnings only to the extent, if any, that the employer
has been withholding earnings pursuant to subdivision (d).
(i) If, after hearing, the court orders that the earnings
withholding order be modified or terminated, the clerk shall promptly
transmit a certified copy of the order to the levying officer who
shall promptly serve on the employer of the judgment debtor (1) a
copy of the modified earnings withholding order or (2) a notice that
the earnings withholding order has been terminated. The court may
order that the earnings withholding order be terminated as of a date
that precedes the date of hearing. If the court determines that any
amount withheld pursuant to the earnings withholding order shall be
paid to the judgment debtor, the court shall make an order directing
the person who holds that amount to pay it promptly to the judgment
debtor.
(j) If, after hearing, the court denies the judgment debtor's
claim of exemption in whole or in part, the clerk shall promptly
transmit a certified , or provide
by mail, facsimile, e-mail, or other electronic means, a copy
of the court's order to the levying officer, who shall promptly serve
on the employer a notice that the employer shall withhold earnings
pursuant to the court's order.
(k) If the earnings withholding order is terminated by the court,
unless the court otherwise orders or unless there is a material
change of circumstances since the time of the last prior hearing on
the earnings withholding order, the judgment creditor may not apply
for another earnings withholding order directed to the same employer
with respect to the same judgment debtor for a period of 100 days
following the date of service of the earnings withholding order or 60
days after the date of the termination of the order, whichever is
later.
(l) If an employer has withheld and paid over amounts pursuant to
an earnings withholding order after the date of termination of the
order but prior to the receipt of notice of its termination, the
judgment debtor may recover those amounts only from the levying
officer if the levying officer still holds those amounts or, if those
amounts have been paid over to the judgment creditor, from the
judgment creditor. If the employer has withheld amounts pursuant to
an earnings withholding order after termination of the order but has
not paid over those amounts to the levying officer, the employer
shall promptly pay those amounts to the judgment debtor.
(m) An appeal lies from any court order under this section denying
a claim of exemption or modifying or terminating an earnings
withholding order. An appeal by the judgment creditor from an order
modifying or terminating the earnings withholding order does not stay
the order from which the appeal is taken. Notwithstanding the
appeal, until the order modifying or terminating the earnings
withholding order is set aside or modified, the order allowing the
claim of exemption in whole or in part shall be given the same effect
as if the appeal had not been taken.
(n) This section does not apply to a withholding order for support
or a withholding order for taxes.
SEC. 2. Section 1 of this act shall become
operative on July 1, 2013.
SEC. 3. The Judicial Council shall, on or before
July 1, 2013, adopt any necessary revisions to any notices, claims of
exemptions, orders, or other documents specified in Section 706.120
of the Code of Civil Procedure in order to implement the provisions
of this act.
SEC. 2. SEC. 4. If the Commission on
State Mandates determines that this act contains costs mandated by
the state, reimbursement to local agencies and school districts for
those costs shall be made pursuant to Part 7 (commencing with Section
17500) of Division 4 of Title 2 of the Government Code.
