SB 616 has just made it harder for judgment creditors to collect from the judgment debtors who are individuals.

Until SB 616 was signed this month, existing law authorized a judgment creditor to levy upon the property of a judgment debtor to satisfy a judgment and authorized the judgment debtor to claim that certain property was exempt from the levy by following a specified procedure. The judgment debtor could assert an exemption by filing a claim of exemption with the levying officer within 10 days after the date the notice of levy on the property claimed to be exempt was served on the judgment debtor. The judgment creditor who opposed a claim of exemption was required to file a notice of opposition to the claim and a notice of motion for an order determining the claim within 10 days after service of the notice of claim of exemption.

SB 616 changes all of that as of September 1, 2020. After that date, a judgment debtor may file a claim of exemption with the levying officer either in person or by mail within 15 days after the judgment debtor is personally served with a notice of levy on
the property claimed to be exempt, and 20 days if the claimant is served with notice by mail. SB 6161 also extended the period in which a judgment creditor may give notice of opposition to a claim of exemption to 15 days after service of the notice of claim of exemption.

Before SB 616, a judgment creditor could levy upon the earnings of a judgment debtor through wage garnishment procedures, that specified the maximum amount of a judgment debtor’s disposable earnings that were subject to garnishment. Until SB 616 becomes effective 75% of paid earnings of an employee that can be traced into deposit accounts or in the form of cash or its equivalent if prior to payment to the employee are not subject to an earnings withholding order or an earnings assignment order for support.

SB 616 generally exempts from a levy money in a judgment debtor’s deposit account in an amount equal to or less than the minimum basic standard of adequate care for a family of four and further exempts from a levy money in a judgment debtor’s deposit account that is not otherwise exempt to the extent that money is necessary for the support of the judgment debtor and the spouse and dependents of the judgment debtor. Thus, in general, it will be virtually impossible to levy on deposit accounts of judgment debtors.

If you have a money judgment against an individual, now is the time to enforce it before SB 616 becomes effective and leaves you unable to reach the judgment debtor’s deposit accounts. Contact your collections attorney. It’s time to get paid.

The information presented is not intended to be, and does not constitute, “legal advice.” Because each situation varies, and only brief summary information is provided here, you should not use this information as a basis for action unless you have independently verified with your own counsel that it applies to your particular situation.