| 1 | 1 | | By: Zaffirini S.B. No. 775 |
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| 2 | 2 | | |
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| 3 | 3 | | |
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| 4 | 4 | | A BILL TO BE ENTITLED |
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| 5 | 5 | | AN ACT |
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| 6 | 6 | | relating to the exemption of certain personal property from |
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| 7 | 7 | | garnishment, attachment, execution, or other seizure by creditors. |
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| 8 | 8 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 9 | 9 | | SECTION 1. Section 31.002, Civil Practices and Remedies |
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| 10 | 10 | | Code is amended by adding Subsection (i) to read as follows: |
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| 11 | 11 | | (i) For collection of judgments on consumer debt, as defined |
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| 12 | 12 | | by Texas Finance Code Section 392.001(2), a court order under this |
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| 13 | 13 | | section must exempt an amount to cover basic needs equal to $3,000 |
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| 14 | 14 | | from freezing and turnover. The order must direct the judgment |
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| 15 | 15 | | creditor or receiver to apply the exemption under this section to |
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| 16 | 16 | | amounts in a demand deposit account first, followed by any other |
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| 17 | 17 | | accounts, as applicable. In the event the judgment debtor has more |
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| 18 | 18 | | than one demand deposit account or other combination of accounts, |
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| 19 | 19 | | the exemption shall be applied to the largest demand deposit |
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| 20 | 20 | | account first followed by any additional accounts in the order of |
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| 21 | 21 | | most to least funds available. The exemption provided in this |
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| 22 | 22 | | section includes any amounts protected under 31 C.F.R. Part 212 and |
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| 23 | 23 | | does not limit other exemptions to the extent those exemptions |
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| 24 | 24 | | exceed this amount. This subsection does not apply to the |
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| 25 | 25 | | enforcement of court-ordered alimony, child support, or spousal |
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| 26 | 26 | | maintenance payments. |
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| 27 | 27 | | SECTION 2. Section 31.002, Civil Practices and Remedies |
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| 28 | 28 | | Code is amended by adding Subsection (j) to read as follows: |
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| 29 | 29 | | (j) In implementing subsection (i) with regard to an account |
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| 30 | 30 | | held on behalf of a judgment debtor by a financial institution, an |
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| 31 | 31 | | order under this section shall direct the judgment creditor or |
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| 32 | 32 | | receiver in the first instance to send a levy letter to the |
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| 33 | 33 | | financial institution. With that levy letter, the judgment |
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| 34 | 34 | | creditor or receiver shall include a separate form that is |
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| 35 | 35 | | identical to or substantially the same as subsection (k). |
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| 36 | 36 | | Section 3. Section 31.002, Civil Practices and Remedies Code |
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| 37 | 37 | | is amended by adding Subsection (k) to read as follows: |
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| 38 | 38 | | (k) The following demand for information, when completed, |
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| 39 | 39 | | meets the obligations of the judgment creditor or receiver under |
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| 40 | 40 | | subsection (j): |
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| 41 | 41 | | DUTIES OF FINANCIAL INSTITUTION |
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| 42 | 42 | | As noted in the levy letter and its attachments, the judgment |
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| 43 | 43 | | debtor, (name of judgment debtor), has an unsatisfied |
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| 44 | 44 | | judgment debt and is obligated by an order of the court to turnover |
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| 45 | 45 | | non-exempt assets to the [identify judgment creditor or receiver] |
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| 46 | 46 | | to satisfy that debt. Any funds equal to or less than $3,000 are |
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| 47 | 47 | | not subject to levy and shall not be disbursed to a judgment |
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| 48 | 48 | | creditor or receiver in response to a levy letter. As reflected by |
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| 49 | 49 | | the court order attached to the levy letter, this exemption shall |
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| 50 | 50 | | be applied to the largest demand deposit account first followed by |
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| 51 | 51 | | any additional accounts in the order of most to least funds |
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| 52 | 52 | | available. The exemption provided in this section includes any |
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| 53 | 53 | | amounts protected under 31 C.F.R. Part 212 and does not limit those |
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| 54 | 54 | | amounts or other amounts protected under other exemptions to the |
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| 55 | 55 | | extent those exemptions exceed this amount. This exemption does |
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| 56 | 56 | | not apply to the enforcement of court-ordered alimony, child |
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| 57 | 57 | | support, or spousal maintenance payments. |
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| 58 | 58 | | Section 4. Section 31.010(a), Civil Practices and Remedies |
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| 59 | 59 | | Code is amended by adding paragraph (3) to read as follows: |
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| 60 | 60 | | (3) A duties of financial institution form in the same or |
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| 61 | 61 | | substantially the same form as set forth in section 31.002(k). |
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| 62 | 62 | | SECTION 5. This Act takes effect September 1, 2023 |
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