Senate Bill No. 70–Senator O’Connell

 

February 7, 2003

____________

 

Referred to Committee on Judiciary

 

SUMMARY—Increases amount of homestead exemption. (BDR 10‑15)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: No.

 

~

 

EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to property; increasing the amount of the homestead exemption; exempting from execution a greater amount of equity in certain dwellings; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1. NRS 115.010 is hereby amended to read as follows:

1-2  115.010  1.  The homestead is not subject to forced sale on

1-3  execution or any final process from any court, except as otherwise

1-4  provided by subsections 2, 3 and 5.

1-5  2.  The exemption provided in subsection 1 extends only to that

1-6  amount of equity in the property held by the claimant which does

1-7  not exceed [$125,000] $200,000 in value, unless allodial title has

1-8  been established and not relinquished, in which case the exemption

1-9  provided in subsection 1 extends to all equity in the dwelling, its

1-10  appurtenances and the land on which it is located.

1-11      3.  Except as otherwise provided in subsection 4, the exemption

1-12  provided in subsection 1 does not extend to process to enforce the

1-13  payment of obligations contracted for the purchase of the property,

1-14  or for improvements made thereon, including any mechanic’s lien

1-15  lawfully obtained, or for legal taxes, or for:

 

 

2-1  (a) Any mortgage or deed of trust thereon executed and given;

2-2  or

2-3  (b) Any lien to which prior consent has been given through the

2-4  acceptance of property subject to any recorded declaration of

2-5  restrictions, deed restriction, restrictive covenant or equitable

2-6  servitude, specifically including any lien in favor of an association

2-7  pursuant to NRS 116.3116 or 117.070,

2-8  by both husband and wife, when that relation exists.

2-9  4.  If allodial title has been established and not relinquished, the

2-10  exemption provided in subsection 1 extends to process to enforce

2-11  the payment of obligations contracted for the purchase of the

2-12  property, and for improvements made thereon, including any

2-13  mechanic’s lien lawfully obtained, and for legal taxes levied by a

2-14  state or local government, and for:

2-15      (a) Any mortgage or deed of trust thereon; and

2-16      (b) Any lien even if prior consent has been given through the

2-17  acceptance of property subject to any recorded declaration of

2-18  restrictions, deed restriction, restrictive covenant or equitable

2-19  servitude, specifically including any lien in favor of an association

2-20  pursuant to NRS 116.3116 or 117.070,

2-21  unless a waiver for the specific obligation to which the judgment

2-22  relates has been executed by all allodial titleholders of the property.

2-23      5.  Establishment of allodial title does not exempt the property

2-24  from forfeiture pursuant to NRS 179.1156 to 179.119, inclusive, or

2-25  207.350 to 207.520, inclusive.

2-26      6.  Any declaration of homestead which has been filed before

2-27  October 1, [1995,] 2003, shall be deemed to have been amended on

2-28  that date by extending the homestead exemption commensurate with

2-29  any increase in the amount of equity held by the claimant in the

2-30  property selected and claimed for the exemption up to the amount

2-31  permitted by law on that date, but the increase does not impair the

2-32  right of any creditor to execute upon the property when that right

2-33  existed before October 1, [1995.] 2003.

2-34      Sec. 2.  NRS 115.050 is hereby amended to read as follows:

2-35      115.050  1.  Whenever execution has been issued against the

2-36  property of a party claiming the property as a homestead, and the

2-37  creditor in the judgment makes an oath before the judge of

2-38  the district court of the county in which the property is situated, that

2-39  the amount of equity held by the claimant in the property exceeds, to

2-40  the best of the creditor’s information and belief, the sum of

2-41  [$125,000,] $200,000, the judge shall, upon notice to the debtor,

2-42  appoint three disinterested and competent persons as appraisers to

2-43  estimate and report as to the amount of equity held by the claimant

2-44  in the property, and if the amount of equity exceeds the sum of

2-45  [$125,000,] $200,000, determine whether the property can be

3-1  divided so as to leave the property subject to the homestead

3-2  exemption without material injury.

3-3  2.  If it appears, upon the report, to the satisfaction of the judge

3-4  that the property can be thus divided, he shall order the excess to be

3-5  sold under execution. If it appears that the property cannot be thus

3-6  divided, and the amount of equity held by the claimant in the

3-7  property exceeds the exemption allowed by this chapter, he shall

3-8  order the entire property to be sold, and out of the proceeds the sum

3-9  of [$125,000] $200,000 to be paid to the defendant in execution, and

3-10  the excess to be applied to the satisfaction on the execution. No bid

3-11  under [$125,000] $200,000 may be received by the officer making

3-12  the sale.

3-13      3.  When the execution is against a husband or wife, the judge

3-14  may direct the [$125,000] $200,000 to be deposited in court, to be

3-15  paid out only upon the joint receipt of the husband and wife, and the

3-16  deposit possesses all the protection against legal process and

3-17  voluntary disposition by either spouse as did the original homestead.

3-18      Sec. 3.  NRS 21.075 is hereby amended to read as follows:

3-19      21.075  1.  Execution on the writ of execution by levying on

3-20  the property of the judgment debtor may occur only if the sheriff

3-21  serves the judgment debtor with a notice of the writ of execution

3-22  pursuant to NRS 21.076 and a copy of the writ. The notice must

3-23  describe the types of property exempt from execution and explain

3-24  the procedure for claiming those exemptions in the manner required

3-25  in subsection 2. The clerk of the court shall attach the notice to the

3-26  writ of execution at the time the writ is issued.

3-27      2.  The notice required pursuant to subsection 1 must be

3-28  substantially in the following form:

 

3-29  NOTICE OF EXECUTION

 

3-30  YOUR PROPERTY IS BEING ATTACHED OR

3-31  YOUR WAGES ARE BEING GARNISHED

 

3-32      A court has determined that you owe money

3-33  to ....................(name of person), the judgment creditor. He

3-34  has begun the procedure to collect that money by garnishing

3-35  your wages, bank account and other personal property held by

3-36  third persons or by taking money or other property in your

3-37  possession.

3-38      Certain benefits and property owned by you may be

3-39  exempt from execution and may not be taken from you. The

3-40  following is a partial list of exemptions:

3-41      1.  Payments received under the Social Security Act.

4-1  2.  Payments for benefits or the return of contributions

4-2  under the Public Employees’ Retirement System.

4-3  3.  Payments for public assistance granted through the

4-4  Welfare Division of the Department of Human Resources.

4-5  4.  Proceeds from a policy of life insurance.

4-6  5.  Payments of benefits under a program of industrial

4-7  insurance.

4-8  6.  Payments received as unemployment compensation.

4-9  7.  Veteran’s benefits.

4-10      8.  A homestead in a dwelling or a mobile home, not to

4-11  exceed [$125,000,] $200,000, unless:

4-12      (a) The judgment is for a medical bill, in which case all of

4-13  the primary dwelling, including a mobile or manufactured

4-14  home, may be exempt.

4-15      (b) Allodial title has been established and not relinquished

4-16  for the dwelling or mobile home, in which case all of the

4-17  dwelling or mobile home and its appurtenances are exempt,

4-18  including the land on which they are located, unless a valid

4-19  waiver executed pursuant to NRS 115.010 is applicable to the

4-20  judgment.

4-21      9.  A vehicle, if your equity in the vehicle is less

4-22  than $4,500.

4-23      10.  Seventy-five percent of the take-home pay for any

4-24  pay period, unless the weekly take-home pay is less than 30

4-25  times the federal minimum wage, in which case the entire

4-26  amount may be exempt.

4-27      11.  Money, not to exceed $500,000 in present value,

4-28  held for retirement pursuant to certain arrangements or plans

4-29  meeting the requirements for qualified arrangements or plans

4-30  of sections 401 et seq. of the Internal Revenue Code , [(]26

4-31  U.S.C. §§ 401 et seq.[).]

4-32      12.  All money and other benefits paid pursuant to the

4-33  order of a court of competent jurisdiction for the support,

4-34  education and maintenance of a child, whether collected by

4-35  the judgment debtor or the State.

4-36      13.  All money and other benefits paid pursuant to the

4-37  order of a court of competent jurisdiction for the support and

4-38  maintenance of a former spouse, including the amount of any

4-39  arrearages in the payment of such support and maintenance to

4-40  which the former spouse may be entitled.

4-41      14.  A vehicle for use by you or your dependent which is

4-42  specially equipped or modified to provide mobility for a

4-43  person with a permanent disability.

 

5-1  15.  A prosthesis or any equipment prescribed by a

5-2  physician or dentist for you or your dependent.

5-3  These exemptions may not apply in certain cases such as

5-4  a proceeding to enforce a judgment for support of a person or

5-5  a judgment of foreclosure on a mechanic’s lien. You should

5-6  consult an attorney immediately to assist you in determining

5-7  whether your property or money is exempt from execution. If

5-8  you cannot afford an attorney, you may be eligible for

5-9  assistance through ....................(name of organization in

5-10  county providing legal services to indigent or elderly

5-11  persons).

 

5-12  PROCEDURE FOR CLAIMING EXEMPT PROPERTY

 

5-13      If you believe that the money or property taken from you

5-14  is exempt, you must complete and file with the clerk of the

5-15  court a notarized affidavit claiming the exemption. A copy of

5-16  the affidavit must be served upon the sheriff and the judgment

5-17  creditor within 8 days after the notice of execution is mailed.

5-18  The property must be returned to you within 5 days after you

5-19  file the affidavit unless you or the judgment creditor files a

5-20  motion for a hearing to determine the issue of exemption. If

5-21  this happens, a hearing will be held to determine whether the

5-22  property or money is exempt. The motion for the hearing to

5-23  determine the issue of exemption must be filed within 10 days

5-24  after the affidavit claiming exemption is filed. The hearing to

5-25  determine whether the property or money is exempt must be

5-26  held within 10 days after the motion for the hearing is filed.

 

5-27      IF YOU DO NOT FILE THE AFFIDAVIT WITHIN THE

5-28  TIME SPECIFIED, YOUR PROPERTY MAY BE SOLD

5-29  AND THE MONEY GIVEN TO THE JUDGMENT

5-30  CREDITOR, EVEN IF THE PROPERTY OR MONEY IS

5-31  EXEMPT.

 

5-32      Sec. 4.  NRS 21.090 is hereby amended to read as follows:

5-33      21.090  1.  The following property is exempt from execution,

5-34  except as otherwise specifically provided in this section:

5-35      (a) Private libraries not to exceed $1,500 in value, and all family

5-36  pictures and keepsakes.

5-37      (b) Necessary household goods, as defined in 16 C.F.R. §

5-38  444.1(i) as that section existed on January 1, 1987, and yard

5-39  equipment, not to exceed $3,000 in value, belonging to the judgment

5-40  debtor to be selected by him.

6-1  (c) Farm trucks, farm stock, farm tools, farm equipment,

6-2  supplies and seed not to exceed $4,500 in value, belonging to the

6-3  judgment debtor to be selected by him.

6-4  (d) Professional libraries, office equipment, office supplies and

6-5  the tools, instruments and materials used to carry on the trade of the

6-6  judgment debtor for the support of himself and his family not to

6-7  exceed $4,500 in value.

6-8  (e) The cabin or dwelling of a miner or prospector, his cars,

6-9  implements and appliances necessary for carrying on any mining

6-10  operations and his mining claim actually worked by him, not

6-11  exceeding $4,500 in total value.

6-12      (f) Except as otherwise provided in paragraph (o), one vehicle if

6-13  the judgment debtor’s equity does not exceed $4,500 or the creditor

6-14  is paid an amount equal to any excess above that equity.

6-15      (g) For any pay period, 75 percent of the disposable earnings of

6-16  a judgment debtor during that period, or for each week of the period

6-17  30 times the minimum hourly wage prescribed by section 6(a)(1) of

6-18  the federal Fair Labor Standards Act of 1938 , 29 U.S.C. §

6-19  206(a)(1), and in effect at the time the earnings are payable,

6-20  whichever is greater. Except as otherwise provided in paragraphs

6-21  (n), (r) and (s), the exemption provided in this paragraph does not

6-22  apply in the case of any order of a court of competent jurisdiction

6-23  for the support of any person, any order of a court of bankruptcy or

6-24  of any debt due for any state or federal tax. As used in this

6-25  paragraph, “disposable earnings” means that part of the earnings of

6-26  a judgment debtor remaining after the deduction from those earnings

6-27  of any amounts required by law, to be withheld.

6-28      (h) All fire engines, hooks and ladders, with the carts, trucks and

6-29  carriages, hose, buckets, implements and apparatus thereunto

6-30  appertaining, and all furniture and uniforms of any fire company or

6-31  department organized under the laws of this state.

6-32      (i) All arms, uniforms and accouterments required by law to be

6-33  kept by any person, and also one gun, to be selected by the debtor.

6-34      (j) All courthouses, jails, public offices and buildings, lots,

6-35  grounds and personal property, the fixtures, furniture, books, papers

6-36  and appurtenances belonging and pertaining to the courthouse, jail

6-37  and public offices belonging to any county of this state, all

6-38  cemeteries, public squares, parks and places, public buildings, town

6-39  halls, markets, buildings for the use of fire departments and military

6-40  organizations, and the lots and grounds thereto belonging and

6-41  appertaining, owned or held by any town or incorporated city, or

6-42  dedicated by the town or city to health, ornament or public use, or

6-43  for the use of any fire or military company organized under the laws

6-44  of this state and all lots, buildings and other school property owned

6-45  by a school district and devoted to public school purposes.

7-1  (k) All money, benefits, privileges or immunities accruing or in

7-2  any manner growing out of any life insurance, if the annual

7-3  premium paid does not exceed $1,000. If the premium exceeds that

7-4  amount, a similar exemption exists which bears the same proportion

7-5  to the money, benefits, privileges and immunities so accruing or

7-6  growing out of the insurance that the $1,000 bears to the whole

7-7  annual premium paid.

7-8  (l) The homestead as provided for by law, including a

7-9  homestead for which allodial title has been established and not

7-10  relinquished and for which a waiver executed pursuant to NRS

7-11  115.010 is not applicable.

7-12      (m) The dwelling of the judgment debtor occupied as a home for

7-13  himself and family, where the amount of equity held by the

7-14  judgment debtor in the home does not exceed [$125,000] $200,000

7-15  in value and the dwelling is [situate] situated upon lands not owned

7-16  by him.

7-17      (n) All property in this state of the judgment debtor where the

7-18  judgment is in favor of any state for failure to pay that state’s

7-19  income tax on benefits received from a pension or other retirement

7-20  plan.

7-21      (o) Any vehicle owned by the judgment debtor for use by him or

7-22  his dependent that is equipped or modified to provide mobility for a

7-23  person with a permanent disability.

7-24      (p) Any prosthesis or equipment prescribed by a physician or

7-25  dentist for the judgment debtor or a dependent of the debtor.

7-26      (q) Money, not to exceed $500,000 in present value, held in:

7-27          (1) An individual retirement arrangement which conforms

7-28  with the applicable limitations and requirements of 26 U.S.C. § 408;

7-29          (2) A written simplified employee pension plan which

7-30  conforms with the applicable limitations and requirements of 26

7-31  U.S.C. § 408;

7-32          (3) A cash or deferred arrangement which is a qualified plan

7-33  pursuant to the Internal Revenue Code; and

7-34          (4) A trust forming part of a stock bonus, pension or profit-

7-35  sharing plan which is a qualified plan pursuant to sections 401 et

7-36  seq. of the Internal Revenue Code , [(]26 U.S.C. §§ 401 et seq.[).]

7-37      (r) All money and other benefits paid pursuant to the order of a

7-38  court of competent jurisdiction for the support, education and

7-39  maintenance of a child, whether collected by the judgment debtor or

7-40  the State.

7-41      (s) All money and other benefits paid pursuant to the order of a

7-42  court of competent jurisdiction for the support and maintenance of a

7-43  former spouse, including the amount of any arrearages in the

7-44  payment of such support and maintenance to which the former

7-45  spouse may be entitled.

8-1  2.  Except as otherwise provided in NRS 115.010, no article or

8-2  species of property mentioned in this section is exempt from

8-3  execution issued upon a judgment to recover for its price, or upon a

8-4  judgment of foreclosure of a mortgage or other lien thereon.

8-5  3.  Any exemptions specified in subsection (d) of section 522 of

8-6  the Bankruptcy Act of 1978 [(92 Stat. 2586)] , 11 U.S.C. § 522(d),

8-7  do not apply to property owned by a resident of this state unless

8-8  conferred also by subsection 1, as limited by subsection 2 . [, of this

8-9  section.]

8-10      Sec. 5.  NRS 31.045 is hereby amended to read as follows:

8-11      31.045  1.  Execution on the writ of attachment by attaching

8-12  property of the defendant may occur only if:

8-13      (a) The judgment creditor serves the defendant with notice of

8-14  the execution when the notice of the hearing is served pursuant to

8-15  NRS 31.013; or

8-16      (b) Pursuant to an ex parte hearing, the sheriff serves upon the

8-17  judgment debtor notice of the execution and a copy of the writ at the

8-18  same time and in the same manner as set forth in

8-19  NRS 21.076.

8-20  If the attachment occurs pursuant to an ex parte hearing, the clerk of

8-21  the court shall attach the notice to the writ of attachment at the time

8-22  the writ is issued.

8-23      2.  The notice required pursuant to subsection 1 must be

8-24  substantially in the following form:

 

8-25  NOTICE OF EXECUTION

 

8-26  YOUR PROPERTY IS BEING ATTACHED OR

8-27  YOUR WAGES ARE BEING GARNISHED

 

8-28      Plaintiff, .................... (name of person), alleges that you

8-29  owe him money. He has begun the procedure to collect that

8-30  money. To secure satisfaction of judgment , the court has

8-31  ordered the garnishment of your wages, bank account or other

8-32  personal property held by third persons or the taking of

8-33  money or other property in your possession.

8-34      Certain benefits and property owned by you may be

8-35  exempt from execution and may not be taken from you. The

8-36  following is a partial list of exemptions:

8-37      1.  Payments received under the Social Security Act.

8-38      2.  Payments for benefits or the return of contributions

8-39  under the Public Employees’ Retirement System.

8-40      3.  Payments for public assistance granted through the

8-41  Welfare Division of the Department of Human Resources.

8-42      4.  Proceeds from a policy of life insurance.

9-1  5.  Payments of benefits under a program of industrial

9-2  insurance.

9-3  6.  Payments received as unemployment compensation.

9-4  7.  Veteran’s benefits.

9-5  8.  A homestead in a dwelling or a mobile home, not to

9-6  exceed [$125,000,] $200,000, unless:

9-7  (a) The judgment is for a medical bill, in which case all of

9-8  the primary dwelling, including a mobile or manufactured

9-9  home, may be exempt.

9-10      (b) Allodial title has been established and not relinquished

9-11  for the dwelling or mobile home, in which case all of the

9-12  dwelling or mobile home and its appurtenances are exempt,

9-13  including the land on which they are located, unless a valid

9-14  waiver executed pursuant to NRS 115.010 is applicable to the

9-15  judgment.

9-16      9.  A vehicle, if your equity in the vehicle is less

9-17  than $4,500.

9-18      10.  Seventy-five percent of the take-home pay for any

9-19  pay period, unless the weekly take-home pay is less than 30

9-20  times the federal minimum wage, in which case the entire

9-21  amount may be exempt.

9-22      11.  Money, not to exceed $500,000 in present value,

9-23  held for retirement pursuant to certain arrangements or plans

9-24  meeting the requirements for qualified arrangements or plans

9-25  of sections 401 et seq. of the Internal Revenue Code , [(]26

9-26  U.S.C. §§ 401 et seq.[).]

9-27      12.  All money and other benefits paid pursuant to the

9-28  order of a court of competent jurisdiction for the support,

9-29  education and maintenance of a child, whether collected by

9-30  the judgment debtor or the State.

9-31      13.  All money and other benefits paid pursuant to the

9-32  order of a court of competent jurisdiction for the support and

9-33  maintenance of a former spouse, including the amount of any

9-34  arrearages in the payment of such support and maintenance to

9-35  which the former spouse may be entitled.

9-36      14.  A vehicle for use by you or your dependent which is

9-37  specially equipped or modified to provide mobility for a

9-38  person with a permanent disability.

9-39      15.  A prosthesis or any equipment prescribed by a

9-40  physician or dentist for you or your dependent.

9-41  These exemptions may not apply in certain cases such as

9-42  proceedings to enforce a judgment for support of a child or a

9-43  judgment of foreclosure on a mechanic’s lien. You should

9-44  consult an attorney immediately to assist you in determining

9-45  whether your property or money is exempt from execution. If

10-1  you cannot afford an attorney, you may be eligible for

10-2  assistance through .................... (name of organization in

10-3  county providing legal services to the indigent or elderly

10-4  persons).

 

10-5  PROCEDURE FOR CLAIMING EXEMPT PROPERTY

 

10-6      If you believe that the money or property taken from you

10-7  is exempt or necessary for the support of you or your family,

10-8  you must file with the clerk of the court on a form provided

10-9  by the clerk a notarized affidavit claiming the exemption. A

10-10  copy of the affidavit must be served upon the sheriff and the

10-11  judgment creditor within 8 days after the notice of execution

10-12  is mailed. The property must be returned to you within 5 days

10-13  after you file the affidavit unless the judgment creditor files a

10-14  motion for a hearing to determine the issue of exemption. If

10-15  this happens, a hearing will be held to determine whether the

10-16  property or money is exempt. The hearing must be held

10-17  within 10 days after the motion for a hearing is filed.

 

10-18     IF YOU DO NOT FILE THE AFFIDAVIT WITHIN THE

10-19  TIME SPECIFIED, YOUR PROPERTY MAY BE SOLD

10-20  AND THE MONEY GIVEN TO THE JUDGMENT

10-21  CREDITOR, EVEN IF THE PROPERTY OR MONEY IS

10-22  EXEMPT.

 

10-23     If you received this notice with a notice of a hearing for

10-24  attachment and you believe that the money or property which

10-25  would be taken from you by a writ of attachment is exempt or

10-26  necessary for the support of you or your family, you are

10-27  entitled to describe to the court at the hearing why you

10-28  believe your property is exempt. You may also file a motion

10-29  with the court for a discharge of the writ of attachment. You

10-30  may make that motion any time before trial. A hearing will be

10-31  held on that motion.

 

10-32     IF YOU DO NOT FILE THE MOTION BEFORE THE

10-33  TRIAL, YOUR PROPERTY MAY BE SOLD AND

10-34  THE MONEY GIVEN TO THE PLAINTIFF, EVEN IF THE

10-35  PROPERTY OR MONEY IS EXEMPT OR NECESSARY

10-36  FOR THE SUPPORT OF YOU OR YOUR FAMILY.

 

10-37  H