November 26, 2008
Letter from President of cdcbaa to California Attorney General re Attack on California Wildcard Exemption
Dear Mr. Krueger,
I write to you as the President of the Central District of California Consumer Bankruptcy Attorneys Association (cdcbaa). We are the second largest organization of consumer bankruptcy attorneys in the United States, second only to the National Association of Consumber Bankruptcy Attorneys (NACBA). The cdcbaa consists of about 170 members based in the Central District of California (from San Luis Obispo, Orange, Riverside, Los Angeles, San Bernardino, Ventura and Santa Barbara Counties); the largest Federal District in the country. In the past, nearly 10% of all bankruptcy filings have originated in this District. We are also the sponsoring organization for the Southern California Bankruptcy Inn of Court, a member of the International Inn of Court; counting among its members and participants several Bankruptcy Judges, the United States Trustee for the Region, as well as attorneys from the Unites States Attorneys Office, and law professors.
We have been communicating and standing ready to assist Mr. Furlong and other Arizona and Ninth Circuit bankruptcy attorneys who find their use of the California exemptions under attack. We have been provided by Mr. Furlong with the emails that you have read. We encourage the California Attorney General to intervene in the pending matter in which Mr. Furlong is counsel, as well as examining the need to protect the "wild card" exemption for California residents and former residence who are attempting to preserve what few assets they may have left during these trying (and yet more to come) economic times. In the absence of any home equity from which to claim a $50,000 to $150,000 exemption, homeowners are relying more on the Wild Card exemption of CCP 703.140 to retain property from liquidation by hungry bankruptcy trustees. The Wild Card exemption is further important in the course of a liquidation analysis under Chapter 13, when there are nonexempt assets that may be liquidated in a Chapter 7. A Chapter 13 Trustee may move for conversion and liquidation; especially, if the debtors otherwise have insufficient income to pay claims. Clearly these are very important issues, guided by the legislative intent to preserve home ownership and stabilize our economy.
Bankruptcy, one of the oldest forms of economic recovery, dating back to Deuteronomy and the United States Constitution provisions that require Congress to enact uniform Bankruptcy laws, is the root of our capitalist form of economy. Even those former Eastern Block countries that seek membership in the Europeon Union must enact laws on Bankruptcy. Our own Central District Bankruptcy Judge, Samuel Bufford, travels the world lecturing and instructing jurists and legislators on how to interpret and devise bankruptcy laws. His latest travels are taking him to China! In California, the exemption scheme enables Californians of all economic strata to retain some semblance of economic stability. And, using either Chapter 13 or Chapter 11 to value homes and eliminate wholly undersecured second and third deeds of trust, while maintaining current payments on first deeds of trust, will enable the consumer bankruptcy attorneys and the courts to slow the spread of foreclosure and loss of home ownership. Truly, one home at a time! The Wild Card Exemption of CCP 703.140 is one of the cornerstones in that strategy, because the debtor's ability to pay based upon income, rather than the addition of nonexempt property, is taken into consideration.
We therefore encourage your office to carefully examine and support intervention in the Arizona case to preserve the California exemption scheme.
As the President of the cdcbaa, I further encourage your office to accept our invitation to send a representative to be member in 2009 in the cdcbaa, as well as the Inn of Court. It is important during these economic times that the California Attorney General Offices joins with the Bankruptcy Judges of the Central District of California to maintain an open dialogue with the consumer bankruptcy attorneys who are in the trenches, in the line of fire and in the emergency rooms of the economy. No business school or bank economist can provide you with greater access to the real economy as the 170 members of the cdcbaa. Please join our group and participate in our members only ListServ, sharing inquiries and ideas 24/7.
Should you have any questions, please do not hesitate to ask them in a further or reply email, and by all means, please do not hesitate to call.
Thank you, and best regards, Lou Esbin
Louis J. Esbin, Esq.
Law Offices of Louis J. Esbin
27201 Tourney Road, Suite 122, Valencia, CA 91355-1857
Tel: 661-254-5050 | Fax: 661-254-5252 | Web: www.Esbinlaw.com
Certified Bankruptcy Specialist - State Bar of California Board of Legal Specialization.
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