Memorandum of Decision Re: Exemption of Truck

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Decisions
IN THE UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA
In re MICHAEL and KARIN BIASI,                                                   No. 95-10232      Debtors. ___________________________/
Memorandum of Decision
     Debtors Michael and Karin Biasi own an unencumbered pickup truck worth about $6,000.00. They have claimed $1,200.00 in equity in the truck exempt pursuant to California Code of Civil Procedure section 704.010, and an additional $4,300.00 pursuant to section 704.060. The trustee has objected on grounds that the debtors are only entitled to a maximum of $2,500.00 in exempt property pursuant to section 704.060, and that the debtors cannot use that exemption to protect a vehicle when they have used section 704.010 to exempt equity in the same vehicle. Section 704.060(a)(3) allows a marries couple to exempt up to $5,000.00 in tools of the trade used by both in the same business by which both earn a livelihood. The trustee argues that because Karin has a full-time job, the debtors are limited to the $2,500.00 exemption of section 704.060(a)(1) even though she also works in the small manufacturing business operated by Michael, and even though her duties in the business include use of the truck.      Since both Michael and Karin actually work in the business and actually use the truck in the business, the requirements of section 704(a)(3) have been met. There is no requirement in the statute that both spouses must work 40 hours per week in the business, nor is there any disqualification if one spouse has an additional source of income. It is not appropriate for the court to infer limitations to an exemption statute.      Section 704.060(c) provides that a motor vehicle may not be exempted as a tool of the trade if there is a motor vehicle exempt under Section 704.010 which is reasonably adequate for the debtor's business. In this case, there is no such vehicle. Since the truck is worth far more than $1,200.00, only a small portion of the equity in the vehicle is exempt under section 704.010. The statute does not say, as the trustee suggests, that section 704.060 may not be used to exempt a vehicle if section 704.010 is used.      For the foregoing reasons, the court determines that the debtors are entitled to the $5,000.00 exemption of section 704.060(a)(3), and that they may use that exemption to protect the excess equity in a commercial vehicle claimed as exempt under section 704.010. Accordingly, the trustee's objection will be overruled. Counsel for the debtors shall submit an appropriate form of order.
Dated: April 20, 1995                                                                                                      _______________________                                                                                                                                                Alan Jaroslovsky                                                                                                                                                U.S. Bankruptcy