Opinion
NOT TO BE PUBLISHED
Superior Court County Super. Ct. No. D260970 of Ventura Henry Walsh, Judge
Steve Hankins, in pro. per., for Appellant.
David Wagner, in pro. per., for Respondent.
GILBERT, P.J.
Stephen Hankins (Hankins) appeals an order denying his claim of exemption to a wage garnishment initiated by David Wagner, the assignee of a money judgment against Hankins by his former wife, Cathy Hankins. We conclude: 1) the trial did not abuse its discretion by finding that Hankins had sufficient resources to support himself and his family; 2) the court reviewed the claim of exemption and a financial statement before it ruled; 3) Wagner's opposition to the claim of exemption appears to have been untimely, and, if so, unless he had good cause for the late filing, Hankins is entitled to a refund or credit for the amount of his funds that were subject to judgment execution during that levy period. We remand for further proceedings.
FACTS
Hankins' former wife obtained a money judgment against him which he did not pay. She assigned the judgment to Wagner who obtained a garnishment levy on Hankins' wages.
Hankins filed a claim of exemption and a financial statement. In the financial statement, he said that his family income included his gross salary of $8,413.30 per month, his pregnant wife's income of $1,800 per month, and that they had one young child. He claimed that his payroll deductions totaled $2,440.70 yielding a monthly take-home pay of $5,972.60. He listed monthly payments for three cars totaling $1,662, a house payment of $4,100, and he said that his total monthly expenses equaled $6,430.
Wagner filed a notice of opposition to claim of exemption and a notice of hearing on the claim of exemption. In his opposition, Wagner stated that Hankins had listed expenses that were not necessary for his family's support. These included the loan payments on the "three luxury" cars, a payroll deduction for an individual retirement account of $420 per month, and an "overpayment of [federal] income tax withholding" in the amount of $414 per month.
At the hearing Hankins made an oral argument. He did not testify or present any evidence. Wagner filed a document entitled "Summary of Creditor's Opposition" which he gave to the trial judge. In his argument opposing the claim of exemption, Wagner referred the court to various documents that were apparently attached to that written summary. He claimed they showed that Hankins had improperly listed deductions and expenses on his financial statement. The court took the matter under submission.
Several weeks later, while the case was still under submission, Wagner filed an additional declaration with the court. He said that Hankins had "entered into an agreement to sell his home." He declared that Hankins' "$4100.00 mortgage payment accounted for 64% of his monthly expenses. At the close of this transaction, [Hankins] will no longer be required to make this mortgage payment, and will also be relieved of real estate tax payments and all other expenses associated with the property."
The court subsequently denied the claim of exemption.
DISCUSSION
I. The Claim of Exemption and Wage Garnishment
Hankins contends the trial court erred because in ruling on his claim of exemption it improperly relied on Wagner's financial documents and did not consider his family's living expenses. We disagree.
California's wage garnishment law "limits the amount of earnings which may be garnished in satisfaction of a judgment . . . ." (California State Employees' Assn. v. State of California (1988) 198 Cal.App.3d 374, 377.) Generally a garnishment may not exceed 25 percent of a worker's "disposable earnings." (15 U.S.C. § 1673; Barnhill v. Robert Saunders & Co. (1981) 125 Cal.App.3d 1, 6.) But the debtor may file a claim of exemption to show that the garnishment should be ended because the funds subject to levy are needed to support the debtor's family. (Code Civ. Proc., §§ 703.520, 703.530, 706.105.) A judgment creditor may file an opposition. (§§ 703.550, 703.560, 706.105.) The court decides whether to grant the claim of exemption based on the declarations of the parties and any evidence presented at the hearing. (§ 703.580.)
All statutory references are to the Code of Civil Procedure.
But in order to decide whether the trial court correctly ruled, there must be an adequate record of the trial court proceedings. Here the record Hankins produced is incomplete. He prepared an appellant's appendix which includes documents he relied on, but excludes some of the documents that Wagner filed. At the hearing Wagner said that a document he prepared entitled "Summary of Creditor's Opposition to Claim of Exemption" showed that Hankins had adequate available resources to pay the judgment. This document was filed with the court on the day of the hearing. It apparently contained facts, financial calculations and records to support the creditor's position. The court took the matter under submission to review the documents the parties filed, which included Wagner's summary. But this document is not included in the appellant's appendix. Hankins did not file a motion to augment the record nor did he obtain a settled statement.
Hankins "has the burden of proof on appeal." (Pringle v. La Chapelle (1999) 73 Cal.App.4th 1000, 1003.) "A fundamental principle of appellate practice is that an appellant '"must affirmatively show error by an adequate record. . . . Error is never presumed. . . . 'A judgment or order of the lower court is presumed correct. All intendments and presumptions are indulged to support it on matters as to which the record is silent . . . .'"'" (Null v. City of Los Angeles (1988) 206 Cal.App.3d 1528, 1532.) Where the record is incomplete, we must presume that the trial court correctly relied on matters that are not before us. (Pringle, at p. 1003.)
But even on the record we have, Hankins has not shown an abuse of discretion. In Hankins' financial statement, he stated that he supported himself, his pregnant wife and a small child, and that his monthly income was $8,413.30 and his wife's monthly income was $1,800.
In his opposition declaration, Wagner stated that Hankins had included expenses on his claim of exemption that were not necessary for his family's support. He said there were unnecessary monthly expenses which Hankins had listed for: 1) "loan payments for three luxury and new automobiles" totaling $1,662 per month, 2) a "payroll deduction to [an] individual retirement account" of $420 per month, and 3) an "overpayment of [federal] income tax withholding" in the amount of $414 per month. At the hearing Wagner told the court that Hankins "is overpaying his withholding tax and that he will receive an almost $5,000 return at the end of the year, which would amount to about $415 per month that he could pay towards this judgment." Given the size of his family annual income and the facts stated in Wagner's opposition declarations, Hankins has not shown an abuse of discretion.
II. Procedural Deficiencies
A. Filing of the Claim of Exemption and Financial Statement
Hankins claims the order denying the claim of exemption must be vacated because the sheriff never filed the claim of exemption or his financial statement with the court. He notes that the court's register of actions does not list either of these documents. But Hankins' contention is without merit.
The clerk's failure to list a document on the register of actions does not mean that it was not part of the official trial court record. (Ten Eyck v. Industrial Forklifts Co. (1989) 216 Cal.App.3d 540, 545; Dillon v. Superior Court (1914) 24 Cal.App. 760, 765-766.) Documents that were presented to and considered by the court may be "deemed filed" even if they were never file stamped by the clerk. (Rojas v. Cutsforth (1998) 67 Cal.App.4th 774, 778.)
Here the record shows that the trial court reviewed the claim of exemption and the financial statement. In its order, it said "The court considered the evidence in support of and in opposition to the Claim of Exemption. . . . [¶] . . . [¶] The judgment debtor's Claim of Exemption is denied." (Italics added.) The evidence in support of the claim of exemption included the claim of exemption and the financial statement. If Hankins is concerned about the current location of the original documents, he should have resolved that matter with a settled statement. Any suggestion that the court ruled on the claim of exemption without having these documents before it is without merit.
B. Timeliness of the Opposition
Hankins contends that the court erred by not ordering the sheriff to release the levied funds because Wagner did not timely file an opposition to the claim of exemption.
Within 10 days after the levying officer serves a "notice of a claim of exemption" by mail, the creditor must file a notice of opposition with the levying officer. (§ 706.105, subds. (c) & (d).) If the opposition is not timely, the levying officer must serve a "notice that the earnings withholding order has been terminated . . . ." (Id., subd. (f)(1).) The creditor normally loses the right to oppose the claim of exemption by not timely filing the opposition. (Westervelt v. Robertson (1981) 122 Cal.App.3d Supp. 1, 9.)
Hankins claims that the creditor's opposition was not filed within the 10-day period. The record on appeal is not complete. We do not have the proof of service or the levying officer's notice of claim of exemption. But from the documents we have, it appears that Hankins' position may have merit.
Wagner claims that he did not receive the notice of claim of exemption. He says he only discovered that a claim of exemption was filed after checking the sheriff's website, and then he promptly filed his opposition and the notice of hearing "within three business days." He suggests that a mistake by the postman or the levying officer is the reason he did not receive the documents in the mail, and he argues that his opposition should be deemed timely or any delay excused.
Creditors have a constitutionally protected interest in receiving adequate notice of proceedings involving their property rights. (Tulsa Professional Collection Services, Inc. v. Pope (1988) 485 U.S. 478, 491.) A creditor may obtain relief for a late filing of an opposition under section 473 where he did not receive actual notice of the claim of exemption or he otherwise had good cause for the late filing. (Westervelt v. Robertson, supra, 122 Cal.App.3d Supp. 1, 10, fn. 2.) But these are issues that initially should be decided by the trial court.
We remand this matter to the trial court for further proceedings with the following instructions: The court shall determine whether the creditor's opposition was timely, and, if not, whether there was good cause for a late filing. If the opposition was timely, or if there was good cause for its late filing, the claim of exemption shall be denied. If it was untimely and without good cause for delay, the funds subject to levy shall be released and the court shall determine the refund or credit owed to Hankins for the amount of funds subject to execution during that levy. We leave to the court's discretion whether additional evidence or testimony is necessary. Each party is to bear his own costs on appeal.
We concur: YEGAN, J. COFFEE, J.