September 21, 2010, Introduced by Reps. Constan, Miller, Hammel, Gonzales, Lemmons, Polidori, Spade, Bennett, Donigan, Durhal, Robert Jones, Barnett, Geiss, Liss, Cushingberry and Meadows and referred to the Committee on Judiciary.
A bill to amend 1961 PA 236, entitled
"Revised judicature act of 1961,"
by amending sections 5201 and 5205 (MCL 600.5201 and 600.5205), and
by adding section 5202; and to repeal acts and parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
5201. (1) All assignments An
assignment commonly called a
common
law assignments assignment
for the benefit of creditors are
is
void unless the same are all of the following apply:
(a)
The assignment is without preferences
as between such the
creditors. and
are
(b) The assignment is of all the property of the assignor not
exempt
from execution, and the under
section 5202.
(c) Within 10 days after the assignment is made, all of the
following are filed with the clerk of the circuit court for the
county in which the assignor resides or, if the assignor does not
reside in this state, for the county where the assigned property is
principally located:
(i) The instrument of
assignment, (or a duplicate thereof), a
or a duplicate of the instrument.
(ii) A list of creditors of the
assignor. , and a
(iii) A bond for the faithful performance of the trust by the
assignee. are
filed in the office of the clerk of the circuit court
where
said assignor resides, or if he is not a resident of the
state,
then of the county where the assigned property is
principally
located, within 10 days after the making thereof.
(2)
No such An assignment is effectual to under this section
does
not convey the title to the property
to the assignee until
such
a bond as
required by subsection (1) is filed
with and
approved
by said the clerk.
(3)
No An attachment or execution levied upon any assigned
property
of such the assignor after such an assignment
under this
section
and before the expiration of the time provided
herein for
filing
such a bond
under this section, is not valid,
and does not
create
any a lien upon such on the property.
(4)
Such An assignment under
this section shall be
acknowledged
before some an officer authorized to take
acknowledgments.
Such An inventory shall be prepared containing a
detailed
statement as near as may be of the general description,
value, and
location of all the property and rights assigned , and,
in
cases of persons if the assignor
is engaged in business,
specifying the original cost of any goods, wares, merchandise,
fixtures, and
furniture. Such The list of creditors required under
subsection
(1) shall , as far as the assignor
can state the same,
contain the name and post office address of each creditor, the
amount
due as near as may be over and above all defenses, the
actual consideration for the debt, when contracted, and all
securities
and the value thereof of
the securities held by each
creditor.
Such The inventory and list of creditors shall be sworn
by
the assignor to be full, true, and correct to the best of his
the assignor's knowledge, information, and belief.
(5)
Such The bond required
under subsection (1) shall be to
the
assignor for the joint and several use and benefit of himself
the
assignor and each, any, and
all of the creditors of such the
assignor in a penal sum at least double the value of the assigned
property
as shown by such the inventory
required under subsection
(4), and conditioned for the prompt and faithful
administration of
the
trust by the assignee, and shall be signed by the assignee and
sufficient surety or sureties, who shall, under oath endorsed on
said
the bond, testify that they are worth in the aggregate
over
and above all exemptions, incumbrances, and debts, the penal sum of
said
the bond.
Sec. 5202. (1) All of the following property is exempt from
assignment under section 5201 or in other liquidation or
reorganization proceedings:
(a) Family pictures.
(b) Arms and accoutrements required by law to be kept by a
person.
(c) Wearing apparel, excluding furs.
(d) Cemeteries, tombs, and rights of burial in use as
repositories for the dead of the debtor's family or kept for burial
of the debtor.
(e) Professionally prescribed health aids.
(f) Provisions and fuel for comfortable subsistence of each
householder and his or her family for 6 months.
(g) The interest, not to exceed a value of $525.00 in each
item and an aggregate value of $3,450.00, in household goods,
furniture, utensils, books, appliances, and jewelry.
(h) The interest, not to exceed $575.00 in value, in a seat,
pew, or slip occupied by the debtor or the debtor's family in a
house or place of public worship.
(i) The interest, not to exceed $2,300.00 in value, in crops,
farm animals, and feed for the farm animals.
(j) The interest, not to exceed $575.00 in value, in household
pets.
(k) The interest, not to exceed $3,175.00 in value, in 1 motor
vehicle.
(l) The interest, not to exceed $575.00 in value, in 1 computer
and its accessories.
(m) The interest, not to exceed $2,300.00 in value, in the
tools, implements, materials, stock, apparatus, or other things to
enable a person to carry on the profession, trade, occupation, or
business in which the person is principally engaged.
(n) Money or other benefits paid, provided, or allowed to be
paid, provided, or allowed, by a stock or mutual life, health, or
casualty insurance company because of the disability due to injury
or sickness of an insured person, whether the debt or liability of
the insured person or beneficiary was incurred before or after the
accrual of benefits under the insurance policy or contract, except
that this exemption does not apply to actions to recover for
necessities contracted for after the accrual of the benefits.
(o) The interest, not exceeding $1,150.00 in par value, in
shares held by a member, who is a householder, of an association
incorporated under the savings and loan act of 1980, 1980 PA 307,
MCL 491.102 to 491.1202, except that this exemption does not apply
to a person who has a homestead exempted under the general laws of
this state.
(p) All individual retirement accounts, including Roth IRAs,
or individual retirement annuities as defined in section 408 or
408a of the internal revenue code, 26 USC 408 and 408a, and the
payments or distributions from those accounts or annuities. This
exemption does not apply to the amount contributed to an individual
retirement account or individual retirement annuity within 120 days
before the assignment or commencement of proceedings. This
exemption does not apply to any of the following:
(i) The portion of an individual retirement account or
individual retirement annuity that is subject to an order of a
court pursuant to a judgment of divorce or separate maintenance.
(ii) The portion of an individual retirement account or
individual retirement annuity that is subject to an order of a
court concerning child support.
(iii) The portion of an individual retirement account or
individual retirement annuity that is attributable to contributions
to the individual retirement account or premiums on the individual
retirement annuity, including the earnings or benefits from those
contributions or premiums, that, in the tax year made or paid,
exceeded the deductible amount allowed under section 408 of the
internal revenue code, 26 USC 408. This limitation on contributions
does not apply to a rollover of a pension, profit-sharing, stock
bonus plan, or other plan that is qualified under section 401 of
the internal revenue code, 26 USC 401, or an annuity contract under
section 403(b) of the internal revenue code, 26 USC 403.
(q) The right or interest of a person in a pension, profit-
sharing, stock bonus, or other plan that is qualified under section
401 of the internal revenue code, 26 USC 401, or an annuity
contract under section 403(b) of the internal revenue code, 26 USC
403, if the plan or annuity is subject to the employee retirement
income security act of 1974, Public Law 93-406, 88 Stat. 829. This
exemption does not apply to any amount contributed to a pension,
profit-sharing, stock bonus, or other qualified plan or a 403(b)
annuity if the contribution occurs within 120 days before the
assignment or commencement of proceedings. This exemption does not
apply to the right or interest of a person in a pension, profit-
sharing, stock bonus, or other qualified plan or a 403(b) annuity
to the extent that the right or interest is subject to either of
the following:
(i) An order of a court pursuant to a judgment of divorce or
separate maintenance.
(ii) An order of a court concerning child support.
(r) The interest of the debtor, or of a codebtor, if any, and
the debtor's dependents, not to exceed $34,450.00 in value or, if
the debtor or a dependent of the debtor at the time of the
assignment or commencement of proceedings is 65 years of age or
older or disabled, not to exceed $51,650.00 in value, in a
homestead.
(s) Property described in section 1 of 1927 PA 212, MCL
557.151, or real property, held jointly by a husband and wife as a
tenancy by the entirety, except that this exemption does not apply
with regard to a claim based on a joint debt of the husband and
wife.
(t) If the owner of a homestead dies, leaving a surviving
spouse but no children, the surviving spouse before his or her
remarriage, unless the surviving spouse is the owner of a homestead
in his or her own right, may exempt the homestead and the rents and
profits of the homestead.
(2) An exemption under this section does not apply to a
mortgage, lien, or security interest in the exempt property that is
consensually given or lawfully obtained unless the lien is obtained
by judgment, attachment, levy, or similar legal process in
connection with a court action or proceeding against the debtor.
(3) If property that is exempt under this section is sold,
damaged, destroyed, or acquired for public use, the right to
receive proceeds or, if the owner receives proceeds and holds them
in a manner that makes them identifiable as proceeds, the proceeds
received are exempt in the same manner and amount as the exempt
property. An exemption under this subsection may be claimed up to 1
year after the receipt of the proceeds by the owner.
(4) On March 1, 2011 and at the end of each 3-year period
after 2011, the state treasurer shall adjust each dollar amount in
this section or, for each adjustment after March 1, 2011, each
adjusted amount, by an amount determined by the state treasurer to
reflect the cumulative change in the consumer price index for the
3-year period ending on the December 31 preceding the adjustment
date and rounded to the nearest $25.00. The state treasurer shall
publish the adjusted amounts. The adjusted amounts apply to cases
filed on or after April 1 following the adjustment date.
(5) As used in this section:
(a) "Consumer price index" means the consumer price index for
all urban consumers in the area of Detroit-Ann Arbor-Flint,
Michigan, published by the United States department of labor or, if
the United States department of labor ceases publishing that index,
the most similar index available.
(b) "Disabled" means unable to engage in substantial gainful
activity, as defined by 42 USC 1382c(a)(3)(E), as a result of a
physical or mental impairment and receiving supplemental security
income under 42 USC 1382c(a)(3)(A) and (C).
(c) "Proceeds" means money payable or paid as a result of 1 or
more of the following:
(i) Sale of the property.
(ii) Insurance or other indemnification for damage or
destruction of the property.
(iii) Compensation for the acquisition for public use of the
property.
(d) "Homestead" means 1 of the following owned or being
purchased under an executory contract by the debtor that the debtor
or a dependent of the debtor occupies as his or her principal
residence:
(i) If the land is located outside of a recorded plat, city, or
village, a residential dwelling and appurtenances and the land on
which they are situated, not exceeding 40 acres.
(ii) If the land is located within a recorded plat, city, or
village, a residential dwelling and appurtenances and the land on
which they are situated, not exceeding 1 lot or parcel.
(iii) A residential dwelling situated on land not owned by the
debtor.
(iv) A condominium unit.
(v) A unit in a cooperative.
(vi) A motor home.
(vii) A boat or other watercraft.
(e) "Residential dwelling" includes, but is not limited to, a
house or a manufactured or mobile home.
Sec.
5205. Such An assignment shall be deemed to convey under
section 5201 conveys to the assignee all property of the assignor
not
exempt from execution under
section 5202, and all rights legal
or
equitable of said the assignor. The assignee shall also be
trustee
of the estate of the debtor for the benefit of his the
debtor's creditors and may recover all property or rights or
equities
in property which that might be recovered by any creditor.
When
If more than 1 assignee is appointed, the debts and
property
of
the assignor may be collected and received by 1 of them and when
if there are more than 2 assignees, every power and authority of
the whole may be exercised by any 2 of them. The survivor or
survivors
of any assignees shall have an
assignee have all their
the
powers and rights and all of the assignee. All property in the
hands
possession of any the assignee at the time of his
the
assignee's death, removal, or incapacity, shall be delivered to the
remaining
assignee or assignees if there be are any, or to the
successor
of the one so dying, assignee
who died or was removed or
incapacitated. ,
who A successor who is
entitled to possession of
property
may demand and sue for possession of the same property.
Enacting section 1. Chapter 54a of the revised judicature act
of 1961, 1961 PA 236, MCL 600.5451, is repealed.