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A (Brief) history of New York exemptions, Part I

As New York appears to be on the verge of greatly expanding its asset exemptions for bankruptcy and judgment debtors, it is instructive to review where our current exemptions came from.

Back in the day, say after the Revolutionary War, collecting from debtors was simple: they were thrown into jail until they, or their family or friends, paid their debt. Alternatively, the debtor could, from jail, petition the court for a discharge of his debts (and his incarceration) in return for transferring all his assets to his creditors, a proceeding very similar to modern bankruptcy. For a fantastic analysis of early bankruptcy, see The New Yorker Magazine article by Jill Lepore, April 13, 2009, p. 34.

New York enacted its first Act for the Relief of Insolvent Debtors April 17, 1784. A jailed debtor could file a petition listing all his or her assets; after a notice was printed in the newspaper for four weeks the debtor and creditors would appear at a hearing where the debtor would swear that his petition was accurate and correct. If no creditor objected, the debtor would be released and discharged of his debts, and his assets would be turned over to a court-appointed person in trust for the creditors, who would reduce the assets to cash and distribute the funds to creditors proportionate to their claims. New York Laws of 1784, Ch. 34.

The proceedings were eerily similar to a bankruptcy case today, minus the bit about going to jail: a petition, a list of creditors and assets sworn to under oath (and penalties for a false oath), a court-appointed trustee, a meeting of creditors a month after filing, discharge of debt, and a process to object to discharge.

Even under this very first proceeding, insolvent debtors were allowed to retain "the necessary wearing apparel and bedding of said debtor, and of his wife and children, and family immediately under his care." This was New York's first bankruptcy exemption.

The insolvency procedure was revised several times in New York over the next thirty years. For example, the Act for the Benefit of Insolvent Debtors and their Creditors" passed April 3, 1811, allows the debtor to retain "articles of wearing apparel and bedding, and such tools of the trade" for himself and his family as the official receiving the debtor's assets on behalf of creditors thought reasonable. Laws of 1811, Ch. 123 (or CXXIII, as it was styled then), Section 9.

But what about judgment debtors who did not petition for an insolvency discharge? It appears that over time, imprisoning debtors faded as the primary collection procedure, much to the chagrin of the creditor's rights bar, I am sure. In 1805, a householder (a person who has the charge of and provides for a family) who was subject to a debt of under $25 could escape imprisonment by making monthly installment payments of $1.50 (Laws of New York 1805, Ch. 93.) In 1809, a householder couldn't be imprisoned for debts for more than thirty days (poor "freeholders" could be jailed a maximum of 60 days.) (Laws of New York 1808 , Ch. 10) By 1819, imprisonment of householders for a judgment of less than $10 was eliminated. (L. 1819, Ch. 103)

As jailing debtors receded, creditors turned to executing directly against the debtor's assets, and exemption statutes began to protect essential assets. A statute passed April 5, 1810 exempted a householder from execution for five years: twenty sheep, one cow, two swine, and all necessary wearing apparel and bedding. Laws of 1810, p. 104.

Five years later, a permanent exemption was enacted, protecting "All sheep to the number of ten, with their fleeces, and the clothe manufactured from the same, one cow, two swine, and the pork of the same, all necessary wearing apparel and bedding, necessary cooking utensils, one table, six chairs, six knives and forks, six plates, six tea-cups and saucers" owned by a householder. Laws of 1815, Ch. 227. This language essentially remained on the books for 131 years.

An additional exemption was added in 1819 for "the pew of any church or house of public worship, the family bible, and school books used by or in the family of any person against whom such execution is issued." Laws of 1819, Ch. 103. The church pew language remains with us today, essentially unchanged in 191 years, and will not be changed in the 2010 amendments.

A statute passed February 16, 1824, protected the widows and orphans of householders, continuing the exemption status of assets of the deceased, and also included "all family pictures and books, not exceeding in value fifty dollars." That $50 family library exemption continues to this day, unchanged in amount, 186 years later, although the 2010 amendment passed by the legislature increases it to $500. Laws of 1824, Ch. 44.

All these exemptions were consolidated in the Fifty Dollar Act of 1824, and spinning wheels, weaving looms, and stoves were added. The family library exemption, for some reason, was listed in this statute as $25. Laws of New York 1824, Ch. 238, Sect. 35, enacted April 12, 1824.

In the late 1820's, New York consolidated all of its permanent statutes into a three-volume set, "The Revised statutes of the State of New York." The exemption statutes were codified by the revisers as Part III, Chapter VI, Title 5, Article 2, Section 22, Subsections 1-6. These six subsections continue, with updates, as subsections 1-5 and 7 of CPLR Section 5205. Compare the 1829 text, in bold type, with the current statute (2009), in regular type, and the 2010 proposed changes in italics, below:

1829: 1) all spinning wheels, weaving looms and stoves, put up or kept for use, in any dwelling-house;

2009: 1. All stoves kept for use in the judgment debtor's dwelling house and necessary fuel therefor for sixty days; one sewing machine with its appurtenances;

2010: 1. all stoves and home heating equipment kept for use in the judgment debtor's dwelling house and necessary fuel therefor for one hundred twenty days; one sewing machine with its appurtenances;

1829: 2. The family bible, family pictures, and school books used by or in the family of such person,; and other books, not exceeding fifty dollars in value, kept and used as part of the family or judgment debtor's library;

2009: 2. The family bible, family pictures, and school books used by the judgment debtor or in the family; and other books, not exceeding fifty dollars in value, kept and used as part of the family or judgment debtor's library;

2010: 2. Religious texts, family pictures and portraits, and school books used by the judgment debtor or in the family; and other books, not exceeding five hundred dollars in value, kept and used as part of the family or judgment debtor's library;

1829: 3. a seat or pew occupied by such person or his family in any house or place of public worship;

2009: 3. a seat or pew occupied by the judgment debtor or the family in a place of public worship;

2010: 3. a seat or pew occupied by the judgment debtor or the family in a place of public worship;

1829: 4. All sheep to the number of ten, with their fleeces, and the yarn or cloth manufactured from the same, one cow, two swine, necessary food for them, all necessary pork, beef, fish, flour and vegetables, actually provided for family use, and necessary fuel for the use of the family for sixty days;

2009: 4. domestic animals with the necessary food for those animals for sixty days, provided that the total value of such animals and food does not exceed four hundred fifty dollars; all necessary food actually provided for the use of the judgment debtor or his family for sixty days;

2010: 4. domestic animals with the necessary food for those animals for one hundred twenty days, provided that the total value of such animals and food does not exceed one thousand dollars; all necessary food actually provided for the use of the judgment debtor or his family for one hundred twenty days;

1829: 5. All necessary wearing apparel, beds, bedsteads and bedding, for such person and his family, arms and accoutrements, required by law to be kept by such person, necessary cooking utensils, one table, six chairs, six knives and forks, six plates, six tea-cups and saucers, one sugar-dish, one milk-pot, one teapot and six spoons one crane and its appendages, one pair of andirons and a shovel and tongs;

2009: 5. all wearing apparel, household furniture, one mechanical, gas or electric refrigerator, one radio receiver, one television set, crockery, tableware and cooking utensils necessary for the judgment debtor and the family;

2010: 5. all wearing apparel, household furniture, one mechanical, gas or electric refrigerator, one radio receiver, one television set, one computer and associated equipment, one cellphone, crockery, tableware and cooking utensils necessary for the judgment debtor and the family; all prescribed health aids,

1829: 6. The tools and implements of any mechanic, necessary to the carrying out of his trade, not exceeding twenty five dollars in value.

2009: 7. necessary working tools and implements, including those of a mechanic, farm machinery, team, professional instruments, furniture and library, not exceeding six hundred dollars in value, together with the necessary food for the team for sixty days, provided, however, that the articles specified in this paragraph are necessary to the carrying on of the judgment debtor's profession or calling.

2010: 7. Tools of trade, necessary working tools and implements, including those of a mechanic, farm machinery, team, professional instruments, furniture and library, not exceeding three thousand dollars in value, together with the necessary food for the team for one hundred twenty days, provided, however, that the articles specified in this paragraph are necessary to the carrying on of the judgment debtor's profession or calling,

A copy of the 1829 revised statutes, page 398 (exemptions) is available online:
http://www.archive.org/stream/revisedstatutes01spengoogpage/n398/mode/1up

I will follow this article up with a second blog on exemption history after 1824.

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Peter R. Scribner, Esq | 1110 Park Avenue | Rochester, New York 14610
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