Chapter 1. General Provisions.

Sec.

§ 34-1. Definitions.

As used in this title, unless the context requires a different meaning:

"Creditor process" means all methods used by creditors to collect unsecured debts.

"Debt" means a legally enforceable monetary obligation or liability of any individual whether arising out of a contract or otherwise, but not an obligation resulting from an intentional tort.

"Exempt" means protected from all forms of creditor process.

"Exemption" means protection from all forms of creditor process.

"Homestead exemption" means that exemption created by § 34-4 .

"Householder" means any resident of Virginia.

"Laboring person" means any person who receives wages for his services.

(Code 1919, § 6566; 1974, c. 272; 1978, c. 253; 1979, c. 674; 1990, c. 942.)

Law review. - For discussion of debtors' exemptions, see 17 Wash. & Lee L. Rev. 19 (1960). For article on the need for reform of and a proposed revision of Virginia's Exemption Statutes, see 37 Wash. & Lee L. Rev. 127 (1980). For comment, "In re Cheeseman: A Judicial Revision of Virginia's Homestead Exemption Laws," see 16 U. Rich. L. Rev. 391 (1982). For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985). For survey on creditors' rights in Virginia for 1989, see 23 U. Rich. L. Rev. 561 (1989).

For essay, "A Distinction Without a Difference? An Examination of the Legal and Ethical Difference Between Asset Protection and Fraudulent Transfers Under Virginia Law," see 47 U. Rich. L. Rev. 381 (2012).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 2 Attachment. § 2.2 Virginia's Statutory Scheme, etc. Rendleman.

Friend's Virginia Pleading and Practice (Matthew Bender). Chapter 22 Enforcement of Judgments. § 22.02 Judgment Liens, et seq. Friend.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, §§ 77, 79.

CASE NOTES

Purpose. - This section, even after the 1978 and 1979 amendments, continues to meet its original purported purpose to conserve the family home (shelter) from forced sales. In re Thompson, 4 Bankr. 823 (E.D. Va. 1980).

Intent of 1978 and 1979 amendments. - The Virginia legislature in its amendments of this section in 1978 and 1979 intended that single persons maintaining a separate residence, and persons separated or divorced from their spouses and maintaining a separate residence, should be entitled to an exemption and this entitlement would be without regard to whether, upon establishing a separate residence, such persons also assumed the mantle of "head of the household"; however, the legislature did not intend to grant double exemptions where there was only one residence occupied by two people. In re Thompson, 4 Bankr. 823 (E.D. Va. 1980); In re Doan, 11 Bankr. 704 (Bankr. E.D. Va. 1981).

How federal court must interpret Virginia exemptions. - Because Congress has the power under the Constitution to establish uniform bankruptcy laws, and has enacted a specific provision for exemptions, 11 U.S.C. § 522, a federal court must adopt an interpretation of Virginia's law with respect to exemptions that does not conflict with the Bankruptcy Act's exemption provision. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

Exemption involving intentional tort allowed. - Because Congress specifically legislated as to the type of claims that can be enforced against exempt property, and since the plaintiff's claim did not fall within any of the enumerated exceptions, the court concluded that the debtor was entitled to her exemptions notwithstanding that the plaintiff held a nondischargeable claim based on an intentional tort. In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

Relation to wage exemption. - With respect to debtor's deferred compensation plan (partner equity plan), debtor's claim of exemption of 75 percent of distribution from plan was proper because distribution that debtor was entitled to receive from partner equity plan qualified as "earnings" under definition contained in statute and "exemption" meant protection from all forms of creditor process whether or not there was pending garnishment at time of bankruptcy filing. In re Foster, 556 Bankr. 233, 2016 Bankr. LEXIS 2963 (Bankr. E.D. Va. 2016).

The homestead exemption by its express terms is made available to any resident of Virginia, without regard to whether such person is a wage earner. In re Fromal, 151 Bankr. 730 (E.D. Va. 1993), aff'd, 14 F.3d 594 (4th Cir.), cert. denied, 511 U.S. 1133, 114 S. Ct. 2148, 128 L. Ed. 2d 875 (1994).

"Creditor process" inapplicable where debtor is a secured creditor. - The exemption from "creditor process" set forth in § 34-28.1 with respect to the proceeds of a personal injury settlement did not apply to the equitable lien a subrogated ERISA plan had against the proceeds of a beneficiary's settlement, since that lien gave the plan a security interest in the proceeds of the settlement. Wal-Mart Stores, Inc. v. Carpenter (In re Carpenter), 252 Bankr. 905, 2000 U.S. Dist. LEXIS 13797 (E.D. Va. 2000).

Debtor had a motive for concealment when valuing his claim or failing to amend the schedules after he filed a personal injury action against a corporation because his unsecured debt was $534,000, his secured debt was $762,000, the exemption statute, § 34-28.1 , did not apply where the lienholder was secured, and, thus, his secured creditors would have been able to collect on any award or settlement recovered by him; therefore, he was judicially estopped from seeking more than $1 million in damages against the corporation when he listed the personal injury claim as $1 million on his schedules. Payne v. Wyeth Pharms., Inc., 606 F. Supp. 2d 613, 2008 U.S. Dist. LEXIS 106938 (E.D. Va. 2008).

The statutory definition of "householder" is vague and ambiguous. Shaia v. Marsh, 26 Bankr. 94 (Bankr. E.D. Va. 1982).

The legislature intended to make clear that the word "householder" should not be restricted as to the marital status nor place or abode or presence of other persons therein as an eliminating feature of the right to claim a homestead exemption. Dickens v. Snelling, 10 Bankr. 949 (Bankr. W.D. Va. 1981).

"Householder" and "head of family" are convertible terms. - The terms "householder" and "head of the family" are convertible terms, and are employed as explanatory the one of the other. They involve the idea of dependence and support, coupled with a legal or moral obligation to support the dependent. Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901).

Although this section defines "householder" and not "head of family," these terms have been considered equivalent. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

The language "shall include" should not be considered a limitation but should be considered an extension or enlargement of the definition "householder." Dickens v. Snelling, 10 Bankr. 949 (Bankr. W.D. Va. 1981).

The phrase "whether or not others are living with him" found in this section (which was added by the 1978 amendment to this section) is clearly intended only to drop the long-standing requirement that in order for a person to be a "householder" he must have dependents. In re Doan, 11 Bankr. 704 (Bankr. E.D. Va. 1981).

A husband and wife, living together, may both be deemed householders under the definition in this section. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

If he or she contributes to the maintenance of the household. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981); In re Gustinis, 16 Bankr. 108 (Bankr. E.D. Va. 1981).

In light of the ambiguities in the householder definition and of strong policy considerations, this section can and should be read to allow a homestead exemption to each spouse living together if he or she contributes to the maintenance of the household. Roberts v. County of Henrico Fed. Credit Union, 709 F.2d 275 (4th Cir. 1983).

Allowing only one householder per residence would conflict with bankruptcy laws. - A construction of Virginia law that allows only one householder per residence, would be inconsistent with § 522(m) of the Bankruptcy Reform Act of 1978, 11 U.S.C. § 101 et seq., which must be interpreted as allowing each debtor in a joint case to take some exemptions, whether the amount is determined by state or federal law. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

A wife who filed a joint voluntary petition in bankruptcy with her husband was a householder within the meaning of this section, and was therefore entitled to a homestead exemption in addition to her husband's, where they were married to each other and living together at the time of filing. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

Where debtors were married and living together, and only the husband was employed, and where they were not each maintaining a separate residence or living quarters, under the applicable Virginia law the wife did not meet the definition of a "householder" and was not entitled to the homestead exemption in the bankruptcy proceeding. In re Thompson, 4 Bankr. 823 (E.D. Va. 1980).

Unmarried debtors living together to pool resources. - Two unmarried debtors were not maintaining a separate residence or living quarters and, therefore, did not qualify as "householders" under this section and could not claim the exemptions provided under § 34-4 , where the debtors resided together in a dwelling they owned as joint tenants with right of survivorship retained, and the debtors testified that their arrangement was for the singular purpose of pooling their resources for the purchase and maintenance of their dwelling. In re Doan, 11 Bankr. 704 (Bankr. E.D. Va. 1981).

Debtor's occasional contributions of small amounts of money to his mother were insufficient to constitute support of his mother, for purposes of status as a householder. Shaia v. Marsh, 26 Bankr. 94 (Bankr. E.D. Va. 1982).

Debtor is prevented from amending a voluntary petition in bankruptcy filed before the Cheeseman decision (Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981)), which expanded exemption allowances by permitting both spouses to file individual homestead deeds, as the law in effect at the time the petition is filed is the controlling law for that case. In re Boggs, 17 Bankr. 228 (Bankr. E.D. Va. 1982).

Unmarried infant may be householder. - A unmarried infant who supports his dependent mother who lives with him is a householder under this section. Epperty v. Holley, 3 Va. L. Reg. (n.s.) 27 (1917).

Child living with parents and not supporting them is not a householder. - Although this section provides that any person may be a householder "whether or not others are living with him," this clause does not extend to a child who lives with his parents and is not supporting dependent parents. Jones v. Kirsch, 93 Bankr. 77 (E.D. Va. 1988).

A son living with his parents did not qualify as a householder, since the primary purpose of the homestead exemption is to conserve the family home, and where debtor had neither an ownership interest nor a lease interest in his parents' residence, which was the home to be "conserved," the underlying purpose of the exemption statute did not support defendant's exemption claim. Jones v. Kirsch, 93 Bankr. 77 (E.D. Va. 1988).

Wife not a householder where husband periodically visits and occasionally provides money. - A married woman whose husband lives out of the State, but visits at intervals of two or three years and occasionally make her small remittances of money, and who has no children dependent upon her for support, is not a householder or head of a family in contemplation of the homestead statutes passed in pursuance thereof. Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901).

Applied in In re Goodman, 208 Bankr. 145 (Bankr. W.D. Va. 1997).

§ 34-2. Injunction restraining sale of exempted property or garnishment of wages.

An injunction may be awarded to enjoin the sale of any property exempt under the provisions of this title, and to prevent the wages exempted by § 34-29 from being garnisheed or otherwise collected by an execution creditor.

(Code 1919, § 6565.)

Michie's Jurisprudence. - For related discussion, see 10A M.J. Injunctions, §§ 52, 70.

§ 34-3. Articles not exempt from taxes or levies or for their purchase price.

The exemptions under §§ 34-4 , 34-4 .1, 34-26 , 34-27 , 34-29 , and 64.2-311 shall not extend to distress or lien for state or local taxes or levies, nor to levy, distress, or lien for the purchase price of any articles claimed as exempt or any part of the price thereof nor for fines and damages or either arising from trespass by animals under § 55.1-2810 as to such animal so trespassing. If an article purchased and not paid for is exchanged or converted into other property of the debtor, such property shall not be exempt from payment of the unpaid purchase money debt.

(Code 1919, § 6563; 1990, c. 942; 1996, c. 323.)

Cross references. - As to debts to which $2,000 homestead exemption of householder created by § 34-4 does not apply, see § 34-5 .

Editor's note. - At the direction of the Virginia Code Commission, the reference to "64.1-151.3" was changed to "64.2-311" to conform to the recodification of Title 64.1 by Acts 2012, c. 614, effective October 1, 2012.

To conform to the recodification of Title 55 by Acts 2019, c. 712, effective October 1, 2019, the following substitution was made at the direction of the Virginia Code Commission: substituted "55.1-2810" for "55-306."

The 1996 amendment, in the first sentence, inserted "or lien" following "distress" in two places and deleted "or" following "nor to levy."

Research References. - Bryson on Virginia Civil Procedure (Matthew Bender). Chapter 1 Extra-Judicial Procedures. § 1.02 Self Help. Bryson.

Michie's Jurisprudence. - For related discussion, see 18 M.J. Trespass, § 1.

§ 34-3.1. Property specified in Bankruptcy Reform Act not exempt.

No individual may exempt from the property of the estate in any bankruptcy proceeding the property specified in subsection (d) of § 522 of the Bankruptcy Reform Act (Public Law 95-598), except as may otherwise be expressly permitted under this title.

(1979, c. 692.)

Law review. - For comment, "In re Cheeseman: A Judicial Revision of Virginia's Homestead Exemption Laws," see 16 U. Rich. L. Rev. 391 (1982). For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985). For article on the distribution of assets in Chapter 7 bankruptcy proceedings closed during 1984-1987, see 22 U. Rich. L. Rev. 303 (1988).

For article, "The Federal Law of Property: The Case of Inheritance Disclaimers and Tenancy by the Entireties," see 75 Wash & Lee L. Rev. 3 (2018).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 5 The Judgment Lien. § 5.7 Judgment Liens Under the Bankruptcy Code. Rendleman.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, §§ 72, 76.

CASE NOTES

Constitutionality. - This section is constitutional. In re White, 11 Bankr. 775 (Bankr. E.D. Va. 1981).

Residents of Virginia filing bankruptcy petitions may claim only those exemptions allowable under state law and general (nonbankruptcy) Federal law. In re Massey, 225 Bankr. 887 (Bankr. E.D. Va. 1998).

This section does not offend 11 U.S.C.S. § 522. It was specifically allowed by 11 U.S.C.S. § 522(b)(1). In re White, 11 Bankr. 775 (Bankr. E.D. Va. 1981).

By the wording of this section, it is clear that this title is the applicable law with regard to exemptions permitted under Section 522 of the Bankruptcy Code (11 U.S.C.S. § 522). Simmons v. Peoples Bank, 27 Bankr. 508 (Bankr. W.D. Va. 1983).

Limitation on "opting out". - The authority for this "opting out" statute, 11 U.S.C.S. § 522(b)(1), does not give the states the power to "opt out" of § 522 in its entirety, but allows "opting out" only with respect to the federal exemptions. Bass v. Thacker, 5 Bankr. 592 (Bankr. W.D. Va. 1980).

This "opting out" statute is clearly limited by its language to excluding only the federal exemptions specified in § 522(d). Bass v. Thacker, 5 Bankr. 592 (Bankr. W.D. Va. 1980).

Only 11 U.S.C.S. § 522(d), the specific provision relating to the federal exemption scheme, is not law in Virginia. There is no effect on the so-called "lien avoidance" §§ 522(e) and (f). F & M Bank v. Boyd, 11 Bankr. 690 (Bankr. W.D. Va. 1981).

Failure to comply with homestead statute precludes exemption in bankruptcy. - Failure of a debtor to comply with the Virginia homestead exemption statute precludes him from claiming that exemption for bankruptcy purposes. Zimmerman v. Morgan, 689 F.2d 471 (4th Cir. 1982).

Virginia has "opted-out" of the federal exemption scheme and Virginia debtors may only assert Virginia exemptions, including the homestead exemption. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

This section allows Virginia residents to use only the exemptions created under state law. In order for a Virginia debtor to avoid a lien pursuant to 11 U.S.C.S. § 522(f)(1) or (2), therefore, the debtor must be entitled to an exemption under state law. Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991).

A state may by statute "opt out" of allowing its residents to take advantage of the federal exemptions, which the state has done, and accordingly, residents of the state filing bankruptcy petitions may claim only those exemptions allowable under state law and general federal law. In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

Because the Commonwealth of Virginia has opted out of the federal exemption scheme, a debtor must claim his exemptions in compliance with Virginia law. Mayer v. Quy Van Nguyen (In re Quy Van Nguyen), 211 F.3d 105, 2000 U.S. App. LEXIS 8271 (4th Cir. 2000).

Under § 34-3.1 , Virginia has opted out of the federal bankruptcy exemptions, and consequently, in Virginia, debtors may only claim those exemptions allowed under 11 U.S.C.S. § 522(b)(2). In re Zaidi, 293 Bankr. 861, 2002 Bankr. LEXIS 1721 (Bankr. E.D. Va. 2002).

Keogh plan. - A bankruptcy debtor's tax-qualified self-employment Keogh retirement plan was not exempt. Parkinson v. Bradford Trust Co. (In re O'Brien), 50 Bankr. 67 (Bankr. E.D. Va. 1985).

Virginia homestead exemptions still available. - Although Virginia opted out of the federal exemptions of 11 U.S.C.S. § 522(d), the exemptions claimed by a Virginia debtor under the Virginia homestead laws are still protected by the debtor's ability under 11 U.S.C.S. § 522(f) to avoid judgment liens and nonpossessory nonpurchase money security interests in certain household and personal goods to the extent of the exemptions allowable under Virginia law. Beneficial Fin. Co. v. Rodgers, 5 Bankr. 761 (Bankr. W.D. Va. 1980).

Exempt property not includible as creditor asset. - Where the debtors had claimed their exemptions pursuant to Virginia law, creditor's attempt to include exempt property on the asset side was unavailing. Babiker v. Citizens Contracting Co., 180 Bankr. 458 (Bankr. E.D. Va. 1995).

Power to avoid interests contained in 11 U.S.C.S. § 522(f) operates independently of state's choice regarding its exemption scheme. O'Malley v. Rapidan River Farm, 24 Bankr. 900 (E.D. Va. 1982).

Exemptions allowed where debtors were state residents at time of filing homestead deed. - Debtors, residents of the Commonwealth, who shipped all of their household goods out-of-state, subsequently filed a homestead deed in Virginia and then moved to Florida while their attorney filed petitions in bankruptcy in Virginia, were allowed their requested exemptions since they were residents of Virginia at the time of the homestead deed filing. In re Chaffins, 16 Bankr. 686 (Bankr. E.D. Va. 1982).

Personal injury suits filed by bankrupt debtor prior to exemption were nullities and did not toll the statute of limitations. - Accident victim lacked standing to file any of the three personal injury suits he filed against a driver because he had filed for bankruptcy, and the cause of action could only be asserted by the trustee. The victim's action was a nullity, and the statute of limitations had run before it was filed, pursuant to § 8.01-243 . Kocher v. Campbell, 282 Va. 113 , 712 S.E.2d 477, 2011 Va. LEXIS 133, cert. denied, 2011 U.S. LEXIS 8861, 181 L. Ed. 2d 549 (U.S. 2011).

Property coming into estate after bankruptcy petition filed. - Former Bankruptcy Rule 110 affects a debtor's procedural rights only and cannot overcome restrictions imposed or permitted by substantive provisions of the Bankruptcy Code such as § 522(b)(1) (allowing states to "opt out" of the federal exemption scheme). Debtors in other states may be able to claim as exempt property coming into the estate after a petition is filed. Bankruptcy Code § 522(b)(1) and this section and § 34-17 , however, operate to bar Virginia debtors from doing so in this jurisdiction. Collins v. Peyton, 24 Bankr. 485 (Bankr. E.D. Va. 1982).

Waiver of exemptions. - Because the debtors did not claim their exemptions until 13 days following the date scheduled for the first meeting of creditors, under § 34-17 , those exemptions were waived. Bryant v. Smith, 165 Bankr. 176 (W.D. Va. 1994).

Applied in Epperley v. Woodyard, 4 Bankr. 124 (Bankr. W.D. Va. 1980); In re Thompson, 4 Bankr. 823 (E.D. Va. 1980); In re Musgrove, 7 Bankr. 892 (Bankr. W.D. Va. 1981); In re Sutton, 10 Bankr. 737 (Bankr. E.D. Va. 1981); Dickens v. Snellings, 10 Bankr. 949 (Bankr. W.D. Va. 1981); Waldrop v. Phillos, 14 Bankr. 781 (Bankr. W.D. Va. 1981); Chippenham Hosp. v. Bondurant, 716 F.2d 1057 (4th Cir. 1983); Bass v. Shackelford, 27 Bankr. 372 (Bankr. W.D. Va. 1983); Barnes v. McCarthy, 29 Bankr. 677 (Bankr. W.D. Va. 1983); In re Redmon, 31 Bankr. 756 (Bankr. E.D. Va. 1983); In re Shines, 39 Bankr. 879 (Bankr. E.D. Va. 1984); Washington v. Virginia State Educ. Assistance Auth., 41 Bankr. 211 (Bankr. E.D. Va. 1984); Webb v. Robert A. Boroughs, Ltd., 49 Bankr. 646 (Bankr. E.D. Va. 1984); Dominion Bank v. Nuckolls, 71 Bankr. 593 (W.D. Va. 1987); In re Shirley, 128 Bankr. 724 (Bankr. W.D. Va. 1991); In re Spraker, 128 Bankr. 727 (Bankr. W.D. Va. 1991); In re Emerson, 129 Bankr. 82 (Bankr. W.D. Va. 1991); T.R. Press, Inc. v. Whitcomb, 140 Bankr. 396 (Bankr. E.D. Va. 1992); In re Heater, 189 Bankr. 629 (Bankr. E.D. Va. 1995); Monticello Arcade Ltd. v. Lyall, 191 Bankr. 78 (E.D. Va. 1996); In re Nguyen, 226 Bankr. 547 (Bankr. E.D. Va. 1998); Tavenner v. Smoot, 257 F.3d 401, 2001 U.S. App. LEXIS 15901 (4th Cir. 2001).

Chapter 2. Homestead Exemption of Householder.

Sec.

§ 34-4. Exemption created.

Every householder shall be entitled, in addition to the property or estate exempt under §§ 23.1-707 , 34-26 , 34-27 , 34-29 , and 64.2-311 , to hold exempt from creditor process arising out of a debt, real and personal property, or either, to be selected by the householder, including money and debts due the householder not exceeding $5,000 in value or, if the householder is 65 years of age or older, not exceeding $10,000 in value, and, in addition, real or personal property used as the principal residence of the householder or the householder's dependents not exceeding $25,000 in value. In addition, upon a showing that a householder supports dependents, the householder shall be entitled to hold exempt from creditor process real and personal property, or either, selected by the householder, including money or monetary obligations or liabilities due the householder, not exceeding $500 in value for each dependent.

For the purposes of this section, "dependent" means an individual who derives support primarily from the householder and who does not have assets sufficient to support himself, but in no case shall an individual be the dependent of more than one householder.

(Code 1919, § 6531; 1918, p. 487; 1975, c. 466; 1977, c. 496; 1978, c. 231; 1990, c. 942; 1997, cc. 785, 861; 2009, c. 387; 2020, c. 328.)

Cross references. - As to claiming exemption in attachment proceedings, see § 8.01-563 .

As to effect of bankruptcy on time for setting apart homestead, see § 34-17 .

As to waiver of exemption, see § 34-22 .

As to other exemptions, see §§ 34-33 , 38.2-3339 , 38.2-3549 .

As to liens on time-share estate owners' associations, see § 55.1-2211 .

Editor's note. - At the direction of the Virginia Code Commission, the reference to "64.1-151.3" was changed to "64.2-311" to conform to the recodification of Title 64.1 by Acts 2012, c. 614, effective October 1, 2012.

At the direction of the Virginia Code Commission, "23.1-707" was substituted for "23-38.81" to conform to the recodification of Title 23 by Acts 2016, c. 588, effective October 1, 2016.

Acts 2020, c. 328, cl. 2 provides: "That the Executive Secretary of the Supreme Court of Virginia shall promulgate and update the forms necessary to comply with the provisions of the first enactment of this act."

The 1997 amendments. - The 1997 amendments by cc. 785 and 861 are identical, and inserted "23-38.81" preceding "34-26" in the first sentence.

The 2009 amendments. - The 2009 amendment by c. 387 added "or, if the householder is 65 years of age or older, not exceeding $10,000 in value" at end of the first sentence in the first paragraph.

The 2020 amendments. - The 2020 amendment by c. 328, inserted "and, in addition, real or personal property used as the principal residence of the householder or the householder's dependents not exceeding $25,000 in value."

Law review. - For article on the need for reform of and a proposed revision of Virginia's Exemption Statutes, see 37 Wash. & Lee L. Rev. 127 (1980). For comment, "In re Cheeseman: A Judicial Revision of Virginia's Homestead Exemption Laws," see 16 U. Rich. L. Rev. 391 (1982). For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985). For article on the distribution of assets in Chapter 7 bankruptcy proceedings closed during 1984-1987, see 22 U. Rich. L. Rev. 303 (1988).

For 1991 survey on bankruptcy law, see 25 U. Rich. L. Rev. 607 (1991).

For 1992 survey article reviewing and analyzing legislative and judicial developments in bankruptcy law, see "Bankruptcy Law," 26 U. Rich. L. Rev. 635 (1992).

For article, "Bankruptcy Law," see 50 U. Rich. L. Rev. 1 (2015).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 3. The Writ Firea Facies: Execution. § 3.3 Relief from Levy, 6.5 etc. Rendleman.

Virginia Forms (Matthew Bender). No. 16-586 Homestead Deed; No. 16-587 Affidavit Concerning Dependent Children to Accompany Homestead Deed.

Michie's Jurisprudence. - For related discussion, see 2B M.J. Automobiles, § 130; 2C M.J. Bankruptcy, §§ 73, 77, 135; 5B M.J. Criminal Procedure, § 104; 7A M.J. Estoppel, § 10; 8A M.J. Exemptions from Execution and Attachment, §§ 8, 12, 13, 16, 22, 25; 9A M.J. Fraudulent and Voluntary Conveyances, § 43; 14B M.J. Pensions, § 2; 16 M.J. Setoff, Recoupment and Counterclaim, § 22.

CASE NOTES

I. GENERAL CONSIDERATION.

This title gave effect to Article 14 of former Constitution. - Article 14 of the former Constitution of Virginia, relating to homestead exemptions, was not self-executing, but was carried into effect by this title. Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901).

It is to be liberally construed. - The homestead provisions must be liberally construed. Wilkinson v. Merrill, 87 Va. 513 , 12 S.E. 1015 (1891); Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901); Brown's Comm. v. Western State Hosp., 110 Va. 321 , 66 S.E. 48 (1909).

A remedial statute such as this one must be construed liberally so as to afford all the relief within the power of the court which the language of the statute indicates that the legislature intended. Dickens v. Snellings, 10 Bankr. 949 (Bankr. W.D. Va. 1981).

With reference to homestead exemptions, courts employ the most liberal and humane rules of interpretation to insure the unfortunate debtor and his equally unfortunate but more helpless family, the shelter and influence of the object which the exemption provides. Dickens v. Snellings, 10 Bankr. 949 (Bankr. W.D. Va. 1981).

Exemption statutes are to be liberally construed in favor of the party asserting the exemption privilege; however, courts are neither to reduce nor enlarge the exemptions or read into the law an exemption not found there. In re Williams, 3 Bankr. 244 (Bankr. E.D. Va. 1980).

It is the almost universal rule that exemption statutes should receive a liberal construction in favor of those intended to be benefited and favorable to the object and purposes of the enactment, and where there is doubt as to whether certain property is exempt or not, the doubt should be resolved in favor of the exemption. In re Perry, 6 Bankr. 263 (Bankr. W.D. Va. 1980).

Courts in Virginia are required to liberally construe statutes relating to homestead laws in favor of debtors in order to protect the debtors and their families. In re Smith, 22 Bankr. 866 (Bankr. E.D. Va. 1982).

Courts must liberally construe the law pertaining to homestead deeds in favor of debtors. Furthermore, any ambiguities found in state exemption laws must be resolved in favor of debtors. In re Redmon, 31 Bankr. 756 (Bankr. E.D. Va. 1983).

Courts should construe liberally the law pertaining to homestead deeds in favor of debtors. The law is equally clear, however, that there are certain strict requirements in a bankruptcy setting which must be observed. Homeowner's Fin. Corp. v. Pennington, 47 Bankr. 322 (Bankr. E.D. Va. 1985).

The Virginia homestead exemption is intended to shield helpless and unfortunate debtors and their families from the onslaught of creditors, and consequently must be liberally construed so as to afford the relief which the legislature intended the debtor to enjoy. In re Hayes, 119 Bankr. 86 (Bankr. E.D. Va. 1990).

In considering the issue of whether creditor's post-discharge actions taken with regard to exempt property which secured the underlying debt violated federal provisions of permanent injunction, the same rule of liberally construing a federal remedial statute in favor of the debtor is recognized in Virginia as it pertains to the Virginia exemption statutes. Martin v. AVCO Fin. Servs., 157 Bankr. 268 (Bankr. W.D. Va. 1993).

The homestead exemption by its express terms is made available to any resident of Virginia, without regard to whether such person is a wage earner. In re Fromal, 151 Bankr. 730 (E.D. Va. 1993), aff'd, 14 F.3d 594 (4th Cir.), cert. denied, 511 U.S. 1133, 114 S. Ct. 2148, 128 L. Ed. 2d 875 (1994).

Purposes of homestead exemptions are two-fold. First, they protect debtors from being left destitute from creditor process by allowing debtors to retain stakeholds. Second, by requiring a homestead deed to be filed in the jurisdiction in which the debtor resides, it enables creditors to ascertain by inspection whether the debtor is underestimating the value of the property he claims exempt, thereby keeping to himself property that should be subjected to the payment of his debts. In re Smith, 22 Bankr. 866 (Bankr. E.D. Va. 1982).

The homestead is a shield to protect the helpless and unfortunate debtor from the importunate and incompassionate creditor. Linkenhoker v. Detrick, 81 Va. 44 (1885); Barker v. Jenkins, 84 Va. 895 , 6 S.E. 459 (1888).

The homestead provision was intended to give protection to the unfortunate as against "debts contracted," and not to fortify the crafty and designing against the consequences of their wrongdoing. Burton v. Mill, 78 Va. 468 (1884).

Section 20-107.3 does not apply to a determination of whether a debtor may claim an exemption under this section in property owned by her spouse prior to marriage. In re Wilkinson, 100 Bankr. 315 (Bankr. W.D. Va. 1989).

Privilege is personal to householder. - The privilege, so far as it was given by the Constitution, is personal to the householder. The language is, "to be selected by him." If he neglects to act, no one is authorized to act in his place. Linkenhoker v. Detrick, 81 Va. 44 (1885).

And it may be waived. - The homestead exemption is a mere privilege extended in the benignity of the law to the debtor, and he may claim the shield and protection of this privilege or not at his election. White v. Owen, 71 Va. (30 Gratt.) 43 (1878); Scott v. Cheatham, 78 Va. 82 (1883); Linkenhoker v. Detrick, 81 Va. 44 (1885); Williams v. Watkins, 92 Va. 680 , 24 S.E. 223 (1896).

A person who has claimed property as exempt pursuant to the homestead statute may subsequently waive such exemption by later deed of trust, sale, or other disposition of the property. In re Shirley, 128 Bankr. 724 (Bankr. W.D. Va. 1991).

Exemption not applicable to judgment liens. - The Virginia homestead exemption is not applicable to judgment liens for wages. Davis v. Lester, 97 Bankr. 292 (Bankr. W.D. Va. 1989).

No right to claim exemption in property no longer owned. - Debtor claimed as exempt under § 34-4 , the following: "Reimbursed money to mother, payment made 2/2/12 claimed as exempt $3,000." The trustee's objections to debtor's claim of exemption was sustained, as there was no right under Virginia law to claim an exemption in property no longer owned by the exemption's claimant. In re Gillenwater,, 2003 Bankr. LEXIS 2442 (Bankr. W.D. Va. July 30, 2003).

Homestead and entireties exemptions distinguished. - The homestead is a statutory creation designed to prevent the poor debtor from being totally impoverished, and the entireties exemption is a creature of the common law, dates back to the fifteenth century, and is based on the concept that a husband and wife are one "person," distinct from its separate parts. Bass v. Thacker, 5 Bankr. 592 (Bankr. W.D. Va. 1980).

Homestead provisions inapplicable to entireties exemption. - All entireties property is exempt in Virginia, with no dollar limitation, and one need not be a "householder" to claim the entireties exemption; therefore, the homestead provisions, including the requirement of filing a homestead deed, do not apply in any way to exemptions claimed for a tenancy by the entirety. Bass v. Thacker, 5 Bankr. 592 (Bankr. W.D. Va. 1980).

This section and § 34-26 provide debtors with two methods for setting apart property as exempt from the actions of creditors. Debtors are entitled to the benefits of both exemption methods. In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982).

A cause of action for wrongful death is an asset of the bankruptcy estate and may not be assigned. In re Tidwell, 19 Bankr. 846 (Bankr. E.D. Va. 1982).

As is award based thereon. - Virginia court's award to debtor on claims against hospital and gasoline company for the death of his mother is the property of the bankrupt's estate. In re Tidwell, 19 Bankr. 846 (Bankr. E.D. Va. 1982).

Judgment rendered against a convicted defendant for court costs in a criminal case is not rendered on any demand for a debt or liability contracted by him. Wicks v. City of Charlottesville, 215 Va. 274 , 208 S.E.2d 752 (1974), appeal dismissed, 421 U.S. 901, 95 S. Ct. 1548, 43 L. Ed. 2d 769 (1975).

Federal and state income tax refunds are debts within the meaning of this statute. Shirkey v. Leake, 715 F.2d 859 (4th Cir. 1983).

Debtors must be "residents" at the time of filing their homestead deed in order to claim an exemption under Virginia law. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

Debtor could file homestead deed after foreclosure but before disbursement by the trustee under the deed of trust and, thereby, properly claim an exemption in the foreclosure proceeds that exceeded prior liens. Webb v. Robert A. Boroughs, Ltd., 49 Bankr. 646 (Bankr. E.D. Va. 1984).

Sanction for fraudulent conduct not exemption denial. - Where state law does not provide for the denial of the homestead exemption for fraudulent conduct, including arson, the appropriate sanction is denial of discharge, not denial of homestead exemption. Rockingham Mut. Ins. Co. v. Beahm, 177 Bankr. 839 (Bankr. W.D. Va. 1995).

Set-offs against exempt property generally not allowed. - Generally, a creditor may not exercise the right of set-off against property exempted from the estate. Virginia v. Haley, 41 Bankr. 44 (Bankr. W.D. Va. 1984).

Set-off of retirement contributions against amounts embezzled from Commonwealth. - Virginia Supplemental Retirement System (now Virginia Retirement System) contributions, claimed as exempt under this section, may be used by the Commonwealth to set off an indebtedness due the Commonwealth as of the date of filing bankruptcy, where the indebtedness results from embezzlement of funds and was not regularly listed in the debtors' schedules. Virginia v. Haley, 41 Bankr. 44 (Bankr. W.D. Va. 1984).

No sanctions where automatic stay was not violated willfully. - U.S. Department of Housing and Urban Development, which violated the automatic stay under circumstances where there was no evidence it did so willfully, sought retroactive relief by annulment of the stay, but annulment would have thwarted the intent of both Congress and Virginia in providing the statutory mechanisms for equality of creditor treatment (11 U.S.C.S. § 362) and debtor's fresh start, § 34-4 and 11 U.S.C.S. § 522(b) and (c). The equities of the case did not favor annulment of the stay. Moore v. United States HUD (In re Moore), 350 Bankr. 650, 2006 Bankr. LEXIS 2865 (Bankr. W.D. Va. 2006).

Homestead deed untimely recorded. - Chapter 7 debtor was not entitled to claim the homestead exemption under § 34-4 because the debtor did not record a homestead deed in the proper jurisdiction within five days after the 11 U.S.C.S. § 341 meeting of creditors, as required by § 34-17 . In re Conner, 408 Bankr. 88, 2009 Bankr. LEXIS 2409 (Bankr. W.D. Va. 2009).

General rule is that after the time for filing a homestead deed has expired, the debtor is precluded from amending a homestead deed for purposes other than increasing or decreasing the value of property previously included in the homestead deed, and new property cannot be exempted. Ames v. Custis, 87 Bankr. 415 (Bankr. E.D. Va. 1988).

Deed could not be amended to decrease value of listed property to add new property. - A recorded homestead deed which lists property equal in value to the entire available homestead exemption cannot be amended to decrease the value of listed property in order to add other property not previously listed, at least not if the property was owned by the debtor when the original homestead deed was filed. In re Emerson, 129 Bankr. 82 (Bankr. W.D. Va. 1991), aff'd, 962 F.2d 6 (4th Cir. 1992).

Amendments allowable to include new property. - When a debtor does not own or have an interest in property that is properly exempt under this section at the time the exemption must be asserted, then an amendment may be allowed to include new property so long as the maximum exemptions have not been taken. Ames v. Custis, 87 Bankr. 415 (Bankr. E.D. Va. 1988).

Debtor lacked title in insurance proceeds assigned by him to hospital. - Where the debtor validly assigned the portion of the insurance proceeds of his personal injury action to the hospital as represented in the assignment, the debtor did not have title in that portion of the assigned proceeds when he filed a homestead deed claiming them as exempt under this section. In re Duty, 78 Bankr. 111 (Bankr. E.D. Va. 1987).

A Virginia debtor may set apart real or personal property from the debtor's bankruptcy estate, valued up to a specified limit, by properly filing appropriate homestead deeds in the correct location no later than five days after the date initially set for the debtor's meeting of creditors. In re Heater, 189 Bankr. 629 (Bankr. E.D. Va. 1995).

Applied in In re Wirick, 3 Bankr. 539 (Bankr. E.D. Va. 1980); In re Dardar, 3 Bankr. 641 (Bankr. E.D. Va. 1980); Boitnott v. United Va. Bank, 4 Bankr. 119 (Bankr. W.D. Va. 1980); In re Musgrove, 7 Bankr. 892 (Bankr. W.D. Va. 1981); Ragsdale v. Genesco, Inc., 9 Bankr. 991 (Bankr. E.D. Va. 1981); In re Stewart, 10 Bankr. 472 (Bankr. E.D. Va. 1981); In re Burns, 23 Bankr. 987 (Bankr. E.D. Va. 1982); O'Malley v. Rapidan River Farm, 24 Bankr. 900 (E.D. Va. 1982); In re Tyler, 27 Bankr. 289 (Bankr. E.D. Va. 1983); Simmons v. Peoples Bank, 27 Bankr. 508 (Bankr. W.D. Va. 1983); Schmidt v. White, 28 Bankr. 240 (Bankr. E.D. Va. 1983); Barnes v. McCarthy, 29 Bankr. 677 (Bankr. W.D. Va. 1983); In re Shelton, 35 Bankr. 505 (Bankr. E.D. Va. 1983); In re Samuel, 36 Bankr. 312 (Bankr. E.D. Va. 1984); In re Shines, 39 Bankr. 879 (Bankr. E.D. Va. 1984); In re Lamm, 47 Bankr. 364 (E.D. Va. 1984); In re Goodman, 208 Bankr. 145 (Bankr. W.D. Va. 1997); American Gen. Fin., Inc. v. Hoss, 233 Bankr. 684 (Bankr. W.D. Va. 1999); In re Gentry, 275 Bankr. 747, 2001 Bankr. LEXIS 1876 (Bankr. W.D. Va. 2001); In re Williams, 337 Bankr. 846, 2005 Bankr. LEXIS 2786 (Bankr. E.D. Va. 2005).

II. WHO IS 'HOUSEHOLDER OR HEAD OF A FAMILY.'

Editor's note. - Section 34-1 no longer requires a householder to have dependents.

"Householder" and "head of a family" are convertible terms. - The terms "householder" and "head of a family," are convertible terms, and are employed as explanatory the one of the other. They involve the idea of dependence and support coupled with a legal or moral obligation to support the dependent. Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901)decided prior to the 1975 amendment to this section. See § 34-1 .

But unmarried infant may be "householder." - An unmarried infant who supports his dependent mother, who lives with him, is a householder. Epperty v. Holley, 3 Va. L. Reg. (n.s.) 27 (1917).

Wife may be "head of family." - A married woman living with her husband may be a "householder or head of a family," where she manages the business of the family and has always been regarded as its head. And her right to claim the exemption provided under this section is not affected by the fact that her husband has already claimed exemption of specific articles of personal property under Chapter 3 of this title. Richardson v. Woodward, 104 F. 873 (4th Cir. 1900). But see Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901).

A husband and wife, living together, may both be deemed householders under the definition in § 34-1 . Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981); Roberts v. County of Henrico Fed. Credit Union, 709 F.2d 275 (4th Cir. 1983).

If he or she contributes to the maintenance of the household. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

Allowing only one householder per residence would conflict with bankruptcy laws. - A construction of Virginia law that allows only one householder per residence would be inconsistent with § 522(m) of the Bankruptcy Reform Act of 1978, 11 U.S.C. § 101 et seq., which must be interpreted as allowing each debtor in a joint case to take some exemptions, whether the amount is determined by state or federal law. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

A wife who filed a joint voluntary petition in bankruptcy with her husband was a householder within the meaning of § 34-1 , and was therefore entitled to a homestead exemption in addition to her husband's, where they were married to each other and living together at the time of filing. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

Where debtors were married and living together, and only the husband was employed, and where they were not each maintaining a separate residence or living quarters, under the applicable Virginia law the wife did not meet the definition of a "householder" and was not entitled to the homestead exemption in the bankruptcy proceeding. In re Thompson, 4 Bankr. 823 (E.D. Va. 1980).

Retention of exemption after debtor's death. - The Virginia homestead exemption protects the families of debtors by allowing the householder's spouse and minor children to retain the exemption after the debtor's death. In re Hayes, 119 Bankr. 86 (Bankr. E.D. Va. 1990).

Debtor is prevented from amending a voluntary petition in bankruptcy filed before the Cheeseman decision (Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981)), which expanded exemption allowances by permitting both spouses to file individual homestead deeds, as the law in effect at the time the petition is filed is the controlling law for that case. In re Boggs, 17 Bankr. 228 (Bankr. E.D. Va. 1982).

Wife may claim homestead although not gainfully employed. - A wife may claim a homestead exemption under Virginia law although she is living with her husband and is not gainfully employed outside of the home. In re Gustinis, 16 Bankr. 108 (Bankr. E.D. Va. 1981).

Wife is entitled to file a homestead deed where she provides necessary services to the household in which she lives as her duties as housewife are legion. A housewife cooks, cleans, shops for groceries, chauffeurs and generally manages the household. Her economic value to the household is certain and demonstrative. A housewife's activities as a housewife contribute to the maintenance of that household. In re Gustinis, 16 Bankr. 108 (Bankr. E.D. Va. 1981).

Unmarried debtors living together to pool resources. - Two unmarried debtors were not maintaining a separate residence or living quarters and, therefore, did not qualify as "householder" under § 34-1 and could not claim the exemptions provided under this section, where the debtors resided together in a dwelling they owned as joint tenants with right of survivorship retained, and the debtors testified that their arrangement was for the singular purpose of pooling their resources for the purchase and maintenance of their dwelling. In re Doan, 11 Bankr. 704 (Bankr. E.D. Va. 1981).

Where party was not an actual owner of the leasehold, she could not claim an exemption in it. In re Preston, 96 Bankr. 61 (Bankr. W.D. Va. 1989).

In the context of determining whether an increase in a homestead exemption is warranted, the test is (1) whether they lack assets sufficient to support themselves and (2) whether they primarily derive their support from the debtor. In re Ghanei,, 2005 Bankr. LEXIS 566 (Bankr. E.D. Va. Feb. 18, 2005).

Independent child living with parents is a householder. - In light of the legislative history transforming the homestead exemption into a true exemption, the modern legislative amendments expanding the number of people who qualify as householder, and the Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981) decision conforming with Virginia's liberal construction policy, makes it unrealistic to hold that an independent child living with his parents and contributing to the maintenance of the residence is not a householder because of his relationship to his parents and/or his failure to support his parents. In re Howell, 106 Bankr. 99 (Bankr. W.D. Va. 1989).

Debtor was entitled to an additional homestead exemption for his children even though he could not claim them as dependents for federal tax purposes. - A Chapter 7 debtor was entitled to an additional $500 homestead exemption for each child even though he could not claim the children as dependents for federal tax purposes where his divorce decree showed that he shouldered a greater portion of the support burden than his ex-wife and thus, the children primarily derived their support from the debtor at the time the homestead exemption was claimed. In re Ghanei,, 2005 Bankr. LEXIS 566 (Bankr. E.D. Va. Feb. 18, 2005).

III. AGAINST WHAT OBLIGATIONS EXEMPTION MAY BE CLAIMED.

The homestead exemption cannot be claimed on a matter arising ex delicto. Jewett v. Ware, 107 Va. 802 , 60 S.E. 131 (1908).

Courts have held as to homestead exempt rights that in some instances, the homestead exemption is superior and in other cases that it must give way to rights of other parties; therefore, the homestead exemption cannot be claimed on a matter arising ex delicto. Epperley v. Woodyard, 4 Bankr. 124 (Bankr. W.D. Va. 1980).

Breach of contract cannot be converted into tort. - Where the right of recovery in an action rests solely upon the ground that the plaintiff has been damaged to a certain amount by a breach of contract on the part of the defendant and not by reason of a tort, the mere use of violent terms in characterizing the alleged fraud in the procurement of the contract and its breach will not suffice to convert the breach of the contract into a tort. Against a judgment obtained in such an action, the defendant may claim the benefit of the homestead exemption. Jewett v. Ware, 107 Va. 802 , 60 S.E. 131 (1908).

But breach of promise to marry is quasi tort. - The homestead exemption does not protect against a demand for damages for breach of promise to marry, which is not a debt contracted, but a quasi tort. Commonwealth v. Ford, 70 Va. (29 Gratt.) 683 (1878); Burton v. Mill, 78 Va. 468 (1884).

Homestead laws apply to fine for violation of federal law. - The homestead laws of Virginia apply to a fine imposed for a violation of the criminal laws of the United States, and the exemption allowed thereunder can be claimed as against a judgment for a fine in favor of the government. Allen v. Clark, 126 F. 738 (4th Cir. 1903).

But not to penalty for crime against Commonwealth. - See Whiteacre v. Rector, 70 Va. (29 Gratt.) 714, 26 Am. R. 420 (1878).

Insurance policy. - Since debtor's wife retained the right to rename a beneficiary in her insurance policy, debtor did not have an ownership right or a vested interest in his wife's policy that could be exempted pursuant to § 34-17 ; however, debtor could have amended his homestead deed to include the insurance proceeds he became entitled to after the time for filing his homestead exemption had expired. Ames v. Custis, 87 Bankr. 415 (Bankr. E.D. Va. 1988).

IV. EFFECT OF EXEMPTION.

The Virginia homestead exemption is not limited merely to the conservation of the family dwelling and adjoining land or curtilage because it may be claimed in real estate or tangible and intangible personal property. In re Howell, 106 Bankr. 99 (Bankr. W.D. Va. 1989).

Section does not change estate of householder. - This section does not create or vest in either the householder or his widow any other or different estate from that which they held before. The right of the widow, upon the death of the householder, is a mere personal right to occupy and possess the premises, unaccompanied by any new or additional title thereto or property interest therein. Murphy v. City of Richmond, 111 Va. 459 , 69 S.E. 442 (1910).

Exemption is of whole estate in land. - The real estate exempt is a unit and consists of the whole estate in the land, and not of a life estate with a remainder over. Virginia-Tennessee Coal & Iron Co. v. McClelland, 98 Va. 424 , 36 S.E. 479 (1900).

Crops raised on land are exempt. - Crops raised in the ordinary course of husbandry upon land previously set apart as a homestead are exempt from levy to the same extent as the land itself. Neblett v. Shackleton, 111 Va. 707 , 69 S.E. 946 (1911). See § 8.01-489 .

Prior involuntary lien gives way to homestead claim. - A lien acquired by judgment execution, or in any other manner than by voluntary act of the debtor himself, gives way to the debtor's claim to homestead exemption, even where the lien attached prior to the debtor's becoming a householder. Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901). See White v. Owen, 71 Va. (30 Gratt.) 43 (1878).

The householder may supplement the original homestead by a new one, so as to make the aggregate equal, but not exceed, the maximum of $2,000 (now $3,500). Oppenheimer v. Howell, 76 Va. 218 (1882). See § 34-21 .

Exemption may be claimed in debt assigned as collateral. - A householder may claim an exemption in a debt which has been assigned by him as collateral security for a loan, and the exemption will prevail over an execution on a debt in which homestead is not waived, and the assignee be entitled to priority over the execution creditor. Williams v. Watkins, 92 Va. 680 , 24 S.E. 223 (1896).

The debtor is entitled to exempt entirely such things as any personal injury action, the family Bible, wedding and engagement rings, a lot in a burial ground, and animals owned as pets, in addition to many other specific items the exemption of which are subject to monetary limitation. Addison v. Reavis, 158 Bankr. 53 (E.D. Va. 1993), aff'd, 32 F.3d 562 (4th Cir. 1994).

V. EXEMPTION IN BANKRUPTCY PROCEEDINGS.

Generally a creditor may not exercise right of setoff against exempt property. In re Ward, 210 Bankr. 531 (Bankr. E.D. Va. 1997).

The homestead exemption is independent of, and may be claimed in addition to, other available exemptions. In re Cathcart, 203 Bankr. 599 (Bankr. E.D. Va. 1996).

Debtors must comply strictly with the Virginia homestead laws in order to be entitled to claim exemptions thereunder for bankruptcy purposes. In re Redmon, 31 Bankr. 756 (Bankr. E.D. Va. 1983).

The failure of a debtor to comply with the Virginia homestead exemption laws precludes an exemption in bankruptcy. In re Emerson, 129 Bankr. 82 (Bankr. W.D. Va. 1991), aff'd, 962 F.2d 6 (4th Cir. 1992).

Where the debtors never claimed or perfected an exemption in their real property under § 34-4 , and were precluded from doing so after the fact, the proceeds of the sale of their real property remained, in their entirety, property of the estate. The trustee's objection, brought under Fed. R. Bankr. P. 4003(b), was sustained. In re Strickland,, 2010 Bankr. LEXIS 1037 (Bankr. E.D. Va. Mar. 30, 2010).

Effect of noncompliance with local county rule. - Where Chapter 7 debtors timely delivered properly executed homestead deeds with fees paid to the county setting the property apart as exempt pursuant to §§ 34-6 and 34-17 , but the debtors did not comply with a local county rule until the time period under § 34-17 had expired, the county rule did not render the claimed exemption void because enforcement of the local rule would have been inconsistent with the statutory provisions for claiming exemptions under Title 34 of the Virginia Code and would also have abridged the substantive rights of the debtors. In re Alley, 354 Bankr. 783, 2006 Bankr. LEXIS 2976 (Bankr. W.D. Va. 2006).

Trustee could setoff against debtors' homestead exemptions where debtors failed to turn over estate funds to trustee, which was a positive statutory duty. In re Ward, 210 Bankr. 531 (Bankr. E.D. Va. 1997).

How federal court must interpret Virginia exemptions. - Because Congress has the power under the Constitution to establish uniform bankruptcy laws, and has enacted a specific provision for exemptions, 11 U.S.C. § 522, a federal court must adopt an interpretation of Virginia's law with respect to exemptions that does not conflict with the act's exemption provision. Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981).

Right to discharge governed by federal law. - Although the scope of the homestead exemption is fixed by state law, the debtor's right to discharge is governed by federal law. In re Hayes, 119 Bankr. 86 (Bankr. E.D. Va. 1990).

Joint bankruptcy petition. - A husband and wife filing a joint bankruptcy petition may each separately claim a $5,000 exemption under this section in property in which each had an interest. In re Heath, 101 Bankr. 469 (Bankr. W.D. Va. 1987).

Husband and wife filing joint bankruptcy petition could each claim a $5000 homestead exemption. In re Ward, 210 Bankr. 531 (Bankr. E.D. Va. 1997).

In a case in which two Chapter 13 bankruptcy debtors appealed the bankruptcy court's denial of their motion to avoid the judgment lien of two creditors, the bankruptcy court's decision centered on the tenancy by the entirety exception found in 11 U.S.C.S. § 522(b)(3)(B). However, the debtors original motion to avoid indicated that they sought avoidance under the homestead exemption found in § 34-4 ; since the bankruptcy did not address the homestead exemption, its decision was in error as a matter of law. Wharton v. Beneficial,, 2010 U.S. Dist. LEXIS 21473 (W.D. Va. Mar. 9, 2010).

Nonresident debtor entitled to exemptions under alternative provisions of federal law. - Where debtor, resident of District of Columbia for two months, filed a petition for voluntary relief in Virginia court as she had resided in Commonwealth for greater portion of 180-day residency requirement under 11 U.S.C. § 522(b), but could not receive Virginia exemption as she was not resident in Virginia, she was entitled to exemptions under alternative provisions of 11 U.S.C. § 522(b), due to the certainty of congressional intent that every debtor have exemptions to enable him a fresh start and due to the inapplicability of Virginia state law of exemptions to debtor. In re Hawkins, 15 Bankr. 618 (Bankr. E.D. Va. 1981).

Nonjudgment creditors may object to allowance of exemption to bankrupt. - In bankruptcy proceedings creditors are not precluded from objecting to the allowance of a homestead exemption because they are not armed with executions against the bankrupt. In proceedings in bankruptcy the property is in effect "seized" or "levied upon" within the meaning of this section, as much in behalf of nonjudgment creditors as of any party in interest. In a voluntary case the debtor surrenders his property, and when he claims some or all of it as exempt, he is asking that such property be not "sold" under judicial "process" or "order." In re Campbell, 124 F. 417 (W.D. Va. 1903).

Homestead will not be allowed for benefit of waiver creditors. - The homestead exemption will not be allowed where the homestead waiver creditors, and not the bankrupt's family, will secure the benefit thereof. In re Garner, 115 F. 200 (W.D. Va. 1902).

Effect of sale of goods after petition filed. - The proceeds derived from goods sold by a bankrupt between the time of the petition in bankruptcy and the adjudication were exempt, where the bankrupt could have claimed the goods as part of his homestead exemption if he had held them instead of selling them. In re Wilson, 108 F. 197 (W.D. Va. 1901).

The debtor may amend upward the valuation stated on the schedule if and when the bankruptcy court determines that a higher value is more appropriate for that item. Addison v. Reavis, 158 Bankr. 53 (E.D. Va. 1993), aff'd, 32 F.3d 562 (4th Cir. 1994).

Wages listed as part of homestead. - Virginia homestead deed is designed to protect a certain amount of debtor's property from creditors and where debtor listed his wages as part of his homestead, he intended to insulate that asset from his creditors. Where debtor filed his homestead deed on June 10, and a summons in garnishment was returnable June 12, he is entitled to his wages, notwithstanding the intervening bankruptcy, because wages are not subjected by sale or otherwise before recordation of homestead deed. Baum v. United Va. Bank, 15 Bankr. 538 (Bankr. E.D. Va. 1981).

Husband and wife may each claim a homestead exemption in tenancy by the entireties properties where they have filed separate, voluntary petitions in bankruptcy. Roberts v. County of Henrico Fed. Credit Union, 709 F.2d 275 (4th Cir. 1983).

Exemptions allowed where debtors were state residents at time of filing homestead deed. - Debtors, residents of the Commonwealth, who shipped all of their household goods out-of-state, subsequently filed a homestead deed in Virginia and then moved to Florida while their attorney filed petitions in bankruptcy in Virginia, were allowed their requested exemptions since they were residents of Virginia at the time of the homestead deed filing. In re Chaffins, 16 Bankr. 686 (Bankr. E.D. Va. 1982).

Amendment of deed and schedules to show increase in appraised value. - Having set apart the property in her original homestead deed, the debtor may increase the value originally stated for the property in both the homestead deed and the schedules filed with the court so as to reflect the results of an appraisal showing an increase in value. In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982).

Conversion of property from nonexempt to exempt on eve of bankruptcy. - Mere conversion of property from nonexempt to exempt on the eve of bankruptcy - even though the purpose is to shield the asset from creditors - is not enough to show fraud. However, if the transfer of property occurs within one year of the bankruptcy filing and there is evidence to indicate a fraudulent purpose aside from the mere conversion of nonexempt property, the claimed exemption is subject to the fraudulent transfer provision of 11 U.S.C. § 727. Ford v. Poston, 773 F.2d 52 (4th Cir. 1985).

Claim of exemption in bankruptcy does not automatically overcome liens docketed in land records if debtor's homestead deed precedes execution upon the liens. A homestead deed does not extinguish judgment liens against exempt property, but merely prevents seizure and sale of the encumbered property in order to satisfy the debt underlying the lien. Absent a lien avoidance proceeding under § 522(f), of the Bankruptcy Code (11 U.S.C. § 522(f)), liens survive a discharge in bankruptcy and continue in force even on exempt homestead property. A subsequent purchaser of encumbered homestead property takes the property subject to creditors' liens. Barzee v. Trammel, 63 Bankr. 878 (Bankr. E.D. Va. 1986).

A debtor's property may be sold and the homestead paid in cash rather than kind. In re Spraker, 128 Bankr. 727 (Bankr. W.D. Va. 1991).

A creditor may liquidate property in which the creditor has a lien but that is subject to a claimed homestead exemption, and the homestead claimant is entitled to satisfy the exemption from the cash proceeds of sale of the property remaining after liens are satisfied. In re Spraker, 128 Bankr. 727 (Bankr. W.D. Va. 1991).

A debtor may not be denied his homestead exemption because of fraudulent conduct. In re Hayes, 119 Bankr. 86 (Bankr. E.D. Va. 1990).

Where, as in Virginia, state law does not provide for the denial of the homestead exemption for fraudulent conduct, the proper course of conduct for the trustee to follow is to object to discharge. In re Hayes, 119 Bankr. 86 (Bankr. E.D. Va. 1990).

Virginia law requires filing homestead deed on or before bankruptcy petition. - Virginia exemption law allows each debtor to exempt up to $5,000 of real or personal property as a homestead exemption. However, in order to perfect the taking of the exemption, Virginia law requires the filing of a homestead deed claiming the exemption on the day of or before filing the petition in bankruptcy. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

The bankruptcy court did not err in denying confirmation of the debtors Chapter 11 Plan of Reorganization which proposed that the remaining unencumbered assets of the debtors be liquidated and the debtors be permitted the benefit of the Homestead Exemption pursuant to this section, where the debtors had not filed their homestead deeds. Smith v. Dairymen, Inc., 75 Bankr. 365 (W.D. Va. 1987).

However, perfecting not prerequisite to consideration under Chapter 13. - A Virginia debtor proceeding under Chapter 13 of the Bankruptcy Code (involving reorganization) is not required to perfect his homestead exemption, pursuant to this title, as a prerequisite to the bankruptcy court's considering that exemption in conducting the "best interests of the creditors" test required by Chapter 13. Grenco Real Estate Inv. Trust v. Morris, 48 Bankr. 313 (W.D. Va. 1985).

Debtor's lease obligation had to be subtracted from corporate assets in order to accurately reflect the value of his stock in the hands of the trustee. Monticello Arcade Ltd. v. Lyall, 191 Bankr. 78 (E.D. Va. 1996).

Note received as payment for property held by entirety. - A bankruptcy debtor was co-owner of a promissory note, along with his wife, received for the sale of real property owned as tenants by the entirety. The debtor's interest in the note became part of his estate when his petition was filed. The debtor was entitled to amend his homestead deed to exempt up to that amount allowed under Virginia law, the remainder of his interest in the note becoming part of the estate for the benefit of creditors. In re Berkovics, 50 Bankr. 223 (Bankr. E.D. Va. 1985).

Waiver of exemption in deed of trust. - Debtors in bankruptcy may avoid a judgment lien on their property to the extent that it impairs their homestead exemption, despite waiver of the homestead exemption in a deed of trust, pursuant to 11 U.S.C. § 522 (f). Blevins v. Bank of Marion, 53 Bankr. 74 (Bankr. W.D. Va. 1985).

Waiver of exemptions. - Because the debtors did not claim their exemptions until 13 days following the date scheduled for the first meeting of creditors, under § 34-17 , those exemptions were waived. Bryant v. Smith, 165 Bankr. 176 (W.D. Va. 1994).

Later lien avoidance was not possible. - Where debtor did not claim the subject property exempt in schedule B-4 of his bankruptcy petition and the time had expired for him to file a homestead exemption, debtor could not later avoid liens on property that he did not set apart as exempt. In re Wall, 127 Bankr. 353 (Bankr. E.D. Va. 1991).

Valuation of property for purpose of determining impairment by lien. - The fair market value of the debtors' property is the proper value to be used in determining whether an exemption is impaired by a creditor's lien. Washington v. Virginia State Educ. Assistance Auth., 41 Bankr. 211 (Bankr. E.D. Va. 1984).

Exemption not impaired where equity does not exceed unavoidable liens. - Where the debtor has no equity in the real estate over and above unavoidable liens the defendant's lien does not impair the debtor's exemption appropriately claimed under this section. Washington v. Virginia State Educ. Assistance Auth., 41 Bankr. 211 (Bankr. E.D. Va. 1984).

Lien as impairing exemption. - Under Virginia law, a creditor's lien arose on the date that a writ of fieri facias and garnishment summons were served on a bank and debtor's accounts were frozen, but on the date that debtor filed his bankruptcy petition, the funds were still on deposit and had not been delivered to the state court. Thus, the garnished funds did not vest in the creditor, as the automatic stay was in place prior to the time when the state court could have ordered payment of the funds to the creditor, and debtor was entitled to avoid the creditor's judgment lien as impairing his exemption in those funds. In re Underwood,, 2018 Bankr. LEXIS 1573 (Bankr. W.D. Va. May 30, 2018).

Lien did not impair exemption. - Debtor had an interest in a portion of the sale proceeds of the marital home when he filed his bankruptcy petition, and as his judgment creditor had not finally executed its judgment lien on the sale proceeds on the date of the petition, the lien attached to the sale proceeds, subject to the debtor's ability to exempt the proceeds; as the debtor timely claimed a homestead exemption in $3000 of the proceeds and the lien was valid as to nonexempt property, when the automatic stay terminated, the creditor could exercise its state law remedies except as to the $3000 exemption. Roadcap v. Harrisonburg Printing & Graphics, LLC (In re Roadcap), 590 Bankr. 747, 2018 Bankr. LEXIS 2528 (Bankr. W.D. Va. 2018).

Right to amend interest upward. - In the present case, the debtor recorded a homestead deed claiming his interest in the funds exempt in the amount of $1, as per Virginia custom; accordingly the debtor retained the right to amend upward, to the extent of the unused amount of his homestead exemption. In re Zella, 196 Bankr. 752 (Bankr. E.D. Va.), aff'd, 202 Bankr. 712 (E.D. Va. 1996).

Right to amend interest downward. - Debtors were not permitted to reduce the amount of exemptions claimed on a prior recorded homestead deed and use the resulting excess exemption amount in an attempt to exempt funds that represented the proceeds of the sale of a distribution contract because debtors had a property interest in the contract on the petition date and did not exempt it. Debtors offered no facts to explain why the proceeds from the sale should be treated as anything other than proceeds of a pre-petition asset. In re Jackson,, 2018 Bankr. LEXIS 2106 (Bankr. W.D. Va. July 17, 2018).

If the debtors have no equity in the property claimed as exempt, such as if the balance due on an obligation secured by a first deed of trust exceeds the value of the property, then although the exemption is properly claimed there is no equity to which the exemption may attach and, therefore, no exemption is impaired by the lien. Washington v. Virginia State Educ. Assistance Auth., 41 Bankr. 211 (Bankr. E.D. Va. 1984).

When a debtor's home is encumbered by consensual unavoidable mortgage liens exceeding its value, the debtor holds only bare legal title and only that legal interest passes to the estate; the equitable interest remains with the mortgage holders. When a debtor's exemption in property has no economic value and consist merely of bare legal title, then the debtor's exemption is not impaired because its amount cannot logically be diminished by the judicial lien. Accordingly, the court denied debtors' motion to avoid the lien held by bank because it did not impair an exemption the debtors would have been entitled absent the lien. Sheaffer v. Marshall Nat'l Bank & Trust Co., 159 Bankr. 758 (Bankr. E.D. Va. 1993).

In a case in which a debtor appealed a bankruptcy court's determination that she was not entitled to avoid a judicial lien under 11 U.S.C.S. § 522(f), since she had not claimed an exemption in the residential property subject to the lien, § 522(f) did not require that a debtor actually claim an exemption in the property subject to a judicial lien; instead, the statute only required that the lien impair an exemption to which the debtor would have been entitled under subsection (b) in the absence of any liens. Under § 34-5 , the debtor had been precluded from claiming a homestead exemption in her residential property. Botkin v. Dupont Cmty. Credit Union, 432 Bankr. 230, 2010 U.S. Dist. LEXIS 48164 (Bankr. W.D. Va. 2010).

Amendment of homestead deed after filing of petition. - Although Virginia law would appear at first blush to be such as to foreclose any amendments to a homestead deed after the filing of a petition in bankruptcy, except for adjustments in the valuation of property already claimed exempt, this is not in fact a complete picture. Whether or not one can properly claim an exemption depends, in the first instance, on whether the debtor owns or has an interest in the subject property. Where the debtor does not have ownership or some other interest in the property when filing the homestead deed prior to bankruptcy, then § 34-17 is inapplicable. In re Smith, 45 Bankr. 100 (Bankr. E.D. Va. 1984).

Trust interest. - Under this section, a debtor may exempt any real or personal property not available for exemption under the specific Title 34 exemption provisions, up to a limit in value of $5,000. The debtor could thus shelter a portion of his trust interest from creditors, provided his total exemptions under this section did not surpass the $5,000 cap. In re Hersch, 57 Bankr. 667 (Bankr. E.D. Va. 1986).

Exemption disallowed. - Chapter 7 debtors were not entitled under 11 U.S.C.S. § 522(b) to claim an exemption under the Virginia homestead exemption, § 34-4 , in payments they made to creditors during the preference period because the Virginia homestead exemption did not permit one to claim an exemption in property that he owned but which he had since used to pay a valid debt. In re Conley, 478 Bankr. 803, 2003 Bankr. LEXIS 2441 (Bankr. W.D. Va. July 30, 2003).

11 U.S.C.S. § 522(g)(1)(A) precluded debtors from exempting under the Virginia homestead exemption, § 34-4 , payments they made to creditors during the preference period because the payments were made voluntarily. In re Conley, 478 Bankr. 803, 2003 Bankr. LEXIS 2441 (Bankr. W.D. Va. July 30, 2003).

Creditor's objection to debtor's claimed exemptions was overruled, where the objection failed to set forth any legal basis for disallowance of the claimed exemptions. In re Vuong,, 2006 Bankr. LEXIS 361 (Bankr. E.D. Va. Feb. 6, 2006).

Debtor's federal tax refund fell within the statutorily provided value provisions in § 34-4 ; however, she failed to list the federal tax refund on her Schedule C as required by Fed. R. Bankr. P. 4003(a). Thus, she failed to properly claim an exemption and was ordered to turnover to the trustee her federal and state tax refunds, but was granted leave to move to amend her schedules pursuant to Fed. R. Bankr. P. 1009(a). Harris v. Banks (In re Banks), 443 Bankr. 708, 2011 Bankr. LEXIS 336 (Bankr. W.D. Va. Jan. 25, 2011).

Trustee's objection to Chapter 13 debtor's Amended Schedule C insofar as debtor claimed exemption in his post-petition wages was sustained because any claim of exemption for post-petition wages; whether under Virginia's wage exemption statute or Virginia's wildcard exemption statute, was fundamentally inconsistent with requirement that debtor devote all of his disposable income to his Chapter 13 plan. In re Cantu, 553 Bankr. 565, 2016 Bankr. LEXIS 2585 (Bankr. E.D. Va. 2016), aff'd, 713 Fed. Appx. 200, 2017 U.S. App. LEXIS 25487 (4th Cir. 2017).

Unauthorized practice of law. - Defendant who assisted debtors who filed bankruptcy in nine separate cases violated 11 U.S.C.S. § 110(e)(2)(A) and engaged in the unauthorized practice of law when she provided the debtors with a list of exemptions they could claim under Virginia law, prepared motions for several of the debtors, and prepared a homestead deed for one of the debtors pursuant to § 34-4 , and the court required defendant to pay a $2,000 fine to each of the debtors in all nine cases, ordered defendant to return fees she received from the debtors, pursuant to § 110(h)(3)(B), ordered defendant to pay the United States Trustee $1,200 for violating § 110(b)(1), and ordered defendant not to engage in further conduct as a bankruptcy petition preparer that violated the Bankruptcy Code. There was no merit to defendant's argument that she did not practice law because she obtained forms she used from the Internet or from an attorney and made only minor modifications to those forms. McDow v. Skinner (In re Jay), 446 Bankr. 227, 2010 Bankr. LEXIS 2763 (Bankr. E.D. Va. Aug. 17, 2010).

CIRCUIT COURT OPINIONS

Return of garnished funds. - Any funds paid by a garnishee to the court or directly to the judgment creditor prior to the return date on the garnishment summons had to be returned to the judgment debtor because his claim for homestead and dependent spouse exemptions were timely and his homestead deed was appropriately filed. Trident Sys. v. Reber, 88 Va. Cir. 394, 2014 Va. Cir. LEXIS 45 (Fairfax County June 25, 2014).

§ 34-4.1. Additional exemption for certain veterans.

Every veteran residing in this Commonwealth having a service connected disability of forty percent or more, as rated by the U.S. Department of Veterans Affairs, shall be entitled, in addition to the property or estate which he is entitled to hold exempt from creditor process under §§ 34-4 , 34-26 , 34-27 , 34-29 , and 64.2-311 , to hold exempt from creditor process his real and personal property, or either, to be selected by him by the writings required by §§ 34-6 and 34-14 , including money and debts due him, not exceeding $ 10,000 in value.

(1966, c. 499; 1977, c. 496; 1978, c. 231; 1990, c. 942; 1993, c. 150; 2009, c. 388.)

Editor's note. - At the direction of the Virginia Code Commission, the reference to "64.1-151.3" was changed to "64.2-311" to conform to the recodification of Title 64.1 by Acts 2012, c. 614, effective October 1, 2012.

At the direction of the Virginia Code Commission, "U.S. Department of Veterans Affairs" was substituted for "Veterans Administration of the United States."

The 2009 amendments. - The 2009 amendment by c. 388 substituted "$10,000" for "$2,000."

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Executions and Attachments, §§ 8, 13.

§ 34-4.2. Additional exemption for parents of dependent children.

  1. Where a parent supports a dependent minor child or children residing with him, that parent can hold exempt from wage garnishment, in addition to the property or estate that he is entitled to hold exempt from creditor process under §§ 20-108.1 , 34-4 , 34-4 .1, 34-26 , 34-27 , 34-29 , and 64.2-311 , an additional amount for the support of the child or children as follows: $34 per week for one child; $52 per week for two children; and $66 per week for three or more children. This additional wage exemption amount shall not be available to a parent whose household gross income, including any support payments for children living in the home, exceeds $1,750 per month. For purposes of this section, "household gross income" means all income from all sources, and shall include, but not be limited to, salaries, wages, commissions, royalties, bonuses, dividends, severance pay, pensions, interest, trust income, annuities, capital gains, social security benefits, workers' compensation benefits, unemployment insurance benefits, disability insurance benefits, veterans' benefits, child support, spousal support, rental income, gifts, prizes or awards paid to any adult living in the household or to the dependent child.
  2. To claim this wage exemption, the parent shall attach to the claim for exemption form set forth in § 8.01-512.4 an affidavit and two items of proof showing that the debtor is entitled to this additional wage exemption. The affidavit shall contain the following statement: (2009, c. 332.)

AFFIDAVIT CONCERNING DEPENDENT CHILDREN

AND HOUSEHOLD INCOME

Having been duly sworn, I, . . . . . . . . . . ., depose and state the following to be true, accurate and complete: 1. I support . . . . . . (number) dependent children, whose names and ages are as follows. For each child I have included the amount of monthly child support I receive (including voluntary support payments and payments made pursuant to a court or administrative order), and, if the child is employed or has other income, the amount of the child's gross monthly income. (If you receive no support for the child and the child has no income, insert zero.) Full legal name of child Age Child's gross monthly support and income .................... ...... .................... .................... ...... .................... .................... ...... .................... .................... ...... .................... (attach additional pages if necessary) 2. My personal gross monthly income, not including any of the above amounts, is $. . . . . . . . 3. The following are the names and gross monthly incomes of all people who reside with me in the same house, apartment or other dwelling, other than the above-named dependent minor child or children. (If the household resident has no income, insert zero.) Full legal name of household residents Gross monthly income .................... .................... .................... .................... .................... .................... .................... .................... (attach additional pages if necessary) 4. I swear or affirm that no person other than the above-named individuals resides with me and that I reside with no person other than the above-named individuals. . . . . . . . . . . . . (signature of debtor) . . . . . . . . . . . . (date) Commonwealth of Virginia: City/County of . . . . . . . . . . ., to wit: Subscribed and sworn to before me, the undersigned Notary Public, this . . . . . . . day of . . . . . . (month), . . . . . .. (year) Notary Public: . . . . . . . . . . .. My commission expires: . . . . . . . . . . ..

Editor's note. - At the direction of the Virginia Code Commission, the reference to "64.1-151.3" was changed to "64.2-311" to conform to the recodification of Title 64.1 by Acts 2012, c. 614, effective October 1, 2012.

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 4 Garnishment. § 4.7 Wages and Statutory Exemptions. Rendleman.

Friend's Virginia Pleading and Practice (Matthew Bender). Chapter 22 Enforcement of Judgments. § 22.08 Garnishment. Friend.

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Executions and Attachments, § 8.

§ 34-5. To what debts exemptions shall not apply.

The property exemptions created under this Code shall not be claimed against the following debts:

  1. For the purchase price of such property or any part thereof. If the property purchased and not paid for is exchanged for or converted into other property by the debtor, such last named property shall not be exempted from the payment of such unpaid purchase money.
  2. For spousal or child support obligations.

    (Code 1919, § 6531; 1918, p. 487; 1956, c. 637; 1986, c. 218; 1990, c. 942; 1991, c. 256; 2010, c. 550.)

Cross references. - As to fraudulent and voluntary conveyances generally, see § 55.1-400 et seq.

The 2010 amendments. - The 2010 amendment by c. 550 reenacted the section without change.

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985). For survey on creditors' rights in Virginia for 1989, see 23 U. Rich. L. Rev. 561 (1989).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 2 Collection of Money Judgments from Personal Property. § 2.3 Relief from Levy. See also, §§ 2.10, 3.5, 3.7, etc. Rendleman.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, §§ 76, 77; 5B M.J. Criminal Procedure, § 104; 7A M.J. Estoppel, § 10; 8A M.J. Exemptions from Execution and Attachment, §§ 8, 10, 22; 9A M.J. Fraudulent and Voluntary Conveyances, § 43.

CASE NOTES

I. GENERAL CONSIDERATION.

The plain language of this section prohibits the claim of an exemption in property against a debt for the purchase price of that property. In re Johnson, 179 Bankr. 800 (Bankr. E.D. Va. 1995).

Not applicable to judgment liens. - The Virginia homestead exemption is not applicable to judgment liens for wages. Davis v. Lester, 97 Bankr. 292 (Bankr. W.D. Va. 1989).

Exemption involving intentional tort allowed. - Because Congress specifically legislated as to the type of claims that can be enforced against exempt property, and since the plaintiff's claim did not fall within any of the enumerated exceptions, the court concluded that the debtor was entitled to her exemptions notwithstanding that the plaintiff held a nondischargeable claim based on an intentional tort. In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

Applied in Epperley v. Woodyard, 4 Bankr. 124 (Bankr. W.D. Va. 1980); O'Malley v. Rapidan River Farm, 24 Bankr. 900 (E.D. Va. 1982); Barnes v. McCarthy, 29 Bankr. 677 (Bankr. W.D. Va. 1983); Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991); Botkin v. DuPont Cmty. Credit Union, 650 F.3d 396, 2011 U.S. App. LEXIS 11974 (4th Cir. 2011).

II. PURCHASE PRICE.

Exemptions under both §§ 34-4 and 34-26 cannot be claimed against debts for the purchase price of the property, or for any part of the purchase price. In re Johnson, 179 Bankr. 800 (Bankr. E.D. Va. 1995).

Demand for purchase money is superior to homestead exemption. - Homestead exemptions do not extend to any execution, order or other process issued on any demand for payment of the purchase money due upon the goods. Wray v. Davenport, 79 Va. 19 (1884).

To extent of market value of goods. - The market value of so much of the goods on hand and not paid for at the time of a debtor's death is the full measure of the seller's recovery superior to the claim of homestead of the debtor's infant children. Edgewood Distilling Co. v. Rosser, 116 Va. 624 , 82 S.E. 716 (1914).

Bankrupt must identify unpaid-for goods. - It is the duty of a bankrupt who wishes to take advantage of the homestead exemption to identify and designate the goods on which, in whole or in part, he still owes the purchase money, in order that the trustee may set apart as exempt such as have been paid for. If the bankrupt is unable to do this, having so intermingled the goods for which he has not paid with others that have been paid for as to make it impossible to designate the class for which he still owes, no homestead can be set apart in any of the goods. In re Tobias, 103 F. 68 (W.D. Va. 1900).

Or no exemption will be allowed. - Where a large portion of goods claimed as exempt has not been paid for, and is so mingled with those that have been as to put it out of the power of the vendors to distinguish between the two, the onus is on the person claiming the exemption to show which has been paid for; and he failing to do this, they will all be treated as not having been paid for, as far as the homestead deed is concerned, and therefore not exempt under the law. Rose v. Sharpless & Son, 74 Va. (33 Gratt.) 153 (1880).

In a case in which a debtor appealed a bankruptcy court's determination that she was not entitled to avoid a judicial lien under 11 U.S.C.S. § 522(f), since she had not claimed an exemption in the residential property subject to the lien, § 522(f) did not require that a debtor actually claim an exemption in the property subject to a judicial lien; instead, the statute only required that the lien impair an exemption to which the debtor would have been entitled under subsection (b) in the absence of any liens. Under § 34-5 , the debtor had been precluded from claiming a homestead exemption in her residential property. Botkin v. Dupont Cmty. Credit Union, 432 Bankr. 230, 2010 U.S. Dist. LEXIS 48164 (Bankr. W.D. Va. 2010).

And burden of proving payment is on him. - In bankruptcy proceedings, where the creditors except to the report of the trustee setting apart the bankrupt's homestead exemption under § 34-4 , on the ground that the articles claimed as exempt have not been paid for, the burden of proving that the articles have been paid for should rest on the bankrupt. In re Campbell, 124 F. 417 (W.D. Va. 1903).

Any creditor may except to the allowance of a homestead exemption to a bankrupt on the ground that the goods set apart have not been paid for, without showing that the excepting creditor is the vendor of the goods, because, under the federal bankruptcy law, every creditor shares pro rata in the fund that may be saved to the estate by such objection. In re Campbell, 124 F. 417 (W.D. Va. 1903).

Where the creditor is not pursuing an action for the purchase price of its collateral, it is not entitled to the protection of subdivision 1. Dominion Bank v. Nuckolls, 780 F.2d 408 (4th Cir. 1985).

Where creditor gave debtor a check for the price of a new car made out to the dealership, this section was not applicable and did not invalidate debtor's exemption on the basis that debtor had not paid the purchase price for the car, since creditor merely made a personal loan to debtor and the automobile dealership was the actual vendor. Jones v. Kirsch, 93 Bankr. 77 (E.D. Va. 1988).

Failure to perfect security interest of no import. - Pursuant to this section, the "poor debtor's exemption" cannot be claimed against a debt for the purchase price of property or any part thereof; thus, creditor's failure to perfect its security interest in debtor's car had no bearing. In re Bonner, 206 Bankr. 387 (Bankr. E.D. Va. 1997).

III. LIABILITIES INCURRED BY OFFICER, FIDUCIARY, OR ATTORNEY FOR MONEY COLLECTED.

Former exemption applied to collector of taxes and his sureties. - The former third exemption embraced the liabilities of a collector of taxes and also of his sureties in his official bond. And therefore the sureties were not entitled to their homestead exemption as against the Commonwealth in a proceeding against them and their principal to recover the amount of taxes for which the collector had failed to account. Commonwealth v. Ford, 70 Va. (29 Gratt.) 683 (1878).

Fiduciary liabilities. - Where the complainant agreed that the defendant should have one-third of the profits of the resale of land purchased at a judicial sale, although there arose from the transaction a fiduciary relationship and not a mere contract of employment, the complainant was not such a fiduciary as was contemplated by former subdivision (3) of this section. Therefore a recital in the decree, against the complainant, that "homestead exemption waived by reason of the fact that this is a fiduciary debt due" from the complainant to the defendant, was improper. Alexander v. Critcher, 121 Va. 723 , 94 S.E. 335 (1917).

Judgment rendered against a convicted defendant for court costs in a criminal case is not rendered on any demand for a debt or liability contracted by him. Wicks v. City of Charlottesville, 215 Va. 274 , 208 S.E.2d 752 (1974), appeal dismissed, 421 U.S. 901, 95 S. Ct. 1548, 43 L. Ed. 2d 769 (1975).

IV. SHIFTING STOCK OF MERCHANDISE.

A stock of merchandise ceases to be shifting upon the death of the owner thereof, and becomes fixed and stable, and it or the proceeds of the sale thereof may be subject to the claim of homestead by the infant children of the former owner. Edgewood Distilling Co. v. Rosser, 116 Va. 624 , 82 S.E. 716 (1914).

A failing debtor cannot transmute a shifting stock of merchandise not exempt into exempt property by withdrawing it from sale for the purpose of claiming it as an exemption. Laderburg v. Miller, 210 F. 614 (4th Cir. 1913).

Destruction by fire or other casualty. - When a shifting stock of merchandise was absolutely destroyed by fire, the stock not only ceased to be shifting, but ceased to exist, and the claim of the owner to money due under his contract of insurance became fixed and stable. The claim was not to a shifting stock of merchandise; it was specifically for "money and debts due," a classification of property entitled to be claimed as exempt. Goldburg Co. v. Salyer, 188 Va. 573 , 50 S.E.2d 272 (1948).

The inclusion in the seventh exception of three specific exceptions in the classification of property not exempt excludes any implication of an exception where the merchandise has been destroyed by fire or other casualty. Goldburg Co. v. Salyer, 188 Va. 573 , 50 S.E.2d 272 (1948).

V. FRAUDULENT CONVEYANCES.

Rights of innocent grantee under fraudulent conveyance. - Where property has been conveyed, directly or indirectly, by a husband to his wife, and the conveyance has been set aside at the instance of his creditors on the ground of fraud or want of consideration, the husband cannot claim a homestead exemption in the property so conveyed, nor can his widow and children claim such exemption after his death. But where it appears that the wife has been guilty of no actual fraud, and that she has, out of her own means, discharged a purchase-money lien on the property, the lien will be treated as in force for her protection, and she will be subrogated to the rights of the lienor. Dickenson v. Patton, 110 Va. 5 , 65 S.E. 529 (1909).

VI. RENT.

Subdivision (5) impermissibly alters 11 U.S.C. § 522(c). - The Bankruptcy Code specifically intended to eliminate state-created priorities especially those provided to landlords. Therefore, what subdivision (5) of this section does is to give the creditor a priority or preference over almost every other creditor. It also places rent creditors in the class of creditors which may reach exempt property thereby impermissively altering the federal law found in 11 U.S.C. § 522(c). In doing so, the Virginia statute disrupts the federal distribution scheme and its underlying goal of equality among classes of creditors. Moreover, it disrupts the second major goal of the Bankruptcy Reform Act of 1978, which is to provide a debtor with a fresh start after bankruptcy, by permitting this creditor to collect a dischargeable debt out of otherwise exempt property.(decided prior to 1990 amendment) In re Shines, 39 Bankr. 879 (Bankr. E.D. Va. 1984) But see In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

Subdivision (5) does not establish state-created debt nondischargeable in bankruptcy. - Although subdivision (5) of this section constitutes a state-created priority and has the effect in a bankruptcy proceeding of permitting this creditor to collect most of a dischargeable debt, it does not, in fact, create a state-created nondischargeable debt.(decided prior to 1990 amendment) In re Shines, 39 Bankr. 879 (Bankr. E.D. Va. 1984) But see In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

Creditor for rent may garnish otherwise exempt wages. - A creditor for rent is one of the classes of creditors that may collect their obligation out of property that is otherwise properly claimed as exempt under the homestead laws. Therefore, the debtors' claim of exemption in garnished wages is inapplicable.(decided prior to 1990 amendment) In re Shines, 39 Bankr. 879 (Bankr. E.D. Va. 1984) But see In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

§ 34-6. How exemption of real estate secured; form to claim exemption of real property.

In order to secure the benefit of the exemptions of real estate under §§ 34-4 and 34-4.1 , the householder, by a writing signed by him and duly admitted to record, to be recorded as deeds are recorded, in the county or city wherein such real estate or any part thereof is located or, if such property is located outside of the Commonwealth, in the county or city in the Commonwealth where the householder resides, shall declare his intention to claim such benefit and select and set apart the real estate to be held by the householder as exempt, and describe the same with reasonable certainty, affixing to the description his cash valuation of the estate so selected and set apart. However, if such real estate is claimed exempt in a case filed under Title 11 of the United States Code, the official Schedule of Property Claimed as Exempt filed in the United States Bankruptcy Court claiming such exemptions shall be sufficient to set apart such property as exempt. Equitable as well as legal estates may be so selected and set apart. The following form, or one which is substantially similar, shall be used and shall be sufficient for the writing required by this section: HOMESTEAD DEED FOR REAL PROPERTY Name of Householder ____________________________________ Name of title holder of record (if different) ____________________________________ Is the householder a disabled veteran entitled to claim the additional exemption under § 34-4.1 ? ________________________________ Address of Householder ____________________________________ Name(s) and age(s) of dependent(s) ____________________________________ County/city/state in which real property claimed as exempt is located ____________________________________ ____________________________________ Description of property claimed as exempt ____________________________________ ____________________________________ Value of property described above ____________________________________ Number of homestead deeds that have been filed by the Householder ____________________________________ Exemption amount previously claimed on prior homestead deeds ____________________________________ List the jurisdictions where previous homestead deeds were filed ____________________________________ ____________________________________ (Signature of Householder) ____________________________________ [ACKNOWLEDGMENT]

Such writing or deed shall not be required to secure any exemption under this Code except those exemptions created by §§ 34-4 and 34-4.1 .

(Code 1919, § 6532; 1990, c. 942; 1993, c. 150; 1998, c. 331; 2008, c. 224; 2019, c. 492; 2020, c. 328.)

Cross references. - As to setting aside of personalty, see note to § 34-14 .

Editor's note. - Acts 2020, c. 328, cl. 2 provides: "That the Executive Secretary of the Supreme Court of Virginia shall promulgate and update the forms necessary to comply with the provisions of the first enactment of this act."

The 1998 amendment, in the first paragraph, in the first sentence, inserted "and if such property is located outside of the Commonwealth, in the county or city where the householder resides"; and in the deed form, added "Name of title holder of record (if different)" and inserted "/state" following "County/city."

The 2008 amendments. - The 2008 amendment by c. 224 inserted the last three entries in the form relating to number, amount of exemption and jurisdictions of previously filed homestead deeds.

The 2019 amendments. - The 2019 amendment by c. 492 substituted "or, if such property is located" for "and, if such property is located" and inserted "in the Commonwealth" in the first paragraph.

The 2020 amendments. - The 2020 amendment by c. 328, added the second sentence.

Law review. - For survey of Virginia law on property for the year 1969-1970, see 56 Va. L. Rev. 1546 (1970). For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 5 Creditors' Bill to Collect Judgment Liens. § 5.4 The Order of Reference. See also, §§ 2.10, 3.5, 3.7, etc. Rendleman.

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Execution and Attachment, §§ 10, 12, 13; 15 M.J. Recording Acts, § 6.

CASE NOTES

Purpose of deed of homestead. - The deed of homestead is merely designed to set apart and designate the portions of his property which the owner claims to hold exempt from seizure and sale under any execution, order or other legal process, and to give notice of it to the world. White v. Owen, 71 Va. (30 Gratt.) 43 (1878); Linkenhoker v. Detrick, 81 Va. 44 (1885).

The homestead exemption is independent of, and may be claimed in addition to, other available exemptions. In re Cathcart, 203 Bankr. 599 (Bankr. E.D. Va. 1996).

There is no statutory requirement to file a copy of the Homestead Deed in the active case file. In re Preston, 96 Bankr. 61 (Bankr. W.D. Va. 1989).

Effect of failure to set apart homestead. - If a party claiming an exemption fails to select and set apart the property which he is entitled to hold, he has failed to avail himself of the right he was entitled to hold in such property, and his right of exemption, if not exercised before sale, is gone. Reed v. Union Bank, 70 Va. (29 Gratt.) 719 (1878).

Claim in schedule filed by bankrupt is insufficient. - The mere act of a bankrupt in claiming a homestead exemption in the schedule filed by him is not a compliance with this section. In re Garner, 115 F. 200 (W.D. Va. 1902).

Value of exempted property improperly claimed. - Bankruptcy debtor improperly claimed exemptions by listing the value of the exempted property as 100 percent of the fair market value of the property, since §§ 34-6 and 34-14 strictly required that the debtor state a dollar amount of the value of the exempt property and the exemption, and the debtor's non-numerical values did not satisfy the requirement. In re Stoney, 445 Bankr. 543, 2011 Bankr. LEXIS 566 (Bankr. E.D. Va. Feb. 9, 2011).

Where the homestead deed is to be recorded depends on the nature of the property, i.e., realty or personalty. If the property is realty, the homestead deed must be filed in the county of the jurisdiction where the land is located. If personalty, the homestead deed must be filed in the county where the debtors reside. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

A Virginia debtor having an interest in real estate located outside of Virginia must nevertheless comply with the requirements of this section and file a homestead deed in the jurisdiction where the property is situate. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

With respect to real property, a debtor must record a signed writing - the Homestead Deed for Real Property - which adequately describes the property and the debtor's intentions, and which must "be recorded as deeds are recorded, in the county or city wherein such real estate or any part thereof is located"; Virginia law is also clear that debtors who claim an interest in property located outside of Virginia must comply strictly with the homestead exemption recording requirements by filing a homestead deed in the appropriate jurisdiction wherein the property is located. In re Heater, 189 Bankr. 629 (Bankr. E.D. Va. 1995).

Bankruptcy court sustained the trustee's objection to the claimed homestead exemption due to debtor's failure to file his homestead deed in compliance with § 34-6 . In re McWilliams, 296 Bankr. 424, 2002 Bankr. LEXIS 1215 (Bankr. E.D. Va. 2002).

Chapter 13 trustee's objection to a homestead exemption was sustained because the debtor, who resided in Virginia, did not strictly comply with § 34-6 by filing a homestead deed in the North Carolina county where the property was located and admitted that a homestead deed would have been accepted for recording there. In re Mackie,, 2006 Bankr. LEXIS 812 (Bankr. E.D. Va. Apr. 19, 2006).

Erroneous filing disallowed despite good faith, diligence and reasonable effort. - Where a homestead deed is filed in the wrong county, the exemption must be disallowed, although good faith, diligence, and reasonable effort was made to properly file and record the homestead deed. A court must apply this rule despite the fact that cases uniformly have held that statutes creating debtors' exemptions must be liberally construed in favor of the debtor and the exemption. Despite that general principle, there is no exception where the homestead deed is filed in an erroneous location. In re Tate, 41 Bankr. 946 (Bankr. W.D. Va. 1984).

Effect of noncompliance with local county rule. - Where Chapter 7 debtors timely delivered properly executed homestead deeds with fees paid to the county setting the property apart as exempt pursuant to §§ 34-6 and 34-17 , but the debtors did not comply with a local county rule until the time period under § 34-17 had expired, the county rule did not render the claimed exemption void because enforcement of the local rule would have been inconsistent with the statutory provisions for claiming exemptions under Title 34 of the Virginia Code and would also have abridged the substantive rights of the debtors. In re Alley, 354 Bankr. 783, 2006 Bankr. LEXIS 2976 (Bankr. W.D. Va. 2006).

Applied in In re Davies, 96 F. Supp. 416 (W.D. Va. 1949); Washington v. Virginia State Educ. Assistance Auth., 41 Bankr. 211 (Bankr. E.D. Va. 1984); In re Zella, 196 Bankr. 752 (Bankr. E.D. Va.); In re Goodman, 208 Bankr. 145 (Bankr. W.D. Va. 1997).

§ 34-7. Real estate, subject to encumbrances, may be set apart; if sold, how surplus disposed of.

Such real estate may be selected and set apart as aforesaid, subject to any paramount encumbrances thereon. If a sale be had to satisfy the encumbrances, the surplus of the proceeds, if any, not exceeding the amount to which the householder is entitled under § 34-4 , shall be paid to the householder and invested by him in such other property as he may select.

(Code 1919, § 6533.)

Cross references. - As to setting apart of property acquired with proceeds of exemption, see § 34-20 .

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

CASE NOTES

Section refers to encumbrances created by act of the debtor. - The security which is declared to be paramount to the homestead exemption is security such as is created by the act of the debtor himself. It does not embrace judgments which are securities created by law. Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901).

Homestead is superior to prior judgment lien. - A judgment lien attaching before homestead claimed in land cannot be enforced against the homestead during the existence of the exemption. Lindsay v. Murphy, 76 Va. 428 (1882); Scott v. Cheatham, 78 Va. 82 (1883); Blose v. Bear, 87 Va. 177 , 12 S.E. 294 (1890).

§ 34-8. Partition or sale of real estate held as exempt by joint tenant, etc.

If the estate so set apart be held by the householder as joint tenant, coparcener or tenant in common, partition or sale may be had as provided by Article 11 (§ 8.01-96 et seq.) of Chapter 3 of Title 8.01 and in case of sale the share of the proceeds to which the householder is entitled shall be paid to the householder and invested by him in such other property as he may select.

(Code 1919, § 6534.)

Research References. - Friend's Virginia Pleading and Practice (Matthew Bender). Chapter 27 Property Actions. § 27.03 Partition of Real Estate. Friend.

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Executions and Attachments, § 8.

CASE NOTES

Homestead provisions inapplicable to entireties exemption. - This section explicitly applies to property where the claimant is a "joint tenant, coparcener or tenant in common," and conspicuously omits any reference to tenants by the entireties; therefore, none of the restrictions applied to homesteads have ever been applied to the entireties exemption. Bass v. Thacker, 5 Bankr. 592 (Bankr. W.D. Va. 1980).

All entireties property is exempt in Virginia, with no dollar limitation, and one need not be a "householder" to claim the entireties exemption; therefore, the homestead provisions, including the requirement of filing a homestead deed, do not apply in any way to exemptions claimed for a tenancy by the entirety. Bass v. Thacker, 5 Bankr. 592 (Bankr. W.D. Va. 1980).

§ 34-9. How real estate set apart as exempt may be encumbered or aliened.

Real estate set apart as aforesaid may be sold and conveyed as other real estate held by the householder and the proceeds invested in other property, or it may in like manner be exchanged for other property, but in no case shall the purchaser be bound to see to the application of the purchase money.

(Code 1919, § 6535.)

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Execution and Attachment, § 17.

§§ 34-10 through 34-12.

Repealed by Acts 1981, c. 580.

Cross references. - For current homestead allowance upon death of domiciliary, see §§ 64.2-311 through 64.2-313 .

Editor's note. - Acts 1981, c. 580, cl. 3 provides: "That the provisions of this act shall not affect homestead waivers executed on or prior to June thirty, nineteen hundred eighty-one, or to the renewal of an indebtedness executed prior to such date if the prior indebtedness contained such a waiver."

§ 34-13. Householder may set apart exemption in personal estate.

If the householder does not set apart any real estate as before provided, or if what he does or has so set apart is not of the total value which he is entitled to hold exempt, he may, in addition to the property or estate which he is entitled to hold exempt under §§ 34-26 , 34-27 , 34-29 , and 64.2-311 , in the first case select and set apart by the writing required by § 34-14 to be held by him as exempt under §§ 34-4 and 34-4.1 , so much of his personal estate as shall not exceed the total value which he is entitled to hold exempt and, in the latter case, personal estate, the value of which, when added to the value of the real estate set apart, does not exceed such total value.

(Code 1919, § 6539; 1975, c. 466; 1980, c. 167; 1990, c. 942; 1993, c. 150.)

Editor's note. - At the direction of the Virginia Code Commission, the reference to "64.1-151.3" was changed to "64.2-311" to conform to the recodification of Title 64.1 by Acts 2012, c. 614, effective October 1, 2012.

Law review. - For comment, "In re Cheeseman: A Judicial Revision of Virginia's Homestead Exemption Laws," see 16 U. Rich. L. Rev. 391 (1982).

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Executions and Attachments, §§ 12, 13.

CASE NOTES

The homestead exemption is independent of, and may be claimed in addition to, other available exemptions. In re Cathcart, 203 Bankr. 599 (Bankr. E.D. Va. 1996).

The debtor is entitled to exempt entirely such things as any personal injury action, the family Bible, wedding and engagement rings, a lot in a burial ground, and animals owned as pets, in addition to many other specific items the exemption of which are subject to monetary limitation. Addison v. Reavis, 158 Bankr. 53 (E.D. Va. 1993), aff'd, 32 F.3d 562 (4th Cir. 1994).

Debtors desiring to exempt personal property must file a signed writing - the Homestead Deed for Personal Property - adequately describing the property in question and the debtor's intentions, which then must "be recorded as deeds are recorded, in the county or city wherein such householder resides." In re Heater, 189 Bankr. 629 (Bankr. E.D. Va. 1995).

Applied in In re Tate, 41 Bankr. 946 (Bankr. W.D. Va. 1984); In re Nguyen, 226 Bankr. 547 (Bankr. E.D. Va. 1998).

§ 34-14. How set apart in personal estate; form to claim exemption of personal property.

Such personal estate selected by the householder under § 34-4 , 34-4 .1, or 34-13 shall be set apart in a writing signed by him. He shall, in the writing, designate and describe with reasonable certainty the personal estate so selected and set apart and each parcel or article, affixing to each his cash valuation thereof. Such writing shall be admitted to record, to be recorded as deeds are recorded in the county or city wherein such householder resides. However, if such personal estate is claimed exempt in a case filed under Title 11 of the United States Code, the official Schedule of Property Claimed as Exempt filed in the United States Bankruptcy Court claiming such exemptions shall be sufficient to set apart such property as exempt.

The following form, or one which is substantially similar, shall be used and shall be sufficient, when duly admitted to record in the county or city in which the householder resides, to exempt such described personal property from creditor process:

HOMESTEAD DEED FOR PERSONAL PROPERTY Name of Householder ____________________________________ Is the householder a disabled veteran entitled to claim the additional exemption under § 34-4.1 ? ________________________________ Address of Householder ____________________________________ Name(s) and age(s) of dependent(s) ____________________________________ County/city in which householder resides ___________________________________ Description of property claimed as exempt and its value ____________________________________ ____________________________________ Number of homestead deeds that have been filed by the Householder ____________________________________ Exemption amount previously claimed on prior homestead deeds ____________________________________ List the jurisdictions where previous homestead deeds were filed ____________________________________ ____________________________________ (Signature of Householder) ____________________________________ [ACKNOWLEDGMENT]

Such writing or deed shall not be required to secure any exemption under this Code except those exemptions created by §§ 34-4 , 34-4 .1 and 34-13 .

(Code 1919, § 6540; 1990, c. 942; 1993, c. 150; 2010, c. 186; 2020, c. 328.)

Cross references. - As to setting aside of realty, see § 34-6 .

Editor's note. - Acts 2020, c. 328, cl. 2 provides: "That the Executive Secretary of the Supreme Court of Virginia shall promulgate and update the forms necessary to comply with the provisions of the first enactment of this act."

The 2010 amendments. - The 2010 amendment by c. 186 added the three entries prior to the signature line on the 'HOMESTEAD DEED FOR PERSONAL PROPERTY" form.

The 2020 amendments. - The 2020 amendment by c. 328, in the first paragraph, substituted "householder under § 34-4 , 34-4 .1, or 34-13 " for "householder and under §§ 34-4, 34-4.1 , or § 34-13 " and added the last sentence.

Law review. - For article reviewing recent legislative and judicial developments in the Virginia law of wills, trusts, and estates, see 68 Va. L. Rev. 521 (1982). For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Executions and Attachments, § 13.

CASE NOTES

I. GENERAL CONSIDERATION.

Section is constitutional. - This section is a reasonable exercise of the power granted the legislature under § 192 of the former Constitution to prescribe the conditions under which exempt property may be held. Wray v. Davenport, 79 Va. 19 (1884).

Purposes of homestead exemptions are two-fold. First, they protect debtors from being left destitute from creditor process by allowing debtors to retain stakeholds. Second, by requiring a homestead deed to be filed in the jurisdiction in which the debtor resides, it enables creditors to ascertain by inspection whether the debtor is underestimating the value of the property he claims exempt, thereby keeping to himself property that should be subjected to the payment of his debts. In re Smith, 22 Bankr. 866 (Bankr. E.D. Va. 1982).

The homestead exemption is not absolute. It exists only when and after the debtor has claimed it and perfected it by recordation in the clerk's office of an instrument setting forth his claim and giving a description and valuation of the property claimed as homestead. Until the debtor has taken the steps prescribed by this section, he is not entitled to any homestead exemption. In re Robinette, 34 F. Supp. 518 (W.D. Va. 1932).

This section must be complied with. - Where a statute prescribes a particular method to be adopted with respect to the claiming, selecting and setting apart of the homestead, its provisions must be complied with, since the entire right to homestead exemption depends on statutory authority. Wray v. Davenport, 79 Va. 19 (1884).

Until the debtor has taken the steps prescribed by this section, he is not entitled to any homestead exemption. In re Robinette, 34 F. Supp. 518 (W.D. Va. 1932).

"Setting apart" includes admitting the homestead deed to record. Only after a homestead deed is properly admitted to record does the clerk's duty arise to record it in deed book. In re Nguyen, 226 Bankr. 547 (Bankr. E.D. Va. 1998), aff'd sub nom. Mayer v. Quy Van Nguyen, 211 F.3d 105 (4th Cir. 2000).

When the clerk receives the homestead deed in proper form with fees paid on a date well before the fifth day after the creditors' meeting, the exemption has been claimed in a timely manner even though the deed is not admitted to record until some day after that. Mayer v. Quy Van Nguyen (In re Quy Van Nguyen), 211 F.3d 105, 2000 U.S. App. LEXIS 8271 (4th Cir. 2000).

Homestead deed recorded in the wrong county is ineffective. Shirkey v. Leake, 715 F.2d 859 (4th Cir. 1983).

The claim to a homestead must be made either by deed or by inventory, and it is not sufficient to set it up in a bill, or for counsel to ask for it in a "note of argument." Wray v. Davenport, 79 Va. 19 (1884).

Purpose of description and valuation. - The requirement of this section that the debtor designate and describe each parcel or article set apart, and affix to each his cash valuation thereof, is a wise and reasonable one. Its purpose is to enable creditors to ascertain, by inspection of the different articles and the prices affixed thereto, whether the debtor is making a fair and honest claim of homestead, or whether he is giving an underestimate of its value, and thereby securing to himself property that should be subjected to the payment of his debts. In re Wilson, 108 F. 197 (W.D. Va. 1901).

The purpose of the "cash valuation" is to enable creditors to ascertain, by inspection of the different articles and the prices affixed thereto, whether the debtor is making a fair and honest claim of homestead, or whether he is giving an underestimate of its value, and thereby securing to himself property that should be subjected to the payment of his debts. In re Waltrip, 260 F. Supp. 448 (E.D. Va. 1966).

The purpose of requiring a reasonably certain description and valuation of property is to enable existing creditors to determine whether the claim is honestly asserted or whether the debtor is improperly seeking to insulate his property from the payment of his debts. Shirkey v. Leake, 715 F.2d 859 (4th Cir. 1983).

Requirement that personal property be described with "reasonable certainty" cannot be defined by a universal standard. Nonetheless, courts cannot be allowed to make wholly subjective determinations of reasonableness. Whether a description is reasonably certain involves a judgment that takes into consideration the purpose of exemption statutes and the characteristics of the object to be described. Certain clearly defined principles exist to assist a court in the exercise of its discretion. Shirkey v. Leake, 715 F.2d 859 (4th Cir. 1983).

Insufficient description of certain property does not invalidate entire deed. - Although a homestead deed may fail sufficiently to describe and value certain property intended to be set aside as exempt, this will not affect the validity of the deed as to other property which is accurately described and valued in the mode prescribed by law. Williams v. Watkins, 92 Va. 680 , 24 S.E. 223 (1896).

Where the deed merely listed and valued various items of property, it did not specify whether each debtor was exempting an interest in jointly owned property nor did the deed indicate whether any of the property was individually owned and being exempted by only one of the debtors, the deed thus frustrates the purpose of requiring a reasonably certain description of the personal estates. In re Heath, 101 Bankr. 469 (Bankr. W.D. Va. 1987).

Disclosure of date of transaction giving rise to debt not required. - Neither this section, nor any other provision of Virginia law, requires disclosure in the deed of the date of a transaction giving rise to a debt owed to the bankrupt. This requirement to the statute will not be added by judicial gloss when the date serves no critical purpose. Shirkey v. Leake, 715 F.2d 859 (4th Cir. 1983).

Not applicable to poor debtor's exemption. - The procedures of this section and § 34-17 do not apply to the poor debtor's exemption of § 34-26 . Bryant v. Smith, 165 Bankr. 176 (W.D. Va. 1994).

Where incarcerated debtor to file. - Where a debtor was incarcerated in Goochland County, but had resided in Chesterfield County, where her home, personal property, and family were located at the time she filed her homestead deed, and intended to return to Chesterfield County upon her release, it was proper to have filed her homestead deed in Chesterfield County. In re Smith, 22 Bankr. 866 (Bankr. E.D. Va. 1982).

The claiming of a mere "equity" in an automobile may tend to confuse the situation as the law permits a claimed exemption in "the personal estate so selected," but it is sufficient under the liberal interpretation which must be accorded to homestead deeds. In re Waltrip, 260 F. Supp. 448 (E.D. Va. 1966).

Where the homestead deed is to be recorded depends on the nature of the property, i.e., realty or personalty. If the property is realty, the homestead deed must be filed in the county of the jurisdiction where the land is located. If personalty, the homestead deed must be filed in the county where the debtors reside. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

Applied in In re Davies, 96 F. Supp. 416 (W.D. Va. 1949); In re Wirick, 3 Bankr. 539 (Bankr. E.D. Va. 1980); In re Smith, 45 Bankr. 100 (Bankr. E.D. Va. 1984); Williams v. Hanson, 107 Bankr. 525 (Bankr. W.D. Va. 1989); In re Zella, 196 Bankr. 752 (Bankr. E.D. Va.)

II. BANKRUPTCY PROCEEDINGS.

The homestead exemption is independent of, and may be claimed in addition to, other available exemptions. In re Cathcart, 203 Bankr. 599 (Bankr. E.D. Va. 1996).

Failure to comply with homestead statute precludes exemption in bankruptcy. - Failure of a debtor to comply with the Virginia homestead exemption statute precludes him from claiming that exemption for bankruptcy purposes. Zimmerman v. Morgan, 689 F.2d 471 (4th Cir. 1982).

Section 34-17 must also be complied with. - For property to be exempt under § 522(b)(2)(A) of the Bankruptcy Code, it must be exempt under state and local law. In Virginia, to obtain the benefit of the exemption, debtors must comply with this section and § 34-17 . Collins v. Peyton, 24 Bankr. 485 (Bankr. E.D. Va. 1982).

No conflict with 11 U.S.C. § 522(1). - There is no conflict between 11 U.S.C. § 522(1) and the recordation requirement of this section. By filing the list of claimed exemptions pursuant to 11 U.S.C. § 522(1), the debtor asserts his belief that he is entitled to exempt that property. Whether that belief is correct will be determined through application of 11 U.S.C. § 522(b)(2)(A) and the state or local exemptions incorporated therein. Therefore, the 11 U.S.C. § 522(1) filing is not a substitute for compliance with the state or local law. Zimmerman v. Morgan, 689 F.2d 471 (4th Cir. 1982).

The debtor may amend upward the valuation stated on the schedule if and when the bankruptcy court determines that a higher value is more appropriate for that item. Addison v. Reavis, 158 Bankr. 53 (E.D. Va. 1993), aff'd, 32 F.3d 562 (4th Cir. 1994).

Improperly claimed exemptions. - Bankruptcy debtor improperly claimed exemptions by listing the value of the exempted property as 100 percent of the fair market value of the property, since §§ 34-6 and 34-14 strictly required that the debtor state a dollar amount of the value of the exempt property and the exemption, and the debtor's non-numerical values did not satisfy the requirement. In re Stoney, 445 Bankr. 543, 2011 Bankr. LEXIS 566 (Bankr. E.D. Va. Feb. 9, 2011).

Chapter 7 debtors were not entitled to a homestead exemption under § 34-14 or § 34-17 for the expected proceeds of the sale of property by the trustee. The homestead deed was either a deed for real property filed in the incorrect county or a deed for personal property that did not exist and could not have existed at time of the filing; in either case, the deed was ineffective. In re Cambre, 463 Bankr. 340, 2012 Bankr. LEXIS 232 (Bankr. W.D. Va. Jan. 27, 2012).

Omission of information concerning a prior deed of homestead in a new deed of homestead did not invalidate a bankruptcy debtor's homestead exemption since the new deed complied with the statutory requirements for timely filing in the proper jurisdiction, the new deed could be freely amended, and information concerning the prior deed only affected the extent of the exemption. In re Chesler, 562 Bankr. 119, 2016 Bankr. LEXIS 3531 (Bankr. E.D. Va. Sept. 27, 2016).

Claim of exemption in bankrupt's schedule is insufficient. - The mere act of a bankrupt, in claiming a homestead exemption in the schedule filed by him, is not a compliance with this section. In re Garner, 115 F. 200 (W.D. Va. 1902)See § 34-17 .

Later lien avoidance was not possible. - Where debtor did not claim the subject property exempt in schedule B-4 of his bankruptcy petition and the time had expired for him to file a homestead exemption, debtor could not later avoid liens on property that he did not set apart as exempt. In re Wall, 127 Bankr. 353 (Bankr. E.D. Va. 1991).

§§ 34-15, 34-16.

Repealed by Acts 1981, c. 580.

Cross references. - As to homestead allowance upon death of domiciliary, see §§ 64.2-311 through 64.2-313 .

Editor's note. - Acts 1981, c. 580, cl. 3 provides: "That the provisions of this act shall not affect homestead waivers executed on or prior to June thirty, nineteen hundred eighty-one, or to the renewal of an indebtedness executed prior to such date if the prior indebtedness contained such a waiver."

§ 34-17. When exemption may be set apart; garnished wages.

  1. The real or personal estate that a householder is entitled to hold as exempt may be set apart at any time before it is subjected by sale under creditor process or by a trustee in bankruptcy, or, if such creditor process does not require sale of the property, before it is turned over to the creditor.
  2. A claim of homestead exemption to protect garnished wages may be filed by the debtor after the garnishment summons is served on the employer but prior to or upon the return date of the garnishment summons and shall be considered by the garnishing court.

    (Code 1919, § 6543; 1944, p. 489; 1974, c. 272; 1981, c. 580; 1985, c. 521; 1990, c. 942; 2003, c. 1000; 2005, c. 367; 2020, c. 328.)

Editor's note. - Acts 1981, c. 580, cl. 3 provides: "That the provisions of this act shall not affect homestead waivers executed on or prior to June thirty, nineteen hundred eighty-one, or to the renewal of an indebtedness executed prior to such date if the prior indebtedness contained such a waiver."

Acts 2020, c. 328, cl. 2 provides: "That the Executive Secretary of the Supreme Court of Virginia shall promulgate and update the forms necessary to comply with the provisions of the first enactment of this act."

The 2003 amendments. - The 2003 amendment by c. 1000, inserted the subsection A designation; and added subsection B.

The 2005 amendments. - The 2005 amendment by c. 367, in subsection A, substituted "of" for "initally set for" twice in clause (ii).

The 2020 amendments. - The 2020 amendment by c. 328, in subsection A, substituted "that a householder" for "which a householder," inserted "or by a trustee in bankruptcy," and deleted the last three sentences, which formerly read "To claim an exemption in bankruptcy, a householder who (i) files a voluntary petition in bankruptcy or (ii) against whom an involuntary petition in bankruptcy is filed shall set such real or personal property apart on or before the fifth day after the date of the meeting held pursuant to 11 U.S.C. § 341, but not thereafter. A householder who converts a case from Chapters 11, 12, or 13 to Chapter 7 shall set such real or personal property apart on or before the fifth day after the date of the meeting held pursuant to 11 U.S.C. § 341 in th e Chapter 7 case, but not thereafter. Nothing in this section shall affect the right of the trustee in bankruptcy, with the approval of the court, to proceed immediately with the sale or other disposition of personal property which the trustee determines to be perishable or particularly susceptible to price deterioration."

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 3 The Writ Firea Facies: Execution. § 3.3 Relief from Levy; § 4.8 Other Property Subject to Garnishment; § 5.4 The Nature of the Judgment Lien. Rendleman.

Friend's Virginia Pleading and Practice (Matthew Bender). Chapter 22 Enforcement of Judgments. § 22.02 Judgment Liens. See also § 22.08 Garnishment. Friend.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, §§ 33, 67, 76, 77; 8A M.J. Exemptions from Execution and Attachment, §§ 8, 12.

CASE NOTES

I. GENERAL CONSIDERATION.

This section is not repugnant to the Constitution of Virginia. In re Swift, 96 F. Supp. 44 (W.D. Va. 1950).

Constitutionality in bankruptcy proceedings. - To the extent that this section affects the rights of debtors in bankruptcy proceedings, it is constitutional. Collins v. Peyton, 24 Bankr. 485 (Bankr. E.D. Va. 1982).

Section should be read into subsequent contracts. - It is proper that the legislative declaration of this section should be read into contracts made and obligations assumed since its enactment. Oppenheim v. Myers, 99 Va. 582 , 39 S.E. 218 (1901).

The date fixed in this section is for the purpose of finalizing an exemption available and procedure for so doing. In re Edwards, 105 Bankr. 10 (Bankr. W.D. Va. 1989).

Liberal construction of laws. - Courts should construe liberally the law pertaining to homestead deeds in favor of debtors. The law is equally clear, however, that there are certain strict requirements in a bankruptcy setting which must be observed. Homeowner's Fin. Corp. v. Pennington, 47 Bankr. 322 (Bankr. E.D. Va. 1985).

Generally, statutes creating debtors' exemptions must be construed liberally in favor of the debtor and the exemption. Mayer v. Quy Van Nguyen (In re Quy Van Nguyen), 211 F.3d 105, 2000 U.S. App. LEXIS 8271 (4th Cir. 2000).

"Setting apart" includes admitting the homestead deed to record. Only after a homestead deed is properly admitted to record does the clerk's duty arise to record it in deed book. In re Nguyen, 226 Bankr. 547 (Bankr. E.D. Va. 1998), aff'd sub nom. Mayer v. Quy Van Nguyen, 211 F.3d 105 (4th Cir. 2000).

The language "subjected by sale or otherwise, etc.," means that a homestead deed may be filed at any time before a court order or decree directs a sale or otherwise orders the payment of money by the garnishees to the judgment creditor at a hearing of the garnishment proceeding. Wilson v. Virginia Nat'l Bank, 214 Va. 14 , 196 S.E.2d 920 (1973); Baum v. United Va. Bank, 15 Bankr. 538 (Bankr. E.D. Va. 1981).

Not applicable to poor debtor's exemption. - The procedures of § 34-14 and this section do not apply to the poor debtor's exemption of § 34-26 . Bryant v. Smith, 165 Bankr. 176 (W.D. Va. 1994).

No retroactive effect. - This section did not apply retroactively to debtors' case because (1) the parties agreed that § 34-17 was procedural in nature, (2) the plain language of § 34-17 evinced no clear intent to apply the statute retroactively, and (3) in light of the absence of a clear legislative intent to have § 34-17 apply retroactively, there was no reason to remove § 34-17 from under the realm of the general rule that statutory changes were not deemed retrospective in application except where there was clear legislative intent to the contrary. Lopez v. Jessee,, 2006 U.S. Dist. LEXIS 42540 (W.D. Va. June 23, 2006).

Calculation of five-day period. - Sections 1-13.3 and 1-13.3:1 [now § 1-210 ], and not the Federal Rules of Bankruptcy Procedure, govern how the five-day period provided for in this section should be calculated to determine whether debtors failed to file their homestead deed in a timely fashion. In re Haynesworth, 145 Bankr. 222 (Bankr. E.D. Va. 1992).

A debtor has five days from the date of the creditors' meeting to "set apart" property claimed to be exempt under the homestead exemption and any intervening Saturday and Sunday must be counted. Mayer v. Quy Van Nguyen (In re Quy Van Nguyen), 211 F.3d 105, 2000 U.S. App. LEXIS 8271 (4th Cir. 2000).

Recordation by clerk at labor date. - When a debtor has filed a homestead deed in proper form with the right clerk, with fees paid, all prior to the deadline established by this section, the debtor has "set apart" his property for purposes of the homestead exemption even though the deed may not be recorded by the clerk until a later date. Mayer v. Quy Van Nguyen (In re Quy Van Nguyen), 211 F.3d 105, 2000 U.S. App. LEXIS 8271 (4th Cir. 2000).

Where debtor's bank accounts were not "subjected by sale or otherwise" before the recordation of the homestead deed, she is entitled to claim the benefit of her exemption. Wilson v. Virginia Nat'l Bank, 214 Va. 14 , 196 S.E.2d 920 (1973).

Property held "subjected." - A creditor obtained judgment and levied execution against his debtor. Suit was brought by other creditors against the execution creditor alleging superior liens, and the execution creditor also brought a chancery suit against the debtor, claiming a lien in his favor on certain property of the debtor. The two suits were heard together. The court decreed that certain funds should be paid to the execution creditor. The same decree directed the payment of all the costs of the suit, and disposed of the entire funds of the debtor in the hands of receivers appointed by the court. After the adjournment of the term of court at which this decree was rendered, the debtor filed a homestead deed, claiming the amount decreed to be paid to the execution creditor as part of his homestead exemption, and filed a petition in the chancery causes, praying that it be paid over to him as part of his homestead. It was held that the fund in question had been "subjected" within the true intent and meaning of this section before the execution of the homestead deed, and the debtor having failed to claim his homestead privilege before the decree, he was concluded by it, not only because the fund had been subjected thereby, but because it was a final decree settling every controversy which had arisen in the cause. Smith v. Holland, 124 Va. 663 , 98 S.E. 676 (1919).

General rule is that after the time for filing a homestead deed has expired, the debtor is precluded from amending a homestead deed for purposes other than increasing or decreasing the value of property previously included in the homestead deed, and new property cannot be exempted. Ames v. Custis, 87 Bankr. 415 (Bankr. E.D. Va. 1988).

Amendments allowable to include new property. - When a debtor does not own or have an interest in property that is properly exempt at the time the exemption must be asserted, then an amendment may be allowed to include new property so long as the maximum exemptions have not been taken. Ames v. Custis, 87 Bankr. 415 (Bankr. E.D. Va. 1988).

Insurance policy. - Since debtor's wife retained the right to rename a beneficiary in her insurance policy, debtor did not have an ownership right or a vested interest in his wife's policy that could be exempted pursuant to this section; however, debtor could have amended his homestead deed to include the insurance proceeds he became entitled to after the time for filing his homestead exemption had expired. Ames v. Custis, 87 Bankr. 415 (Bankr. E.D. Va. 1988).

Applied in Reed v. Union Bank, 70 Va. (29 Gratt.) 719 (1878); In re Davies, 96 F. Supp. 416 (W.D. Va. 1949); In re Burns, 23 Bankr. 987 (Bankr. E.D. Va. 1982); In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982); Williams v. Hanson, 107 Bankr. 525 (Bankr. W.D. Va. 1989); In re Emerson, 129 Bankr. 82 (Bankr. W.D. Va. 1991); In re Gentry, 275 Bankr. 747, 2001 Bankr. LEXIS 1876 (Bankr. W.D. Va. 2001).

II. BANKRUPTCY PROCEEDINGS.

Section 34-14 must also be complied with. - For property to be exempt under § 522(b)(2)(A) of the Bankruptcy Code, it must be exempt under state and local law. In Virginia, to obtain the benefit of the exemption, debtors must comply with § 34-14 and this section. Collins v. Peyton, 24 Bankr. 485 (Bankr. E.D. Va. 1982).

The manner prescribed for claiming a homestead exemption is set out in sections establishing the time allowed for setting apart the property, the place where the debtor must file the writing describing the property, and the form and content of that writing; it is clear that a debtor must satisfy these state procedural requirements in order to perfect a homestead exemption in bankruptcy. Mayer v. Quy Van Nguyen (In re Quy Van Nguyen), 211 F.3d 105, 2000 U.S. App. LEXIS 8271 (4th Cir. 2000).

Necessity of following statute. - If a bankruptcy petitioner does not abide by this section for filing a homestead deed, then the petitioner is not entitled to the exemption. Crossroads of Hillsville v. Payne, 179 Bankr. 486 (W.D. Va. 1995).

Chapter 7 debtors were not entitled to a homestead exemption under § 34-14 or § 34-17 for the expected proceeds of the sale of property by the trustee. The homestead deed was either a deed for real property filed in the incorrect county or a deed for personal property that did not exist and could not have existed at time of the filing; in either case, the deed was ineffective. In re Cambre, 463 Bankr. 340, 2012 Bankr. LEXIS 232 (Bankr. W.D. Va. Jan. 27, 2012).

Debtor must be given meaningful notice. - This provision must be construed to mean such meeting where the debtors are given meaningful notice thereof and is in keeping with the universal liberal construction of exemption laws in favor of the debtor. In re Preston, 96 Bankr. 61 (Bankr. W.D. Va. 1989).

Nonresident debtor entitled to exemption under alternate provision of federal law. - Where debtor, resident of District of Columbia for two months, filed a petition for voluntary relief in Virginia court as she had resided in Commonwealth for greater portion of 180-day residency requirement under 11 U.S.C. § 522(b), but could not receive Virginia exemption as she was not a resident in Virginia, she was entitled to exemptions under alternative provisions of 11 U.S.C. § 522(b) due the certainty of congressional intent that every debtor have exemptions to enable him a fresh start and due inapplicability of Virginia state law of exemptions to debtor. In re Hawkins, 15 Bankr. 618 (Bankr. E.D. Va. 1981).

The proviso to this section neither impairs nor defeats the benefits of the homestead exemption, but merely provides for a difference in the manner of claiming the benefits depending upon a difference of conditions. It seems reasonable for the General Assembly to require those who voluntarily seek the benefits of the Bankruptcy Act to exercise their option to also claim the benefits of the homestead exemption law on or before the date of filing their petitions. In re Swift, 96 F. Supp. 44 (W.D. Va. 1950).

This section does not preclude any and all amendments to a homestead deed after bankruptcy where the item is claimed exempt and the controversy rests upon the valuation thereof. In re Waltrip, 260 F. Supp. 448 (E.D. Va. 1966).

This section does not prohibit an amendment to a homestead deed after bankruptcy, where the sole purpose of the amendment is to correct the valuation claimed in the deed. In re Waltrip, 260 F. Supp. 448 (E.D. Va. 1966).

Exemption in bankruptcy of property not claimed in original homestead deed. - A debtor who has not exempted property up to the maximum value permitted by the statute may amend his homestead deed until he reaches the maximum. In bankruptcy, however, this right to amend is restricted to adjustments in the value of property already claimed in the original homestead deed; new items may not be claimed. In re Sutphin, 24 Bankr. 149 (Bankr. E.D. Va. 1982).

Once a householder has filed his homestead deed and his petition in bankruptcy he may later amend that deed to increase or decrease the valuation of items claimed exempt therein. However, he may not amend the deed to claim additional items exempt. In re Redmon, 31 Bankr. 756 (Bankr. E.D. Va. 1983).

Although Virginia law would appear at first blush to be such as to foreclose any amendments to a homestead deed after the filing of a petition in bankruptcy except for adjustments in the valuation of property already claimed exempt, this is not in fact a complete picture. Whether or not one can properly claim an exemption depends, in the first instance, on whether the debtor owns or has an interest in the subject property. Where the debtor does not have ownership or some other interest in the property when filing the homestead deed prior to bankruptcy, then this section is inapplicable. In re Smith, 45 Bankr. 100 (Bankr. E.D. Va. 1984).

Debtors must strictly comply with the provisions of the Virginia homestead laws in order to claim exemptions for bankruptcy purposes. As a result, although there is no doubt but that a homestead deed may be amended to correct descriptions or values of properties listed in the original homestead deed, the law is equally clear that an amendment to a homestead deed may not set apart additional items not included in the original homestead deed. Homeowner's Fin. Corp. v. Pennington, 47 Bankr. 322 (Bankr. E.D. Va. 1985).

A debtor may amend his homestead deed so as to correct the year of tax refund claimed as exempt. Such an amendment does not conflict with the Bankruptcy Reform Act of 1978 which freely allows the bankrupt to amend his schedule of exemptions. By permitting a bankrupt to amend his homestead deed to clarify his claim, a court does not trench on the statutory rights conferred on the trustee and the creditors when the petition in bankruptcy is filed. Shirkey v. Leake, 715 F.2d 859 (4th Cir. 1983).

Exemption of property coming into estate after bankruptcy petition filed. - Bankruptcy Rule 110 affects a debtor's procedural rights only and cannot overcome restrictions imposed or permitted by substantive provisions of the Bankruptcy Code such as § 522(b)(1) (allowing states to "opt out" of the federal exemption scheme). Debtors in other states may be able to claim as exempt property coming into the estate after a petition is filed. Bankruptcy Code § 522(b)(1) and § 34-3.1 and this section, however, operate to bar Virginia debtors from doing so in this jurisdiction. Collins v. Peyton, 24 Bankr. 485 (Bankr. E.D. Va. 1982).

Debtor is prevented from amending a voluntary petition in bankruptcy filed before the Cheeseman decision (Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981)), which expanded exemption allowances by permitting both spouses to file individual homestead deeds, as the law in effect at the time the petition is filed is the controlling law for that case. In re Boggs, 17 Bankr. 228 (Bankr. E.D. Va. 1982).

Debtor held entitled to exemption in chattels. - This section makes it unclear whether the last moment for claiming exemptions under Virginia law is before the sale of the chattels or before the levy on the chattels; however, because case law is unclear and the statute is ambiguous, where debtor claimed exemption in chattels prior to their sale by the High Constable, the debtor would be entitled to the exemption, as exemption laws are to be construed liberally in favor of the debtor and strictly against creditors. Warehouse Furn. Sales, Inc. v. Callender, 20 Bankr. 448 (Bankr. E.D. Va. 1982).

Judgment lien attached to home sale proceeds subject to debtor's ability to exempt. - Debtor had an interest in a portion of the sale proceeds of the marital home when he filed his bankruptcy petition, and as his judgment creditor had not finally executed its judgment lien on the sale proceeds on the date of the petition, the lien attached to the sale proceeds, subject to the debtor's ability to exempt the proceeds; as the debtor timely claimed a homestead exemption in $3000 of the proceeds and the lien was valid as to nonexempt property, when the automatic stay terminated, the creditor could exercise its state law remedies except as to the $3000 exemption. Roadcap v. Harrisonburg Printing & Graphics, LLC (In re Roadcap), 590 Bankr. 747, 2018 Bankr. LEXIS 2528 (Bankr. W.D. Va. 2018).

Residence of bankrupt is determined as of date of adjudication. - The fact that a bankrupt has established a bona fide domicile in Virginia does not give him a right to the Virginia homestead exemption, where at the time of the adjudication of bankruptcy he was a citizen of another state. The rights of a bankrupt are fixed as of the date of adjudication. Were this not the rule, the bankrupt, after being so adjudicated, might "shop around" and establish a domicile in a state more generous in its exemptions. Palais v. DeJarnette, 145 F.2d 953 (4th Cir. 1944).

Claim of exemption in bankruptcy does not automatically overcome liens docketed in land records if debtor's homestead deed precedes execution upon the liens. A homestead deed does not extinguish judgment liens against exempt property, but merely prevents seizure and sale of the encumbered property in order to satisfy the debt underlying the lien. Absent a lien avoidance proceeding under § 522(f) of the Bankruptcy Code (11 U.S.C. § 522(f)), liens survive a discharge in bankruptcy and continue in force even on exempt homestead property. A subsequent purchaser of encumbered homestead property takes the property subject to creditors' liens. Barzee v. Trammel, 63 Bankr. 878 (Bankr. E.D. Va. 1986).

Where creditors did not execute upon their alleged consensual lien in the funds held in escrow as security for the debtors' promise to deliver clear title and acquire a decree ordering the escrow agent to pay the proceeds to the creditors in satisfaction of the lien before filing of the debtors' homestead deed exempting the fund, the deed insulated the fund from enforcement of any lien. The lien was not avoided in the sense liens are avoided under section 522(f) of the Bankruptcy Code (11 U.S.C. § 522(f)), but was rendered unenforceable by operation of Virginia law. Barzee v. Trammel, 63 Bankr. 878 (Bankr. E.D. Va. 1986).

Later lien avoidance was not possible. - Where debtor did not claim the subject property exempt in schedule B-4 of his bankruptcy petition and the time had expired for him to file a homestead exemption, debtor could not later avoid liens on property that he did not set apart as exempt. In re Wall, 127 Bankr. 353 (Bankr. E.D. Va. 1991).

Strict adherence to statutory requirements necessary. - While it is recognized that homestead exemption statutes should be construed in favor of the debtor when possible, it is just as well settled that debtors must strictly abide by the Virginia requirements for filing homestead deeds in order to be entitled to an exemption. In re Heater, 189 Bankr. 629 (Bankr. E.D. Va. 1995).

Homestead deed must be properly filed under Virginia law or bankruptcy exemption is lost. In re Meyer, 211 Bankr. 203 (Bankr. E.D. Va. 1997).

Where debtor improperly filed homestead deed, he could not claim exemption for retirement trust, checking accounts, or interest in real estate brokerage. In re Meyer, 211 Bankr. 203 (Bankr. E.D. Va. 1997).

The homestead exemption claimed by debtors in bankruptcy was disallowed where the homestead deed setting apart the property at issue was not filed until 16 days after the creditors' meeting. In re Wallace, 249 Bankr. 677, 2000 Bankr. LEXIS 663 (Bankr. W.D. Va. 2000).

Time by which exemption must be claimed. - An 11 U.S.C.S. § 341 meeting is "held" until it is concluded; the homestead deed must be filed within five days from that date. Stated another way, the effect of the change to the language in § 34-17 , effective July 1, 2005, is interpreted to mean that in order for a debtor to claim the homestead exemption under current Virginia law, that debtor must file the homestead deed within 5 days of the conclusion of the 11 U.S.C.S. § 341 meeting. In re Stewart, 360 Bankr. 132, 2006 Bankr. LEXIS 491 (Bankr. E.D. Va. 2006).

Trustee's objection to debtors' claim of exemptions, under 11 U.S.C.S. § 522(b)(2)(A), was overruled as debtors timely filed their amended homestead deeds on November 16, 2005, pursuant to subsection A, because (1) a legal proceeding was not in ordinary parlance considered to have been "held" until it was over, (2) a meeting of creditors had not "occurred," pursuant to § 1-210 , until it actually concluded, and (3) the original meeting of creditors was not concluded on October 17, 2005, but was continued to November 23, 2005, at which time the meeting was concluded according to trustee. In re Shelton, 343 Bankr. 545, 2006 Bankr. LEXIS 1401 (W.D. Va. 2006).

Bankruptcy court disallowed Chapter 7 debtors' claim that money in a deferred profit sharing (DPS) plan provided by a former employer, and property they purchased with DPS funds, was exempt from creditors' claims, pursuant to former subsection G of § 34-34 . Section 34-17 required the debtors to claim the exemption within five days of the date the trustee held a meeting of creditors pursuant to 11 U.S.C.S. § 341, and they had not done so; the court also had the power to reject the debtors' amended schedules and deny their claim because the debtors acted in bad faith, and their claim was precluded by 11 U.S.C.S. § 522(g)(1) because they voluntarily transferred the funds out of the DPS plan before they disclosed the plan's existence to the court or the trustee. In re Price,, 2008 Bankr. LEXIS 486 (Bankr. E.D. Va. Feb. 19, 2008).

Chapter 7 debtor was not entitled to claim the homestead exemption under § 34-4 because the debtor did not record a homestead deed in the proper jurisdiction within five days after the 11 U.S.C.S. § 341 meeting of creditors, as required by § 34-17 . In re Conner, 408 Bankr. 88, 2009 Bankr. LEXIS 2409 (Bankr. W.D. Va. 2009).

Effect of noncompliance with local county rule. - Where Chapter 7 debtors timely delivered properly executed homestead deeds with fees paid to the county setting the property apart as exempt pursuant to §§ 34-6 and 34-17 , but the debtors did not comply with a local county rule until the time period under § 34-17 had expired, the county rule did not render the claimed exemption void because enforcement of the local rule would have been inconsistent with the statutory provisions for claiming exemptions under Title 34 of the Virginia Code and would also have abridged the substantive rights of the debtors. In re Alley, 354 Bankr. 783, 2006 Bankr. LEXIS 2976 (Bankr. W.D. Va. 2006).

Waiver of exemptions. - Because the debtors did not claim their exemptions until 13 days following the date scheduled for the first meeting of creditors, under this section, those exemptions were waived. Bryant v. Smith, 165 Bankr. 176 (W.D. Va. 1994).

Homestead exemption must be claimed within five days of date initially set for creditors' meeting. - The debtors failed to claim a homestead exemption in a timely manner where (1) the trustee set the initial meeting of creditors for November 17, (2) the debtors then wrote to the trustee and requested a change in the date, (3) the trustee obliged, and the debtors issued a "Notice of Rescheduled Meeting of Creditors" which announced that the meeting would be held instead on December 18, (4) the trustee convened the meeting on November 17 and then immediately adjourned it to December 18, (5) the debtors appeared for the first time at the December 18 meeting and filed their homestead deeds within five days of that meeting; therefore, the homestead deeds were untimely. Smoot v. Wolfe, 271 Bankr. 115, 2001 U.S. Dist. LEXIS 21108 (W.D. Va. 2001) (decided prior to 2005 amendments).

Debtors did not timely file their homestead petition because (1) former § 34-17 required that the homestead petition be filed within five days of the date that the first meeting of the creditors was originally scheduled, (2) the first meeting of the creditors was originally scheduled for July 5, 2005, and (3) however, the debtors did not file their homestead deed until October 21, 2005. Lopez v. Jessee,, 2006 U.S. Dist. LEXIS 42540 (W.D. Va. June 23, 2006).

Virginia law requires filing homestead deed on or before bankruptcy petition. - Virginia exemption law allows each debtor to exempt up to $5,000 of real or personal property as a homestead exemption. However, in order to perfect the taking of the exemption, Virginia law requires the filing of a homestead deed claiming the exemption on the day of or before filing the petition in bankruptcy. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

The bankruptcy court did not err in denying confirmation of the debtors Chapter 11 Plan of Reorganization which proposed that the remaining unencumbered assets of the debtors be liquidated and the debtors be permitted the benefit of the Homestead Exemption pursuant to § 34-4 , where the debtors had not filed their homestead deeds. Smith v. Dairymen, Inc., 75 Bankr. 365 (W.D. Va. 1987).

Mailing of homestead deed does not constitute filing. - A debtor has set apart the property claimed exempt in his homestead deed only when he has actually delivered a properly executed and recordable homestead deed together with all applicable filing fees to the clerk, not when he deposits it in the mail or puts it in the hands of a delivery service or messenger. In re Saud Ahmed, 411 Bankr. 537, 2009 Bankr. LEXIS 1634 (Bankr. E.D. Va. 2009).

III. GARNISHMENT.

Property may still be set aside as exempt after it is subject to the lien of the judgment and after a garnishment proceeding has been instituted. Wilson v. Virginia Nat'l Bank, 214 Va. 14 , 196 S.E.2d 920 (1973).

Garnishment proceeds. - Subsection B trumped subsection A as to when a debtor's exemption to protect garnished wages must be claimed. Thus, where the debtor failed to file a homestead deed claiming an exemption in the funds prior to the return date on the garnishment summons, the funds became property of the estate under 11 U.S.C.S. § 541(a). In re Neilsen, 427 Bankr. 581, 2010 Bankr. LEXIS 1324 (Bankr. W.D. Va. 2010).

When wages listed as homestead. - Virginia homestead deed is designed to protect a certain amount of debtor's property from creditors, and where debtor listed his wages as part of his homestead, he intended to insulate that asset from his creditors. Where debtor filed his homestead deed on June 10, and a summons in garnishment was returnable June 12, he is entitled to his wages, notwithstanding the intervening bankruptcy, because wages are not subjected by sale or otherwise before recordation of homestead deed. Baum v. United Va. Bank, 15 Bankr. 538 (Bankr. E.D. Va. 1981).

In the case of a garnishment, a homestead deed may be filed at any time before a court orders the payment of money by the garnishees to the judgment creditor at a hearing of the garnishment proceeding. In re Wilkinson, 196 Bankr. 311 (Bankr. E.D. Va. 1996).

Effect of § 522(g) and (h) of Bankruptcy Code. - Under Virginia law, if the debtor does not choose to exempt his wages prior to the return date on the writ of garnishment, he cannot do so later. However, the strong policy of the Bankruptcy Code under § 522(g) and (h) is to allow the debtor to recover such property and exempt it where the property was preferentially transferred. Therefore, to the extent that Virginia law would bar a debtor from exempting property under § 522(g) and (h) of the Bankruptcy Code, the federal law must supersede Virginia law. In re Smith, 45 Bankr. 100 (Bankr. E.D. Va. 1984).

Timeliness. - Filing of a debtor's bankruptcy petition on November 24 preceded the November 30 state court return date of a garnishment summons but although the debtor did not file a homestead deed pursuant to subsection B of § 34-17 by the return date, when she filed her homestead deed on December 13, the automatic stay under 11 U.S.C.S. § 362 was in place and as a result, the state court did not enter an order of pay of the garnished funds on the return date, as the operative effect of subsection B was stayed. The debtor filed her homestead deed 14 days after the return date of the summons but within the time limitations set forth in subsection A of § 34-17 because the § 341 meeting of creditors took place on December 29; thus, she timely filed her homestead deed with regard to the garnished wages. Harris v. Banks (In re Banks), 443 Bankr. 708, 2011 Bankr. LEXIS 336 (Bankr. W.D. Va. Jan. 25, 2011).

Creditor not entitled to return of garnished funds. - Garnished wages became property of a debtor's estate under 11 U.S.C.S. § 541(a) and subject to administration by the Chapter 7 trustee under 11 U.S.C.S. § 704(a), and the garnished funds remained property of the estate because although she homesteaded them pursuant to subsection A of § 34-17 , she failed to claim an exemption in the garnished funds on Schedule C of her bankruptcy schedules as required by Fed. R. Bankr. P. 4003(a), and there was no order of abandonment entered by the court under 11 U.S.C.S. § 554. Thus, the garnished funds were subject to the administration of the Chapter 7 trustee, and the creditor who initiated the garnishment proceedings was not entitled to the return of the garnished funds. Harris v. Banks (In re Banks), 443 Bankr. 708, 2011 Bankr. LEXIS 336 (Bankr. W.D. Va. Jan. 25, 2011).

CIRCUIT COURT OPINIONS

Return of garnished funds. - Any funds paid by a garnishee to the court or directly to the judgment creditor prior to the return date on the garnishment summons had to be returned to the judgment debtor because his claim for homestead and dependent spouse exemptions were timely and his homestead deed was appropriately filed. Trident Sys. v. Reber, 88 Va. Cir. 394, 2014 Va. Cir. LEXIS 45 (Fairfax County June 25, 2014).

§ 34-18. Rents and profits exempt; increase in value of estate set apart.

The rents and profits of the property set apart shall be exempt in the same manner as the corpus of such property and if the whole real and personal estate set apart be not of greater value than the amount the householder is entitled to exempt at the time it is so set apart, the exemption thereof shall not be affected by any increase in its value afterwards, unless such increase consists of permanent improvements placed upon real estate set apart by means derived from some source other than exempt property.

(Code 1919, § 6544; 1975, c. 466; 1977, c. 496; 1990, c. 942.)

Cross references. - As to levy on growing crops generally, see § 8.01-489 .

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 5 The Judgment Lien. § 5.4 The Nature of the Judgment Lien. Rendleman.

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Execution and Attachment, § 16.

CASE NOTES

Applicability. - Bankruptcy debtor was not entitled to exempt the full value of real property under § 34-18 since the increase in the value of the debtor's equity in property since an express exemption in a prior bankruptcy case of the debtor and a now deceased spouse, which resulted from the reduction in the amount of the mortgage lien against it, constituted a permanent improvement placed upon the property funded by the use of nonexempt funds, which was not entitled to receive the exemption. Moore v. Capital One Bank (In re Moore), 412 Bankr. 830, 2008 Bankr. LEXIS 4184 (Bankr. W.D. Va. 2008).

By the plain language of § 34-18 , the "increase in value" language modifies only the property that is "set apart" and, by reference to §§ 34-4 and 34-6 , a debtor sets apart property, which the debtor is entitled to exempt under § 34-4 , by recording a homestead deed; thus, the property set apart does not relate to the whole of the property that is exempted and, instead, the property set apart only includes that which is exempted under § 34-4 through the procedure established in § 34-6 . Moore v. Capital One Bank (In re Moore), 412 Bankr. 830, 2008 Bankr. LEXIS 4184 (Bankr. W.D. Va. 2008).

Increase in the value of a debtor's equity in property resulting from a reduction in the amount of any lien against it is more akin to permanent improvements placed upon real estate funded by the use of nonexempt funds that are not entitled to receive an exemption under the plain language of § 34-18 . Moore v. Capital One Bank (In re Moore), 412 Bankr. 830, 2008 Bankr. LEXIS 4184 (Bankr. W.D. Va. 2008).

§ 34-19. How excess in value set apart subjected to debts.

Any creditor, against whom an exemption is claimed, may file a bill in equity, alleging that the value of the estate at the time it was set apart was more than the amount the householder is entitled to exempt or, that by reason of permanent improvements made on the real estate after it was set apart by means derived from some source other than exempt property, the whole estate set apart is of greater value than the amount the householder is entitled to exempt. If the court is satisfied from the proofs in the cause that the allegations of the bill are true, it shall make such decree or order as may be necessary to subject the estate set apart, so far as it exceeds the amount the householder is entitled to exempt, to the payment of the debt or demand of such creditor.

(Code 1919, § 6545; 1975, c. 466; 1977, c. 496; 1990, c. 942.)

§ 34-20. Proceeds of sale of estate exempt; how evidenced.

The estate or property in which proceeds of sale are invested, or which may be acquired in exchange, under any of the preceding sections of this chapter, shall be held exempt in like manner and to the like extent as the estate sold or exchanged was held. But such estate or property when acquired in exchange or otherwise than by investment under an order of court, or unless when set apart by a court, shall be set apart, if real estate, by such a writing as is prescribed by § 34-6 ; if personal estate, by such a writing as is prescribed by § 34-14 ; and such writing shall be recorded as provided by the same sections, respectively. In addition to the requirements of such sections, the writing shall state from what source the estate was derived and with what means acquired. When such estate is invested or set apart under an order of court, a copy of the order and of any report of a commissioner or other officer making the investment thereunder, if confirmed, and a copy of the order of confirmation, duly certified by the clerk of the court, shall be recorded in the deed book of the county or city wherein the writing, if the estate had been set apart by a writing, is required to be recorded.

(Code 1919, § 6546.)

Cross references. - As to sale of homestead and investment of proceeds, see §§ 34-7 through 34-9 .

CASE NOTES

Applicability. - This section applied to exemptions under "preceding sections of this chapter," while debtors claimed an exemption in the proceeds of the personal injury award under § 34-28.1 , a succeeding section that was in Title 34, chapter 3. Consequently, debtors could not take advantage of § 34-20 to exempt property they purchased with the settlement proceeds of the personal injury action. In re Williams, 337 Bankr. 846, 2005 Bankr. LEXIS 2786 (Bankr. E.D. Va. 2005).

Applied in In re Heater, 189 Bankr. 629 (Bankr. E.D. Va. 1995).

§ 34-21. When householder's right to exemption is exhausted.

When an amount of property, whether real or personal, or both, has been set apart to be held by a householder as exempt under § 34-4 , 34-4 .1, or 34-13 , such amount shall for a period of eight years from such setting apart be applied against the maximum amount to which the householder is entitled to set apart as exempt under § 34-4, 34-4.1 , or 34-13 .

(Code 1919, § 6547; 1975, c. 466; 1977, c. 496; 1990, c. 942; 1996, c. 330; 2020, c. 328.)

Editor's note. - Acts 2020, c. 328, cl. 2 provides: "That the Executive Secretary of the Supreme Court of Virginia shall promulgate and update the forms necessary to comply with the provisions of the first enactment of this act."

The 1996 amendment substituted "the maximum amount of property, whether real or personal" for "estate, real or personal," inserted "or § 34-4 .1" following " § 34-4 ," and substituted "as otherwise provided by law" for "that mentioned in §§ 34-18 , 34-20 , 34-26 , 34-27 , and 34-29 ."

The 2020 amendments. - The 2020 amendment by c. 328, rewrote the section, which formerly read "When the maximum amount of property, whether real or personal, or both, has been once set apart to be held by a householder as exempt under § 34-4 or § 34-4.1 , he shall not afterwards be entitled to the exemption of any estate other than that so set apart or as otherwise provided by law.

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Execution and Attachment, § 14.

CASE NOTES

Perfection of homestead exemption in Chapter 13 proceedings. - Although a Chapter 13 debtor need not perfect his homestead exemption, he derives no benefit from that fact; since Chapter 13 of the Bankruptcy Code involves a reorganization rather than a liquidation of the debtor's estate, the Chapter 13 debtor retains possession of his assets. Conversely, requiring the Chapter 13 debtor to perfect his homestead exemption would result in an unnecessary exhaustion of the exemption in a proceeding involving no liquidation of the debtor's estate. Grenco Real Estate Inv. Trust v. Morris, 48 Bankr. 313 (W.D. Va. 1985).

Debtor cannot hold property exceeding in aggregate the legal maximum. - While the debtor may supplement the original homestead by a new one, so as to make the aggregate equal to the maximum under this section, this privilege after being once fully exercised is regarded as exhausted. The householder cannot by successive acts hold at one time, or at different times, property which in the aggregate exceeds the maximum value. Oppenheimer v. Howell, 76 Va. 218 (1882).

He cannot attack validity of original deed. - If a householder has squandered, or does not account for, the property set apart for his original homestead he cannot found a claim to a new one by attacking the validity of the deed of his own making which created the original. Oppenheimer v. Howell, 76 Va. 218 (1882).

Deed could not be amended to decrease value of listed property in order to add new property. - A recorded homestead deed which lists property equal in value to the entire available homestead exemption cannot be amended to decrease the value of listed property in order to add other property not previously listed, at least not if the property was owned by the debtor when the original homestead deed was filed. In re Emerson, 129 Bankr. 82 (Bankr. W.D. Va. 1991), aff'd, 962 F.2d 6 (4th Cir. 1992).

Additional exemptions, not exceeding the total valuation allowed under this section during a lifetime, may be set apart as exempt under successive homestead deeds. In re Waltrip, 260 F. Supp. 448 (E.D. Va. 1966).

Section not applicable to life insurance exemptions. - In light of the liberality that must be afforded debtors in construing Virginia's exemption laws and in light of the clear meaning of this section, it must be concluded that the life insurance exemptions found in former § 38.1-448 (see now § 38.2-3122 ) and former § 38.1-449 (see now § 38.2-3123 ) are separate and independent from the homestead exemption found in this title and are not limited by the provisions of this section. In re Redmon, 31 Bankr. 756 (Bankr. E.D. Va. 1983).

This section does not limit debtors' rights to exempt the cash surrender value of their life insurance policies pursuant to former § 38.1-448 (see now § 38.2-3122 ) and former § 38.1-449 (see now § 38.2-3123 ). In re Redmon, 31 Bankr. 756 (Bankr. E.D. Va. 1983).

Applied in In re Williams, 337 Bankr. 846, 2005 Bankr. LEXIS 2786 (Bankr. E.D. Va. 2005).

§ 34-22. Waiver of exemption; its effect; form of waiver.

If any person shall declare in a bond, bill, note or other instrument by which he is or may become liable for the payment of money to another or by a writing thereon or annexed thereto that he waives, as to such obligation, the exemption from liability of the property or estate which he may be entitled to claim and hold exempt under the provisions of this chapter, such property or estate, whether previously set apart or not, shall be liable to be subjected for such obligation, under legal process, in like manner and to the same extent as other property or estate of such person. But such waiver shall not extend to or affect the exemption of the property or estate exempt under §§ 34-26 , 34-27 and 34-29 . The following or equivalent words shall be sufficient to operate as the waiver hereinbefore provided for: "I (or we) waive the benefit of my (or our) exemption as to this obligation." If a debt which is superior to the homestead, or as to which the homestead is waived, be paid off by a surety therein, the principal shall not be allowed to claim the homestead as against such surety.

(Code 1919, § 6548.)

Cross references. - As to waiver of homestead in bonds and recognizances in favor of State, see §§ 19.2-135, 49-12 .

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Research References. - Bryson on Virginia Civil Procedure (Matthew Bender). Chapter 18 Enforcement of Judgments and Decrees. § 18.01 Exemptions from Execution. Bryson.

Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 4 Garnishment. § 4.7 Wages and Statutory Exemptions. Rendleman.

Virginia Forms (Matthew Bender). No. 16-601 Deed of Trust Note - Simple Form; et seq. No. 16-632 USDA Rural Housing Services Note.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, § 82; 8A M.J. Exemptions from Execution and Attachment, § 18; 13A M.J. Mortgages and Deeds of Trust, § 19.

CASE NOTES

Where loan is secured and security interest perfected under Virginia law, the waiver is not voided by operation of 11 U.S.C. § 522(e), covering unsecured loans. Dominion Bank v. Nuckolls, 780 F.2d 408 (4th Cir. 1985).

A householder may waive the benefit of his homestead exemption by contractual stipulation, and thereby the property set apart as exempt will be subject to the debt. Williams v. Watkins, 92 Va. 680 , 24 S.E. 223 (1896).

The right to waive the homestead is not unconstitutional or against public policy. Barbarossa v. Beneficial Fin. Co., 438 F. Supp. 840 (E.D. Va. 1977).

The right to claim the exemption is purely a personal one. The debtor is not compelled to take advantage of it. There is no power vested in his wife or children or other member of his family, to require him to hold it exempt. White v. Owen, 71 Va. (30 Gratt.) 43 (1878).

The right to claim the homestead exemption is a personal privilege and may be waived. Barbarossa v. Beneficial Fin. Co., 438 F. Supp. 840 (E.D. Va. 1977).

Waiver must be express and in writing. - The waiver is required to be in writing and must be expressed in the bond, bill, note or other writing itself, which is the evidence of the obligation, or by a writing thereon or annexed thereto, and where it is so done, the exemption is declared to be waived as to the said obligation. Long v. Pence, 93 Va. 584 , 25 S.E. 593 (1896).

It cannot be made by implication. - Statutes relating to the homestead and constituting a favor of the law to protect the debtor and his family, are liberally construed in favor of the debtor and strictly against the creditor. Thus the waiver cannot be made by implication, but must be by an express declaration in writing. Home Owners' Loan Corp. v. Reese, 170 Va. 275 , 196 S.E. 625 (1938).

Waiver does not increase or diminish indebtedness. - The right to claim or to waive a homestead is a question apart from the amount of the indebtedness. The waiver or nonwaiver of the homestead does not increase or diminish the indebtedness. Waiver simply increases the chance of the creditor to collect the debt owing to him, by denying the debtor the right to withdraw a portion of his property from execution or levy. Home Owners' Loan Corp. v. Reese, 170 Va. 275 , 196 S.E. 625 (1938).

There was no conflict between the provisions of this section and § 6.1-289 [see now § 6.2-1528 ] where the inclusion of a provision in a promissory note waiving appellant-bankrupt's homestead exemption did not "have the effect of impairing in any manner any rights on the part of anyone as to exemptions under the poor debtor's laws" since the homestead exemption "is a mere personal privilege extended in the benignity of the law to the debtor, which he may waive or claim at his election." Barbarossa v. Beneficial Fin. Co., 438 F. Supp. 840 (E.D. Va. 1977).

Waiver is conclusive against debtor, his wife and children. - If a party executing his bond or note before or after the property has been set apart as his homestead exemption, waives his homestead exemption as to the bond or note, neither he nor his wife, in his lifetime, nor, after his decease, either his widow or his infant children, can set up said homestead exemption as against said bond or note. Linkenhoker v. Detrick, 81 Va. 44 (1885). See Reed v. Union Bank, 70 Va. (29 Gratt.) 719 (1878).

Waiver as to obligation of instrument does not apply to liability of assignor. - Waiver of the homestead exemption in the body of a nonnegotiable note is only a waiver as to the particular obligation expressed in the body of the note, and not as to the implied obligation growing out of an assignment of the note, and, as against the liability of the assignor to the assignee, the former may claim the benefit of the exemption, although the note declares that "the drawers and endorsers each hereby waive the benefit of our homestead exemptions . . . as to this debt." Long v. Pence, 93 Va. 584 , 25 S.E. 593 (1896).

Waiver not allowed in bankruptcy. - While this section allows the enforcement of a homestead waiver, the Bankruptcy Code, in 11 U.S.C. § 522(e), does not. Baum v. United Va. Bank, 15 Bankr. 538 (Bankr. E.D. Va. 1981).

Applied in In re Moran, 105 F. 901 (W.D. Va. 1900); Dockery v. Flanary, 194 Va. 318 , 73 S.E.2d 375 (1952).

§ 34-23. How claim enforced when exemption waived, etc.

In any proceeding for the enforcement of a claim, which by reason of the waiver aforesaid or otherwise, is paramount to the exemption, if there be in the county or city wherein the proceeding is estate of the debtor other than that which has been set apart as aforesaid, such other estate shall be subjected and exhausted before the estate so set apart is resorted to. If, however, the claim is secured by mortgage, deed of trust or other specific lien on the estate set apart, nothing in this section contained shall prevent the enforcement of the security in the first instance and before resorting to other estate of the debtor.

(Code 1919, § 6549; 1974, c. 272; 1981, c. 580.)

Editor's note. - Acts 1981, c. 580, cl. 3 provides: "That the provisions of this act shall not affect homestead waivers executed on or prior to June thirty, nineteen hundred eighty-one, or to the renewal of an indebtedness executed prior to such date if the prior indebtedness contained such a waiver."

§ 34-24. When the exemption ceases; lien of judgment or decree against householder.

When any person, entitled as a householder to the exemption provided for in § 34-4 , ceases to be a householder or when any person removes from this Commonwealth, his right to claim or hold any estate as exempt under the provisions of this chapter, shall cease; but the lien of a judgment, or decree for money, rendered against a householder, and which is not paramount to the exemption provided for in this chapter, shall, as to the real estate held as exempt by him, attach to such only of that estate as he may be possessed of or entitled to at the time the exemption thereof ceases, as aforesaid, and until that time the lien shall not be enforced. Such judgments shall attach in the order of their priority, respectively, subject to the provisions of Article 2 (§ 64.2-309 et seq.) of Chapter 2 of Title 64.2.

(Code 1919, § 6550; 1972, c. 825; 1974, c. 272; 1981, c. 580.)

Cross references. - As to judgment and execution liens, see §§ 8.01-458 et seq. and 8.01-466 et seq.

Editor's note. - Acts 1981, c. 580, cl. 3 provides: "That the provisions of this act shall not affect homestead waivers executed on or prior to June thirty, nineteen hundred eighty-one, or to the renewal of an indebtedness executed prior to such date if the prior indebtedness contained such a waiver."

At the direction of the Virginia Code Commission, the reference to "Article 5.1 ( § 64.1-151.1 et seq.) of Chapter 6 of Title 64.1" was changed to "Article 2 ( § 64.2-309 et seq.) of Chapter 2 of Title 64.2" to conform to the recodification of Title 64.1 by Acts 2012, c. 614, effective October 1, 2012.

Law review. - For article, "The Federal Law of Property: The Case of Inheritance Disclaimers and Tenancy by the Entireties," see 75 Wash & Lee L. Rev. 3 (2018).

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Execution and Attachment, §§ 4, 5, 8, 19, 20.

CASE NOTES

I. GENERAL CONSIDERATION.

Judgment lien attaches when exemption ceases. - The main object of this section in declaring when the homestead exemption shall cease was to fix the time when the judgment lien shall attach to the exempted real estate. It is declared that the lien shall not attach except to such real estate as the householder shall have at the time the exemption ceases, and that it shall attach at that time. Ackiss v. Satchell, 104 Va. 700 , 52 S.E. 378 (1905).

A change of domicile to another state involves an abandonment of the homestead rights and privileges in this State. Lindsay v. Murphy, 76 Va. 428 (1882); Blose v. Bear, 87 Va. 177 , 12 S.E. 294 (1890); Wilkinson v. Merrill, 87 Va. 513 , 12 S.E. 1015 (1891).

Court will not require security for forthcoming of principal on termination of exemption. - Although a limit is fixed as to the duration of the homestead no lien attaches thereto until that time has arrived. A court of equity will not require security to be given for the forthcoming of the principal of the exemption at the expiration of the homestead period. Williams v. Watkins, 92 Va. 680 , 24 S.E. 223 (1896).

The widow and infant children of a householder ought not to be required at the instance of a creditor of the householder to give bond and security to have the corpus of the homestead forthcoming at the termination of the homestead period. Mahoney v. James, 94 Va. 176 , 26 S.E. 384 (1897).

And statute of limitations is not suspended during homestead period. - The prohibition to the enforcement of a judgment against property set apart as a homestead does not suspend the running of the statute of limitations as to the judgment. After the lapse of the statutory period the judgment is barred by limitation, and the lien, which is a mere incident of the judgment, ceases. Ackiss v. Satchell, 104 Va. 700 , 52 S.E. 378 (1905).

The debtors must be "residents" at time of filing their homestead deed in order to claim exemption under Virginia law. In re Calhoun, 47 Bankr. 119 (Bankr. E.D. Va. 1985).

Applied in Barker v. Jenkins, 84 Va. 895 , 6 S.E. 459 (1888); Hanby v. Henritze, 85 Va. 177 , 7 S.E. 104 (1888).

II. BANKRUPTCY PROCEEDINGS.

Nonresident debtor entitled to exemption under alternate provision of federal law. - Where debtor, resident of District of Columbia for two months, filed a petition for voluntary relief in Virginia court as she had resided in Commonwealth for greater portion of 180-day residency requirement under 11 U.S.C. § 522(b), but could not receive Virginia exemption as she was not resident in Virginia, she was entitled to exemptions under alternative provisions of 11 U.S.C. § 522(b) due the certainty of congressional intent that every debtor have exemptions to enable him a fresh start and due inapplicability of Virginia state law of exemptions to debtor. In re Hawkins, 15 Bankr. 618 (Bankr. E.D. Va. 1981).

Exemptions allowed where debtors were state residents at time of filing homestead deed. - Debtors, residents of the Commonwealth, who shipped all of their household goods out-of-state, subsequently filed a homestead deed in Virginia and then moved to Florida while their attorney filed petitions in bankruptcy in Virginia, were allowed their requested exemptions since they were residents of Virginia at the time of the homestead deed filing. In re Chaffins, 16 Bankr. 686 (Bankr. E.D. Va. 1982).

§ 34-25. When homestead waived judgments and executions to so state.

Whenever a judgment or decree is rendered on an instrument waiving the homestead or upon a demand against which the homestead cannot be claimed the court shall include in its judgment or decree words to the following effect, as the case may be: "Upon an instrument waiving the homestead," or "upon a claim against which the homestead cannot be demanded." This statement shall be endorsed upon the executions issued upon such judgments or decrees. In any action or suit when it is not apparent from the face of the pleadings that the demand is not subject to the homestead exemption the plaintiff shall not have the benefit of the foregoing provision of this section unless in his declaration he alleges that his demand is not subject to such homestead exemption. But no presumption of nonwaiver or that the judgment or decree was rendered upon a demand against which homestead could be claimed is to be drawn from the silence of any judgment, execution or decree on the matters provided for by this section.

(Code 1919, § 6551.)

Michie's Jurisprudence. - For related discussion, see 11A M.J. Judgments and Decrees, § 34.

CASE NOTES

Erroneous statement of waiver does not vitiate judgment. - In an action on an assigned nonnegotiable note as to which assignment the homestead exemption is not waived, the statement in the entry that the homestead is waived does not vitiate the judgment. The judgment in this respect will be amended and affirmed. Long v. Pence, 93 Va. 584 , 25 S.E. 593 (1896).

Applied in Dickens v. Snellings, 10 Bankr. 949 (Bankr. W.D. Va. 1981).

Chapter 3. Other Articles Exempt.

Sec.

§ 34-26. Poor debtor's exemption; exempt articles enumerated.

In addition to the exemptions provided in Chapter 2 (§ 34-4 et seq.), every householder shall be entitled to hold exempt from creditor process the following enumerated items:

  1. The family Bible.

    1a. Wedding and engagement rings.

  2. Family portraits and family heirlooms not to exceed $5,000 in value.
    1. A lot in a burial ground, and (ii) any preneed funeral contract not to exceed $5,000. 3. (i) A lot in a burial ground, and (ii) any preneed funeral contract not to exceed $5,000.
  3. All wearing apparel of the householder not to exceed $1,000 in value.

    4a. All household furnishings including, but not limited to, beds, dressers, floor coverings, stoves, refrigerators, washing machines, dryers, sewing machines, pots and pans for cooking, plates, and eating utensils, not to exceed $5,000 in value.

    4b. Firearms, not to exceed a total of $3,000 in value.

  4. All animals owned as pets, such as cats, dogs, birds, squirrels, rabbits and other pets not kept or raised for sale or profit.
  5. Medically prescribed health aids.
  6. Tools, books, instruments, implements, equipment, and machines, including motor vehicles, vessels, and aircraft, which are necessary for use in the course of the householder's occupation or trade not exceeding $10,000 in value, except that a perfected security interest on such personal property shall have priority over the claim of exemption under this section. A motor vehicle, vessel or aircraft used to commute to and from a place of occupation or trade and not otherwise necessary for use in the course of such occupation or trade shall not be exempt under this subdivision. "Occupation," as used in this subdivision, includes enrollment in any public or private elementary, secondary, or career and technical education school or institution of higher education.
  7. Motor vehicles, not held as exempt under subdivision 7, owned by the householder, not to exceed a total of $6,000 in value, except that a perfected security interest on a motor vehicle shall have priority over the claim of exemption under this subdivision.
  8. Those portions of a tax refund or governmental payment attributable to the Child Tax Credit or Additional Child Tax Credit pursuant to § 24 of the Internal Revenue Code of 1986, as amended, or the Earned Income Credit pursuant to § 32 of the Internal Revenue Code of 1986, as amended.
  9. Unpaid spousal or child support.

    The value of an item claimed as exempt under this section shall be the fair market value of the item less any prior security interest.

    The monetary limits, where provided, are applicable to the total value of property claimed as exempt under that subdivision.

    The purchase of an item claimed as exempt under this section with nonexempt property in contemplation of bankruptcy or creditor process shall not be deemed to be in fraud of creditors.

    No officer or other person shall levy or distrain upon, or attach, such articles, or otherwise seek to subject such articles to any lien or process. It shall not be required that a householder designate any property exempt under this section in a deed in order to secure such exemption.

    (Code 1919, § 6552; 1934, p. 371; 1936, p. 322; 1956, c. 637; 1970, c. 428; 1975, c. 466; 1976, c. 150; 1977, cc. 253, 496; 1990, c. 942; 1992, c. 644; 1993, c. 150; 2001, c. 483; 2002, c. 88; 2011, cc. 761, 835; 2015, c. 686.)

Cross references. - As to injunction to protect this exemption, see § 34-2 .

As to liability of articles exempt under this section and § 34-27 for taxes and levies and for their purchase price, see § 34-3 .

As to other exemptions, see §§ 8.01-489 , 8.01-563 , 34-27 , 34-29 , 34-33 .

The 2001 amendments. - The 2001 amendment by c. 483 substituted "career and technical education" for "vocational" near the end of subdivision (7).

The 2002 amendments. - The 2002 amendment by c. 88 changed the subdivision designations from (1) through (8) to 1. through 8.; in subdivision 3, added the clause (i) designation and added clause (ii); in subdivision 7, substituted "subdivision" for "subsection" at the end of the second sentence; and in subdivision 8, substituted "subdivision 7" for "subdivision (7)" and "subdivision" for "subsection."

The 2011 amendments. - The 2011 amendments by cc. 761 and 835 are identical, and added subdivision 4b, substituted "not to exceed $6,000" for "not to exceed $2,000" in subdivision 8, and made a minor stylistic change.

The 2015 amendments. - The 2015 amendment by c. 686 substituted "Firearms, not to exceed a total of $3,000" for "One firearm, not to exceed $3000" in subdivision 4b; in subdivision 8 substituted "Motor vehicles" for "A motor vehicle" and "exceed a total of $6000" for "exceed $6000"; added subdivisions 9 and 10, and made a stylistic change.

Law review. - For comment, "In re Cheeseman: A Judicial Revision of Virginia's Homestead Exemption Laws," see 16 U. Rich. L. Rev. 391 (1982). For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985). For survey on creditor's rights in Virginia for 1989, see 23 U. Rich. L. Rev. 561 (1989).

For 1991 survey on bankruptcy law, see 25 U. Rich. L. Rev. 607 (1991).

For essay, "A Distinction Without a Difference? An Examination of the Legal and Ethical Difference Between Asset Protection and Fraudulent Transfers Under Virginia Law," see 47 U. Rich. L. Rev. 381 (2012).

For article, "Commercial Bribery: Choice and Measurement Within a Remedies Smorgasbord," see 74 Wash & Lee L. Rev. 369 (2017).

Research References. - Bryson on Virginia Civil Procedure (Matthew Bender). Chapter 18 Enforcement of Judgments and Decrees. § 18.01 Exemptions from Execution. Bryson.

Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 3 The Writ Firea Facies: Execution. § 3.3 Relief from Levy; § 11.4 Exempt Property. Rendleman.

Virginia Forms (Matthew Bender). No. 16-586 Homestead Deed.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, §§ 72, 76, 78; 8A M.J. Executions, § 20; 8A M.J. Exemptions from Execution and Attachment, §§ 6, 8, 21.

CASE NOTES

I. GENERAL CONSIDERATION.

This section and § 34-4 provide debtors with two methods for setting apart property as exempt from the actions of creditors. Debtors are entitled to the benefits of both exemption methods. In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982).

No time or value limits under this section. - There is no limit on the value of the articles exempted under this section, no time specified for setting aside qualifying property, and no procedure specified for claiming the property as exempt. In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982).

Purpose of amendment of subdivision 7 of this section. - By amending subdivision 7 of this section using the words "perfected security interest," the Virginia legislature meant to give both purchase-money and nonpurchase-money security interests priority over the exemption for tools of the trade. Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991).

The procedures of §§ 34-14 and 34-17 do not apply to the poor debtor's exemption of this section. Bryant v. Smith, 165 Bankr. 176 (W.D. Va. 1994).

Application of monetary limits to value of exemption. - A reading of the complete exemption scheme in this section makes it clear that the monetary limits found in several of its subsections apply to the value of the exemption rather than the value of the property. In re Fenessy, 156 Bankr. 22 (Bankr. E.D. Va. 1993).

"Necessary" wearing apparel. - In a bankruptcy proceeding where the debtor attempted to exempt her $2,500 mink coat, the court held that the phrase "all necessary wearing apparel of the debtor and his family" warranted granting of the exemption, since the word "necessary" is not a word of limitation requiring the fixing of a value upon clothing as a criteria in determining its exempt status. In re Perry, 6 Bankr. 263 (Bankr. W.D. Va. 1980).

A person must be a resident of Virginia in order to qualify for the poor debtor's exemption under this section. Davis v. Maloney, 243 Va. 500 , 416 S.E.2d 232 (1992).

Section does not protect one in unlawful possession of property. - This section does not contemplate that an intruder, who does not own the property levied on and is in unlawful possession of it, may have the property set aside for the use of himself and his family. Boswell v. Lipscomb, 177 Va. 309 , 14 S.E.2d 305 (1941).

Conflict between language of subdivision 7 of this section and § 34-28 . - Section 34-28 , which was not amended in 1990, expressly voids all nonpurchase-money security interests on property exempted under this section, but leaves purchase money security interests in place. Prior to 1990, the effect of § 34-28 was the same on all property which could be exempted under this section. Because § 34-28 was not amended in 1990 when this section was, a conflict exists between the language in subdivision 7 of this section which gives perfected security interests priority over the exemption for tools of the trade and the language in § 34-28 which voids nonpurchase-money security interests in exempted property. Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991).

To the extent that amended subdivision 7 of this section conflicts with § 34-28 , the language in subdivision of this section, which is the more specific and more recently enacted statute, will be given effect. Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991).

Amendment of deed and schedules to show increase in appraised value. - Having set apart the property in her original homestead deed, the debtor may increase the value originally stated for the property in both the homestead deed and the schedules filed with the court so as to reflect the results of an appraisal showing an increase in value. In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982).

Court cannot enlarge exemptions. - Bankruptcy court could not use its equitable powers to enlarge the statutory exemption under subdivision 8 of § 34-26 on the ground that allowing only a $2,000 exemption in a vehicle would have precluded the debtors from obtaining an effective fresh start. In re Lopez,, 2008 Bankr. LEXIS 4012 (Bankr. E.D. Va. Nov. 5, 2008).

Articles not exempt. - A color television, a life insurance policy, and a bank deposit are not exemptable under this section. Canfield v. Lyons, 23 Bankr. 123 (Bankr. E.D. Va. 1982).

Sports memorabilia not family heirloom. - Where a bankruptcy debtor contended that sports memorabilia which the debtor acquired through business relationships with sports figures were exempt family heirlooms since the debtor intended to give or bequeath them to the debtor's children, the memorabilia were not heirlooms for purposes of exemption since the items were not transferred from an ancestor of the debtor with the intention that they remain in the debtor's family. In re Pullman, 317 Bankr. 324, 2004 Bankr. LEXIS 1776 (Bankr. E.D. Va. 2004).

Heirloom must be transferred from ancestor to descendant. - While all heirlooms must originate somewhere, an item of personal property is not an heirloom for purposes of exemption, unless and until it has been transferred from an ancestor to a descendant with the intention that it remain in the family. In re Pullman, 317 Bankr. 324, 2004 Bankr. LEXIS 1776 (Bankr. E.D. Va. 2004).

The term "furnishings" does not necessarily exclude televisions, stereos and VCRs because this section includes "non-furniture" items - such as eating utensils and plates - as examples of "household furnishings." In re Hanes, 162 Bankr. 733 (Bankr. E.D. Va. 1994).

"Household furniture" in subdivision 4a of this section of the Code of Virginia means those items of furniture that are typically found in or around the home of debtors and are used by the debtors and their dependents to support and facilitate day-to-day living within the home, including maintenance and upkeep of the home itself. In re Latham, 182 Bankr. 479 (Bankr. W.D. Va. 1995).

Scope of household furnishings. - The intended scope of subdivision 4a of § 34-26 was personal property commonly found in Virginia households, used to support the everyday life of its members and reasonably necessary for that household to enjoy that basic standard of living which the vast majority of Virginia's citizens were privileged to have. Hence, in bankruptcy debtor's motion to exempt certain personal property from a non-purchase money security interest, an exemption would be granted as to debtor's television, VCR and computer, but not as to movie camera and pool table. Hicks v. Wash. Mut. Fin. (In re Hicks), 276 Bankr. 84, 2001 Bankr. LEXIS 1872 (Bankr. W.D. Va. 2001).

Items included in a prior bankruptcy case. - Bankruptcy court sustained in part and overruled in part a Chapter 7 trustee's objection to Chapter 7 debtors' claim that household furnishings they owned were exempt from creditors' claims under subdivision 4a of § 34-26 . There was no merit to the debtors' claim that certain items of property they owned were exempt from creditors' claims because they were included in a prior bankruptcy case. In re Kramer, 476 Bankr. 220, 2011 Bankr. LEXIS 3514 (Bankr. E.D. Va. Sept. 13, 2011).

Applied in In re Dardar, 3 Bankr. 641 (Bankr. E.D. Va. 1980); Boitnott v. United Va. Bank, 4 Bankr. 119 (Bankr. W.D. Va. 1980); Prudential Ins. Co. of Am. v. Stephens, 498 F. Supp. 155 (E.D. Va. 1980); Ragsdale v. Genesco, Inc., 9 Bankr. 991 (Bankr. E.D. Va. 1981); In re Tate, 41 Bankr. 946 (Bankr. W.D. Va. 1984); In re Lamm, 47 Bankr. 364 (E.D. Va. 1984); Monticello Arcade Ltd. v. Lyall, 191 Bankr. 78 (E.D. Va. 1996); In re Bonner, 206 Bankr. 387 (Bankr. E.D. Va. 1997).

II. TOOLS OF TRADE.

Debtor can exempt up to $2,000 in value of a vehicle. - Virginia state laws allow a debtor to exempt, and avoid the lien on, up to $2,000 in value of a motor vehicle where that lien is neither a perfected security interest, nor was it given to secure a loan for the purchase of the vehicle. In re Fenessy, 156 Bankr. 22 (Bankr. E.D. Va. 1993).

Exemption could apply to proceeds from sale of vehicle. - Where debtor's claim of exemption was properly noticed long before sale of vehicle, the debtor's exemption could apply to proceeds from sale of the vehicle, even if the vehicle itself was subject to an exemption. In re Fenessy, 156 Bankr. 22 (Bankr. E.D. Va. 1993).

Where debtors intended to use beach home as a place to go on vacation only when it was not rented, the beach house was not the type of "home of the debtors" contemplated by this section. In re Latham, 182 Bankr. 479 (Bankr. W.D. Va. 1995).

Where primary purpose of beach furniture was for attracting potential renters and for use by those renters and the furniture was not acquired and used by the debtors for the support of debtors or to facilitate their day-to-day living within the home, it did not satisfy the definition of household furnishings. In re Latham, 182 Bankr. 479 (Bankr. W.D. Va. 1995).

Occupationally-related exemptions limited to principal occupation. - For purposes of the exemption statutes a debtor may claim occupationally-related exemptions in this section only in his or her principal occupation. A debtor may claim only one principal occupation. In re Allen, 52 Bankr. 206 (Bankr. E.D. Va. 1985).

Tools and utensils must be reasonably necessary. - Where there is a dispute as to the items which constitute tools and utensils of the debtor's trade for purposes of the poor debtor's exemption, the court will look to see whether the item claimed to be exempt is reasonably necessary both in kind and in quality for the workman to perform his chosen craft in an efficient and competent manner. In re Allen, 52 Bankr. 206 (Bankr. E.D. Va. 1985).

How tool used in trade must be examined. - Since different trades put the same tools to different uses, a factual inquiry must be made in each case concerning the use to which the property claimed exempt is in fact put. Quidley v. Small Bus. Admin., 39 Bankr. 362 (Bankr. E.D. Va. 1984).

It would be impermissible to allow duplication of tools since the purpose of the exemption statute is to set forth and protect the basic tools and utensils in order to aid the debtor in continuing in his means of livelihood and not to guarantee to the mechanic each and every possible and potential tool that can be used to set up the perfect workshop. In re Allen, 52 Bankr. 206 (Bankr. E.D. Va. 1985).

Exemption does not cover every possible tool that could be used. - The exemption of tools and utensils of the debtor's trade is not one that guarantees to the mechanic each and every possible and potential tool that can be used to set up the perfect workshop. Rather the exemption is to set forth and protect the basic tools and utensils in order to aid the debtor in continuing in his means of livelihood. Quidley v. Small Bus. Admin., 39 Bankr. 362 (Bankr. E.D. Va. 1984).

Mechanic's tools. - Bankruptcy court dismissed a creditor's claim seeking a determination that a Chapter 7 debtor who sold her an inoperative, partially reconstructed sports car was ineligible under 11 U.S.C.S. § 727(a)(4) to have his debts discharged because he underreported the value of tools he owned and overstated his monthly living expenses on his bankruptcy schedules. The debtor was allowed under subdivision 7 of § 34-26 to claim that $10,000 in tools he owned were exempt from creditors' claims because he used those tools as a mechanic, the debtor's claim that tools he owned were worth $2,000 was well within that limit and the creditor did not rebut the debtor's claim that he sold some of the tools the creditor saw in his garage before he declared bankruptcy. Miller v. Liatos (In re Liatos),, 2012 Bankr. LEXIS 3650 (Bankr. E.D. Va. Aug. 8, 2012).

Tools and utensils of trade exempt without regard to dollar value. - This section does not define what constitutes a tool or utensil of trade nor does it set a limitation as to number or dollar amount of tools and utensils of the trade that may be claimed exempt. Therefore, if the court finds a particular item of personal property to qualify as a tool or utensil of the trade the debtor may avoid the fixing of a lien on that item without regard to the dollar value of such tool or utensil. Quidley v. Small Bus. Admin., 39 Bankr. 362 (Bankr. E.D. Va. 1984).

Legislature did not intend that a party could engage in several trades or occupations in order to claim multiple exemptions. To do so would be to allow a debtor to engage potentially in a vocation as a mechanic, an oysterman or fisherman, and a farmer, and thereby claim additional exemptions. In re Samuel, 36 Bankr. 312 (Bankr. E.D. Va. 1984).

Power tools may be considered tools within the meaning of this section such that a carpenter could exempt drills, saws, and other equipment necessary to the carrying out of his occupation. In re Allen, 52 Bankr. 206 (Bankr. E.D. Va. 1985).

General contractor can have principal occupation as carpenter. - A debtor may be both a carpenter and a general contractor and still retain his principal occupation as carpenter, for purposes of claiming the exemption of the tools and utensils of a carpenter's trade. Being a carpenter and a general contractor are not necessarily mutually exclusive occupations. The court is required to look at the facts and circumstances of each case to determine whether a debtor who desires to exempt his tools of the trade as a carpenter is actually performing carpentry work as his principal occupation. In re Allen, 52 Bankr. 206 (Bankr. E.D. Va. 1985).

Restaurant equipment is not "tools of the trade." - A restaurateur is not a mechanic and, consequently, restaurant equipment is not a mechanic's "tools of the trade." Dominion Bank v. Nuckolls, 71 Bankr. 593 (W.D. Va. 1987).

Restaurant equipment does not fall within the "tools of trade" language of this section such that it is exempt property in which the debtors may attempt to avoid the fixing of a lien under 11 U.S.C. § 522(f). Nuckolls v. Dominion Bank, 63 Bankr. 254 (Bankr. W.D. Va. 1986)aff'd, 71 Bankr. 593 (W.D. Va. 1987).

Tools of trade not used in primary occupation. - Chapter 7 debtor could not exempt a pick-up truck and various power tools as tools of the trade under subdivision 7 of § 34-26 because the debtor had primarily earned his living for some six months as a budget analyst, not as a carpenter, and given that any return to carpentry as his primary source of income was wholly dependent upon the recovery of the housing market, something that might not occur for many months, and perhaps even years, the court could not find that the debtor's employment situation on the filing date of the bankruptcy petition constituted only a temporary cessation of his former trade or occupation. In re Cordova, 394 Bankr. 389, 2008 Bankr. LEXIS 2956 (Bankr. E.D. Va. 2008).

Truck not tool of trade. - Where even the debtors themselves evidently did not, when they filed their petition, consider a truck to be a tool of the husband's trade, since they did not exempt it as such on the schedules filed with the petition, the court was unable to conclude that the truck was "necessary" to the husband's trade or occupation as a heating and air-conditioning mechanic on that date, even though it may have become so subsequently; that being the case, the debtors were not entitled to exempt the truck under this section. In re Weinstein, 192 Bankr. 133 (Bankr. E.D. Va. 1995).

Primary trade or occupation. - Debtor could not exempt his pickup truck and carpentry tools as tools of the trade under subdivision 7 of § 34-26 where carpentry was not the debtor's primary trade or occupation on the date he filed his bankruptcy petition. Debtor had earned no income from his carpentry business in the six weeks prior to the bankruptcy filing, and earned a salary of $70,000 a year from his full-time position as a budget analyst. In re Cordova, 394 Bankr. 389, 2008 Bankr. LEXIS 2956 (Bankr. E.D. Va. 2008).

III. BANKRUPTCY PROCEEDINGS.

Change in exemption method in bankruptcy. - If the property at issue qualifies for exemption under this section and, by virtue of having been exempted by homestead deed at the inception of the case, has not passed into the bankruptcy estate, the debtors may amend their Schedule B-4 under the former bankruptcy rules to reflect the change in exemption method. Indeed, the only procedure by which exemptions under this section may be claimed in bankruptcy is that of listing the property in Schedule B-4. In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982).

The liberal amending provision of former Bankruptcy Rule 110 and the absence of a time restraint in this section make clear the right of the debtors to effect the requested change in method for claiming this property as exempt, and debtors may amend schedules of property originally submitted with the bankruptcy petition so as to exempt certain property under this section rather than under § 34-4 . In re Maginnis, 24 Bankr. 146 (Bankr. E.D. Va. 1982).

Exemption involving intentional tort allowed. - Because Congress specifically legislated as to the type of claims that can be enforced against exempt property, and since the plaintiff's claim did not fall within any of the enumerated exceptions, the court concluded that the debtor was entitled to her exemptions notwithstanding that the plaintiff held a nondischargeable claim based on an intentional tort. In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

Since the prior security interest exceeded the fair market value of the automobile, it necessarily followed that the value of the debtor's interest was less than $2000, which is well within the amount allowed by this section. In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

Race car is a motor vehicle. - Bankruptcy debtor's vehicle that was modified to be a race car was a motor vehicle subject to exemption under subdivision 8 of § 34-26 , since the vehicle was capable of transporting persons on the highways of the state, within the meaning of the definitions of "motor vehicle" and "vehicle" set out in § 46.2-100 , even if the race car was not legally able to do so. In re Crump,, 2007 Bankr. LEXIS 1346 (Bankr. E.D. Va. Apr. 3, 2007).

Powerboat is not a motor vehicle. - Debtors' powerboat did not constitute a motor vehicle for which they could claim an exemption under the poor debtor's exemption of subdivision 8 of § 34-26 because, considering the dictionary definition as well as the way the term "motor vehicle" was used elsewhere in the Code of Virginia, §§ 8.01-307 and 46.2-100 , the General Assembly did not intend the term "motor vehicle" as used in the exemption statute to include a powerboat, which did not operate on a highway, did not have rubber tires for use on a highway, and was an entirely different creature, a vessel used for transportation on water. In re Potter,, 2009 Bankr. LEXIS 804 (Bankr. E.D. Va. Mar. 24, 2009).

Mobile home not a "motor vehicle." - Chapter 7 debtor could not exempt her mobile home under subdivision 8 of § 34-26 because it did not meet the statutory requirements of the § 46.2-100 test; it was not self propelled or designed for self propulsion, nor was it designed or used primarily to be loaded on or affixed to a motor vehicle to provide a mobile dwelling. In re Scott,, 2012 Bankr. LEXIS 3107 (Bankr. E.D. Va. July 3, 2012).

Debtors were not allowed automobile exemptions as result of 1990 amendments. - Debtors were not entitled to claim automobile exemptions as a result of the 1990 amendments to the Virginia poor debtor's exemption statute after they filed Chapter 13 but before they converted to Chapter 7. In re Stroble, 127 Bankr. 372 (Bankr. W.D. Va. 1991).

Debtor qualifying for "farming" exemption. - Even though the debtor was not physically present and performing manual labor on the land itself, debtor owned outright 102 acres of currently farmed land; she and her husband farmed the land for 35 years until his death in 1987; she owned 14 percent of a corporation actively farming 700 acres of land; the machinery and equipment were currently used in the farming operations; and she participated in the decision-making process of the farm operations, therefore, the debtor was actively and legitimately engaged in the business of farming for the purposes of Bankruptcy Code § 522(f)(2)(B) and § 34-27 and was engaged in the trade of farming pursuant to subdivision 7 of this section. In re Ottoway, 169 Bankr. 581 (Bankr. E.D. Va. 1994).

Heirloom exemption applied. - Shares of stock in a hunting club which a Chapter 7 debtor inherited from his father qualified as "heirloom" under subdivision 2 of § 34-26 and were exempt up to $5,000 from creditors' claims. The stock was personal property, the debtor's testimony and documentary evidence showed that he received the stock from his father and intended to bequeath it to his son, and there was a generational connection in the stock because it allowed the debtor to enjoy the same thing that his ancestors enjoyed. In re Sempeles, 471 Bankr. 178, 2012 Bankr. LEXIS 2569 (Bankr. W.D. Va. 2012).

"Heirloom" status not found where no supporting evidence. - The debtor claimed that the necklace was a "family heirloom," the exemption of which is provided for in this section. However, there was no evidence offered by the debtor on the issue, and the necklace was not described in the schedules as an heirloom. In the absence of testimony or other evidence establishing its status as an heirloom, there was no basis for exempting the necklace under this section. In re Scott, 199 Bankr. 586 (Bankr. E.D. Va. 1996).

§ 34-27. Additional articles exempted to householder engaged in agriculture.

If the householder be at the time actually engaged in the business of agriculture, there shall also be exempt from such levy or distress, while he is so engaged, to be selected by him or his agent, the following articles, or so many thereof as he may have, to wit: a pair of horses or mules unless he selects or has selected a horse or mule under § 34-26 , in which case he shall be entitled to select under this section only one, with the necessary gearing, one wagon or cart, one tractor, not exceeding in value $3,000, two plows, one drag, one harvest cradle, one pitchfork, one rake, two iron wedges and fertilizer and fertilizer material not exceeding in value $1,000. It shall not be required that a householder designate any property exempt under this section in a deed in order to secure such exemption.

(Code 1919, § 6533; 1932, p. 324; 1956, c. 637; 1970, c. 428; 1977, c. 496; 1993, c. 150.)

Cross references. - As to waiver of exemptions, see § 34-22 .

The 1993 amendment added the second sentence.

Law review. - For comment, "In re Cheeseman: A Judicial Revision of Virginia's Homestead Exemption Laws," see 16 U. Rich. L. Rev. 391 (1982).

Research References. - Bryson on Virginia Civil Procedure (Matthew Bender). Chapter 18. Enforcement of Judgments and Decrees. § 18.02 Exemptions from Execution. Bryson.

Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 3. The Writ Firea Facies: Execution. § 3.3 Relief from Levy; § 3.5 Property Subject to Execution. Rendleman.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, § 78; 8A M.J. Executions, § 20; 8A M.J. Exemptions from Executions and Attachments, §§ 6, 8, 21.

CASE NOTES

Section 34-28 applies to property exempt under this section. - Under § 34-28 a deed of trust executed by a householder engaged in agriculture conveying articles embraced in this section is void; for, although this section is not specifically mentioned in § 34-28 , it is by inference so allied to § 34-26 as to prompt the strongest implication that by legislative intention it is embraced within the meaning of § 34-28 . The opposing view is narrow and constricted, and if adopted would defeat the purpose of § 34-28, and § 34-28 is a remedial one and must be liberally construed. South Hill Prod. Credit Ass'n v. Hudson, 174 Va. 284 , 6 S.E.2d 668 (1940).

Section does not apply to one in unlawful possession of property. - This section does not contemplate that an intruder, who does not own the property levied on and is in unlawful possession of it, may have the property set aside for the use of himself and his family. Boswell v. Lipscomb, 177 Va. 309 , 14 S.E.2d 305 (1941).

Deed of trust is void. - A deed of trust executed by a householder engaged in agriculture, conveying articles embraced in this section is void. South Hill Prod. Credit Ass'n v. Hudson, 174 Va. 284 , 6 S.E.2d 668 (1940).

The legislature did not intend that a party could engage in several trades or occupations in order to claim multiple exemptions. To do so would be to allow a debtor to engage potentially in a vocation as a mechanic, an oysterman or fisherman, and a farmer, and thereby claim additional exemptions. In re Samuel, 36 Bankr. 312 (Bankr. E.D. Va. 1984).

Liberal construction. - This section is a remedial statute which should be liberally construed. Meadows v. F & M Nat'l Bank, 75 Bankr. 357 (W.D. Va. 1987).

In determining whether the exemption under this section is available, the court must look to the time that the bankruptcy petition was filed. Meadows v. F & M Nat'l Bank, 75 Bankr. 357 (W.D. Va. 1987).

It is clear that "agriculture" is not confined solely to the raising of crops. The fact that debtor derived the greater part of his farm income from the sale and transportation of livestock does not take him outside the exemption section's definition of one "engaged in the business of agriculture." Fleet Bros. v. Newsome, 60 Bankr. 169 (Bankr. E.D. Va. 1986).

The court finds that the Hazelwood stock trailer is exempt as a "wagon or cart" within the contemplation of the statute. Debtor has in reality no other way to get his animals to market. The exemption statute provides for the exemption of a "wagon or cart," and it appears that this section intends that a farmer be allowed to exempt a piece of equipment which he needs to transport his commodities. The court acknowledges that this is a liberal interpretation of the statute's terms; however, as mentioned earlier, such is the analysis the Virginia courts have adopted. Fleet Bros. v. Newsome, 60 Bankr. 169 (Bankr. E.D. Va. 1986).

Disc found exempt. - Given that the statute allows an exemption for two plows, it may reasonably be concluded that a farmer may need more than one type of plow to till the soil in varying conditions. The fact that a disc does not turn over the soil as a plow might is not dispositive of whether or not debtor may claim it as exempt. The court finds that the legislature intended an exemption for a farm implement that a farmer can use to get his land ready for planting, and at the present debtor would be unable to till his land in a manner satisfactory to him without the use of the disc as a plow. For that reason, the court finds that debtor may properly claim the disc as exempt under this section. Fleet Bros. v. Newsome, 60 Bankr. 169 (Bankr. E.D. Va. 1986).

Debtor qualifying for "farming" exemption. - Even though the debtor was not physically present and performing manual labor on the land itself, debtor owned outright 102 acres of currently farmed land; she and her husband farmed the land for 35 years until his death in 1987; she owned 14 percent of a corporation actively farming 700 acres of land; the machinery and equipment were currently used in the farming operations; and she participated in the decision-making process of the farm operations, therefore, the debtor was actively and legitimately engaged in the business of farming for the purposes of Bankruptcy Code § 522(f)(2)(B) and this section and was engaged in the trade of farming pursuant to subdivision 7 of § 34-26 . In re Ottoway, 169 Bankr. 581 (Bankr. E.D. Va. 1994).

Applied in Prudential Ins. Co. of Am. v. Stephens, 498 F. Supp. 155 (E.D. Va. 1980).

§ 34-28. Deed of trust, etc., on such property void.

Every deed of trust, mortgage or other writing or pledge made by a householder to give a lien on property exempt from distress or levy under § 34-26 shall be void as to such property. However, this section shall have no application to (i) property covered by a deed of trust, mortgage or other writing or pledge given by a householder to secure a loan made for the purchase of such property or (ii) security interests in such property having priority over the claim of exemption as specifically provided in subdivisions 7 and 8 of § 34-26 .

(Code 1919, § 6564; 1938, p. 218; 1940, p. 615; 1992, c. 644; 2002, c. 88.)

The 2002 amendments. - The 2002 amendment by c. 88 substituted "in subdivisions 7 and 8 of § 34-26 " for "in subsections (7) and (8) of § 34-26 ."

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 3. The Writ Firea Facies: Execution. § 3.3 Relief from Levy; § 11.4 Exempt Property. Rendleman

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Execution and Attachment, §§ 21, 25; 13A M.J. Mortgages and Deeds of Trust, § 19.

CASE NOTES

This section applies to property exempt under § 34-27 . - Under this section a deed of trust executed by a householder engaged in agriculture conveying articles embraced in § 34-27 is void; for, although § 34-27 is not specifically mentioned in this section, it is by inference so allied to § 34-26 as to prompt the strongest implication that by legislative intention it is embraced within the meaning of this section. The opposing view is narrow and constricted, and if adopted would defeat the purpose of this section, and this section is a remedial one and must be liberally construed. South Hill Prod. Credit Ass'n v. Hudson, 174 Va. 284 , 6 S.E.2d 668 (1940).

Conflict between language of subdivision 7 of § 34-26 and this section. - This section, which was not amended in 1990, expressly voids all nonpurchase-money security interests on property exempted under § 34-26 , but leaves purchase money security interests in place. Prior to 1990, the effect of this section was the same on all property which could be exempted under § 34-26. Because this section was not amended in 1990 when § 34-26 was, a conflict exists between the language in subdivision 7 of § 34-26 which gives perfected security interests priority over the exemption for tools of the trade and the language in this section which voids nonpurchase-money security interests in exempted property. Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991).

To the extent that amended subdivision 7 of § 34-26 conflicts with this section, the language in subdivision 7 of § 34-26 , which is the more specific and more recently enacted statute, will be given effect. Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991).

Purpose of amendment of § 34-26 . - By amending subdivision 7 of § 34-26 using the words "perfected security interest," the Virginia legislature meant to give both purchase-money and nonpurchase-money security interests priority over the exemption for tools of the trade. Shearer v. Crestar Bank, 132 Bankr. 313 (Bankr. W.D. Va. 1991).

Debtor can exempt up to $2,000 in value of a vehicle. - Virginia state laws allow a debtor to exempt, and avoid the lien on, up to $2,000 in value of a motor vehicle where that lien is neither a perfected security interest, nor was it given to secure a loan for the purchase of the vehicle. In re Fenessy, 156 Bankr. 22 (Bankr. E.D. Va. 1993).

Exemption could apply to proceeds from sale of vehicle. - Where debtor's claim of exemption was properly noticed long before sale of vehicle, the debtor's exemption could apply to proceeds from sale of the vehicle, even if the vehicle itself was subject to an exemption. In re Fenessy, 156 Bankr. 22 (Bankr. E.D. Va. 1993).

Bankruptcy court determines whether personal injury claims are exempt. - Fact that a debtor's personal injury claims might be exempt property under § 34-28.1 did not determine whether the claims were property of the bankruptcy estate because the commencement of the debtor's Chapter 7 created an estate comprised of the property and interests described in 11 U.S.C.S. § 541 and it was only through the administration of the estate that the propriety of such exemptions was determined in a manner consistent with 11 U.S.C.S. § 522. Jenkins v. A.T. Massey Coal Co. (In re Jenkins), 410 Bankr. 182, 2008 Bankr. LEXIS 4191 (Bankr. W.D. Va. 2008).

Applied in Reid v. Finance One of Va., Inc., 560 F. Supp. 791 (W.D. Va. 1983).

§ 34-28.1. Personal injury and wrongful death actions exempt; exceptions.

Except for liens created under Article 7.1 (§ 8.01-66.2 et seq.) of Title 8.01, Article 5 (§ 54.1-3932 et seq.) of Title 54.1, and Chapter 19 (§ 63.2-1900 et seq.) of Title 63.2, all causes of action for personal injury or wrongful death and the proceeds derived from court award or settlement shall be exempt from creditor process against the injured person or statutory beneficiary as defined in Article 5 (§ 8.01-50 et seq.) of Title 8.01. It shall not be required that a householder designate any property exempt under this section in a deed in order to secure such exemption. The provisions of this section shall not be construed to affect any voluntary assignment of the proceeds or anticipated proceeds of a personal injury or wrongful death award or settlement as permitted by § 8.01-26 .

(1990, c. 942; 1991, c. 256; 1993, c. 150; 1994, c. 35; 2003, cc. 929, 942.)

The 2003 amendments. - The 2003 amendments by cc. 929 and 942 are identical, and in the first sentence, deleted "and" following "Title 8.01," and inserted "and Chapter 19 ( § 63.2-1900 et seq.) of Title 63.2."

Law review. - For 1991 survey on bankruptcy law, see 25 U. Rich. L. Rev. 607 (1991).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 3. The Writ Firea Facies: Execution. § 3.3 Relief from Levy, etc.; § 4.7 Wages and Statutory Exemptions. Rendleman.

Michie's Jurisprudence. - For related discussion, see 2C Bankruptcy, § 79, 81; 8A M.J. Exemptions from Execution and Attachment, § 21.

CASE NOTES

Wrongful death claims distinct from personal injury category. - This section refers to "causes of action for personal injury or wrongful death," inviting the inference that Virginia intended this section to exempt two distinct types of actions from creditor process, neither of which would define or limit the other. That this section was only recently amended to include wrongful death claims bolsters the conclusion that such claims are viewed as distinct from the category of "personal injury." In re Webb, 214 Bankr. 553 (E.D. Va. 1997).

Personal injury proceeds only exempt from creditor with unsecured claim. - This section only applies to the efforts of creditors at exercising process against unsecured debts; it does not apply where a party who has paid medical expenses has an equitable subrogation lien against the proceeds of the injured party's personal injury recovery and such proceeds are not exempt from a claim by such a lienholder. In re Carpenter, 245 Bankr. 39 (Bankr. E.D. Va. 2000).

Personal injury lawsuit settlement. - Account exempted under this section as the proceeds of a personal injury lawsuit settlement did not lose its exemption where tax refund monies were commingled into the account post-petition and later removed as this section did not require that the proceeds of a personal injury claim be deposited into a specially designated account, and the funds were easily traceable; there was no reason to depart from the general rule that exemptions were to be determined as of the date of the bankruptcy petition, and in this case, there was no requirement that the debtor had to segregate the proceeds of a personal injury settlement post-petition to maintain an exemption properly claimed under this section. In re Lane,, 2017 Bankr. LEXIS 1992 (Bankr. W.D. Va. July 19, 2017).

No exemption for unlisted personal injury action. - Chapter 7 debtor was not allowed an exemption under § 34-28.1 for an unscheduled personal injury action because he did not provide an excusable reason why the cause of action was not listed while his bankruptcy case was open. Under Fed. R. Bankr. P. 1009 and 9006, the debtor did not have the right as a matter of course to amend his schedules after the case was closed, and he was responsible for full disclosure on the schedules under 11 U.S.C.S. § 521. In re Wilmoth, 412 Bankr. 791, 2009 Bankr. LEXIS 882 (Bankr. E.D. Va. 2009).

Medical malpractice claim. - Because the former debtor's malpractice claim ceased to property of the estate under 11 U.S.C.S. § 541 when no objection to the debtor's claim of an exemption to the malpractice action under § 34-28.1 was timely filed under Fed. R. Bankr. P. 4003(b), there was no reason to reopen the bankruptcy case to determine if a state court later improperly disbursed the settlement funds. In re Zaidi, 293 Bankr. 861, 2002 Bankr. LEXIS 1721 (Bankr. E.D. Va. 2002).

Legal malpractice claim. - Debtor's legal malpractice claims were not exempt under this provision because the legal malpractice claims at issue were not proceeds derived from a court award or settlement. In re Sheikhzadeh,, 2018 Bankr. LEXIS 1924 (Bankr. E.D. Va. June 26, 2018).

Wrongful death proceeds not exempt. - The Virginia legislature did not intend to include wrongful death causes of action within the meaning of "personal injury" for purposes of this section and that wrongful death proceeds are not exempt from creditor process. Krippendorf v. Cassell, 151 Bankr. 78 (Bankr. W.D. Va.), aff'd, 158 Bankr. 963 (W.D. Va. 1993), 23 F.3d 400 (4th Cir. 1994).

Proceeds from wrongful death action do not qualify as proceeds from a personal injury action. Cassell v. Krippendorf, 158 Bankr. 963 (W.D. Va. 1993), aff'd, 23 F.3d 400 (4th Cir. 1994).

Proceeds of a Title VII settlement are exempt from federal creditor process pursuant to this section which allows exemptions for the proceeds of "personal injury" actions. In re Webb, 214 Bankr. 553 (E.D. Va. 1997).

Claims for libel, malice, and negligence. - The debtor was entitled to claim an exemption to the settlement proceeds received from a state court lawsuit that involved, libel, malice, and negligence, because those state court claims came within the meaning of "personal injury." In re Walters, 339 Bankr. 607, 2006 Bankr. LEXIS 493 (Bankr. W.D. Va. 2006).

Extension of personal injury proceeds exemption. - It was reasonable to extend the § 34-28.1 exemption in proceeds of a personal injury action to property the debtors irrefutably purchased with the proceeds immediately after their receipt of the proceeds. Debtors purchased a mobile home and van with proceeds of a personal injury recovery shortly after receipt of the proceeds, and the court's ability to easily trace the settlement proceeds to the mobile home and van was sufficient to extend the exemption under § 34-28.1 to those assets. In re Williams, 337 Bankr. 846, 2005 Bankr. LEXIS 2786 (Bankr. E.D. Va. 2005).

Personal injury suits filed by bankrupt debtor prior to exemption were nullities and did not toll the statute of limitations. - Accident victim lacked standing to file any of the three personal injury suits he filed against a driver because he had filed for bankruptcy, and the cause of action could only be asserted by the trustee. The victim's action was a nullity, and the statute of limitations had run before it was filed, pursuant to § 8.01-243 . Kocher v. Campbell, 282 Va. 113 , 712 S.E.2d 477, 2011 Va. LEXIS 133, cert. denied, 2011 U.S. LEXIS 8861, 181 L. Ed. 2d 549 (U.S. 2011).

Ex-wife could not garnish deceased's annuity payments. - Deceased's daughter, as the named beneficiary, was entitled to annuity payments from the deceased's personal injury settlement agreement because the separation agreement between the deceased and the ex-wife was not an assignment of the deceased's right to receive periodic payments and the annuity payments were exempt from the ex-wife's garnishment action under § 34-28.1 . Liberty Life Assur. Co. v. Gilbert, 507 F.3d 952, 2007 U.S. App. LEXIS 26326 (2007).

Secured creditors. - A debtor could not exempt settlement proceeds with respect to an ERISA plan's subrogation lien because an equitable lien grants the recipient a security interest in the res to which the lien attaches and the plan was, therefore, a secured creditor. Wal-Mart Stores, Inc. v. Carpenter (In re Carpenter), 252 Bankr. 905, 2000 U.S. Dist. LEXIS 13797 (E.D. Va. 2000).

Debtor had a motive for concealment when valuing his claim or failing to amend the schedules after he filed a personal injury action against a corporation because his unsecured debt was $534,000, his secured debt was $762,000, the exemption statute did not apply where the lienholder was secured, and, thus, his secured creditors would have been able to collect on any award or settlement recovered by him; therefore, he was judicially estopped from seeking more than $1 million in damages against the corporation when he listed the personal injury claim as $1 million on his schedules. Payne v. Wyeth Pharms., Inc., 606 F. Supp. 2d 613, 2008 U.S. Dist. LEXIS 106938 (E.D. Va. 2008).

Applied in In re Conley, 478 Bankr. 803, 2003 Bankr. LEXIS 2441 (Bankr. W.D. Va. July 30, 2003).

CIRCUIT COURT OPINIONS

Plaintiff's medical bills discharged in bankruptcy admissible in tort case under collateral source rule. - Bankruptcy discharge is within the scope of the collateral source rule, because a tortfeasor should not receive a windfall at the expense of the creditors and plaintiff, especially when the bankruptcy might itself have been precipitated by the tortfeasor's acts. Dodd v. Lang, 71 Va. Cir. 235, 2006 Va. Cir. LEXIS 151 (Roanoke 2006).

In a personal injury suit against a driver, plaintiff's medical bills, which had been discharged in a Chapter 7 bankruptcy, were admissible to show the extent of her pain, suffering, and because a bankruptcy discharge was within the scope of the collateral source rule. However, after paying creditors holding valid liens and an assignment of benefits on the proceeds of any tort recovery, plaintiff had to pay the balance of any award of medical bills to the health care providers in pro rata shares. Dodd v. Lang, 71 Va. Cir. 235, 2006 Va. Cir. LEXIS 151 (Roanoke 2006).

§ 34-28.2. Spousal and child support exempt.

The debtor's right to receive spousal or child support, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor, shall be exempt from creditor process.

(2015, c. 686.)

§ 34-28.3. Emergency relief payments exempt.

  1. For the purposes of this section, "emergency relief payment" means a 2020 recovery rebate for individuals and qualifying children provided pursuant to § 2201 of the federal Coronavirus Aid, Relief, and Economic Security Act (P.L. 116-136) or any future federal payments or rebates provided directly to individuals for economic relief or stimulus due to the COVID-19 pandemic.
  2. All emergency relief payments paid to individuals shall be automatically exempt from the creditor process. Any financial institution, as defined by § 6.2-100 , receiving such payments directly from the federal government shall exempt such payments from the creditor process if (i) the payment is marked by the federal government as an "emergency relief payment" or includes some other unique identifier that is reasonably sufficient to allow the financial institution to identify the funds as an emergency relief payment or (ii) the federal government or accountholder receiving the emergency relief payment gives notice to the financial institution of such payment. In exempting emergency relief payments on deposit from the creditor process, a financial institution shall look back two months preceding the date of receipt of service of the creditor process. The financial institution shall perform a one-time account review separately for each account in the name of an account holder who is subject to the creditor process without consideration for any other attributes of the account or the creditor process, including (a) the presence of other funds, from whatever source, that may be commingled in the account with funds from an emergency relief payment; (b) the existence of a co-owner on the account; and (c) the balance in the account, provided the balance is above zero dollars on the date of account review. After conducting the account review, a financial institution shall exempt from the creditor process the lesser of the sum of all posted emergency relief payments to an account between the close of business on the beginning date of the lookback period and the open of business on the ending date of the lookback period or the balance in an account when the account review is performed. If the creditor process involves a court return date, such as a garnishment, and requires a continued hold on the account, including any deposits made up to the return date, then if an emergency relief payment is deposited into an account after the completion of the account review but before the creditor process or garnishment return date and the account holder notifies the financial institution that the deposit of an emergency relief payment has been made, the financial institution must review the account. If the financial institution verifies that the deposited funds are exempt under this section, then such deposited funds shall be treated as exempt from the creditor process or garnishment. This second account review shall begin within two business days of receiving the notice from the account holder and shall cover the period from the start of business on the date of the completion of the previous account review to the end of business on the date of the notification from the account holder. For any creditor process that requires a continued hold, such as a garnishment where the account hold must continue until the garnishment return date, the account holder may access exempt funds by withdrawal as permitted by the financial institution. In its answer to the creditor process, the financial institution shall state the amount of account funds that are being held pursuant to the creditor process and the amount of account funds that were treated as exempt under this section. A financial institution that makes a good faith effort to comply with the requirements set forth herein shall not be subject to liability or regulatory action under any state law, regulation, court or other order, or regulatory interpretation for actions concerning any emergency relief payments. Emergency relief payments shall be exempt from the creditor process even if deposited into an account with a financial institution or other organization accepting deposits and thereby commingled with other funds. For the purposes of this section, no such exemption shall extend to child support, spousal support, or criminal restitution orders.
  3. If a financial institution does not set aside an emergency relief payment as exempt from the creditor process, then the accountholder receiving such payment must claim the exemption within the time limits prescribed by subsection B of § 34-17 and in the manner prescribed under § 8.01-512.4 . (2020, Sp. Sess. I, c. 39; 2021, Sp. Sess. I, c. 552.)

Editor's note. - Acts 2020 Sp. Sess. I, c. 39, cl. 3, effective October 28, 2020, provides: "The exemption created by this act shall not extend to a garnishment process or other creditor process that concluded before the enactment of this act."

The 2021 Sp. Sess. I amendments. - The 2021 amendment by Sp. Sess. I, c. 552, cl. 13, effective April 7, 2021, deleted "not to exceed $1,200 per individual per payment or rebate, and not to exceed $500 for each qualifying child paid to the individual per payment or rebate" at the end of subsection A.

Effective date. - This section is effective October 28, 2020.

Chapter 4. Wages Exempt.

Sec.

§ 34-29. Maximum portion of disposable earnings subject to garnishment.

  1. Except as provided in subsections (b) and (b1), the maximum part of the aggregate disposable earnings of an individual for any workweek that is subjected to garnishment may not exceed the lesser of the following amounts:
    1. Twenty-five percent of his disposable earnings for that week; or
    2. The amount by which his disposable earnings for that week exceed 40 times the federal minimum hourly wage prescribed by 29 U.S.C. § 206(a)(1) or the Virginia minimum hourly wage prescribed by § 40.1-28.10 , whichever is greater, in effect at the time earnings are payable. In the case of earnings for any pay period other than a week, the State Commissioner of Labor and Industry shall by regulation prescribe a multiple of the federal or Virginia minimum hourly wage equivalent in effect to that set forth in this section.
  2. The restrictions of subsection (a) do not apply in the case of:
    1. Any order for the support of any person issued by a court of competent jurisdiction or in accordance with an administrative procedure that is established by state law, affords substantial due process, and is subject to judicial review.
    2. Any order of any court of bankruptcy under Chapter XIII of the Bankruptcy Act.
    3. Any debt due for any state or federal tax.

    (b1) The maximum part of the aggregate disposable earnings of an individual for any workweek that is subject to garnishment to enforce any order for the support of any person shall not exceed:

    (1) Sixty percent of such individual's disposable earnings for that week; or

    (2) If such individual is supporting a spouse or dependent child other than the spouse or child with respect to whose support such order was issued, 50 percent of such individual's disposable earnings for that week.

    The 50 percent specified in subdivision (2) shall be 55 percent and the 60 percent specified in subdivision (1) shall be 65 percent if and to the extent that such earnings are subject to garnishment to enforce an order for support for a period that is more than 12 weeks prior to the beginning of such workweek.

  3. No court of the Commonwealth and no state agency or officer may make, execute, or enforce any order or process in violation of this section.

    The exemptions allowed herein shall be granted to any person so entitled without any further proceedings.

  4. For the purposes of this section:
    1. The term "earnings" means compensation paid or payable for personal services, whether denominated as wages, salary, commission, bonus, payments to an independent contractor, or otherwise, whether paid directly to the individual or deposited with another entity or person on behalf of and traceable to the individual, and includes periodic payments pursuant to a pension or retirement program,
    2. The term "disposable earnings" means that part of the earnings of any individual remaining after the deduction from those earnings of any amounts required by law to be withheld, and
    3. The term "garnishment" means any legal or equitable procedure through which the earnings of any individual are required to be withheld for payment of any debt.
  5. Every assignment, sale, transfer, pledge, or mortgage of the wages or salary of an individual that is exempted by this section, to the extent of the exemption provided by this section, shall be void and unenforceable by any process of law.
  6. No employer may discharge any employee by reason of the fact that his earnings have been subjected to garnishment for any one indebtedness.
  7. A depository wherein earnings have been deposited on behalf of and traceable to an individual shall not be required to determine the portion of such earnings that are subject to garnishment.

    (Code 1919, § 6555; 1928, p. 348; 1938, p. 574; 1948, p. 489; 1952, c. 432; 1954, cc. 143, 379; 1958, cc. 217, 417; 1960, c. 498; 1970, c. 428; 1978, c. 564; 1992, c. 674; 1996, c. 330; 2005, c. 286; 2021, Sp. Sess. I, c. 8.)

Cross references. - As to other exemptions, see §§ 8.01-489 , 8.01-563 , 34-4 , 34-26 , 34-27 , 34-33 .

As to lien of fieri facias upon wages, see § 8.01-501 .

As to garnishment, see § 8.01-511 et seq.

As to the form of garnishment summons, which sets out this section, see § 8.01-512.3 .

As to garnishment of wages exempt under this section, see § 8.01-517 .

As to garnishment of wages of state and municipal employees, see §§ 8.01-522 , 8.01-524 , 8.01-525 .

As to liability of wages for taxes and levies, see § 34-3 .

As to exemption under this section when exemption under § 34-4 is exhausted, see § 34-21 .

As to waiver of exemption, see § 34-22 .

As to assignment of wages and salaries, see §§ 40.1-31 through 40.1-33 .

As to provision in administrative support orders of immediate withholding from income, and applicability of maximum amount permitted under § 34-29 , see § 63.2-1923 . As to provision in administrative support orders for withholding an amount to be applied toward arrearages in certain circumstances, see § 63.2-1924 . As to amount of income that may be withheld by support lien or order, see § 63.2-1925 .

Editor's note. - The plain language interpretation in § 8.01-512.3 does not reflect the changes made by Acts 1996, c. 330, which amended this section.

Acts 2017, cc. 36 and 143, cl. 2 provides: "That the Executive Secretary of the Supreme Court of Virginia shall update the form of garnishment summons in accordance with this act and subdivision (a)(2) of § 34-29 of the Code of Virginia."

The 1996 amendment, in subdivision (d)(1), inserted "payments to an independent contractor" following "bonus" and deleted "provided, that in no event shall funds that have been deposited by or for an individual for more than thirty days be considered earnings" following "retirement program."

The 2005 amendments. - The 2005 amendment by c. 286 substituted "40" for "thirty" in the first paragraph of subdivision (a) (2) and made minor stylistic changes.

The 2021 Sp. Sess. I amendments. - The 2021 amendment by Sp. Sess. I, c. 8, effective July 1, 2021, in subdivision (a)(2), substituted "prescribed by 29 U.S.C. § 206(a)(1) or the Virginia minimum hourly wage prescribed by § 40.1-28.10 , whichever is greater" for "prescribed by § 206 (a) (1) of Title 29 of the United States Code" in the first paragraph and inserted "or Virginia" in the second paragraph; deleted "(b1)" following "subdivision" twice in the second paragraph of subdivision (b1)(2); and made stylistic changes.

Law review. - For note discussing wage garnishment under the Consumer Credit Protection Act and its effects on state law, see 12 Wm. & Mary L. Rev. 357 (1970). For article, "Uniform Consumer Credit Code - A Prospect for Consumer Credit Reform in Virginia," see 28 Wash. & Lee L. Rev. 75 (1971). For article on the need for reform of and a proposed revision of Virginia's Exemption Statutes, see 37 Wash. & Lee L. Rev. 127 (1980). For article on recent developments in Virginia domestic relations law, see 68 Va. L. Rev. 507 (1982). For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985). For note, "Erosion of the Employment-at-Will Doctrine: Recognition of an Employee's Right to Job Security," see 43 Wash. & Lee L. Rev. 593 (1986).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 4 Garnishment. § 4.7 Wages and Statutory Exemptions, etc. Rendleman.

Friend's Virginia Pleading and Practice (Matthew Bender). Chapter 22 Enforcement of Judgments. § 22.08 Garnishment. Friend.

Virginia Forms (Matthew Bender). No. 5-228 Income Deduction Order, et seq.

Michie's Jurisprudence. - For related discussion, see 2A M.J. Assignments, §§ 1, 12; 2C M.J. Bankruptcy, § 80; 6A M.J. Divorce and Alimony, § 81; 8A M.J. Exemptions from Execution and Attachment, §§ 8, 22.

CASE NOTES

Applicability. - Law governing garnishments did not apply because the monthly payment amount set by the trial court was not a garnishment but was a payment plan to allow a wife to purge herself of contempt. Wharam v. Austin, No. 2044-16-2, 2017 Va. App. LEXIS 307 (Dec. 5, 2017).

Limitation. - Wage garnishments, except for enforcement of support or tax obligations, are limited to 25% of disposable income. In re Wilkinson, 196 Bankr. 311 (Bankr. E.D. Va. 1996).

Because this section only applies to exempt earnings that are subject to garnishment, and the debtor's earnings or wages in this case had not been subject to a judicial or equitable proceeding of garnishment, Chapter 7 trustee's objection to debtor's claim of exemption under this section was well taken. In re Kluge,, 2011 Bankr. LEXIS 5780 (Bankr. W.D. Va. Oct. 3, 2011).

Bankruptcy debtor improperly claimed an exemption in a portion of accounts receivable owed to the debtor for services rendered prior to the debtor's bankruptcy since there was no pending garnishment of the debtor's earnings and thus the protection of a percentage of the debtor's earnings did not apply. In re Pierce,, 2015 Bankr. LEXIS 4372 (Bankr. W.D. Va. Dec. 30, 2015).

Trustee's objection to Chapter 13 debtor's Amended Schedule C insofar as debtor claimed exemption in his post-petition wages was sustained because any claim of exemption for post-petition wages; whether under Virginia's wage exemption statute or Virginia's wildcard exemption statute, was fundamentally inconsistent with requirement that debtor devote all of his disposable income to his Chapter 13 plan. In re Cantu, 553 Bankr. 565, 2016 Bankr. LEXIS 2585 (Bankr. E.D. Va. 2016), aff'd, 713 Fed. Appx. 200, 2017 U.S. App. LEXIS 25487 (4th Cir. 2017).

With respect to debtor's deferred compensation plan (partner equity plan), debtor's claim of exemption of 75 percent of distribution from plan was proper because distribution that debtor was entitled to receive from partner equity plan qualified as "earnings" under definition contained in statute and "exemption" meant protection from all forms of creditor process whether or not there was pending garnishment at time of bankruptcy filing. In re Foster, 556 Bankr. 233, 2016 Bankr. LEXIS 2963 (Bankr. E.D. Va. 2016).

The word "wages" must be given the widest scope which is at all compatible with reason. In re Green, 34 F. Supp. 791 (W.D. Va. 1940).

Commissions due insurance agent are "wages." - Commissions on renewal premiums due on life insurance policies written by a bankrupt insurance agent are "wages" under this section and, consequently, exempt in bankruptcy proceedings to extent allowed by this section. In re Green, 34 F. Supp. 791 (W.D. Va. 1940).

Exemption does not extend to tax refunds. - Debtor argued, in effect, that there was no fundamental difference between depositing wages in a bank account and depositing them with the U.S. Government, and that so long as the refund was derived from and could be traced to a debtor's wages, the § 34-29 exemption should apply to the refund; the court did not concur. It could not find that the General Assembly intended the exemption created by § 34-29 to extend to tax refunds, even when the refund could be traced to wages. In re Rivenbark,, 2010 Bankr. LEXIS 2132 (Bankr. E.D. Va. June 29, 2010).

The attachment of wages under § 8.01-533 is subject to a garnishment limitation pursuant to this section. If this were not so the statute would clearly be unconstitutional and a violation of 15 U.S.C. § 1673. Fuller v. Hurley, 559 F. Supp. 313 (W.D. Va. 1983).

Unmarried infant may be householder. - An unmarried infant who supports his dependent mother who lives with him is a householder and entitled to the wage exemption under this section. Epperty v. Holley, 3 Va. L. Reg. (n.s.) 27 (1917).

When wages listed as part of homestead. - Virginia homestead deed is designed to protect a certain amount of debtor's property from creditors and where debtor listed his wages as part of his homestead, he intended to insulate that asset from his creditors. Where debtor filed his homestead deed on June 10, and a summons in garnishment was returnable June 12, he is entitled to his wages, notwithstanding the intervening bankruptcy, because wages are not subjected by sale or otherwise before recordation of homestead deed. Baum v. United Va. Bank, 15 Bankr. 538 (Bankr. E.D. Va. 1981).

Judgment for contractual arrearages not support order. - Where ex-wife brought garnishment proceeding against her ex-husband and the United States to enforce a judgment against the husband for arrearages under a property settlement agreement and to attach the husband's Marine Corps retirement pay, the ex-wife's prior judgment for arrearages was not based upon any arrearages in court-ordered support payments, but upon violations of a contractual obligation; thus the trial court's ruling that the ex-wife's judgment for contractual arrearages was not a court order for her support within the meaning of this section was correct, and it followed that a limitation of 25 percent applied in determining the amount of the ex-husband's federal income that was subject to garnishment for enforcement of the judgment. Butler v. Butler, 221 Va. 1035 , 277 S.E.2d 180 (1981).

Loss of exemptions in commingling exempt and nonexempt funds in bank account. - By depositing checks representing workers' compensation and social security disability benefits and wages exempt from garnishment in a general account and commingling them with other nonexempt money, the funds lost whatever exemptions they may have had. Bernardini v. Central Nat'l Bank, 223 Va. 519 , 290 S.E.2d 863 (1982).

Bankruptcy debtors were entitled to claim an exemption in their wages since the wages did not lose their exempt status when they were paid and deposited into a checking account in which they were commingled with other funds. In re Delima, 561 Bankr. 647, 2016 Bankr. LEXIS 3466 (Bankr. E.D. Va. 2016).

Protection of exempt funds deposited in special account. - By depositing exempt funds (such as workers' compensation, social security benefits, and earnings exempt from garnishment) in a special account with proper notice to the bank, and keeping these moneys separate from other nonexempt funds, a debtor can protect himself from creditors and still avail himself of the conveniences of modern banking. Bernardini v. Central Nat'l Bank, 223 Va. 519 , 290 S.E.2d 863 (1982).

Section not applicable to order that husband pay attorney fee in support action. - Order that husband pay attorney fee for representation of wife at Revised Uniform Reciprocal Enforcement of Support Act proceeding was enforceable even if that order would have required him to pay more than 55% of his income at the time of its entry, since this section applies to garnishments and nothing more, and is not applicable to this cause. Frazier v. Commonwealth, 3 Va. App. 84, 348 S.E.2d 405 (1986).

Exemption for personal services performed by attorney. - Creditor's objection to a debtor's exemption in wages earned by the debtor for personal services performed, with the assistance of a paralegal and title examiner, as the sole attorney for a professional corporation under subdivision (d)(1) of § 34-29 was overruled because the creditor failed to show that the debtor did no work to earn the difference between the amount the debtor was paid by her client and the amount she paid to her two contractors and because Va. Sup. Ct. R., Pt. 6, § II, R. 5.3, required the debtor to be responsible for nonlawyers in her employ. In re Sheeran, 369 Bankr. 910, 2007 Bankr. LEXIS 2052 (Bankr. E.D. Va. 2007).

Debtor's interests in retirement plans were estate property and were exempt at least 75 percent of their "aggregate disposable earnings" from creditor process which included periodic payments pursuant to a pension or retirement program. In re Hanes, 162 Bankr. 733 (Bankr. E.D. Va. 1994).

Applied in Branch v. VEC, 219 Va. 609 , 249 S.E.2d 180 (1978); In re Musgrove, 7 Bankr. 892 (Bankr. W.D. Va. 1981).

§ 34-30.

Repealed by Acts 1970, c. 428.

§ 34-31. Revocation of such exemption.

Any judgment creditor, upon having a garnishment summons issued upon a judgment against the judgment debtor named in such certificate, may give five days' written notice, to be served personally on the employer and the judgment debtor by any officer authorized by law to serve civil process, that he will apply to the court or judge who issued such certificate to have the same revoked, and, upon proof that the holder of the certificate is no longer entitled to the exemption allowed thereby, the court or judge shall revoke the same and require the holder to deliver such certificate to the court, which shall cancel the same.

(Code 1919, § 6556; 1932, p. 384; 1936, p. 378; 1974, c. 272.)

Michie's Jurisprudence. - For related discussion, see 8A M.J. Exemptions from Executions and Attachments, § 22.

Applied in Security Pac. Fin. Corp. v. Barto, 8 Bankr. 145 (Bankr. E.D. Va. 1981).

§ 34-32. Illegal to garnish such exempt wages out of Commonwealth, etc.

No person shall institute or permit to be instituted proceedings in his own name or in the name of any other person or shall assign or transfer, either for or without value, any claim for debt or liability of any kind held by him against a resident of the Commonwealth who is a laboring person and a householder for the purpose of having payment of the same or any part thereof enforced out of the wages exempted by § 34-29 by proceedings in attachment or garnishment in courts or before magistrates in any other state than the Commonwealth, or to send out of the Commonwealth by assignment, transfer or in any other manner whatsoever, either for or without value, any claim or debt against any resident thereof for the purpose or with the intent of depriving such person of the right to have his wages exempt from distress, levy or garnishment according to the provisions of § 34-29 . And the person instituting such suit or permitting such suit to be instituted or sending, assigning, or transferring any such claim or debt for the purpose or with the intent aforesaid shall, upon conviction thereof, be fined not less than $10 nor more than $100 and shall, in addition thereto, be civilly liable to the person from whom payment of the same, or any part thereof, shall have been enforced by attachment or garnishment or otherwise, elsewhere than in the Commonwealth, for the full amount, payment whereof shall have been so enforced, together with interest thereon and the costs of the attachment or garnishee proceedings, as well as the costs of such action.

The amount recovered in such action shall stand on the same footing with the wages of the plaintiff under § 34-29 and shall be exempt and free from any and all liability of the plaintiff to the defendant in the way of setoff or otherwise.

The fact that the payment of a claim or debt against any person entitled to the exemption provided for in § 34-29 has been enforced by legal proceedings in some state other than the Commonwealth in such manner as to deprive such person to any extent of the benefit of such exemption shall be prima facie evidence that any resident of the Commonwealth who may at any time have been owner or holder of the claim or debt has violated this section.

(Code 1919, § 6557; 1954, c. 613; 1974, c. 272; 2005, c. 839.)

The 2005 amendments. - The 2005 amendment by c. 839, effective October 1, 2005, substituted "the Commonwealth" for "this Commonwealth" in the first and last paragraphs; and substituted "magistrates" for "justices of the peace or other trial justices" in the first paragraph.

§ 34-33. Exemption of wages of minor from garnishment process.

The wages of a minor shall not be liable to garnishment or otherwise liable to the payment of the debts of parents.

(Code 1919, § 6558.)

Law review. - For article, "How Bankruptcy Exemptions Work: Virginia As an Illustration of Why the 'Opt Out' Clause Was a Bad Idea," see 8 G.M.U. L. Rev. 1 (1985).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 4. Garnishment. § 4.7 Wages and Statutory Exemptions. Rendleman.

Michie's Jurisprudence. - For related discussion, see 14A M.J. Parent and Child, § 13.

Applied in In re Lamm, 47 Bankr. 364 (E.D. Va. 1984).

§ 34-34. Certain retirement benefits exempt.

  1. For the purposes of this section:

    "Alternate payee" shall have the same meaning as provided under § 206 of the Employee Retirement Income Security Act of 1974 (ERISA). In the case of a retirement plan that is not subject to ERISA, the term "alternate payee" means an individual who has an interest in a retirement plan pursuant to a judgment, decree, or order, including approval of a property settlement agreement, that would be described in § 206(d)(3)(B) of ERISA if the retirement plan were subject to ERISA.

    "Annual benefit" means an amount payable as an annuity for the lifetime of the individual who claims the exemption provided under this section, assuming that annuity payments will commence upon the individual's attainment of age sixty-five or, if the individual attained age sixty-five on or before the exemption provided under this section is claimed, the individual's age on the date that the exemption is claimed.

    "Retirement plan" means a plan, account, or arrangement that is intended to satisfy the requirements of United States Internal Revenue Code §§ 401, 403 (a), 403 (b), 408, 408A, 409 (as in effect prior to repeal by United States P.L. 98-369), or § 457. Whether a plan, account, or arrangement is intended to satisfy the requirements of one of the foregoing provisions shall be determined based on all of the relevant facts and circumstances including, but not limited to, the issuance of a favorable determination letter by the United States Internal Revenue Service, reports or returns filed with United States or state agencies, and communications from the plan sponsor to participants.

  2. Except as otherwise provided in this section, the interest of an individual under a retirement plan shall be exempt from creditor process to the same extent permitted under federal bankruptcy law for such a plan. The exemption provided by this section shall be available whether such individual has an interest in the retirement plan as a participant, beneficiary, contingent annuitant, alternate payee, or otherwise.
  3. The exemption provided under subsection B shall not apply to claims made against an individual by the alternate payee of such individual or to claims made against such individual by the Commonwealth in administrative actions pursuant to Chapter 19 (§ 63.2-1900 et seq.) of Title 63.2 or any court process to enforce a child or child and spousal support obligation.
  4. If two individuals who are married or were married are entitled to claim the exemption provided under subsection B of an interest under the same retirement plan or plans and such individuals are jointly subject to creditor process as to the same debt or obligation and the debt or obligation arose during the marriage, then the exemption provided under subsection B as to such debts or obligations shall not exceed, in the aggregate, the exemption permitted under federal bankruptcy law for such a plan. The exemption permitted under federal bankruptcy law shall be allocated among such persons in the same proportion as their respective interests in the retirement plan or plans.
  5. The exemption provided under this section must be claimed within the time limits prescribed by § 34-17 . (1990, c. 425; 1992, c. 716; 1996, c. 330; 1999, cc. 766, 796; 2005, c. 284; 2007, c. 302.)

The 1996 amendment inserted "other than amounts that were exempt from creditor process immediately prior to being contributed to the retirement plan" at the end of the first sentence of subsection D.

The 1999 amendments. - The 1999 amendments by cc. 766 and 796 are identical, and inserted "408 A" in the definition of "Retirement plan" and added subsection H.

The 2005 amendments. - The 2005 amendment by c. 284, throughout the section, substituted "$25,000" for "$17,500"; substituted "$127,875" for "$89,512.50" in the last paragraph of subsection C; and made a minor stylistic change.

The 2007 amendments. - The 2007 amendment by c. 302 rewrote the section.

Law review. - For 1991 survey on bankruptcy law, see 25 U. Rich. L. Rev. 607 (1991).

For article on 2007 and 2008 legislative and judicial developments in the areas of wills, trusts, and estates, see 43 U. Rich. L. Rev. 435 (2008).

For essay, "A Distinction Without a Difference? An Examination of the Legal and Ethical Difference Between Asset Protection and Fraudulent Transfers Under Virginia Law," see 47 U. Rich. L. Rev. 381 (2012).

Research References. - Enforcement of Judgments and Liens in Virginia (Matthew Bender). Chapter 4. Garnishment. § 4.8 Other Property Subject to Garnishment. Rendleman.

Friend's Virginia Pleading and Practice (Matthew Bender). Chapter 22 Enforcement of Judgments. § 22.08 Garnishment. Friend.

Virginia Forms (Matthew Bender). No. 6-501 Summons for Lien of Mechanic for Repairs in General District Court, et seq.

Michie's Jurisprudence. - For related discussion, see 2C M.J. Bankruptcy, §§ 54, 80.

Editor's note. - The cases cited below were decided prior to 2007 amendments to this section, which rewrote the section.

CASE NOTES

This section provides a limited exemption for retirement plans to the extent necessary to produce an annual retirement benefit of $17,500 [now $25,000]. In re Bissell, 255 Bankr. 402 (Bankr. E.D. Va. 2000).

Section not preempted by ERISA. - Since deeming I.R.C. § 401(k) plans to be retirement plans under subsection A of § 34-34 would not impair any federal law, and would in fact implement the express federal authority permitting the state to set appropriate exemption levels on retirement benefits for bankruptcy purposes, the Employee Retirement Income Security Act (ERISA) does not preempt subsection A of § 34-34 nor preclude consideration of a debtor's I.R.C. § 401(k) plan in determining the allowable IRA exemption. Abbate v. Spear, 289 Bankr. 62, 2003 U.S. Dist. LEXIS 2455 (E.D. Va. 2003).

Essentially, an individual may hold exempt in a retirement plan an amount that would pay a benefit of $17,500 [now $25,000] per year for life beginning at age 65. In re Cathcart, 203 Bankr. 599 (Bankr. E.D. Va. 1996).

The thrust of this statute is to give a debtor who has no other tax-qualified retirement plan the right to an unlimited exemption for an individual retirement account but to deny the unlimited exemption to a person who is covered by such a plan. In re Hasse, 246 Bankr. 247, 2000 Bankr. LEXIS 300 (Bankr. E.D. Va. 2000).

There is no apparent bar to claiming a homestead exemption in addition to whatever amounts may be held exempt under this section. In re Cathcart, 203 Bankr. 599 (Bankr. E.D. Va. 1996).

Exemption unlimited as to all plans not specified. - This section specifically identifies the types of retirement plans for which a debtor's exemption is limited; a debtor who participates in a plan other than of the type specified is entitled to an unlimited exemption even though such plan is functionally indistinguishable from those specified in the statute. In re Hasse, 246 Bankr. 247, 2000 Bankr. LEXIS 300 (Bankr. E.D. Va. 2000).

Schedule ambiguity construed against debtor. - Although Virginia's exemption statutes are construed liberally, any ambiguities found in the debtor's schedules are construed against the debtor. Thus, since filing his schedules, debtor has made no attempt to amend his exemption upward to take advantage of the maximum claim available under this section, consequently, the only portion of his interest that is exempt is $1.00. Thompson v. Board of Trustees, 182 Bankr. 140 (Bankr. E.D. Va. 1995), aff'd, 92 F.3d 1182 (4th Cir. 1996).

Debtor's prohibited transactions with account resulted in loss of exemption. Debtor's actions with respect to his SEP-IRA account were deemed to be prohibited transactions with a disqualified person, under 26 U.S.C.S. § 4975, that caused the account to lose its status as an individual retirement account under 26 U.S.C.S. § 408(k), and thereby also lose its exemption under § 34-34 . In re Meredith,, 2005 Bankr. LEXIS 2798 (Bankr. E.D. Va. May 19, 2005).

Debtor's wife's interest in debtor husband's IRA as death beneficiary was at best an expectancy and thus had no real value; therefore, she could not exempt this interest under the homestead exemption in addition to couple's retirement exemption. In re Cathcart, 203 Bankr. 599 (Bankr. E.D. Va. 1996).

Individual retirement accounts. - Where the debtor's IRAs squarely fell within the exemption provided by 11 U.S.C.S. § 522(b)(3)(C), and were not subject to disallowance because the bankruptcy exemption was claimed after the time allowed for claiming an exemption under subsection E of § 34-34 , the debtor was entitled to claim them as exempt. In re Diaz,, 2010 Bankr. LEXIS 1944 (Bankr. E.D. Va. June 10, 2010).

Bankruptcy debtor properly claimed an exemption in an individual retirement account since the debtor's investment of account funds in a limited liability company was not a prohibited transaction for the debtor's personal benefit under the Internal Revenue Code, and thus the account was immune from taxation and properly treated as exempt. In re Nolte,, 2015 Bankr. LEXIS 1524 (Bankr. E.D. Va. May 5, 2015).

Mistaken overpayment not exempted. - Creditor's objection to a debtor's § 34-34 exemption of an overpayment mistakenly deposited in her 401k account, which she rolled into an individual retirement account (IRA) pre-petition, was sustained because the overpayment should not have been included in her IRA and became part of the estate. In re Sheeran, 369 Bankr. 910, 2007 Bankr. LEXIS 2052 (Bankr. E.D. Va. 2007).

Navy retirement pay of Chapter 7 debtor was not exempt "retirement plan" under the statute. In re Meyer, 211 Bankr. 203 (Bankr. E.D. Va. 1997).

Debtor's exemption failed because the estate was not listed in her homestead deed. - Creditor's objection to a debtor's exemption of potential contingent and non-contingent interests in the estate of decedent was sustained because the debtor conceded that the estate was not listed in her homestead deed and was, thus, not exempt under § 34-34 . In re Sheeran, 369 Bankr. 910, 2007 Bankr. LEXIS 2052 (Bankr. E.D. Va. 2007).

ERISA plans. - The General Assembly intended the definition of "retirement plan" not to include ERISA-qualified plans, and intended to exclude ERISA-qualified pension plans from the statutory definition in this section. In re Bissell, 255 Bankr. 402 (Bankr. E.D. Va. 2000).

The amount of the exemption for qualified retirement plans is to be calculated without regard to the existence of or amount held in an ERISA-qualified pension plan; the amount held in an ERISA-qualified pension plan does not eliminate or reduce the amount of the exemption available for other retirement plans. In re Bissell, 255 Bankr. 402 (Bankr. E.D. Va. 2000).

Deferred profit sharing plan. - Bankruptcy court disallowed Chapter 7 debtors' claim that money in a deferred profit sharing (DPS) plan provided by a former employer, and property they purchased with DPS funds, was exempt from creditors' claims, pursuant to former subsection G of § 34-34 . Section 34-17 required the debtors to claim the exemption within five days of the date the trustee held a meeting of creditors pursuant to 11 U.S.C.S. § 341, and they had not done so; the court also had the power to reject the debtors' amended schedules and deny their claim because the debtors acted in bad faith, and their claim was precluded by 11 U.S.C.S. § 522(g)(1) because they voluntarily transferred the funds out of the DPS plan before they disclosed the plan's existence to the court or the trustee. In re Price,, 2008 Bankr. LEXIS 486 (Bankr. E.D. Va. Feb. 19, 2008).

Applied in In re Koons, 225 Bankr. 121 (Bankr. E.D. Va. 1998).