In re: Angie M. Garcia
FILED OPINION (ALEX KOZINSKI, BARRY G. SILVERMAN and JED S. RAKOFF) AFFIRMED., Judge: BGS Authoring,. FILED AND ENTERED JUDGMENT. 
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
IN RE : ANGIE M. GARCIA , AKA
Angel Garcia, AKA Angie Marie
ORANGE COUNTY ’S CREDIT UNION ,
ANGIE M. GARCIA ,
UNITED STATES TRUSTEE and
CHARLES W. DAFF, Chapter 7
Appeal from the United States District Court
for the Central District of California
Josephine Staton Tucker, District Judge, Presiding
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IN RE: GARCIA
Submitted February 13, 2013*
Filed March 5, 2013
Before: Alex Kozinski, Chief Judge, Barry G. Silverman,
Circuit Judge, and Jed S. Rakoff, Senior District Judge.**
Opinion by Judge Silverman
Affirming the district court’s judgment in a bankruptcy
case, the panel held that: (1) a motor vehicle may fall within
California’s “wildcard” or “grubstake” exemption; and (2) if
an exempt vehicle is a tool of the debtor’s trade and is
secured by a nonpossessory, nonpurchase-money lien, then
the debtor can avoid the lien pursuant to 11 U.S.C.
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
The Honorable Jed S. Rakoff, Senior District Judge for the U.S.
District Court for the Southern District of New York, sitting by
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
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IN RE: GARCIA
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Robert M. Dato and Joseph M. Welch, Buchalter Nemer,
Irvine, California, for Creditor-Appellant.
Anerio V. Altman, Lake Forest, California, for DebtorAppellee.
SILVERMAN, Circuit Judge:
We hold today that a motor vehicle, even a Mercedes,
may fall within California’s so-called “wildcard” or
Cal. Civ. Proc. Code
§ 703.140(b)(5). We also hold that if an exempt vehicle is a
tool of the debtor’s trade and is secured by a nonpossessory,
nonpurchase-money lien, the debtor can avoid the lien
pursuant to 11 U.S.C. § 522(f)(1)(B). The district court so
ruled and remanded the case to the bankruptcy court to
determine whether the vehicle in question, a 2001 Mercedes
320E sedan, was in fact a tool of the debtor’s trade as a real
estate agent, or just a sweet ride. The lien-holder appealed.
In November 2006, Angie Garcia, a real estate agent,
borrowed $22,160 from Orange County’s Credit Union and
used her Mercedes as collateral. The credit union perfected
a nonpossessory, nonpurchase-money lien on the vehicle.
IN RE: GARCIA
Garcia filed for Chapter 7 bankruptcy and listed the
outstanding balance of the loan as $12,715.50. She claimed
that the car, valued at $5,350, was exempt from her
bankruptcy estate under California Civil Procedure Code
§ 703.140(b)(5). That section allows a debtor to exempt up
to $18,350 in “any property.”1 Garcia also moved to avoid
the lien on the car pursuant to 11 U.S.C. § 522(f)(1)(B). That
section allows debtors to avoid nonpossessory, nonpurchase-
Cal. Civ. Proc. Code § 703.140(b) (2010) states:
The following exemptions may be elected as provided
in subdivision (a):
(1) The debtor’s aggregate interest, not to exceed
seventeen thousand four hundred twenty-five dollars
($17,425) in value, in real property or personal property
that the debtor or a dependent of the debtor uses as a
residence, in a cooperative that owns property that the
debtor or a dependent of the debtor uses as a residence,
or in a burial plot for the debtor or a dependent of the
(5) The debtor’s aggregate interest, not to exceed in
value nine hundred twenty-five dollars ($925) plus any
unused amount of the exemption provided under
paragraph (1), in any property.
On January 1, 2013, the amounts were increased to $24,060 and
$1,280, respectively, and the burial plot reference was deleted.
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IN RE: GARCIA
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money liens on exempt property that is a tool of the debtor’s
The bankruptcy court ruled that the California wildcard
exemption could not be used for vehicles like Garcia’s
because other sections of the California exemption statutes
deal with them explicitly. It also ruled that Garcia could not
use the lien avoidance provisions of 11 U.S.C. § 522(f)(1)(B)
because motor vehicles were explicitly mentioned in other
portions of the statute, (e.g., § 522(d)(2)), and because the
legislative history behind § 522(f) did not support avoiding
liens on luxury items.
The district court reversed. As for the California wildcard
exemption, the district court ruled that “any property” means
just that – any property – up to the statutory amount. Quoting
In re Taylor, 861 F.2d 550, 553 (9th Cir. 1988), the court also
11 U.S.C. § 522(f)(1) states:
Notwithstanding any waiver of exemptions but subject
to paragraph (3), the debtor may avoid the fixing of a
lien on an interest of the debtor in property to the extent
that such lien impairs an exemption to which the debtor
would have been entitled under subsection (b) of this
section, if such lien is-...
(B) a nonpossessory, nonpurchase-money security
interest in any-...
(ii) implements, professional books, or tools, of the
trade of the debtor or the trade of a dependent of the
IN RE: GARCIA
ruled that “[l]ien avoidance on motor vehicles as tools of the
debtor’s trade . . . is generally allowed in situations where the
vehicle is necessary to the debtor’s trade, and the state has
opted out of the federal laundry list.” The court remanded the
case to the bankruptcy court for further factual findings to
determine whether Garcia’s Mercedes is indeed a tool of her
II. JURISDICTION AND STANDARD OF REVIEW
We have jurisdiction to hear appeals from a district
court’s ruling on a bankruptcy court’s final order, judgment,
or decree under 28 U.S.C. § 1291. Although the district
court’s order reversed and remanded to the bankruptcy court
for further factual findings, we may exercise jurisdiction if
the issues on appeal are legal “in nature and [their] resolution
either (1) could dispose of the case or proceedings and
obviate the need for factfinding; or (2) would materially aid
the bankruptcy court in reaching its disposition on remand.”
In re Scovis, 249 F.3d 975, 980 (9th Cir. 2001) (citing
Lundell v. Anchor Constr. Specialists, 223 F.3d 1035, 1038
(9th Cir. 2000)).
Here, the issues are purely legal. On appeal, we consider
whether California Civil Procedure Code § 703.140(b)(5)
permits the exemption of a motor vehicle and whether
11 U.S.C. § 522(f)(1)(B) permits lien avoidance on the same.
As the district court noted, the bankruptcy court resolved
these issues as a matter of law and made no factual findings.
We review de novo the district court’s decision, In re AFI
Holding, Inc., 525 F.3d 700, 702 (9th Cir. 2008), and the
bankruptcy court’s interpretation of the Bankruptcy Code,
Blausey v. U.S. Trustee, 552 F.3d 1124, 1132 (9th Cir. 2009).
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IN RE: GARCIA
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Generally, when a debtor files Chapter 7 bankruptcy, all
of the debtor’s property becomes the property of the
bankruptcy estate. 11 U.S.C. § 541. Federal law, however,
provides avenues for the debtor to exempt certain property.
11 U.S.C. § 522(d). This exemption scheme can be
supplanted by states that choose to provide their own menu of
exemptions. 11 U.S.C. § 522(b)(2); see also In re Granger,
754 F.2d 1490, 1490, 1492 (9th Cir. 1985) (“[A] state that has
opted out has considerable freedom in creating exemptions
and eligibility requirements for those exemptions.”).
California is one such state, providing its own exemption
scheme in California Civil Procedure Code §§ 703.130 and
We agree with the district court that as a purely legal
matter Garcia is not prevented from exempting a motor
vehicle up to the maximum allowable amount under
California Civil Procedure Code § 703.140(b)(5). Section
703.140(b)(5) permits a debtor to exempt her “aggregate
interest, not to exceed in value nine hundred twenty-five
dollars ($925) plus any unused amount of the exemption
provided under paragraph (1), in any property.” Cal. Civ.
Proc. Code § 703.140(b)(5) (2010) (emphasis added).
Paragraph (1) states that a debtor can exempt up to $17,425
in certain types of real or personal property.
§ 703.140(b)(1) (2010). Thus, these two paragraphs combine
to allow a debtor to exempt up to $18,350 in “any property.”
“Any” means any, and fancy cars are not excluded.
The final question is whether a lien on a motor vehicle
can be avoided under 11 U.S.C. § 522(f)(1)(B) as a tool of the
IN RE: GARCIA
debtor’s trade. As the district court correctly ruled, the
answer is “yes.” In re Taylor, 861 F.2d at 553.
It remains to be seen whether Garcia’s car qualifies as a
tool of her trade. We affirm the district court’s remand to the
bankruptcy court for that factual determination, and likewise
affirm the district court’s ruling in all other respects.
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