Opinion ID: 455888
Heading Depth: 2
Heading Rank: 2

Heading: Stacking of Exemptions

Text: 10 The Illinois personal property exemption provision exempts in part the following items from judgment, attachment, or distress for rent: (1) the necessary wearing apparel, Bible, school books, and family pictures of the debtor and the debtor's dependents; (2) the debtor's equity interest, not to exceed $2,000 in value, in any other property; and (3) the debtor's interest, not to exceed $1,200 in value, in any one motor vehicle. Ill.Rev.Stat. ch. 110, Sec. 12-1001(a)-(c) (1983). 4 The trustee, relying on the precedent established by the district court of the Central District of Illinois, argues that Barker cannot claim the additional equity in his car, $1,022.72, under subsection (b) of the personal property exemption statute, but rather can only claim the $1,200 statutory maximum under subsection (c). See, e.g., In re Pastorek, Jr., 33 B.R. 406 (C.D.Ill.1983). Barker, on the other hand, cites cases from the Northern and Southern Districts of Illinois that have allowed a debtor to stack his exemptions under subsections (b) and (c) in one vehicle. See, e.g., In re Terry, 41 B.R. 508 (Bankr.N.D.Ill.1984); In re Cullen, 21 B.R. 118 (Bankr.S.D.Ill.1982). 11 The Illinois courts have followed the well-established principle that the primary goal of statutory construction is to ascertain and effectuate the legislature's intent. See In re Marriage of Logston, 103 Ill.2d 266, 277, 82 Ill.Dec. 633, 637, 469 N.E.2d 167, 171 (1984). In construing a statute, a court should first examine the statutory language itself. Id. at 277, 82 Ill.Dec. at 637, 469 N.E.2d at 171. If the court finds that the language is clear and unambiguous, then the court should give that language its effect and should not resort to extrinsic aids in construing the statute. Id. at 277, 82 Ill.Dec. at 637, 469 N.E.2d at 171. When a statute is subject to various interpretations, however, a court should look to other sources for evidence of the legislative intent such as the statute's legislative history, the reason for the statute's enactment, the circumstances that led to its adoption, and the ends that the legislature wished to achieve. Id. at 279, 82 Ill.Dec. at 638, 469 N.E.2d at 172. 12 Applying these general principles of statutory construction, we find that the Illinois personal property exemption statute is ambiguous on its face and susceptible of various interpretations. First, the reference to any other property in subsection (b) could mean that a debtor can exempt his equity interest up to a maximum of $2,000 in any property not specifically exempted in any other subsection of section 12-1001. See In re Pastorek, 33 B.R. at 407. Since subsection (c) specifically exempts a maximum of $1,200 in any one motor vehicle, a debtor would not be able to include any excess equity in that vehicle in the general $2,000 exemption under subsection (b). Id. One might also interpret subsection (b) as permitting a debtor to exempt any property of his estate, including the equity remaining in a motor vehicle after the specific exemption of (c) has been used. See In re Terry, 41 B.R. at 509; In re Cullen, 21 B.R. at 119-20. Under this latter interpretation, the remaining equity in a debtor's vehicle would be encompassed by the reference in subsection (b) to other property. In re Terry, 41 B.R. at 509. Finally, the trustee argues that pursuant to the doctrine of ejusdem generis, the language of subsection (b) permits a debtor to exempt an additional $2,000 of items in the same general class as the items listed in subsection (a), including wearing apparel, a Bible, school books, and family pictures, since subsection (b) is connected to subsection (a) by the word and and since there is no connecting word between subsections (b) and (c). Under this view, a debtor would not be able to exempt the additional equity in his car after taking the $1,200 exemption of subsection (c). 13 Each of the first two interpretations of section 12-1001 is reasonable in light of the language of the statute. As to the third interpretation advanced by the trustee, although we cannot explain the reason for the inclusion of the word and between subsections (a) and (b), we do not think that subsection (b) can be interpreted to limit a debtor to an exemption of $2,000 covering items similar to those listed in subsection (a). First, there is no dollar limit on the amount of items that a debtor can exempt under subsection (a), so there would be no need for subsection (b) if its only function was to allow a debtor to exempt an additional $2,000 worth of similar items. Furthermore, one could interpret the term other in the phrase any other property of subsection (b) as allowing a debtor to exempt $2,000 worth of any property other than the property previously listed in subsection (a). 14 Since the statute is subject to various interpretations as evidenced by the split among the district and bankruptcy courts of the Central District of Illinois and those of the Northern and Southern Districts of Illinois, we must look to the statute's legislative history and the Illinois courts' general view as to how to construe exemption statutes in order to shed light on the legislature's intent in enacting section 12-1001. At common law, all of the debtor's property was subject to execution. In re Marriage of Logston, 103 Ill.2d at 279, 82 Ill.Dec. at 638, 469 N.E.2d at 172. Since state legislatures viewed debtors with more compassion, all of the fifty states enacted personal property exemption statutes. Id. at 279, 82 Ill.Dec. at 638, 469 N.E.2d at 172. In 1843, the Illinois legislature enacted the predecessor to section 12-1001 in an attempt to prevent a debtor from being completely deprived of the means of supporting his family and from becoming a public charge. Id. at 279, 82 Ill.Dec. at 638, 469 N.E.2d at 172. Following the enactment of the Bankruptcy Reform Act of 1978, which increased the relief available to debtors by granting certain exemptions, the Illinois legislature expanded the available personal property exemptions by increasing the types of property and the amounts of property that could be exempted. 5 In re Cullen, 21 B.R. at 119; In re Marriage of Logston, 103 Ill.2d at 281-82, 82 Ill.Dec. at 639-40, 469 N.E.2d at 173-74. 15 In addition to this legislative history, this circuit and the courts in Illinois have consistently held that personal property exemption statutes should be liberally construed in order to carry out the legislature's purpose in enacting them--to protect debtors. See In the Matter of Schriar, 284 F.2d 471, 473-74 (7th Cir.1960); In re Feilchenfeld, 99 F.2d 710, 711 (7th Cir.1938); Finlen v. Howard, 126 Ill. 259, 262, 18 N.E. 560, 561 (1888); Washburn v. Goodheart, 88 Ill. 229, 231 (1878); Burns v. Turner, 193 Ill.App. 172, 175 (1915); McClellan v. Powell, 109 Ill.App. 222, 225 (1902). This clear legislative intent to grant protections to debtors and the courts' liberal construction of exemption statutes convince us that in a case such as this one, where an exemption statute might be interpreted either favorably or unfavorably vis-a-vis a debtor, we should interpret the statute in a manner that favors the debtor. In the absence of a more specific statement by the Illinois legislature that a debtor cannot use the $2,000 general exemption in subsection (b) to exempt the remaining equity in a car, we must conclude that a debtor is entitled to stack his exemptions for the same motor vehicle under both subsections (b) and (c). 16 In conclusion, the district court's order affirming the bankruptcy judge's decision disallowing the stacking of exemptions is reversed.