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15.3.3 Motor Vehicles; Modified Vans and Other Health Aids

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  3. Chapter 15 Protecting the Debtor’s Home, Tangible Personal Property, and Other Assets
  4. 15.3 Tangible Personal Property: Household Goods, Vehicles, Health Aids, Tools of the Trade; Tenancy by Entireties in Personal Property
  5. 15.3.3 Motor Vehicles; Modified Vans and Other Health Aids

15.3.3 Motor Vehicles; Modified Vans and Other Health Aids

Many statutes provide an exemption for motor vehicles. Such an exemption should be construed broadly.195 These exemptions have often been construed to include motorcycles,196 motor homes,197 and ATVs,198 but usually not powerboats.199 Debtors may also be able to exempt trailers or other equipment that are subject to state vehicle registration requirements.200 On the other hand, one court adopted a judicially-created definition that had originated in a criminal case and held that a motor vehicle was a “self-propelled vehicle with wheels that is designed to be used, or is ordinarily used, to transport people or property on roads.” It applied this definition to conclude that a tractor was not exempt.201 It may be possible to exempt a disassembled vehicle if all essential parts are present.202 The availability of the exemption may depend on the use the debtor makes of the vehicle.203

Some jurisdictions allow a debtor to exempt more than one vehicle, if this can be done within the exemption’s monetary limits.204 Co-debtors may be able to stack their exemptions to protect a more expensive vehicle.205 Motor vehicle title laws may create a presumption as to ownership, but a court may allow this to be rebutted by evidence that a non-titled spouse paid for or drives the vehicle.206

In some states, the exempt amount for a motor vehicle is increased if the debtor or a family member is disabled.207 Most states provide an exemption for health aids, and one court has allowed a mobility-impaired debtor to exempt a modified van, up to the value of the modifications, and stack that exemption with the motor vehicle exemption.208 Another court allowed an exemption for the extensive improvements made to a debtor’s condominium to accommodate her chemical sensitivity; this exemption could be stacked with her homestead exemption.209

Whether a motor vehicle can be exempted as a tool of the debtor’s trade is discussed in § 15.3.4, infra.

Footnotes

  • 195 In re Martinez-Colon, 2014 WL 3616235 (D. P.R. July 21, 2014) (liberally construing exemption for a laborer’s “cart” to include interior decorator’s SUV).

  • 196 See, e.g., In re Clemons, 441 B.R. 519 (Bankr. N.D. Miss. 2010) (motorcycle is motor vehicle); In re Lund, 2005 WL 3620335 (Bankr. W.D. Mo. Dec. 9, 2005) (motorcycle is exempt but not motorized bicycle). See also In re Sutherland, 495 B.R. 134 (Bankr. D. Mass. 2013) (Massachusetts general exemption for automobile does not cover motorcycle but enhanced exemption for “vehicle” of elderly or disabled debtor does). But see In re Drewes, 217 B.R. 978 (D.N.H. 1998) (motorcycle is not protected by exemption for “automobile”).

  • 197 See, e.g., In re Sleeth, 300 B.R. 351 (Bankr. D. Ariz. 2003) (motor home is motor vehicle). But cf. In re McLain, 2018 WL 7051504 (Bankr. D. Colo. Nov. 14, 2018) (denying exemption; motor home in which debtor resided was neither a homestead nor a motor vehicle); In re Scott, 2012 WL 2576783 (Bankr. E.D. Va. July 3, 2012) (manufactured home not exempt motor vehicle; neither self-propelled, nor primarily designed to be attached to vehicle to provide mobile dwelling).

  • 198 See, e.g., In re Buchberger, 311 B.R. 794 (Bankr. D. Ariz. 2004) (“personal, family or household” purposes include recreation; applying rule of liberal construction and definition in transportation statute to exempt ATV); In re Moore, 251 B.R. 380 (Bankr. W.D. Mo. 2000) (when Missouri motor vehicle exemption did not explicitly exclude recreational ATVs, principle of liberal construction required inclusion); In re Holzapfel, 262 P.3d 1114 (Mont. 2011) (four-wheel ATV is a motor vehicle). But see In re Bosworth, 449 B.R. 104 (Bankr. D. Idaho 2011) (ATV with restricted license plate, which could not be lawfully operated on limited access highway, was not a motor vehicle).

  • 199 In re Gilica, 530 B.R. 429 (Bankr. N.D. Ohio 2015) (motor vehicle must be something on wheels or runners, designed to operate on the highway; powerboat not exempt); In re Potter, 2009 WL 902415 (Bankr. E.D. Va. Mar. 24, 2009) (powerboat not a motor vehicle within meaning of Virginia exemption); In re Barbera, 285 B.R. 355 (Bankr. D.R.I. 2002) (Rhode Island motor vehicle exemption does not cover boat, when definition of vehicle in state transportation law includes operation on highway).

  • 200 In re Alexander, 472 B.R. 815 (B.A.P. 9th Cir. 2012) (allowing motor vehicle exemption for mobile kitchen used in debtors’ barbecue business when Nebraska law required that trailer be titled and registered as motor vehicle).

  • 201 In re Matthews, 449 B.R. 833 (Bankr. M.D. Ga. 2011) (farm tractor, although it may be driven for short distances on public road, is not a motor vehicle).

  • 202 See, e.g., In re Bailey, 326 B.R. 750 (Bankr. S.D. Iowa 2004) (Iowa motor vehicle exemption would cover classic Ford, disassembled and currently inoperable, being rebuilt for investment; when essential parts were present, it was “self-propelled vehicle” within statutory definition). But see In re McMillin, 441 B.R. 348 (Bankr. D. Or. 2010) (denying vehicle exemption to parts that were sufficient to build a vehicle but had not yet been assembled).

  • 203 In re Letizia, 2014 WL 184438 (Bankr. D. Ariz. Jan. 14, 2014) (Arizona motor vehicle exemption only protects car used for personal or household purposes; vehicles used by sole proprietorship may be exempted only as tools of trade); In re Hill, 310 B.R. 294 (Bankr. W.D. La. 2004) (Louisiana motor vehicle exemption applies only to vehicle used for work or commuting; retired or unemployed debtor may not exempt vehicle).

  • 204 See, e.g., In re Scott, 332 B.R. 377 (Bankr. E.D. Mo. 2005) (Missouri’s amended motor vehicle exemption, “any vehicle in the aggregate,” may be split to protect two vehicles). See also In re McLean, 505 B.R. 361 (Bankr. D. Me. 2014) (couple owned two vehicles in joint tenancy with right of survivorship; each spouse could exempt full value of one vehicle); In re Bell, 333 B.R. 839 (Bankr. W.D. Mo. 2005) (amended Missouri statute covering “any motor vehicle in the aggregate” allows debtors to split the exemption between two vehicles; here, debtors stacked head-of-household, two wildcard, one motor vehicle, and part of another motor vehicle exemption to exempt one vehicle and applied balance of second motor vehicle exemption to second vehicle). But see In re Savoie, 351 B.R. 392 (Bankr. W.D. La. 2006) (former Louisiana statute, now amended, allowed exemption only for one vehicle per household used for work or commuting; debtors could exempt either pickup or family car); In re Struckhoff, 231 B.R. 69 (Bankr. E.D. Mo. 1999) (Missouri exemption for “any motor vehicle” covers exemption of only one motor vehicle when other exemptions refer to “one or more” or use the plural; statute has since been amended).

  • 205 See, e.g., Schilling v. Tran, 287 B.R. 887 (W.D. Ky. 2002) (allowing husband and wife to stack motor vehicle exemptions to exempt one vehicle; when title listed both spouses in alternative each had ownership interest); In re Reisdorff, 2010 WL 4852457 (Bankr. D. Neb. Nov. 27, 2010) (spouses, who each used jointly owned vehicle to commute to work, could stack two tools of trade and two wildcard exemptions).

  • 206 In re Jourdain, 2013 WL 944948 (Bankr. E.D.N.C. Mar. 8, 2013) (wife could exempt 50% interest in car titled in husband’s name; testimony that car was paid for with joint funds and driven by wife sufficient to rebut presumption). But see In re Frankel, 508 B.R. 527 (Bankr. D. Mass. 2014) (wife could not claim federal bankruptcy exemption for car titled in husband’s name even though she was primary driver and made many of the payments; rejecting claim that husband held car in trust for her). But cf. In re Whitt, 534 B.R. 320 (Bankr. N.D. Ohio 2015) (rejecting argument that statutory right of surviving spouse to obtain decedent’s motor vehicle in some circumstances similar to dower is sufficient basis for her to claim Ohio exemption for car titled solely in husband’s name).

  • 207 See In re Sleeth, 300 B.R. 351 (Bankr. D. Ariz. 2003) (applying enhanced exemption for “physically disabled” when debtor had serious heart disease and qualified for Social Security disability payments). But see In re Coleman, 209 B.R. 739 (Bankr. D. Colo. 1997) (Colorado’s $3000 “elderly or disabled” exemption for a motor vehicle did not protect a motor vehicle used by an able-bodied debtor to transport an arguably disabled dependent to medical treatment).

  • 208 In re Hellen, 329 B.R. 678 (Bankr. N.D. Ill. 2005) (doctor-recommended modifications to van to enable patient to drive entitled to exemption as “professionally prescribed heath aids” even though no written prescription). Cf. In re Dowell, 456 B.R. 578 (Bankr. M.D. Fla. 2011) (car was equipped with device to enable debtor to steer with one hand; device was a health aid, but car was not, when device could be easily detached and used in other car). But cf. In re Oelschlager, 2015 WL 4769004 (M.D. Fla. Aug. 13, 2015) (must show that vehicle is “uniquely designed” to accommodate disability; not shown here when debtor with complex medical problems, who visited doctors in many locations, chose unmodified car that was easy for him to get in and out of); In re Khan, 375 B.R. 5 (Bankr. M.D. Fla. 2007) (unmodified van, approved for a handicapped parking permit, not an exempt health aid; must be “uniquely suited” to accommodate disability); In re McCashen, 339 B.R. 907 (Bankr. N.D. Ohio 2006) (even if unmodified van could be health aid—which is debatable—not exempt when neither professionally prescribed nor medically necessary; no health aid exemption for only model of van roomy enough for morbidly obese debtor).

  • 209 In re Man, 428 B.R. 644 (Bankr. M.D.N.C. 2010) (encyclopedic collection of cases defining health aids).