(a) The Legislature finds and declares that generally persons who enter into contracts do not do so in reliance on an assumption that the exemptions in effect at the time of the contract will govern enforcement of any judgment based on the contract, that liens imposed on property are imposed not as a matter of right but as a matter of privilege granted by statute for purposes of priority, that no vested rights with respect to exemptions are created by the making of a contract or imposition of a lien, that application of exemptions and exemption procedures in effect at the time of enforcement of a judgment is essential to the proper balance between the rights of judgment debtors and judgment creditors and has a minimal effect on the economic stability essential for the maintenance of private and public faith in commercial matters, and that it is the policy of the state to treat all judgment debtors equally with respect to exemptions and exemption procedures in effect at the time of enforcement of a money judgment. To this end, the Legislature reserves the right to repeal, alter, or add to the exemptions and the procedures therefor at any time and intends, unless otherwise provided by statute, that any repeals, alterations, or additions apply upon their operative date to enforcement of all money judgments, whether based upon tort, contract, or other legal theory or cause of action that arose before or after the operative date of the repeals, alterations, or additions, whether the judgment was entered before or after the operative date of the repeals, alterations, or additions.
§ 703.060.Power of State to Repeal, Alter and Add to Statutes
Title 9. Enforcement of Judgments · Division 2 · Chapter 4. Exemptions · Article 1. General Provisions · Enacted 1982 · no amendments on record · Last verified July 28, 2026
In one sentenceSection 703.060 records the Legislature's declaration that it reserves the right to repeal, alter, or add to exemption statutes and procedures at any time, applying every change to the enforcement of all money judgments regardless of when the underlying claim arose or the judgment was entered, since contracts and liens are deemed made with that legislative power already in mind.
Full Text of § 703.060
(b) All contracts shall be deemed to have been made and all liens on property shall be deemed to have been created in recognition of the power of the state to repeal, alter, and add to statutes providing for liens and exemptions from the enforcement of money judgments.
Plain-English Summary
This section is the policy statement behind § 703.050's timing rule. The Legislature explains its reasoning at length: people who sign contracts don't do so expecting the exemptions in place at signing to govern collection years later, liens exist as a matter of statutory privilege rather than vested right, and treating all debtors the same under whatever exemption rules are current serves fairness better than freezing old rules in place.
Having laid out that reasoning, the Legislature reserves the right to repeal, alter, or add to exemptions and their procedures at any time, and directs that such changes apply — unless a statute says otherwise — to every money judgment being enforced on or after the change takes effect, no matter what legal theory produced the judgment and no matter when the claim arose or the judgment was entered.
Subdivision (b) puts a legal backstop under that policy: every contract and every lien on property is deemed made with the state's power to change exemption law already built in. A creditor extending credit, or taking a lien, does so knowing the exemption rules can shift before enforcement happens.
Frequently Asked Questions
Can the Legislature change exemption rules that affect judgments that already exist?
Yes. Section 703.060 has the Legislature expressly reserve that right, applying changes to the enforcement of all money judgments regardless of when the claim arose or the judgment was entered.
Why doesn't this violate a creditor's expectations under an existing contract or lien?
Because subdivision (b) deems every contract made and every lien created with the state's reserved power to alter exemption law already understood and accounted for.
What policy does the Legislature give for applying current exemption rules to all debtors?
That treating all judgment debtors alike under the exemption rules in effect at the time of enforcement serves the proper balance between debtors and creditors better than preserving whatever rules existed when the contract or lien was made.
Amendment History
Added by Stats. 1982, Ch. 1364, Sec. 2. Operative July 1, 1983, by Sec. 3 of Ch. 1364.
Source & verification. Section text is reproduced verbatim from
the Deering's California Codes Annotated / vLex. Enacted by the California Legislature.
Last verified July 28, 2026.
· Official source
Also known as: legislature reserves right change exemptions californiaretroactive exemption law california judgments