AMENDED IN SENATE JUNE 15, 2026

AMENDED IN SENATE MAY 20, 2026

AMENDED IN ASSEMBLY APRIL 8, 2026

CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

96

Introduced by Committee on Judiciary (Assembly Members Kalra (Chair), Bauer-Kahan, Bryan, Connolly, Harabedian, Macedo, Pacheco, Papan, Stefani, and Zbur)

March 11, 2026

An act to amend Sections 2981, 2982, and 2982.2 of the Civil Code, to amend Sections 568.1 and 704.730 of the Code of Civil Procedure, to amend Sections 2110 and 3042 Section 2110 of the Family Code, to amend Section 2699.3 of the Labor Code, and to amend Sections 9763 and 16350 1063, 9763, and 16350 of the Probate Code, relating to state government.

Vote: majority   Appropriation: no   Fiscal committee: no   Local program: no

LEGISLATIVE COUNSEL’S DIGEST

(1) The Automobile Sales Finance Act generally regulates motor vehicle conditional sale contracts. The act defines various terms for these purposes, including “cash price” to mean the amount for which the seller would sell and transfer to the buyer unqualified title to the motor vehicle described in the conditional sale contract, if the property were sold for cash at the seller’s place of business on the date the contract is executed, and taxes to the extent imposed on the cash sale and the cash price of accessories or services related to the sale, including, among other things, a vehicle contract cancellation option agreement. The act requires a conditional sale contract to contain certain disclosures, including the amount charged for a contract cancellation option agreement. The act requires a seller to provide specified information to a buyer prior to the execution of a conditional sale contract, as specified, including a description and the price of a vehicle contract cancellation option agreement.

This bill would remove a vehicle contract cancellation option agreement from the definition of “cash price.” The bill would remove the requirement that a conditional sale contract disclose the amount charged for a contract cancellation option agreement. The bill would remove the requirement that the seller provide to a buyer prior to the execution of a conditional sale contract a description and the price of a vehicle contract cancellation option agreement.

(2) Existing law defines “homestead” to mean a principal dwelling in which a judgment debtor or their spouse resided on the date the judgment creditor’s lien attached to the dwelling and in which the judgment debtor or their spouse resided continuously thereafter until the date of a court determination that the dwelling is a homestead. Under existing law, a homestead is exempt from a sale to enforce a money judgment, except pursuant to a court order for sale if certain conditions are met. Existing law provides that the amount of a homestead exemption is the greater of (A) the countywide median price for a single-family home in the calendar year prior to the calendar year in which the judgment debtor claims the exemption, not to exceed $600,000, or (B) $300,000. Beginning on January 1, 2022, existing law requires the amount of a homestead exemption to be adjusted annually for inflation, as specified.

This bill would set the amount of a homestead exemption in the 2026 calendar year as the greater of (A) the “ceiling amount” of $746,350, or (B) the “floor amount” of $373,175. The bill would require those ceiling and floor amounts to be adjusted annually for inflation, beginning on January 1, 2027, by applying a multiplier produced by the change in the annual California Consumer Price Index (CPI) for All Urban Consumers, published by the Department of Industrial Relations, during the prior fiscal year. The bill would provide that the multiplier is calculated by dividing the CPI for the June ending the prior fiscal year by the CPI for the June immediately preceding the prior fiscal year. The bill would require each ceiling and floor amount that has been adjusted annually for inflation to be rounded to the nearest $25.

(3) Existing law requires each party to a proceeding for dissolution of marriage or legal separation to serve on the other party a preliminary declaration of disclosure of assets, as specified, and a final declaration of disclosure, as specified. In the case of a default judgment, existing law prohibits a petitioner from being required to serve or receive a final declaration of disclosure, but still requires a preliminary declaration of disclosure, except as specified.

This bill would provide that both parties are not required to exchange declarations of disclosure in a dissolution of marriage or registered domestic partnership if the parties have an existing enforceable judgment of legal separation that adjudicates or reserves jurisdiction over the division of property.

(4) This bill would correct various cross-references and make other technical changes.

The people of the State of California do enact as follows:

SECTION 1.

Section 2981 of the Civil Code is amended to read:

2981.

As used in this chapter, unless the context otherwise requires:

(a) “Conditional sale contract” means:

(1) A contract for the sale of a motor vehicle between a buyer and a seller, with or without accessories, under which possession is delivered to the buyer and either of the following:

(A) The title vests in the buyer thereafter only upon the payment of all or a part of the price, or the performance of any other condition.

(B) A lien on the property is to vest in the seller as security for the payment of part or all of the price, or for the performance of any other condition.

(2) A contract for the bailment of a motor vehicle between a buyer and a seller, with or without accessories, by which the bailee or lessee agrees to pay as compensation for use a sum substantially equivalent to or in excess of the aggregate value of the vehicle and its accessories, if any, at the time the contract is executed, and by which it is agreed that the bailee or lessee will become, or for no other or for a nominal consideration has the option of becoming, the owner of the vehicle upon full compliance with the terms of the contract.

(b) “Seller” means a person engaged in the business of selling or leasing motor vehicles under conditional sale contracts.

(c) “Buyer” means the person who buys or hires a motor vehicle under a conditional sale contract.

(d) “Person” includes an individual, company, firm, association, partnership, trust, corporation, limited liability company, or other legal entity.

(e) “Holder” means the person entitled to enforce the conditional sale contract against the buyer at the time.

(f) “Cash price” means the amount for which the seller would sell and transfer to the buyer unqualified title to the motor vehicle described in the conditional sale contract, if the property were sold for cash at the seller’s place of business on the date the contract is executed, and shall include taxes to the extent imposed on the cash sale and the cash price of accessories or services related to the sale, including, but not limited to, delivery, installation, alterations, modifications, improvements, document preparation fees, a service contract, and payment of a prior credit or lease balance remaining on property being traded in.

(g) “Downpayment” means a payment that the buyer pays or agrees to pay to the seller in cash or property value or money’s worth at or prior to delivery by the seller to the buyer of the motor vehicle described in the conditional sale contract. The term shall also include the amount of any portion of the downpayment the payment of which is deferred until not later than the due date of the second otherwise scheduled payment, if the amount of the deferred downpayment is not subject to a finance charge. The term does not include any administrative finance charge charged, received, or collected by the seller as provided in this chapter.

(h) “Amount financed” means the amount required to be disclosed pursuant to paragraph (8) of subdivision (a) of Section 2982.

(i) “Unpaid balance” means the difference between subdivisions (f) and (g), plus all insurance premiums (except for credit life or disability insurance when the amount thereof is included in the finance charge), which are included in the contract balance, and the total amount paid or to be paid as follows:

(1) To a public officer in connection with the transaction.

(2) For license, certificate of title, and registration fees imposed by law, and the amount of the state fee for issuance of a certificate of compliance or certificate of waiver pursuant to Section 9889.56 of the Business and Professions Code.

(j) “Finance charge” has the meaning set forth for that term in Section 226.4 of Regulation Z. The term shall not include delinquency charges or collection costs and fees as provided by subdivision (k) of Section 2982, extension or deferral agreement charges as provided by Section 2982.3, or amounts for insurance, repairs to or preservation of the motor vehicle, or preservation of the security interest therein advanced by the holder under the terms of the contract.

(k) “Total of payments” means the amount required to be disclosed pursuant to subdivision (h) of Section 226.18 of Regulation Z. The term includes any portion of the downpayment that is deferred until not later than the second otherwise scheduled payment and that is not subject to a finance charge. The term shall not include amounts for which the buyer may later become obligated under the terms of the contract in connection with insurance, repairs to or preservation of the motor vehicle, preservation of the security interest therein, or otherwise.

(l) “Motor vehicle” means a vehicle required to be registered under the Vehicle Code that is bought for use primarily for personal or family purposes, and does not mean any vehicle that is bought for use primarily for business or commercial purposes or a mobilehome, as defined in Section 18008 of the Health and Safety Code that is sold on or after July 1, 1981. “Motor vehicle” does not include any trailer that is sold in conjunction with a vessel and that comes within the definition of “goods” under Section 1802.1.

(m) “Purchase order” means a sales order, car reservation, statement of transaction, or any other such instrument used in the conditional sale of a motor vehicle pending execution of a conditional sale contract. The purchase order shall conform to the disclosure requirements of subdivision (a) of Section 2982 and Section 2984.1, and subdivision (m) of Section 2982 shall apply.

(n) “Regulation Z” means a rule, regulation, or interpretation promulgated by the Board of Governors of the Federal Reserve System (“Board”) under the federal Truth in Lending Act, as amended (15 U.S.C. Sec. 1601, et seq.), and an interpretation or approval issued by an official or employee of the Federal Reserve System duly authorized by the board under the Truth in Lending Act, as amended, to issue the interpretations or approvals.

(o) “Simple-interest basis” means the determination of a finance charge, other than an administrative finance charge, by applying a constant rate to the unpaid balance as it changes from time to time either:

(1) Calculated on the basis of a 365-day year and actual days elapsed (although the seller may, but need not, adjust its calculations to account for leap years); reference in this chapter to the “365-day basis” shall mean this method of determining the finance charge, or

(2) For contracts entered into prior to January 1, 1988, calculated on the basis of a 360-day year consisting of 12 months of 30 days each and on the assumption that all payments will be received by the seller on their respective due dates; reference in this chapter to the “360-day basis” shall mean this method of determining the finance charge.

(p) “Precomputed basis” means the determination of a finance charge by multiplying the original unpaid balance of the contract by a rate and multiplying that product by the number of payment periods elapsing between the date of the contract and the date of the last scheduled payment.

(q) “Service contract” means “vehicle service contract” as defined in subdivision (c) of Section 12800 of the Insurance Code.

(r) “Surface protection product” means the following products installed by the seller after the motor vehicle is sold:

(1) Undercoating.

(2) Rustproofing.

(3) Chemical or film paint sealant or protectant.

(4) Chemical sealant or stain inhibitor for carpet and fabric.

(s) “Theft deterrent device” means the following devices installed by the seller after the motor vehicle is sold:

(1) A vehicle alarm system.

(2) A window etch product.

(3) A body part marking product.

(4) A steering lock.

(5) A pedal or ignition lock.

(6) A fuel or ignition kill switch.

(t) “Guaranteed asset protection waiver” means an optional contractual obligation under which a seller agrees, for additional consideration, to cancel or waive all or part of amounts due on the buyer’s conditional sale contract subject to this chapter in the event of a total loss or unrecovered theft of the motor vehicle specified in the conditional sale contract.

SEC. 2.

Section 2982 of the Civil Code, as added by Section 3 of Chapter 354 of the Statutes of 2025, is amended to read:

2982.

A conditional sale contract subject to this chapter shall contain the disclosures required by Regulation Z, whether or not Regulation Z applies to the transaction. In addition, to the extent applicable, the contract shall contain the other disclosures and notices required by, and shall satisfy the requirements and limitations of, this section. The disclosures required by subdivision (a) may be itemized or subtotaled to a greater extent than as required by that subdivision and shall be made together and in the sequence set forth in that subdivision. All other disclosures and notices may appear in the contract in any location or sequence and may be combined or interspersed with other provisions of the contract.

(a) The contract shall contain the following disclosures, as applicable, which shall be labeled “itemization of the amount financed”:

(1) (A) The cash price, exclusive of document processing charges, charges to electronically register or transfer the vehicle, taxes imposed on the sale, pollution control certification fees, prior credit or lease balance on property being traded in, the amount charged for a service contract, the amount charged for a theft deterrent system, the amount charged for a surface protection product, and the amount charged for an optional debt cancellation agreement or guaranteed asset protection waiver.

(B) The charge to be retained by the seller for document processing authorized pursuant to Section 4456.5 of the Vehicle Code.

(C) The fee charged by the seller for certifying that the motor vehicle complies with applicable pollution control requirements.

(D) A charge for a theft deterrent device.

(E) A charge for a surface protection product.

(F) The total amount charged by the seller for an electric vehicle charging station, which may include only the charges for the electric vehicle charging station device, any materials and wiring, and any installation services. The total amount shall be labeled “EV Charging Station.”

(G) Taxes imposed on the sale.

(H) The charge to electronically register or transfer the vehicle authorized pursuant to Section 4456.5 of the Vehicle Code.

(I) The amount charged for a service contract.

(J) The prior credit or lease balance remaining on property being traded in, as required by paragraph (6). The disclosure required by this subparagraph shall be labeled “prior credit or lease balance (see downpayment and trade-in calculation).”

(K) Any charge for an optional debt cancellation agreement or guaranteed asset protection waiver.

(L) The total cash price, which is the sum of subparagraphs (A) to (K), inclusive.

(M) The disclosures described in subparagraphs (D) and (E) are not required on contracts involving the sale of a motorcycle, as defined in Section 400 of the Vehicle Code, or on contracts involving the sale of an off-highway motor vehicle that is subject to identification under Section 38010 of the Vehicle Code, and the amounts of those charges, if any, are not required to be reflected in the total price under subparagraph (L).

(2) Amounts paid to public officials for the following:

(A) Vehicle license fees.

(B) Registration, transfer, and titling fees.

(C) California tire fees imposed pursuant to Section 42885 of the Public Resources Code.

(3) The aggregate amount of premiums agreed, upon execution of the contract, to be paid for policies of insurance included in the contract, excluding the amount of any insurance premium included in the finance charge.

(4) The amount of the state fee for issuance of a certificate of compliance, noncompliance, exemption, or waiver pursuant to any applicable pollution control statute.

(5) A subtotal representing the sum of the amounts described in paragraphs (1) to (4), inclusive.

(6) The amount of the buyer’s downpayment itemized to show the following:

(A) The agreed value of the property being traded in.

(B) The prior credit or lease balance, if any, owing on the property being traded in.

(C) The net agreed value of the property being traded in, which is the difference between the amounts disclosed in subparagraphs (A) and (B). If the prior credit or lease balance of the property being traded in exceeds the agreed value of the property, a negative number shall be stated.

(D) The amount of any portion of the downpayment to be deferred until not later than the due date of the second regularly scheduled installment under the contract and that is not subject to a finance charge.

(E) The amount of any manufacturer’s rebate applied or to be applied to the downpayment.

(F) The remaining amount paid or to be paid by the buyer as a downpayment.

(G) The total downpayment. If the sum of subparagraphs (C) to (F), inclusive, is zero or more, that sum shall be stated as the total downpayment, and no amount shall be stated as the prior credit or lease balance under subparagraph (I) of paragraph (1). If the sum of subparagraphs (C) to (F), inclusive, is less than zero, then that sum, expressed as a positive number, shall be stated as the prior credit or lease balance under subparagraph (I) of paragraph (1), and zero shall be stated as the total downpayment. The disclosure required by this subparagraph shall be labeled “total downpayment” and shall contain a descriptor indicating that if the total downpayment is a negative number, a zero shall be disclosed as the total downpayment and a reference made that the remainder shall be included in the disclosure required pursuant to subparagraph (I) of paragraph (1).

(7) The amount of any administrative finance charge, labeled “prepaid finance charge.”

(8) The difference between the amount described in paragraph (5) and the sum of the amounts described in paragraphs (6) and (7), labeled “amount financed.”

(b) No particular terminology is required to disclose the items set forth in subdivision (a) except as expressly provided in that subdivision.

(c) If payment of all or a portion of the downpayment is to be deferred, the deferred payment shall be reflected in the payment schedule disclosed pursuant to Regulation Z.

(d) If the downpayment includes property being traded in, the contract shall contain a brief description of that property.

(e) The contract shall contain the names and addresses of all persons to whom the notice required pursuant to Section 2983.2 and permitted pursuant to Sections 2983.5 and 2984 is to be sent.

(f) (1) If the contract includes a finance charge determined on the precomputed basis, the contract shall identify the method of computing the unearned portion of the finance charge in the event of prepayment in full of the buyer’s obligation and contain a statement of the amount or method of computation of any charge that may be deducted from the amount of any unearned finance charge in computing the amount that will be credited to the obligation or refunded to the buyer. The method of computing the unearned portion of the finance charge shall be sufficiently identified with a reference to the actuarial method if the computation will be under that method. The method of computing the unearned portion of the finance charge shall be sufficiently identified with a reference to the Rule of 78, the sum of the digits, or the sum of the periodic time balances method in all other cases, and those references shall be deemed to be equivalent for disclosure purposes.

(2) If the contract includes a finance charge that is determined on the simple-interest basis but provides for a minimum finance charge in the event of prepayment in full, the contract shall contain a statement of that fact and the amount of the minimum finance charge or its method of calculation.

(g) (1) If the contract includes a finance charge that is determined on the precomputed basis and provides that the unearned portion of the finance charge to be refunded upon full prepayment of the contract is to be determined by a method other than actuarial, the contract shall contain a notice, in at least 10-point boldface type if the contract is printed, reading as follows:   “Notice to buyer:   (1) Do not sign this agreement before you read it or if it contains any blank spaces to be filled in.   (2) You are entitled to a completely filled-in copy of this agreement.   (3) You can prepay the full amount due under this agreement at any time and obtain a partial refund of the finance charge if it is $1 or more. Because of the way the amount of this refund will be figured, the time when you prepay could increase the ultimate cost of credit under this agreement.   (4) If you default in the performance of your obligations under this agreement, the vehicle may be repossessed and you may be subject to suit and liability for the unpaid indebtedness evidenced by this agreement.”

(2) If the contract includes a finance charge that is determined on the precomputed basis and provides for the actuarial method for computing the unearned portion of the finance charge upon prepayment in full, the contract shall contain a notice, in at least 10-point boldface type if the contract is printed, reading as follows:   “Notice to buyer:   (1) Do not sign this agreement before you read it or if it contains any blank spaces to be filled in.   (2) You are entitled to a completely filled-in copy of this agreement.   (3) You can prepay the full amount due under this agreement at any time and obtain a partial refund of the finance charge if it is $1 or more.   (4) If you default in the performance of your obligations under this agreement, the vehicle may be repossessed and you may be subject to suit and liability for the unpaid indebtedness evidenced by this agreement.”

(3) If the contract includes a finance charge that is determined on the simple-interest basis, the contract shall contain a notice, in at least 10-point boldface type if the contract is printed, reading as follows:   “Notice to buyer:   (1) Do not sign this agreement before you read it or if it contains any blank spaces to be filled in.   (2) You are entitled to a completely filled-in copy of this agreement.   (3) You can prepay the full amount due under this agreement at any time.   (4) If you default in the performance of your obligations under this agreement, the vehicle may be repossessed and you may be subject to suit and liability for the unpaid indebtedness evidenced by this agreement.”

(h) The contract shall contain a notice in at least 8-point boldface type, acknowledged by the buyer, that reads as follows:

“If you have a complaint concerning this sale, you should try to resolve it with the seller.

Complaints concerning unfair or deceptive practices or methods by the seller may be referred to the city attorney, the district attorney, or an investigator for the Department of Motor Vehicles, or any combination thereof.

After this contract is signed, the seller may not change the financing or payment terms unless you agree in writing to the change. You do not have to agree to any change, and it is an unfair or deceptive practice for the seller to make a unilateral change.

(i) (1) The contract shall contain an itemization of any insurance included as part of the amount financed disclosed pursuant to paragraph (3) of subdivision (a) and of any insurance included as part of the finance charge. The itemization shall identify the type of insurance coverage and the premium charged therefor, and, if the insurance expires before the date of the last scheduled installment included in the repayment schedule, the term of the insurance shall be stated.

(2) If any charge for insurance, other than for credit life or disability, is included in the contract balance and disbursement of any part thereof is to be made more than one year after the date of the conditional sale contract, any finance charge on the amount to be disbursed after one year shall be computed from the month the disbursement is to be made to the due date of the last installment under the conditional sale contract.

(j) (1) Except for contracts in which the finance charge or a portion of the finance charge is determined by the simple-interest basis and the amount financed disclosed pursuant to paragraph (8) of subdivision (a) is more than two thousand five hundred dollars ($2,500), the dollar amount of the disclosed finance charge may not exceed the greater of:

(A) (i) One and one-half percent on so much of the unpaid balance as does not exceed two hundred twenty-five dollars ($225), 1⅙ percent on so much of the unpaid balance in excess of two hundred twenty-five dollars ($225) as does not exceed nine hundred dollars ($900) and five-sixths of 1 percent on so much of the unpaid balance in excess of nine hundred dollars ($900) as does not exceed two thousand five hundred dollars ($2,500).

(ii) One percent of the entire unpaid balance; multiplied in either case by the number of months (computed on the basis of a full month for any fractional month period in excess of 15 days) elapsing between the date of the contract and the due date of the last installment.

(B) If the finance charge is determined by the precomputed basis, twenty-five dollars ($25).

(C) If the finance charge or a portion thereof is determined by the simple-interest basis:

(i) Twenty-five dollars ($25) if the unpaid balance does not exceed one thousand dollars ($1,000).

(ii) Fifty dollars ($50) if the unpaid balance exceeds one thousand dollars ($1,000) but does not exceed two thousand dollars ($2,000).

(iii) Seventy-five dollars ($75) if the unpaid balance exceeds two thousand dollars ($2,000).

(2) The holder of the contract shall not charge, collect, or receive a finance charge that exceeds the disclosed finance charge, except to the extent (A) caused by the holder’s receipt of one or more payments under a contract that provides for determination of the finance charge or a portion thereof on the 365-day basis at a time or times other than as originally scheduled whether or not the parties enter into an agreement pursuant to Section 2982.3, (B) permitted by paragraph (2), (3), or (4) of subdivision (c) of Section 226.17 of Regulation Z, or (C) permitted by subdivisions (a) and (c) of Section 2982.8.

(3) If the finance charge or a portion thereof is determined by the simple-interest basis and the amount of the unpaid balance exceeds five thousand dollars ($5,000), the holder of the contract may, in lieu of its right to a minimum finance charge under subparagraph (C) of paragraph (1), charge, receive, or collect on the date of the contract an administrative finance charge not to exceed seventy-five dollars ($75), provided that the sum of the administrative finance charge and the portion of the finance charge determined by the simple-interest basis shall not exceed the maximum total finance charge permitted by subparagraph (A) of paragraph (1). Any administrative finance charge that is charged, received, or collected by a holder shall be deemed a finance charge earned on the date of the contract.

(4) If a contract provides for unequal or irregular payments, or payments on other than a monthly basis, the maximum finance charge shall be at the effective rate provided for in paragraph (1), having due regard for the schedule of installments.

(k) The contract may provide that for each installment in default for a period of not less than 10 days the buyer shall pay a delinquency charge in an amount not to exceed in the aggregate 5 percent of the delinquent installment, which amount may be collected only once on any installment regardless of the period during which it remains in default. Payments timely received by the seller under an extension or deferral agreement may not be subject to a delinquency charge unless the charge is permitted by Section 2982.3. The contract may provide for reasonable collection costs and fees in the event of delinquency.

(l) Notwithstanding any provision of a contract to the contrary, the buyer may pay at any time before maturity the entire indebtedness evidenced by the contract without penalty. In the event of prepayment in full:

(1) If the finance charge was determined on the precomputed basis, the amount required to prepay the contract shall be the outstanding contract balance as of that date, provided, however, that the buyer shall be entitled to a refund credit in the amount of the unearned portion of the finance charge, except as provided in paragraphs (3) and (4). The amount of the unearned portion of the finance charge shall be at least as great a proportion of the finance charge, including any additional finance charge imposed pursuant to Section 2982.8 or other additional charge imposed because the contract has been extended, deferred, or refinanced, as the sum of the periodic monthly time balances payable more than 15 days after the date of prepayment bears to the sum of all the periodic monthly time balances under the schedule of installments in the contract or, if the contract has been extended, deferred, or refinanced, as so extended, deferred, or refinanced. If the amount of the refund credit is less than one dollar ($1), no refund credit need be made by the holder. Any refund credit may be made in cash or credited to the outstanding obligations of the buyer under the contract.

(2) If the finance charge or a portion of the finance charge was determined on the simple-interest basis, the amount required to prepay the contract shall be the outstanding contract balance as of that date, including any earned finance charges that are unpaid as of that date and, if applicable, the amount provided in paragraph (3), and provided further that in cases where a finance charge is determined on the 360-day basis, the payments received under the contract shall be assumed to have been received on their respective due dates regardless of the actual dates on which the payments were received.

(3) If the minimum finance charge provided by subparagraph (B) or subparagraph (C) of paragraph (1) of subdivision (j), if either is applicable, is greater than the earned finance charge as of the date of prepayment, the holder shall be additionally entitled to the difference.

(4) This subdivision shall not impair the right of the seller or the seller’s assignee to receive delinquency charges on delinquent installments and reasonable costs and fees as provided in subdivision (k) or extension or deferral agreement charges as provided in Section 2982.3.

(5) Notwithstanding any provision of a contract to the contrary, if the indebtedness created by any contract is satisfied prior to its maturity through surrender of the motor vehicle, repossession of the motor vehicle, redemption of the motor vehicle after repossession, or any judgment, the outstanding obligation of the buyer shall be determined as provided in paragraph (1) or (2), except that the buyer’s outstanding obligation shall be computed by the holder as of the date the holder recovers the value of the motor vehicle through disposition thereof or judgment is entered or, if the holder elects to keep the motor vehicle in satisfaction of the buyer’s indebtedness, as of the date the holder takes possession of the motor vehicle.

(m) Notwithstanding any other provision of this chapter to the contrary, any information required to be disclosed in a conditional sale contract under this chapter may be disclosed in any manner, method, or terminology required or permitted under Regulation Z, as in effect at the time that disclosure is made, except that permitted by paragraph (2) of subdivision (c) of Section 226.18 of Regulation Z, if all of the requirements and limitations set forth in subdivision (a) are satisfied. This chapter does not prohibit the disclosure in that contract of additional information required or permitted under Regulation Z, as in effect at the time that disclosure is made.

(n) If the seller imposes a charge for document processing or to electronically register or transfer the vehicle, the contract shall contain a disclosure that the charge is not a governmental fee.

(o) A seller shall not impose an application fee for a transaction governed by this chapter.

(p) The seller or holder may charge and collect a fee not to exceed fifteen dollars ($15) for the return by a depository institution of a dishonored check, negotiated order of withdrawal, or share draft issued in connection with the contract if the contract so provides or if the contract contains a generalized statement that the buyer may be liable for collection costs incurred in connection with the contract.

(q) The contract shall disclose on its face, by printing the word “new” or “used” within a box outlined in red, that is not smaller than one-half inch high and one-half inch wide, whether the vehicle is sold as a new vehicle, as defined in Section 430 of the Vehicle Code, or as a used vehicle, as defined in Section 665 of the Vehicle Code.

(r) The contract shall contain the disclosure identified in subdivision (e) of Section 1784.43.

(s) This section shall become operative October 1, 2026.

SEC. 3.

Section 2982.2 of the Civil Code is amended to read:

2982.2.

(a) Prior to the execution of a conditional sale contract, the seller shall provide to a buyer, and obtain the buyer’s signature on, a written disclosure that sets forth the following information:

(1) (A) A description and the price of each item sold if the contract includes a charge for the item.

(B) Subparagraph (A) applies to each item in the following categories:

(i) A service contract.

(ii) An insurance product.

(iii) A debt cancellation agreement or guaranteed asset protection waiver agreement.

(iv) A theft deterrent device.

(v) A surface protection product.

(2) The sum of all of the charges disclosed under subdivision (a), labeled “total.”

(3) The amount that would be calculated under the contract as the regular installment payment if charges for the items disclosed pursuant to subdivision (a) are not included in the contract. The amount disclosed pursuant to this subdivision shall be labeled “Installment Payment EXCLUDING Listed Items.”

(4) The amount that would be calculated under the contract as the regular installment payment if charges for the items disclosed under subdivision (a) are included in the contract. The amount disclosed pursuant to this subdivision shall be labeled “Installment Payment INCLUDING Listed Items.”

(b) The disclosures required under this section shall be in at least 10-point type and shall be contained in a document that is separate from the conditional sale contract and a purchase order.

(c) This section does not apply to the sale of a motorcycle, as defined in Section 400 of the Vehicle Code, or an off-highway vehicle subject to identification under Section 38010 of the Vehicle Code.

SEC. 4.

Section 568.1 of the Code of Civil Procedure is amended to read:

568.1.

Any securities in the hands of a receiver may, under the control of the court, be deposited by the receiver into a securities depository, as defined in Section 30004 of the Financial Code, which is licensed under Section 30200 of the Financial Code or exempted from licensing thereunder by Section 30005 or 30006 of the Financial Code, and those securities may be held by the securities depository in the manner authorized by Section 1331 of the Financial Code.

SEC. 5.

Section 704.730 of the Code of Civil Procedure is amended to read:

704.730.

(a) The amount of the homestead exemption is the greater of the following:

(1) (A) The “ceiling amount,” meaning the countywide median sale price for a single-family home in the calendar year prior to the calendar year in which the judgment debtor claims the exemption, not to exceed six hundred thousand dollars ($600,000).

(B) After applying annual adjustments and roundings for prior years to the nearest twenty-five dollars ($25), as described in subdivision (b), the adjusted ceiling amount for the 2026 calendar year is seven hundred forty-six thousand three hundred fifty dollars ($746,350).

(2) (A) The “floor amount,” which is three hundred thousand dollars ($300,000).

(B) After applying annual adjustments and roundings for prior years to the nearest twenty-five dollars ($25), as described in subdivision (b), the adjusted floor amount for the 2026 calendar year is three hundred seventy-three thousand one hundred seventy-five dollars ($373,175).

(b) (1) The ceiling and floor amounts specified in this section shall adjust annually for inflation, beginning on January 1, 2027, by applying the multiplier produced by the change in the annual California Consumer Price Index (CPI) for All Urban Consumers, published by the Department of Industrial Relations, during the prior fiscal year. On January 1, 2027, and annually thereafter, this multiplier shall be calculated by dividing the CPI for the June ending the prior fiscal year by the CPI for the June immediately preceding the prior fiscal year.

(2) Each ceiling and floor amount adjusted pursuant to paragraph (1) shall be rounded to the nearest twenty-five dollars ($25).

SEC. 6.

Section 2110 of the Family Code is amended to read:

2110.

(a) In the case of a default judgment, the petitioner may waive the final declaration of disclosure requirements provided in this chapter, and shall not be required to serve a final declaration of disclosure on the respondent nor receive a final declaration of disclosure from the respondent. However, a preliminary declaration of disclosure by the petitioner is required unless the petitioner served the summons and petition by publication or posting pursuant to court order and the respondent has defaulted.

(b) The petitioner and respondent shall not be required to exchange declarations of disclosure pursuant to Sections 2104 and 2105 in a dissolution of marriage or registered domestic partnership if the parties have an existing enforceable judgment of legal separation that adjudicates or reserves jurisdiction over the division of property.

SEC. 8.SEC. 7.

Section 2699.3 of the Labor Code is amended to read:

2699.3.

(a) A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision listed in Section 2699.5 shall commence only after the following requirements have been met:

(1) (A) The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.

(B) A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.

(C) The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (n) of Section 2699.

(2) (A) The agency shall notify the employer and the aggrieved employee or representative by certified mail that it does not intend to investigate the alleged violation within 60 calendar days of the postmark date of the notice received pursuant to paragraph (1). Upon receipt of that notice or if no notice is provided within 65 calendar days of the postmark date of the notice given pursuant to paragraph (1), the aggrieved employee may commence a civil action pursuant to Section 2699.

(B) If the agency intends to investigate the alleged violation, it shall notify the employer and the aggrieved employee or representative by certified mail of its decision within 65 calendar days of the postmark date of the notice received pursuant to paragraph (1). Within 120 calendar days of that decision, the agency may investigate the alleged violation and issue any appropriate citation. If the agency determines that no citation will be issued, it shall notify the employer and aggrieved employee of that decision within five business days thereof by certified mail. Upon receipt of that notice or if no citation is issued by the agency within the time limits prescribed by subparagraph (A) and this subparagraph or if the agency fails to provide timely or any notification, the aggrieved employee may commence a civil action pursuant to Section 2699.

(C) Notwithstanding any other provision of law, a plaintiff may as a matter of right amend an existing complaint to add a cause of action arising under this part at any time within 60 days of the time periods specified in this part.

(b) A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall commence only after the following requirements have been met:

(1) The aggrieved employee or representative shall give notice by online filing with the Division of Occupational Safety and Health and by certified mail to the employer, with a copy to the Labor and Workforce Development Agency, of the specific provisions of Division 5 (commencing with Section 6300) alleged to have been violated, including the facts and theories to support the alleged violation.

(2) (A) The division shall inspect or investigate the alleged violation pursuant to the procedures specified in Division 5 (commencing with Section 6300).

(i) If the division issues a citation, the employee may not commence an action pursuant to Section 2699. The division shall notify the aggrieved employee and employer in writing within 14 calendar days of certifying that the employer has corrected the violation.

(ii) If by the end of the period for inspection or investigation provided for in Section 6317, the division fails to issue a citation and the aggrieved employee disputes that decision, the employee may challenge that decision in the superior court. In such an action, the superior court shall follow precedents of the Occupational Safety and Health Appeals Board. If the court finds that the division should have issued a citation and orders the division to issue a citation, then the aggrieved employee may not commence a civil action pursuant to Section 2699.

(iii) A complaint in superior court alleging a violation of Division 5 (commencing with Section 6300) other than those listed in Section 2699.5 shall include therewith a copy of the notice of violation provided to the division and employer pursuant to paragraph (1).

(iv) The superior court shall not dismiss the action for nonmaterial differences in facts or theories between those contained in the notice of violation provided to the division and employer pursuant to paragraph (1) and the complaint filed with the court.

(B) If the division fails to inspect or investigate the alleged violation as provided by Section 6309, the provisions of subdivision (c) shall apply to the determination of the alleged violation.

(3) (A) Nothing in this subdivision shall be construed to alter the authority of the division to permit long-term abatement periods or to enter into memoranda of understanding or joint agreements with employers in the case of long-term abatement issues.

(B) Nothing in this subdivision shall be construed to authorize an employee to file a notice or to commence a civil action pursuant to Section 2699 during the period that an employer has voluntarily entered into consultation with the division to ameliorate a condition in that particular worksite.

(C) An employer who has been provided notice pursuant to this section may not then enter into consultation with the division in order to avoid an action under this section.

(4) The superior court shall review and approve any proposed settlement of alleged violations of the provisions of Division 5 (commencing with Section 6300) to ensure that the settlement provisions are at least as effective as the protections or remedies provided by state and federal law or regulation for the alleged violation. The provisions of the settlement relating to health and safety laws shall be submitted to the division at the same time that they are submitted to the court. This requirement shall be construed to authorize and permit the division to comment on those settlement provisions, and the court shall grant the division’s commentary the appropriate weight.

(c) A civil action by an aggrieved employee pursuant to subdivision (a) or (f) of Section 2699 alleging a violation of any provision other than those listed in Section 2699.5 or Division 5 (commencing with Section 6300) shall commence only after the following requirements have been met:

(1) (A) The aggrieved employee or representative shall give written notice by online filing with the Labor and Workforce Development Agency and by certified mail to the employer of the specific provisions of this code alleged to have been violated, including the facts and theories to support the alleged violation.

(B) A notice filed with the Labor and Workforce Development Agency pursuant to subparagraph (A) and any employer response to that notice shall be accompanied by a filing fee of seventy-five dollars ($75). The fees required by this subparagraph are subject to waiver in accordance with the requirements of Sections 68632 and 68633 of the Government Code.

(C) The fees paid pursuant to subparagraph (B) shall be paid into the Labor and Workforce Development Fund and used for the purposes specified in subdivision (n) of Section 2699.

(D) If the employer is not eligible for the processes in paragraphs (2) or (3) or chooses not to utilize those processes, the agency shall notify the employer and the aggrieved employee or representative by certified mail that it does not intend to investigate the alleged violation within 60 calendar days of the postmark date of the notice received pursuant to subparagraph (A). Upon receipt of that notice or if no notice is provided within 65 calendar days of the postmark date of the notice given pursuant to subparagraph (A), the aggrieved employee may commence a civil action pursuant to Section 2699.

(E) If the agency intends to investigate the alleged violation, it shall notify the employer and the aggrieved employee or representative by certified mail of its decision within 65 calendar days of the postmark date of the notice received pursuant to subparagraph (A). Within 120 calendar days of that decision, the agency may investigate the alleged violation and issue any appropriate citation. If the agency determines that no citation will be issued, it shall notify the employer and aggrieved employee of that decision within five business days thereof by certified mail. Upon receipt of that notice or if no citation is issued by the agency within the time limits prescribed by subparagraph (D) and this subparagraph or if the agency fails to provide timely or any notification, the aggrieved employee may commence a civil action pursuant to Section 2699.

(2) (A) Within 33 days of receipt of the notice sent by the aggrieved employee or representative, an employer that employed fewer than 100 employees in total during the period covered by the notice may submit to the agency a confidential proposal to cure one or more of the alleged violations. The employer shall specify which of the alleged violations it proposes to cure.

(B) If the cure is facially sufficient or if a conference is necessary to determine if a sufficient cure is possible, then within 14 days after receipt of the employer’s proposal, the agency may set a conference with the parties, to be conducted no more than 30 days thereafter, to determine whether the proposed cure is sufficient, what additional information may be necessary to evaluate the sufficiency of the cure, and the deadline agreed upon by the parties for the employer to complete the cure. If the cure includes the payment of unpaid wages, the agency shall also determine at the conference whether to request the employer pay the proposed cure amount, including any wages and liquidated damages due and 7 percent interest, into escrow or shall provide such other form of security as the agency deems suitable. Any such conference may be electronic, telephonic, or in person. If the agency determines that the cure is not facially sufficient or does not act upon the employer’s cure proposal, the employee may proceed with a civil action under this part after 65 calendar days from sending the notice required by this subdivision, unless this time is extended by the agency, provided that such time shall not be extended to more than 120 calendar days after notice is sent. However, the employer shall be entitled to file a request for a stay and early evaluation conference as set forth in subdivision (f).

(C) On or before the agreed upon deadline to cure, but no more than 45 days after the conference, the employer shall complete the cure and provide a sworn notification to the employee and agency that the cure is completed, accompanied by a payroll audit and check register if the violation involves a payment obligation. This notification shall also include any information the parties deemed necessary to determine the sufficiency of the cure. The agency shall verify whether the cure is complete within 20 days of receiving the employer’s notification. If the agency review procedure under this section extends beyond the 65-day period set forth in this section, the statute of limitation on the alleged violations shall remain tolled until that procedure has been completed.

(D) If the agency preliminarily determines that the alleged violation has been cured, it shall notify the aggrieved employee and, if requested by the aggrieved employee, shall set a hearing within 30 days of such determination. The agency shall issue an order no more than 20 days after the hearing providing a determination whether the cure is adequate and the reasons for its determination. If the agency determines that the alleged violation has been cured, the aggrieved employee may not proceed with a civil action. If the aggrieved employee disagrees with the cure determination, the aggrieved employee may appeal that determination to the superior court. Any amounts paid by the employer to the aggrieved employees exclusive of penalties under this section to cure the alleged violation shall be offset against any judgment later entered with respect to that violation, if the superior court concludes the agency abused its discretion in finding that the employer’s cure was adequate.

(E) No cure or proposal to cure pursuant to this paragraph may be deemed an admission of liability by the employer that submitted the proposed cure. Any cure proposal shall be deemed a confidential settlement proposal subject to Section 1152 of the Evidence Code.

(F) Nothing in this paragraph prohibits an employer from independently remedying any violations or prevents the parties from agreeing to their own mediation process.

(3) If the only alleged violation the employer seeks to cure is a violation of Section 226, the following procedure shall apply:

(A) The employer may cure the alleged violation within 33 calendar days of the postmark date of the notice sent by the aggrieved employee or representative. The employer shall give written notice within that period of time by certified mail to the aggrieved employee or representative and by online filing with the agency if the alleged violation is cured, including a description of actions taken, and no civil action pursuant to Section 2699 may commence. If the alleged violation is not cured within the 33-day period, the employee may commence a civil action pursuant to Section 2699.

(B) If the aggrieved employee disputes that the alleged violation of Section 226 has been cured, the aggrieved employee or representative shall provide written notice by online filing with the agency and by certified mail to the employer, including specified grounds to support that dispute, to the employer and the agency. Within 17 calendar days of the receipt of that notice, the agency shall review the actions taken by the employer to cure the alleged violation, and provide written notice of its decision by certified mail to the aggrieved employee and the employer. The agency may grant the employer three additional business days to cure the alleged violation. If the agency determines that the alleged violation has not been cured or if the agency fails to provide timely or any notification, the employee may proceed with the civil action pursuant to Section 2699. If the agency determines that the alleged violation has been cured, but the employee still disagrees, the employee may appeal that determination to the superior court.

(d) No employer shall avail itself of the notice and cure provisions of this section more than one time in a 12-month period for violations of the same provisions set forth in the notice, regardless of the location of the worksite or if it has been served with a prior notice pursuant to this part alleging the same violation that it did not cure.

(e) The periods specified in this section are not counted as part of the time limited for the commencement of the civil action to recover penalties under this part.

(f) (1) (A) Notwithstanding any other law, an employer not covered by subparagraph (A) of paragraph (2) of subdivision (c), upon being served with a summons and complaint asserting a claim under subdivision (a) or (f) of Section 2699, may file a request for an early evaluation conference in the proceedings of the claim and a request for a stay of court proceedings prior to or simultaneous with that defendant’s responsive pleading or other initial appearance in the action that includes the claim.

(B) The purpose of the evaluation conference shall include, but not be limited to, evaluation of all of the following, as applicable:

(i) Whether any of the alleged violations occurred and if so, whether the defendant has cured the alleged violations.

(ii) The strengths and weaknesses of the plaintiff’s claims and the defendant’s defenses.

(iii) Whether plaintiff’s claims, including any claim for penalties or injunctive relief, can be settled in whole or in part.

(iv) Whether the parties should share other information that may facilitate early evaluation and resolution of the dispute.

(2) A request for an early evaluation conference by a defendant pursuant to paragraph (1) shall include a statement regarding whether the defendant intends to cure any or all of the alleged violations, specify the alleged violations it will cure, if applicable, and identify the allegations it disputes.

(3) Upon the filing of a request for an early evaluation conference by a defendant and, if requested, a stay of proceedings, a court shall stay the proceedings and issue an order that does the following, absent good cause for denying defendant’s request in whole or in part:

(A) Schedules a mandatory early evaluation conference for a date as soon as possible from the date of the order but in no event later than 70 days after issuance of the order.

(B) Directs a defendant that has filed a statement that it intends to cure any or all of the alleged violations to submit confidentially to the neutral evaluator and serve on the plaintiff, within 21 days after issuance of the order, the employer’s proposed plan to cure those violations.

(C) Directs a defendant that is disputing any alleged violations to submit to the neutral evaluator and serve on the plaintiff a confidential statement that includes for use solely for the early evaluation conference, the basis and evidence for disputing those alleged violations.

(D) Directs the parties to appear at the time set for the conference.

(E) Directs the plaintiff to submit to the neutral evaluator and serve on the defendant no more than 21 days after service of defendant’s proposed cure plan, a confidential statement that includes, to the extent reasonably known, for use solely for the purpose of the early evaluation conference, all of the following:

(i) The factual basis for each of the alleged violations.

(ii) The amount of penalties claimed for each violation if any, and the basis for that calculation.

(iii) The amount of attorney’s fees and costs incurred to date, if any, that are being claimed.

(iv) Any demand for settlement of the case in its entirety.

(v) The basis for accepting or not accepting the employer’s proposed plan for curing any or all alleged violations.

(4) If the neutral evaluator accepts the employer’s proposed plan for curing any or all alleged violations, the defendant shall present evidence within 10 calendar days or such longer period as agreed by the parties or set by the neutral evaluator, demonstrating that the cure has been accomplished. If the defendant indicated it would cure any alleged violations and fails to timely submit the required evidence showing correction of the violation or violations to neutral evaluator and plaintiff, the early evaluation process and any stay may be terminated by the court.

(5) If the neutral evaluator and the parties agree that the employer has cured the alleged violations that it stated an intention to cure, the parties shall jointly submit a statement to the court setting forth the terms of their agreement.

(6) If no other alleged violations remain in dispute, the parties and the court shall treat the parties’ submission as a proposed settlement pursuant to the terms and procedures set forth in subdivision (s) of Section 2699.

(7) If other alleged violations remain in dispute, the court shall have discretion to defer consideration of the parties’ agreement until after further litigation proceedings.

(8) In calculating any penalties owed under this part for any violations that the employer promptly cured pursuant to this section, the court shall determine the applicability of subdivision (j), paragraph (2) of subdivision (e), paragraph (1) of subdivision (g), and paragraph (1) of subdivision (h) of Section 2699, and the court shall consider that the violations were cured without the need for extended litigation.

(9) If the neutral evaluator or plaintiff does not agree that the employer has cured the alleged violations that it stated an intention to cure, the employer may file a motion to request the court to approve the cure and submit evidence showing correction of the alleged violations. The court may request further briefing and evidentiary submissions from the parties in response to that motion and evidence.

(10) All statements or evidence submitted for purposes of the early evaluation conference and all discussions at the early evaluation conference shall be subject to Section 1152 of the Evidence Code.

(11) The early evaluation process shall not extend beyond 30 days unless parties mutually agree to extend time.

(12) Early evaluation conferences shall be conducted by a judge or commissioner or such other person knowledgeable about and experienced with issues arising under the code whom the court shall designate.

(13) Nothing in this subdivision affects or modifies the inadmissibility of evidence regarding offers of compromise pursuant to Section 1152 of the Evidence Code, including, but not limited to, inadmissibility to prove injury or damage.

(14) Nothing in this subdivision prohibits an employer from independently curing any violations or prevents the parties from agreeing to their own mediation process. Nor does anything in this section prohibit an employer covered by subparagraph (A) of paragraph (2) of subdivision (c) from requesting an early evaluation conference under such other terms and conditions as the court makes available to other litigants.

(15) Nothing in this subdivision shall preclude a court from ordering appropriate injunctive relief pursuant to paragraph (1) of subdivision (e) of Section 2699.

(16) Nothing in this subdivision limits the court’s obligation to approve settlements under this part.

(g) This section shall become operative October 1, 2024.

SEC. 8.

Section 1063 of the Probate Code is amended to read:

1063.

(a) In all accounts, there shall be an additional schedule showing the estimated market value of the assets on hand as of the end of the accounting period, and a schedule of the estimated market value of the assets on hand as of the beginning of the accounting period for all accounts subsequent to the initial account. The requirement of an estimated value of real estate, a closely held business, or other assets without a ready market, may be satisfied by a good faith estimate by the fiduciary.

(b) If there were purchases or other changes in the form of assets occurring during the period of the account, there shall be a schedule showing these transactions. However, no reporting is required for transfers between cash or accounts in a financial institution or money market mutual funds as defined in subdivision (d) of Section 8901.

(c) If an estate of a decedent or a trust will be distributed to an income beneficiary, there shall be a schedule showing an allocation of receipts and disbursements between principal and income.

(d) If there is specifically devised property, there shall be an additional schedule accounting for income, disbursements, and proceeds of sale pursuant to Section 12002 and subdivision (a) of Section 16340. Sections 12002 and 16370.

(e) If any interest has been paid or is to be paid under Section 12003, 12004, or 12005, or subdivision (b) of Section 16340, (e) of Section 16370, there shall be a schedule showing the calculation of the interest.

(f) If the accounting contemplates a proposed distribution, there shall be a schedule setting forth the proposed distribution, including the allocation of income required under Section 12006. If the distribution requires an allocation between trusts, the allocation shall be set forth on the schedule, unless the allocation is to be made by a trustee after receipt of the assets. If the distribution requires valuation of assets as of the date of distribution, the schedule shall set forth the fair market value of those assets.

(g) If, at the end of the accounting period, there are liabilities of the estate or trust, except current or future periodic payments, including rent, salaries, utilities, or other recurring expenses, there shall be a schedule showing all of the following:

(1) All liabilities which are a lien on estate or trust assets.

(2) Taxes due but unpaid as shown on filed returns or assessments received subsequent to filing of returns.

(3) All notes payable.

(4) Any judgments for which the estate or trust is liable.

(5) Any other material liability.

(h) If the guardian or conservator has knowledge of any real property of the conservatee or ward located in a foreign jurisdiction, the guardian or conservator shall include an additional schedule that identifies the real property, provides a good faith estimate of the fair market value of the real property, and states what action, if any, will or has been taken to preserve and protect the real property, including a recommendation whether an ancillary proceeding is necessary to preserve and protect the real property.

SEC. 9.

Section 9763 of the Probate Code is amended to read:

9763.

(a) If the decedent was a general partner, the personal representative may commence and maintain any action against the surviving partner that the decedent could have commenced and maintained.

(b) The personal representative may exercise the decedent’s rights as a limited partner as provided in the Uniform Limited Partnership Act of 2008 (Chapter 4.5 (commencing with Section 15900) of Title 2 of the Corporations Code).

SEC. 10.

Section 16350 of the Probate Code is amended to read:

16350.

(a) To the extent a fiduciary does not account for a receipt from an interest in minerals, water, or other natural resources as a business under Section 16342, the fiduciary shall allocate the receipt in the following manner:

(1) To income, to the extent received:

(A) As delay rental or annual rent on a lease.

(B) As a factor for interest or the equivalent of interest under an agreement creating a production payment.

(C) On account of an interest in renewable water.

(2) To principal, if received from a production payment, to the extent subparagraph (B) of paragraph (1) does not apply.

(3) Between income and principal in a reasonable manner, to the extent received:

(A) On account of an interest in nonrenewable water.

(B) As a royalty, shut-in-well payment, take-or-pay payment, or bonus.

(C) From a working interest or any other interest not provided for in subparagraph (A) or (B), or paragraph (1) or (2).

(b) This section applies to an interest owned or held by a fiduciary whether or not a settlor was extracting minerals, water, or other natural resources before the fiduciary owned or held the interest.

(c) An allocation of a receipt under paragraph (3) of subdivision (a) is presumed to be reasonable if the amount allocated to principal is equal to the amount allowed by the Internal Revenue Code of 1986, as amended (Title 26 of the United States Code, as amended), as a deduction for depletion of the interest.

(d) If a fiduciary owns or holds an interest in minerals, water, or other natural resources before the effective date of this chapter, the fiduciary may allocate receipts from the interest as provided in this section or in the manner used by the fiduciary before the effective date of this chapter. If the fiduciary acquires an interest in minerals, water, or other natural resources on or after the effective date of this chapter, the fiduciary shall allocate receipts from the interest as provided in this section.