661 B.R. 191
Bankr. E.D.N.Y.2024Background
- Eugene DeMarco, a U.S. citizen, became a permanent resident of New Zealand in May 2008 and has lived there almost exclusively since then.
- On July 14, 2021, DeMarco was declared bankrupt by a New Zealand court; a New Zealand Foreign Representative was appointed to manage his assets, including property in New York.
- An involuntary Chapter 7 bankruptcy case was commenced by the Foreign Representative in the Eastern District of New York on September 29, 2022.
- DeMarco claimed a New York homestead exemption for the property located at 117 Burr Road, East Northport, NY, though he had not resided there since at least 2017 and had been in New Zealand (including periods of incarceration and parole restrictions) almost continuously.
- DeMarco’s travel to New York shortly before the petition date was temporary and for compassionate reasons, not for the purpose of re-establishing domicile.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether DeMarco can claim the NY homestead exemption | DeMarco is not domiciled in NY; no physical presence | Restrictions in New Zealand were involuntary; intends NY | DeMarco is not domiciled in NY; exemption denied |
| Whether temporary visits establish NY domicile | Temporary visits are insufficient for domicile | Last visit intended as relocation to NY | Temporary visits do not establish NY domicile |
| Effect of incarceration/parole on domicile determination | DeMarco voluntarily left NY long before incarceration | Presence in NZ was involuntary due to parole | Incarceration did not interrupt NZ domicile |
| Credibility of stated intent to return to NY | Objective evidence contradicts DeMarco’s claim | Subjective intent to return to NY | Court found DeMarco’s intent not credible |
Key Cases Cited
- Palazzo ex rel. Delmage v. Corio, 232 F.3d 38 (2d Cir. 2000) (defines domicile as true fixed home with intention of returning)
- Linardos v. Fortuna, 157 F.3d 945 (2d Cir. 1998) (reiterates domicile requires intent and physical presence)
- Matter of Brunner’s Estate, 41 N.Y.2d 917 (N.Y. 1977) (domicile determination requires a fact-specific inquiry)
- In re Estate of Newcomb, 192 N.Y. 238 (N.Y. 1908) (acquisition of new domicile requires union of residence and intention)