478 B.R. 281
Bankr. E.D. Mich.2012Background
- Debtors own two homes: Riverview Property (Detroit area) and Cheboygan Property (Cheboygan, MI).
- Riverview has long been treated as principal residence; Cheboygan used part-time and listed as Second Residence.
- Petition filed Feb 28, 2012; Riverview mortgage lender obtained stay relief for foreclosure.
- Cheboygan Property was listed for sale; some offers received but rejected.
- Debtors testified they lived in Cheboygan about half the year and intended to live there more, not permanently at petition date.
- Trustee objected that §522(d)(1) residence exemption could not apply to Cheboygan if not the principal residence; Debtors argued they can have two residences and exempt either.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §522(d)(1) allows a residence exemption in more than one home. | Trustee: residence equals principal homestead; single residence policy under state law. | Demeters: residence is broader than principal residence; can exempt Cheboygan as a residence. | Yes; debtor may exempt Cheboygan as a residence under §522(d)(1). |
Key Cases Cited
- In re Lawrence, 469 B.R. 140 (Bankr.D.Mass.2012) (recognizes that residence may be broader than principal residence under §522(d)(1))
- In re Brown, 299 B.R. 425 (Bankr.N.D.Tex.2003) (holds ‘residence’ and ‘homestead’ interchangability (legislative history) not controlling here)
- Butner v. United States, 440 U.S. 48 (U.S. 1979) (state law generally defines property interests; federal interest discussed later)
- In re Rivera, 470 B.R. 109 (Bankr.D.P.R.2012) ( Puerto Rico homestead considerations; state law relevance in some contexts)
- In re Kaplan, 468 B.R. 246 (Bankr.W.D.Ky.2012) (state law homestead concepts used in some contexts)