459 B.R. 861
Bankr. M.D. Fla.2011Background
- Debtor filed Chapter 7 petition March 1, 2011, and disclosed schedules and statement of financial affairs on March 16, 2011.
- On Schedule C, the Debtor did not claim the residence as exempt initially; he indicated an intention to surrender the Property to the mortgagee in the Statement of Intention.
- The Trustee filed a Report and Notice of Intention to Sell the Property; Debtor objected and amended Schedule C to claim Florida homestead exemption and amended Statement of Intention to indicate intent to retain the Property.
- The Trustee objected to the amended exemption claiming lack of intent to reside permanently due to the stated surrender intent; Debtor testified to permanent residence despite foreclosure risk.
- The court ultimately ruled that the Statement of Intention cannot defeat the homestead exemption and that the Debtor’s intent to reside indefinitely supports exemption; the Property cannot be sold.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does a debtor's stated intention to surrender defeat homestead exemption? | Gentry argues surrender does not preclude permanent residence and exemption relates back. | Trustee contends surrender showed lack of permanent intent, defeating exemption. | No; exemption stands; surrender intent alone does not defeat homestead. |
| Does amendment to Schedule C relate back to the petition date for exemption? | Amendment to claim exemption retroactively valid. | Trustee may challenge timing based on lack of intent. | Amendment relates back to petition date; exemption valid. |
| Is the Florida homestead exemption liberally construed in bankruptcy? | Florida liberal interpretation favors exemptions. | Trustee argues strict application due to surrender indication. | Exemption liberally construed in debtor’s favor. |
| Has the debtor abandoned the homestead to nullify exemption? | Debtor has not abandoned; no intent to return removed. | Surrendering with intent to foreclose implies abandonment. | No abandonment; surrender alone does not equal abandonment here. |
Key Cases Cited
- Butterworth v. Caggiano, 605 So.2d 56 (Fla.1992) (homestead exemption liberally construed)
- Engel v. Engel, 97 So.2d 140 (Fla.1957) (permanency notion for homestead is indefinite period, not forever)
- Barlow v. Barlow, 23 So.2d 723 (Fla.1945) (abandonment of homestead occurs when owner leaves, does not intend to return)