479 B.R. 9
Bankr. D. Mass.2012Background
- Debtor holds a one-quarter remainder interest in a Shrewsbury, MA home, subject to her mother's life estate.
- Mother conveyed the remainder interests in 1996 and a fourth remainder was added in 2009; Debtor's interest remains a remainder, not a present possessory interest.
- Debtor recorded a declaration of homestead on the remainder interest on September 7, 2011.
- Debtor filed Chapter 13 in October 2011, listing the remainder interest and claiming a Massachusetts Homestead Exemption for its full value.
- Trustee objected, contending Debtor is not an 'owner' under Mass. Gen. Laws ch. 188, § 1, and thus cannot exempt the remainder.
- Court analyzes whether the 2011 amendments expanding 'owner' to include life estate holders and beneficial interests apply to remainder interests and whether Boyle v. Weiss forecloses exemptions for remainder holders.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is a remainder interest an 'owner' under Mass. Gen. Laws ch. 188, § 1? | Debtor as remainder holder seeks exemption under the amended 'owner' definition. | Remainder holder is not among enumerated owners; not eligible. | Remainer holder is not an 'owner'; exemption denied. |
| Do the 2011 amendments to the Homestead Statute affect the outcome for remainder interests? | Expansion to include life estate holders and trust beneficiaries should liberalize to cover remainder interests. | Plain statutory text controls; amendments do not extend to remainder interests. | Amendments do not include remainder interests as owners; liberal construction cannot override language. |
| Should Massachusetts caselaw liberal construction favor Departing debtors regarding homestead exemptions? | Mass. caselaw supports liberal construction in debtor-friendly fashion. | Liberal construction cannot override express statutory categories of 'owners'. | Liberal construction does not expand the clear statutory list of owners. |
| What is the controlling authority for interpreting the Massachusetts Homestead Statute in this context? | Consider comparable decisions from other jurisdictions supporting exemptions for remainder interests. | Massachusetts statute has specific definitions; other jurisdictions are not controlling. | Massachusetts SJC guidance (Boyle) indicates remainder interests are not exempt under current statute; rely on state interpretation. |
Key Cases Cited
- Boyle v. Weiss, 461 Mass. 519 (Mass. S.J.C. 2012) (SJC held a debtor with a beneficial interest could not claim homestead exemption under the 2004 statute as an owner)
- In re Kimble, 344 B.R. 546 (Bankr. S.D. Ohio 2006) (held remainder owners could claim exemption under Ohio statute; distinguished as inapposite)
- In re Rasmussen, 456 B.R. 1 (E.D.N.Y. 2011) (New York statute analysis; rejected for Massachusetts context)
- In re Hayes, 376 B.R. 55 (Bankr. D. Mass. 2007) (liberal construction noted but not to override plain language)