487 B.R. 599
6th Cir. BAP2013Background
- Debtor Monae Breece and her grandmother jointly held title to 2124 Greencrest Drive, Union Town, Ohio; ownership later transferred to Gardinia Breeze, LLC, which holds legal title.
- Gardinia Breeze, LLC is an Ohio LLC with Debtor as sole member after grandmother’s death; Gardinia’s only asset is the Real Property and it has no debt.
- The Real Property has a mortgage, with Debtor personally liable for the secured debt.
- Debtor used the Real Property as her residence since 2004 and remained residing there at the bankruptcy filing.
- Debtor claimed a homestead exemption in the Real Property under Ohio Revised Code § 2329.66(A)(1)(b) on Schedule C and listed Gardinia ownership on Schedule B as 100% membership with value $0; Trustee objected to exemption on the basis that the Real Property is owned by Gardinia, not Debtor.
- The bankruptcy court sustained the Trustee’s objection, holding that Debtor’s sole membership in Gardinia does not confer an exemptible interest in the Real Property; Debtor timely appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Debtor may claim a homestead exemption in the LLC-owned Real Property. | Breece argues her membership in Gardinia yields an exemptible interest in the Real Property. | Trustee contends no exemptible interest passes to Debtor because the Real Property is owned by Gardinia, not by Debtor. | Affirmed. Debtor has no interest in the Real Property; property not estate property; exemption denied. |
Key Cases Cited
- Gaylord, Son & Co. v. M. Imhoff & Co., 26 Ohio St. 317 (Ohio 1875) (exemption not extended to partnership property; supports interpreting exemption to owner/debtor)
- Morgridge v. Converse, 150 Ohio St. 239 (Ohio 1948) (ownership/use requirement for homestead exemption under Ohio law)
- McComb v. Thompson, 42 Ohio St. 139 (Ohio 1884) (historic occupation/possession focus; ownership not implied from occupancy)
- Jackson v. Reid, 32 Ohio St. 443 (Ohio 1877) (possession/ownership considerations for homestead exemption)
- Gibson v. Mundell, 29 Ohio St. 523 (Ohio 1876) (discussion of residence use in exemption context)