The debtor, Don Orriel Neis, appeals from a district court judgment,
I
Don and Andrea Neis purchased a house, as joint tenants, at 4062 Glenhaven Drive, La Crosse, Wisconsin, in 1972. They lived in this house together until February 1979 when marital difficulties caused Don Neis to spend part of his time at an apartment in a building which he owned and usually rented out to tenants. In late March, he entered into a year’s lease for аn apartment at 1638 Bainbridge Street, also in La Crosse. On April 2, Andrea filed for a divorce. She and their son continued to reside in the Glenhaven house, and in July a temporary order was issued requiring Don to vacate the Glenhaven property.
In September 1979, Don left the Bain-bridge apartment and began to live at 1104 Wells Street, Onalaska, Wisconsin. This was another property which he owned and *586 usually rented to tenants. Because there had been flooding and he was having difficulty finding a tenant, Don decided that it was economically more reasonable for him to occupy the Wells Street property than to pay rent elsewhere. During the summer of 1980, three judgments were docketed against him in favor of Cameron, Nix, Collins and Quillin on June 11, Anna and Raymond Mook on June 17 and Trane Employee’s Credit Union on July 16.
On November 10, 1980, Don and Andrea Neis agreed on a stipulation which was incorporated in a judgment of divorce entered on November 26, 1980. According to the divorce decree, Andrea was to occupy the Glenhaven house until it could be sold, and the proceeds of the sale were to be divided between her and Don after payment of the mortgage and the crediting of certain expenses to Andrea. The closing of the sale of the house was set for December 31,1980, and Andrea moved out in January. The buyers, however, would not accept title because of the judgment liens against the property. While the parties negotiated an agreement, Don moved back into the house in February 1981 in order to protеct it from vandalism and to allow him to rent out the Wells Street property for which he had now found a tenant. On March 11, 1981, he filed a Chapter 7 bankruptcy petition, claiming the homestead exemption allowed by Wisconsin statute in the Glenhaven property. The Glenhaven house was sold on March 31, 1981, and the sale proceeds were placed in an escrow account рursuant to an agreement among Don, Andrea and the three judgment lienholders.
II
The sole issue on appeal both in the district court and here is whether under Wisconsin law a debtor has a right to the homestead exemption permitted by Wisconsin statute in a property which he left because of a pending divorce. Although in the course of these proceedings there has been considerable discussion of Don Neis’ residency status at the various places where he has lived, the relevant moment for determining the availability of the homestead exemption is the time at which the judgments were docketed — that is, the summer of 1980.
Northern State Bank v. Toal,
Wisconsin law protects a debtor’s homestead property from judgments to the extent of $25,000:
*587 (1) An exempt homestead ... selected by a resident owner and occupied by him shall be exempt from execution, from the lien of every judgment and from liability for the debts of such owner to the amount of $25,000 ... except as otherwise provided. Such exemption shall not be impaired by temporary removal with the intention tb reoccupy the premises as a homestead nor by the sale thereof, but shall extend to the proceeds derived from such sale to an amount not exceeding $25,000, while held, with the intention to procure another homestead therewith, for 2 years.
Wis.Stat. § 815.20 (1981). The statute thus requires that an owner be a resident-oсcupant of the property claimed as a homestead subject to two exceptions: (1) when the owner is temporarily absent with an intent to return and (2) when the house is to be sold with the proceeds intended for the purchase of another homestead. Thus, with respect to these exceptions, the owner’s intent is crucial to a determination of qualification for thе homestead exemption.
The statute has been liberally construed in favor of debtors, as typified in
Schwanz v. Teper,
[tjhere is a strong public policy in this state to protect the homestead exemption. Because of this public policy, homestead statutes are liberally construed in favor of the debtor, and homestead rights are preferred over the rights of creditors.
Id.
at 163,
In following this policy, the Wisconsin courts have considered whether the owner was required to leave the home involuntarily, as, for example, by a judicial divorcе decree barring him from the home or by economic and personal necessities which operated to expel the owner from the residence.
3
In
In re Bleiler,
Nos. 73-BK-696, 73-BK-697 (W.D.Wis. March 11, 1974), the court found that financial and marital difficulties had rendered the debtor’s departure from her home involuntary and so exempted the proceeds from the sale of the home. Finally, in
In re Lumb,
Following these precedents, the bankruptcy court in the present case determined that Don Neis was prevented during the summer of 1980, at the time the judgments against him were docketed, from occupying his Glenhaven home, first by marital difficulties and later by order of the Family Court Commissioner. The bankruptcy court went on to hold that the Glenhaven home was therefore protected from Don’s creditors. Because the statutory language relies, in determining the availability of the homestead exemption, on the owner-occupant’s intent, one may infer that the bankruptcy court made an implicit finding of fact consistent with its conclusion — that is, that Neis’ departure was invоluntary; that he intended, if he had been permitted, to return to the Glenhaven house up to the time of its sale and that he did not intend to abandon it as his homestead.
The district court on review reversed the decision of the bankruptcy court and held that the Glenhaven house was not exempt.
*588
The district court accepted the findings of fact of the bankruptcy judge as not clearly еrroneous and therefore, following Rule 810 of the Rules of Bankruptcy, held that they could not be disturbed. The district court, however, stated that “in order properly to resolve the legal issues before me, I find it necessary to make the following additional findings, which are based on undisputed testimony and documentary evidence.”
The crucial additional finding of fact made by the district court was that “Don Neis had no intention of reoccupying the Glenhaven home when he moved out in April, 1979.”
Ill
Based on relevant Wisconsin precedent, including such decisions as Eloff, Lumb, and Bielke, supra, it seems clear that the issues of abandonment and creation of a homestead are fact-bound questions based primarily on a determination of the owner’s intent.
[T]he statutory requirements regarding еstablishment and abandonment have been liberally construed by the courts in favor of the debtor, placing great reliance on the debtor’s actions and intent. As a result the court’s view of the facts and surrounding circumstances of each case is characteristically more important in resolution of the ease than is the application of any strict rules.
Wisconsin Homestead at 892.
When a district сourt hears an appeal from the decision of the bankruptcy court, it sits as an appellate court. Its authority in such cases is set out in Bankruptcy Rule 810:
Upon an appeal the district court may affirm, modify, or reverse a referee’s judgment or order, or remand with instructions for further proceedings. The court shall accept the referee's findings of fact unless they are clearly erroneous, and shall give due regard to the opportunity of the referee to judge of the credibility of the witnesses.
11 U.S.C. Bankruptcy Rule 810.
Universal Minerals, Inc. v. C.A. Hughes & Co.,
A person’s state of mind is a narrative or historical fact, albeit one that often must be determined by drawing inferences from evidence of his conduct and the surrounding circumstances. Drawing such inferences does not, however, require application of a legal standard to historical facts; it demаnds application of logic and human experience and the inference drawn as to intent is a statement of fact and not a holding of law.
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The district court did not set aside any of these basic findings .... The district court chose, however, to emphasize other facts not mentioned in the bankruptcy court’s opinion and to draw opposing inferences from the record. In doing so, the district court erred. A reviewing court may not substitute its own findings for those of the primary tribunal merely because it finds other inferences more likely.
Id
at 104 (citations omitted). The Third Circuit thus reversed the district court and reinstated the bankruptcy court’s decision.
See also In re Multiponics, Inc.,
The issue of Don Neis' intent to abandon or create a particular homestead is a question of fact, or of inference to be drawn from facts, for the bankruptcy court to determine. Once such a determination is made, the district court in review may only accept such findings or rejеct them as “clearly erroneous;” the district court may not accept the findings of the bankruptcy court and then go on to make additional findings having the effect of contradicting the conclusions of the. bankruptcy court.
The district court refers in its opinion to the principle that remand to the trial court for additional fact-finding is unnecessary if all the evidence is documentary, all the facts are on the record and undisputed or the record as a whole presents no genuine issue as to material fact.
The bankruptcy court’s decision that the Glenhaven property did qualify as Neis’ homestead implies a finding that Neis intended to maintain that house as his homestead and that he intended to return to it, if he were able to do so, up until the time of its sale. The district cоurt’s decision that the Glenhaven house was not Neis’ homestead indicates a finding of intent to the contrary and is not consistent with the implicit findings of the bankruptcy court. It is therefore necessary to remand this case to the bankruptcy court for a clearer and more explicit finding of fact as to Neis’ intent in abandoning or maintaining his homestead in the Glenhaven property or in creating a new homestead in the Wells Street property in Onalaska. Intent, of course, must be determined in relation to the surrounding exigencies.
While the bankruptcy court’s conclusion in light of the factual record, the trial testimony and applicable Wisconsin precedent is not unpersuasive, its findings of fact are not sufficiently clear or complete under the particular сircumstances presented here. We therefore conclude that the district court erred in engaging in additional fact finding and in basing its decision on these additional facts. We reverse the judgment of the district court and remand to the district court with instructions to remand to the bankruptcy court for additional findings of fact with respect to Don Neis’ intent in creating or abandoning his homesteаd rights and for other proceedings not inconsistent with this opinion.
Notes
. The appellate jurisdiction provided in 28 U.S.C. § 1293(b), Pub.L. No. 95-598, Title II, § 236(a), 92 Stat. 2667 (1978), is not applicable until April 1, 1984. Section 405(c)(2), Pub.L. No. 95-598, Title IV, 92 Stat. 2682, grants the same appellate authority during the current interim period.
. Appellees argue that a second critical point was reached when Andrea and Don Neis were divorced in November 1980 аnd that the liens would have attached to the Glenhaven property when it ceased to be occupied by Don Neis’ family (at that time his ex-wife and his son).
Moore v. Smead,
. See also Comment, Establishment and Abandonment of a Wisconsin Homestead, 1973 Wis. L.Rev. 876 [hereinafter cited as Wisconsin Homestead]. In discussing the relevant faсtors in determining abandonment of a homestead, the author states: “[i]t is logical to assume however, that a person who leaves out of necessity leaves in spite of a desire to stay and would naturally intend to return as soon as circumstances would permit.” Id. at 886.
.
In re Lumb
specifically holds, and perceives the Wisconsin legislature as intending, that the homestead exemption may be claimed by unmarried joint owners as well as by divorced joint owners.
. See, e.g., Neis’ claim both in testimony in the bankruptcy court and on appeal that “he did not intend to abandon the Glenhaven house .... He did not want to make any impression he was abandoning the Glenhaven house after his wife and family moved out .... Ñor did he ever intend to claim the Wells Street property as his homestead.” Appеllant’s brief at 9; Tr. 36-37, 41, 22. Cf. Appellees’ assertion: “He had not lived at Glenhaven Drive since March, 1979, over a year before the judgments were docketed. He had left the Glenhaven property at that time with no intent of ever returning to reoccupy the premises.” Appellees’ brief at 6. The importance of observation of the witness’ demeanor for purposes of detеrmining credibility is particularly critical when the testimony involves intent as to past acts, as appellees also emphasized. “Although Mr. Neis testifies that he never intended to abandon his homestead, testimony of such intent should be accorded little weight after intervening occurances [sic] makes [sic] such statements advantageous to the property owner.” Appellees’ brief at 7.