Leslie S. Osborne v. Denise J. Dumoulin , 326 F. App'x 498 ( 2009 )


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  •                                                          [DO NOT PUBLISH]
    IN THE UNITED STATES COURT OF APPEALS
    FOR THE ELEVENTH CIRCUIT
    ________________________                  FILED
    U.S. COURT OF APPEALS
    No. 08-15355                ELEVENTH CIRCUIT
    APRIL 23, 2009
    Non-Argument Calendar
    THOMAS K. KAHN
    ________________________
    CLERK
    D. C. Docket No. 08-60686-CV-AJ,
    BKCY No. 07-17750 BKC-JK
    DENISE J. DUMOULIN,
    Debtor,
    ________________________________________
    LESLIE S. OSBORNE,
    Plaintiff-Appellant,
    versus
    DENISE J. DUMOULIN,
    Defendant-Appellee.
    ________________________
    Appeal from the United States District Court
    for the Southern District of Florida
    _________________________
    (April 23, 2009)
    Before TJOFLAT, DUBINA and KRAVITCH, Circuit Judges.
    PER CURIAM:
    Chapter 222 of the Florida Statutes addresses what real and personal
    property a Florida resident may claim as exempt during certain legal proceedings
    including bankruptcy. Section 222.25 exempts personal property other than a
    homestead.1 In 2007, subparagraph 4 was added to permit a debtor to increase the
    amount of personal exemptions “if the debtor does not claim or receive the benefits
    of a homestead exemption.” 
    Fla. Stat. § 222.25
    (4).
    In this case, Denise Dumoulin filed a voluntary Chapter 7 bankruptcy
    petition. Although she initially filed a schedule of assets claiming an exemption
    for her homestead along with a notice indicating her intent to surrender the
    property, she later amended the schedule of assets to remove the homestead
    exemption and seek additional personal property exemptions under 
    Fla. Stat. § 222.25
    (4). Trustee Leslie Osborne objected to the additional exemptions on the
    ground that Dumoulin was not entitled to claim exemptions under § 222.25(4).
    The question presented on appeal is whether a debtor who elects not to claim a
    homestead exemption and indicates an intent to surrender the property is entitled to
    the additional exemptions for personal property under 
    Fla. Stat. § 222.25
    (4).
    Because this case involves the interpretation of a Florida statute, we certify the
    1
    Generally, homestead exemptions arise under the Florida Constitution, Art. X, § 4.
    2
    controlling question to the Florida Supreme Court.
    I. Background
    The following facts have been stipulated by the parties: Dumoulin filed a
    voluntary Chapter 7 bankruptcy petition, initially claiming a homestead exemption
    and listing her other personal property as a car worth $5,925. Dumoulin indicated
    that she intended to surrender the homestead property. Dumoulin planned to sell
    the home, which was in foreclosure proceedings, and rent it from the purchaser.
    The sale, however, later fell through.
    After a creditor’s meeting, the trustee demanded Dumoulin remit $4,000 in
    assets from personal property that exceeded the allowed exemptions. Dumoulin
    then filed an amended schedule of assets removing the homestead exemption and
    claiming the majority of the equity in the car as exempt under § 222.25(4). The
    trustee filed an objection, arguing that the personal property was not exempt
    because Dumoulin had originally claimed the homestead exemption.
    The bankruptcy court overruled the objection, citing In re Gatto, 
    380 B.R. 88
    (Bankr. M.D. Fla. 2007). According to the bankruptcy court, because Dumoulin
    amended the schedule of assets to remove the homestead exemption and had
    indicated her intent to surrender the property, Dumoulin had not “received the
    benefit” of the homestead exemption under § 222.25(4) and thus was entitled to
    3
    additional exemptions.
    The trustee appealed to the district court, which affirmed the bankruptcy
    court’s order overruling the objection to the claim of exemption, citing In re Gatto,
    In re Hernandez, 
    2008 WL 1711528
     (Bankr. S.D. Fla. 2008) and In re Shoopman,
    
    2008 WL 817109
     (Bankr. S.D. Fla. 2008). Considering the term “receives the
    benefit” of the homestead exemption, the court concluded that the plain language
    of the statute indicated that the debtor was entitled to the additional exemption if
    she was not claiming the benefit of a homestead exemption on the date of the
    petition. The court further noted that the debtor had consistently indicated an
    intent to surrender the property. Although the court adopted a narrow reading of
    § 222.25(4), the court acknowledged that bankruptcy cases provided some support
    for the trustee’s interpretation of the statute. The trustee now appeals.
    II. Standard of Review
    In the bankruptcy context, we sit as a “second court of review” and thus
    “examine[] independently the factual and legal determinations of the bankruptcy
    court and employ[] the same standards of review as the district court.” In re
    Optical Technologies, Inc., 
    425 F.3d 1294
    , 1299-1300 (11th Cir. 2005); In re Issac
    Leaseco, Inc., 
    389 F.3d 1205
    , 1209 (11th Cir. 2004) (quotation marks and citation
    omitted). Generally, we review legal conclusions by either the bankruptcy court or
    4
    the district court de novo.2 In re Financial Federated Title & Trust, Inc., 
    309 F.3d 1325
    , 1328-29 (11th Cir. 2002).
    III. Analysis
    The trustee argues that both the terms “claim” and “receive the benefits” in
    § 222.25(4) must be given meaning. According to the trustee, every person who
    owns a homestead receives the benefits of that homestead and would be precluded
    from claiming the exemption. The trustee explains that the debtor in this case
    intended to claim the homestead exemption and then sell the home to someone
    who would allow her to rent it and retain possession, thus continuing to receive the
    benefits of the homestead. The trustee further explains that the definition of
    benefit includes those interests which are never realized. The trustee then argues
    that the Florida legislature did not intend to increase exemptions for personal
    property of homeowners, as indicated by the legislative history. Finally, the trustee
    contends that the district court misunderstood the facts, as there was contradictory
    evidence as to whether Dumoulin intended to surrender the property.3
    2
    Although we generally review factual findings for clear error, In re Financial Federated
    Title & Trust, Inc., 
    309 F.3d 1325
    , 1329 (11th Cir. 2002), in this case the parties stipulated to the
    facts and the bankruptcy court made no factual findings.
    3
    The trustee also argues that, if the court is to consider the debtor’s statement of intention,
    as it did in this case, the court failed to consider the debtor’s contradictory action of initially
    claiming the homestead exemption and ignored the bankruptcy rules limiting the time in which a
    debtor can amend the schedule of assets or the statement of intention. Courts have no “discretion
    to deny amendments to claims of exemption, unless a showing of bad faith by the debtor or
    prejudice to a creditor is made by clear and convincing evidence.” In re Jordan, 
    332 B.R. 472
    , 475
    5
    Section 222.25 exempts personal property other than a homestead, but
    allows for an expanded personal property exemption to qualified debtors, i.e., those
    who did not claim any homestead exemption. 
    Fla. Stat. § 222.25
    (4).
    “The intent of the statute appears to be to give a debtor who lacks homestead
    protections some extra personal exemptions.” In re Rogers, 
    396 B.R. 100
    , 102
    (M.D. Fla. 2008) (citing Proposed Amendment to Personal Property Exemption
    Statute 
    Fla. Stat. § 222.25
    , Bankruptcy/UCC Comm. Business and Law Section,
    Florida Bar (August 6, 2006)). “The purpose of these extra exemptions is to give a
    person who lacks a homestead a minimal amount of property from which to restart
    their lives.” Id.; In re Morales, 
    381 B.R. 917
    , 921 (Bankr. S.D. Fla.2008).
    Under the terms of the statute, the extra exemptions are not available to
    debtors who either (1) claim a homestead exemption under the Florida
    Constitution, or (2) receive the benefits of a homestead exemption under the
    Florida Constitution. Rogers, 396 B.R. at 102-03. The second clause applies to
    debtors who do not affirmatively claim a homestead exemption. The statute
    prevents such debtors from claiming the additional personal property exemption if
    they indirectly “receive the benefits of” the homestead exemption. Id.; In re Gatto,
    (Bankr. M.D. Fla. 2005) (citing Doan v. Hudgins (In re Doan), 
    672 F.2d 831
    , 833 (11th Cir. 1982);
    In re Talmo, 
    185 B.R. 637
    , 645 (Bankr. S.D. Fla. 1995)). Here, there is no claim that the debtor
    acted in bad faith in amending her schedules or that any creditor has been prejudiced. Thus,
    trustee’s argument regarding the timeliness of the amended schedules is without merit.
    6
    380 B.R. at 92. Thus, the issue is what constitutes “receiving the benefits” of the
    homestead exemption.
    Bankruptcy courts have concluded that the debtor does not “receive the
    benefits of a homestead exemption” if (1) she does not claim her home as exempt
    on the bankruptcy schedules, and (2) she timely and effectively makes a statement
    showing the clear intention to abandon or surrender the property. In re Rogers,
    369 B.R. at 103 (interpreting § 222.25(4) to allow an additional exemption but
    concluding that debtor was not entitled to further exemption because he had not
    indicated his intent to surrender the property); In re Morales, 
    381 B.R. at 923
    ; In re
    Martias, 
    2008 WL 906776
     (Bankr. S.D. Fla. 2008) (concluding that the debtor was
    entitled to the exemption under § 222.25(4) where she did not claim her homestead
    as exempt and she stated her intention to surrender the home on amended
    schedules); In re Shoopman, 
    2008 WL 817109
     (Bankr. S.D. Fla. 2008) (holding
    that the statutory language was plain and unambiguous and the debtor was entitled
    to the exemption under § 222.25(4) where he consented to relief from the stay and
    filed an amended Statement of Intention indicating his intent to surrender the
    home); In re Gatto, 380 B.R. at 93 (explaining that the debtors were entitled to the
    exemption under § 222.25(4) where they elected to surrender their home).
    The trustee’s interpretation of the statute, however, finds some support on
    7
    other bankruptcy court decisions, as the district court itself noted. See In re
    Franzese, 
    383 B.R. 197
     (Bankr. N.D. Fla. 2008) (concluding that § 222.25(4) bars
    debtor who could have claimed a homestead exemption from exempting personal
    property). See also In re Magelitz, 
    386 B.R. 879
    , 883 (Bankr. N.D. Fla. 2008)
    (stating that “[a]dmittedly where a homestead has been acquired it can be waived
    only by abandonment or by alienation in the manner provided by law” and that
    because the debtor owned the home, lived in it, and intended to continue to reside
    there, the property has homestead status under Florida law and therefore receives
    constitutional protection from creditors regardless of whether the debtor claimed a
    homestead exemption during bankruptcy proceedings).
    Because this case presents an interpretation of a Florida statute, we certify
    the issue to the Florida Supreme Court.
    IV. Question Certified
    We respectfully certify to the Florida Supreme Court the following question:
    Whether a debtor who elects not to claim a homestead exemption and
    indicates an intent to surrender the property is entitled to the additional exemptions
    for personal property under 
    Fla. Stat. § 222.25
    (4).
    In certifying this question, we do not intend to restrict the issues considered
    by the state court and note that discretion to examine this issue and other relevant
    8
    issues lies with the Florida Supreme Court. Stevens v. Battelle Memorial Institute,
    
    488 F.3d 896
    , 904 (11th Cir. 2007); Miller v. Scottsdale Ins. Co., 
    410 F.3d 678
    ,
    682 (11th Cir. 2005) (“Our phrasing of the certified question is merely suggestive
    and does not in any way restrict the scope of the inquiry by the Supreme Court of
    Florida.”). We also recognize that “latitude extends to the Supreme Court’s
    restatement of the issue or issues and the manner in which the answers are given.”
    Swire Pacific Holdings Inc. v. Zurich Ins. Co., 
    284 F.3d 1228
    , 1234 (11th Cir.
    2002) (citation omitted).
    QUESTION CERTIFIED.
    9