Sepulveda v. Westport Recovery Corp. , 2014 Fla. App. LEXIS 10515 ( 2014 )

Third District Court of Appeal
State of Florida
Opinion filed July 09, 2014.
Not final until disposition of timely filed motion for rehearing.
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No. 3D14-223
Lower Tribunal No. 13-152 AP
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Daniel A. Sepulveda,
Petitioner,
vs.
Westport Recovery Corporation,
Respondent.
A Writ of Certiorari to the Circuit Court for Miami-Dade County, Appellate
Division, Maria M. Korvick, Teresa Pooler, and Robert J. Luck, Judges.
Kawel PLLC, and Andrew Paul Kawel, for petitioner.
Friedman & Greenberg, P.A., and Robert D. Friedman (Plantation), for
respondent.
Before ROTHENBERG, SALTER, and FERNANDEZ, JJ.
ROTHENBERG, J.
Daniel A. Sepulveda’s (“Sepulveda”) second-tier petition for writ of
certiorari comes to us from the Appellate Division of the Miami-Dade Circuit
Court’s (“the circuit court”) denial of Sepulveda’s petition for writ of certiorari,
which sought relief from a Miami-Dade County Court (“the county court”) order
denying his motion to dismiss for lack of subject matter jurisdiction and allowing a
levy sale of his property to proceed despite Sepulveda’s claimed homestead
exemption. Although our second-tier certiorari review is extremely limited,
because we find that the county court exceeded its jurisdiction by determining that
Sepulveda’s claim of homestead did not prevent the levy sale, we conclude the
circuit court departed from the essential requirements of law when it denied
Sepulveda’s petition. Accordingly, we grant Sepulveda’s petition and quash the
order below.
BACKGROUND
Nearly seventeen years ago, in October 1997, First Union National Bank of
Florida (“First Union”) obtained a final judgment for approximately $9,000 against
Sepulveda’s sister, Wilda J. Arana (“Arana”), in Miami-Dade County Court. In
July 2001, First Union sold its right to enforce the judgment to Westport Recovery
Corporation (“Westport”). Sometime prior to 2005, Sepulveda acquired the
property in question, which is located in Polk County, Florida (“the Polk County
Property”), and on October 3, 2005, Sepulveda transferred the Polk County
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Property to Arana. Two weeks after Sepulveda transferred the property to Arana,
Westport recorded the 1997 county court judgment against Arana in Polk County.
Several months later, Arana transferred the Polk County Property back to
Sepulveda.
In February 2012, six and one-half years after recording the Miami-Dade
judgment in Polk County, Westport reopened the 1997 county court case,
substituted itself as plaintiff, and attempted to levy against Arana’s alleged right,
title, and interest in the Polk County Property in order to satisfy the 1997
judgment. After learning of the pending levy sale of his property, Sepulveda
recorded a Notice of Claim of Homestead Real Property by Owner After Levy
(“Notice of Homestead”), see § 222.02, Fla. Stat. (2013),1 on March 1, 2013,
approximately two weeks before the levy sale was to take place.
After filing his Notice of Homestead, Sepulveda moved to dismiss the
county court action on the basis that the county court lacked subject matter
1Section 222.02 allows a property owner to serve a notice of homestead exemption
on the levying officer after property has been levied upon so long as the notice is
served before the date of the levy sale. Section 222.02 reads, in full:
Whenever a levy is made upon the lands, tenements, mobile home, or
modular home of such person whose homestead has not been set apart
and selected, such person, or the person’s agent or attorney, may in
writing notify the officer making such levy, by notice under oath
made before any officer of this state duly authorized to administer
oaths, at any time before the day appointed for the sale thereof, of
what such person regards as his or her homestead, with a description
thereof; and the remainder only shall be subject to sale under such
levy.
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jurisdiction to determine the validity of his claimed homestead exemption.
Sepulveda’s position below and on appeal is that the determination regarding his
claimed homestead exemption lies exclusively within the circuit court’s
jurisdiction based on section 222.10, Florida Statutes (2013).2 In response,
Westport argued that: (1) section 222.10 was inapplicable because the 1997
judgment against Arana predated Sepulveda’s claimed homestead exemption; (2)
Sepulveda’s Notice of Homestead, even if valid, was wholly irrelevant; and (3)
even if section 222.10 applied, the county court had concurrent jurisdiction to
determine homestead exemptions so long as the other jurisdictional requirements
were met.
Despite Sepulveda’s Notice of Homestead, the county court denied
Sepulveda’s motion to dismiss and granted Westport’s motion to allow the pending
levy sale, finding that “the lien of the Final Judgment on the subject [Polk County]
Property, recorded on October 18, 2005, in the Public Records of Polk County,
2 Section 222.10 grants Florida’s circuit courts equity jurisdiction over homestead
exemption disputes. It reads, in full:
The circuit courts have equity jurisdiction upon bill filed by a creditor
or other person interested in enforcing any unsatisfied judgment or
decree, to determine whether any property, real or personal,
claimed to be exempt, is so exempt, and in case it be not exempt, the
court shall, by its decree subject it, or so much thereof as may be
necessary, to the satisfaction of said judgment or decree and may
enjoin the sheriff or other officer from setting apart as exempt
property, real or personal, which is not exempt, and may annul all
exemptions made and set apart by the sheriff or other officer.
(emphasis added).
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Florida, has priority over the subsequently acquired title interest and homestead
status of Daniel Sepulveda.” The county court, therefore, essentially found that it
was ruling only on a priority of lien issue rather than making a homestead
exemption determination.
Sepulveda filed a petition for writ of certiorari contesting the county court’s
ruling in the appellate division of the Miami-Dade circuit court, and the circuit
court denied the petition, affirming the county court’s reasoning and result. This
second-tier petition for certiorari followed.
DISCUSSION
A district court’s second-tier certiorari review—certiorari review of a circuit
court sitting in its appellate capacity—is extremely limited. “The inquiry is limited
to whether the circuit court afforded procedural due process and whether the circuit
court applied the correct law.” Haines City Cmty. Dev. v. Heggs, 658 So. 2d 523,
530 (Fla. 1995). Thus, we review the circuit court’s decision only for legal error,
and we treat all facts found by the county and circuit courts as established. See id.(“The standard of review for certiorari in the district court effectively eliminates
the substantial competent evidence component.”).
The circuit court’s denial of Sepulveda’s petition for certiorari, however,
was based entirely on a question of law. See Nissen v. Cortez Moreno, 10 So. 3d
1110, 1111 (Fla. 3d DCA 2009) (“[T]he issue of whether a court has subject matter
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jurisdiction involves a question of law that is reviewed de novo.”). In determining
whether the circuit court departed from the essential requirements of law by
denying the certiorari petition, we must consider Sepulveda’s challenge to the
county court’s jurisdiction. Accordingly, we consider de novo: (1) whether the
county court’s finding that Sepulveda’s Notice of Homestead was irrelevant to its
determination of exemption under section 222.10 was in fact a determination of
Sepulveda’s homestead exemption claim; and if so, (2) whether such a
determination can be made by a county court, or rather, whether section 222.10
grants exclusive jurisdiction to the circuit courts of Florida to determine whether
property shall be exempt from a forced sale once a Notice of Homestead is filed
pursuant to section 222.01 or 222.02.
I. Whether the county court’s ruling was a determination of
Sepulveda’s homestead exemption claim
Article X, section 4 of the Florida Constitution provides, in pertinent part, as
follows:
SECTION 4. Homestead; exemptions.—
(a) There shall be exempt from forced sale under process of any
court, and no judgment, decree or execution shall be a lien thereon,
except for [certain exceptions not relevant to this case], the following
property owned by a natural person:
(1) a homestead . . . .
Section 4 provides one of the broadest protections for a citizen’s primary property
in the nation. “[T]he constitutional homestead exemption . . . ‘protects the
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homestead against every type of claim and judgment except those specifically
mentioned in the constitutional provision itself.’” Osborne v. Dumoulin, 55 So. 3d
577, 582 (Fla. 2011) (quoting Olesky v. Nicholas, 82 So. 2d 510, 513 (Fla. 1955)).3
Florida courts grant a liberal construction to the constitutional and statutory
provisions in favor of the homeowner, and cast a restrictive eye towards exceptions
to the homestead exemption. See Havoco of Am., Ltd. v. Hill, 790 So. 2d 1018,
1021 (Fla. 2001) (“As previously mentioned, this Court’s homestead exemption
jurisprudence has long been guided by a policy favoring the liberal construction of
the exemption: ‘Organic and statutory provisions relating to homestead exemptions
should be liberally construed in the interest of the family home.”’) (quoting Milton
v. Milton, 58 So. 718, 719 (Fla. 1912)).
Chapter 222 of the Florida Statutes further clarifies the constitutional
homestead protection by explaining the process by which an owner or lessee of
real property can declare his or her homestead rights and prevent an execution of
judgment (i.e., a levy sale) against the property. “Sections 222.01 and 222.02
provide a means whereby a person may claim property as homestead and notify
judgment creditors of the property’s exempt status under article X, section 4, either
pre- or post-levy.” Osborne, 55 So. 3d at 583; 4 see also Grant v. Credithrift of
3 The homestead exemption also provides certain tax protections, but those
provisions are not germane to the issues presented in this case.
4 Osborne also noted that the homestead exemption protection is so rigorous that
even a debtor who fails to observe these statutory declarations and claim the
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Am., Inc., 402 So. 2d 486, 488 (Fla. 1st DCA 1981) (allowing post-levy
designation of homestead under section 222.02).
Once a homeowner has claimed a homestead exemption, the sheriff cannot
levy against the property unless the creditor prevails against the homeowner’s
claimed homestead exemption. Section 222.10 provides that: “The circuit courts
have equity jurisdiction . . . to determine whether any property, real or personal,
claimed to be exempt, is so exempt.” Westport, however, convinced the county
court that it did not need to make a homestead exemption determination, thereby
avoiding the necessity of applying section 222.10. Westport claimed, and the
county and circuit courts found, that because Westport conceded for purposes of its
motion that the Polk County Property was Sepulveda’s homestead from the date
Arana conveyed the property to him, the only issue the county court needed to
determine was whether the timing of the recordation of the judgment predated
Sepulveda’s homestead. Based on Westport’s arguments, both lower courts have
framed the issue exclusively as a priority of liens contest, with the homestead
exemption having only incidental impact, if any. Such an interpretation, however,
would read a restriction into the statutory text that is not present.
Section 222.10 is worded quite broadly. It provides, in relevant part, that the
circuit courts have jurisdiction “to determine whether any property . . . claimed to
exemption may still be able to set aside a levy sale. Id. (citing Albritton v. Scott,
74 So. 975, 975 (Fla. 1917)).
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be exempt, is so exempt . . . .” Thus, section 222.10 will apply in every case where
a creditor is attempting to levy against property where a claim of homestead has
been filed under section 222.01 or section 222.02.5
These prerequisites were clearly met on these facts. It is undisputed that
Sepulveda filed his Notice of Homestead under section 222.02 after Westport
attempted to levy against the Polk County Property to satisfy its judgment against
Arana, but prior to the levy sale. The county court determined that Sepulveda’s
homestead exemption did not prevent Westport from levying against the property,
which is a clear determination “whether the property claimed to be exempt, is so
exempt.” It matters not that the county court’s determination was based on the
date of conveyance and the date of judgment. Therefore, section 222.10 applies to
the matter at hand, and the county court erred when it concluded that it did not.
The question we must now decide is whether the county court exceeded its
jurisdiction by determining whether the property was exempt from levy under
section 222.10.
II. Whether Florida circuit courts have exclusive jurisdiction over
homestead exemption claims
The relevant jurisdictional provision, section 222.10, provides, in full:
5 Section 222.10 may even apply to homeowners who intend to protect their
property, but do not properly claim the homestead exemption under sections
222.01 or 222.02. See Osborne, 55 So. 3d at 583 (stating that the failure to strictly
comply with 222.01 and 222.02 does not waive a homeowner’s homestead rights).
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The circuit courts have equity jurisdiction upon bill filed by a
creditor or other person interested in enforcing any unsatisfied
judgment or decree, to determine whether any property, real or
personal, claimed to be exempt, is so exempt, and in case it be not
exempt, the court shall, by its decree subject it, or so much thereof as
may be necessary, to the satisfaction of said judgment or decree and
may enjoin the sheriff or other officer from setting apart as exempt
property, real or personal, which is not exempt, and may annul all
exemptions made and set apart by the sheriff or other officer.
(emphasis added). Westport contends that the lack of mandatory or exclusive
language in section 222.10 evinces a legislative intent to grant concurrent
jurisdiction in the county and circuit courts over homestead exemption
determinations. Westport contends that when the amount in dispute is $15,000 or
less, jurisdiction lies in the county courts; and when the amount in dispute is in
excess of $15,000, jurisdiction lies solely with the circuit court. Westport is
incorrect. The circuit court has exclusive jurisdiction to determine the validity of a
claimed homestead exemption.
The jurisdiction of the courts of our state is broadly defined by our State
Constitution. Article V, section 5 of the Florida Constitution establishes and
specifies the jurisdiction of the circuit courts of the State. Subsection 5(b) provides
that:
The circuit courts shall have original jurisdiction not vested in the
county courts, and jurisdiction of appeals when provided by general
law. They shall have the power to issue writs of mandamus, quo
warranto, certiorari, prohibition and habeas corpus, and all writs
necessary or proper to the complete exercise of their jurisdiction.
Jurisdiction of the circuit court shall be uniform throughout the state.
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They shall have the power of direct review of administrative action
prescribed by general law.
(emphasis added). Similarly, article V, section 6 of the Florida Constitution both
establishes and prescribes the jurisdiction of the county courts of the State.
Subsection 6(b) of article V provides: “The county courts shall exercise the
jurisdiction prescribed by general law. Such jurisdiction shall be uniform
throughout the state.” (emphasis added). As is plain from the constitutional text,
the circuit courts are courts of general jurisdiction—that is to say, we presume the
circuit courts have jurisdiction over an action unless such jurisdiction is expressly
vested exclusively in another tribunal. Conversely, the county courts are courts of
limited jurisdiction, having authority over only those actions specifically
designated by the legislature.
“Absent a constitutional prohibition or restriction, the legislature is free to
vest courts with exclusive, concurrent, original, appellate, or final jurisdiction.”
Alexdex Corp. v. Nachon Enters., Inc., 641 So. 2d 858, 861 (Fla. 1994). As to the
circuit courts’ jurisdiction, section 26.012, Florida Statutes (2013), specifies, in
relevant part, that:
(2) [The circuit courts] shall have exclusive original jurisdiction:
(a) In all actions at law not cognizable by the county courts;
....
(c) In all cases in equity[6] including all cases relating to juveniles
except traffic offenses as provided in chapters 316 and 985;
6 A determination of the validity of a claimed homestead exemption under section
11
....
(g) In all actions involving the title and boundaries of real property.
(emphasis added).
Prior to 1990, county courts had no jurisdiction over cases in equity.
However, in 1990, the legislature amended section 34.01 of the Florida statutes by
adding subsection (4). Subsection (4) grants, to a limited degree, equitable
jurisdiction to county courts. Specifically, subsection 34.01(4) provides: “Judges
of county courts may hear all matters in equity involved in any case within the
jurisdictional amount of the county court [$15,000 or less], except as otherwise
restricted by the State Constitution or the laws of Florida.” (emphasis added).
The tension between the exclusive grant of jurisdiction to the circuit courts
over “all cases in equity” in section 26.012(2)(c), and the subsequent 1990
amendment stating that county courts “may hear all matters in equity” so long as
the case is below the jurisdictional monetary amount, understandably created
confusion regarding the circuit and county courts’ jurisdiction over equitable
matters. To resolve the confusion and potential conflict between section
26.012(2)(c) and section 34.01(4), the Florida Supreme Court held in Alexdex that
“it is clear that in 1990 the legislature amended chapter 34 to grant limited equity
jurisdiction to the county courts. Chapter 26, which vests circuit courts with
222.10 sounds in equity. § 222.10 (granting circuit courts “equity jurisdiction”);
See also Grant, 402 So.2d at 489 n.5 (quoting section 222.10, Fla. Stat. (1979)).
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exclusive original jurisdiction, remained unchanged.” Alexdex, 641 So. 2d at 861(citation omitted). Alexdex ultimately held that county and circuit courts enjoy
concurrent equitable jurisdiction for controversies regarding $15,000 or less in
dispute, but that the circuit courts retain exclusive equitable jurisdiction for cases
disputing a greater amount. Id. at 862.
Based on the Florida Supreme Court’s ruling in Alexdex, Westport claims
that, in all equitable matters, including homestead exemption determinations, the
county and circuit courts enjoy concurrent jurisdiction when the amount in
controversy is less than $15,000, the jurisdictional maximum for county courts.
This argument, however, entirely discounts the reasoning supporting the Alexdex
holding. In reaching its decision in Alexdex, the Court specifically attempted to
give each statute its full effect and concluded that to interpret the two statutes
otherwise would have rendered entire subsections of Florida’s jurisdictional
statutes meaningless. The Court stated:
We now have two statutes that when considered separately are clear,
precise, and their meanings understandable; yet when taken together
they are inconsistent. To accept the proposition that the exclusive
jurisdiction given to circuit courts in section 26.012 constitutes the
“otherwise restricted by the laws of Florida” contained in section
34.01(4) would render the latter section totally meaningless.
Therefore, in order to give each statute its full effect, we conclude
that the legislature intended to provide concurrent equity jurisdiction
in circuit and county courts, except that equity cases filed in county
courts must fall within the county court’s monetary jurisdiction, as set
by statute. A contrary holding would ignore the latest legislative
expression on the subject and run counter to our principle enunciated
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in [State v.] Sullivan, that a statute should not be interpreted in a
manner that would deem legislative action useless. 95 Fla. at 207,
116 So. at 261.
Id. at 861-62 (emphasis added) (footnotes omitted).
It remains a key tenet of statutory interpretation that the courts of this state
are to read statutes holistically and give some effect to the terms adopted by the
legislature. See Heart of Adoptions, Inc. v. J.A., 963 So. 2d 189, 198 (Fla. 2007)
(“[Florida courts] are required to give effect to ‘every word, phrase, sentence, and
part of the statute, if possible, and words in a statute should not be construed as
mere surplusage.’” (quoting Am. Home Assur. Co. v. Plaza Materials Corp., 908
So. 2d 360, 366 (Fla. 2005))).
It is clear that the equity jurisdiction of the county courts must yield to a
specific grant of equitable jurisdiction to the circuit courts. § 34.01(4) (“Judges of
county courts may hear all matters in equity involved in any case . . . except as
otherwise restricted by the State Constitution or the laws of Florida.”
(emphasis added)). And section 222.10 provides that, “The circuit courts have
equity jurisdiction . . . to determine whether any property, real or personal, claimed
to be exempt [as homestead], is so exempt.” Because the circuit and county courts
already have concurrent jurisdiction over equitable actions involving $15,000 or
less, Alexdex, 641 So. 2d at 862, section 222.10 would be of no consequence if it
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is not a grant of exclusive jurisdiction over homestead determinations to the circuit
courts.
Therefore, we find that the action below was a determination of homestead
exemption under section 222.10, and that such determinations are within the
exclusive province of the circuit courts of Florida. Accordingly, the county court
exceeded its subject matter jurisdiction by determining that Sepulveda’s Claim of
Homestead did not exempt the property from levy; and the circuit court departed
from the essential requirements of law by denying Sepulveda’s petition for writ of
certiorari to correct the county court’s improper exercise of its jurisdiction.
Petition granted; order quashed.
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