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Judgments and Decrees regarding Homestead

Author johnbsims3
Admin 

#1 - Posted: 18 Dec 2006 17:17 
32A Fla. Jur 2d Judgments and Decrees 435
Florida Jurisprudence, Second Edition


Judgments and Decrees
Sonja Larsen J.D.
XII. Liens
E. Priorities
2. Preferences Between Liens Predicated on Judgments, Decrees, or Execution and Other Interests

435. Homestead claims

Judgments or decrees are not liens on exempt property.[FN1] Except for taxes, assessments, or for obligations contracted for its purchase, improvements, or repair, or for labor performed thereon,[FN2] no lien attaches to homestead property.[FN3] However, a judgment lien attaching before a declaration of homestead is filed is effective and has priority over a claim of exemption.[FN4] For a debtor to avoid a judicial lien as impairing an exemption to which the debtor would otherwise be entitled, the lien at issue must have fixed on the interest of the debtor in the property, and the lien must impair the exemption to which the debtor would have been entitled.[FN5]

Once property is subject to a judgment lien, the lien cannot be canceled by a subsequent attempt to convert the property into a homestead,[FN6] nor will a change in the status of the owner of the property, by which he or she becomes the head of a family and entitled to a homestead, affect an existing lien.[FN7]

The fact that at the time a judgment was rendered a judgment debtor intended to occupy the land eventually as a homestead does not affect the priority of the lien that attaches.[FN8] Moreover, land on which no house stands cannot be claimed as a homestead although the claimant has made preparations for building and moving into a home thereon.[FN9]

Cases:
Under Florida law, judgment that creditor recorded against judgment debtors four years before they acquired homestead property gave rise to judgment lien on homestead property simultaneously with debtors' acquisition of ownership interest therein, such that lien did not burden any preexisting interest of debtors, and they could not avoid lien, when they later filed for Chapter 7 relief, on exemption-impairment grounds. Bankr.Code, 11 U.S.C.A. 522(f). In re Whelan, 325 B.R. 462 (Bankr. M.D. Fla. 2005).

Lien arising out of recording in Florida of out-of-state sanctions order entered against debtor for his bad faith in filing involuntary bankruptcy petition against home builder was "judicial lien," of kind potentially subject to avoidance on exemption-impairment grounds. Bankr.Code, 11 U.S.C.A. 101(36), 522(f)(1)(A). In re Adell, 321 B.R. 573 (Bankr. M.D. Fla. 2005).

Judgment lien that creditor acquired upon recording of certified copy of its judgment never "fixed" on debtor's exempt Florida homestead, as required for debtor to avoid lien as "impairing" his homestead exemption rights, inasmuch as Florida law prohibits most judgment liens from fastening any type of liability against homestead property. Bankr.Code, 11 U.S. 522(f)(1)(A); Fla. Const. Art. 10, 4(a)(1). In re Epstein, 298 B.R. 917 (Bankr. S.D. Fla. 2003).

[FN1] 416.
[FN2] Fla. Const., Art. X 4.
[FN3] Clements v. Henderson, 70 Fla. 260, 70 So. 439 (1915); Wilhelm v. Locklar, 46 Fla. 575, 35 So. 6 (1903).
[FN4] In re Owen, 86 B.R. 691 (M.D. Fla. 1988), decision aff'd, 877 F.2d 44 (11th Cir. 1989), cert. granted, 495 U.S. 929, 110 S. Ct. 2166, 109 L. Ed. 2d 496 (1990) and judgment rev'd on other grounds, 500 U.S. 305, 111 S. Ct. 1833, 114 L. Ed. 2d 350 (1991), on remand to, 961 F.2d 170 (11th Cir. 1992) and (overruling recognized by, In re Braverman, 150 B.R. 681 (Bankr. S.D. Ohio 1993)) and (overruling recognized by, In re Braverman, 150 B.R. 681 (Bankr. S.D. Ohio 1993) supra) (applying state law); In re Cooper, 202 B.R. 319 (Bankr. M.D. Fla. 1995), aff'd, 197 B.R. 698 (M.D. Fla. 1996); Lyon v. Arnold, 46 F.2d 451 (C.C.A. 5th Cir. 1931); Aetna Ins. Co. v. LaGasse, 223 So. 2d 727 (Fla. 1969); Giddens v. McFarlan, 152 Fla. 281, 10 So. 2d 807 (1943); Porter-Mallard Co. v. Dugger, 117 Fla. 137, 157 So. 429 (1934); First Nat. Bank v. Peel, 107 Fla. 413, 145 So. 177 (1932); Pasco v. Harley, 73 Fla. 819, 75 So. 30 (1917); Schaller v. Bruce N. Balk, A.I.A., P.A., 708 So. 2d 299, 23 Fla. L. Weekly D593 (Fla. Dist. Ct. App. 2d Dist. 1998), reh'g denied, (Mar. 27, 1998).
[FN5] In re Cooper, 202 B.R. 319 (Bankr. M.D. Fla. 1995), aff'd, 197 B.R. 698 (M.D. Fla. 1996).
[FN6] First Nat. Bank v. Peel, 107 Fla. 413, 145 So. 177 (1932).
[FN7] In re Porter, 3 F. Supp. 582 (S.D. Fla. 1933); Pasco v. Harley, 73 Fla. 819, 75 So. 30 (1917).
[FN8] First Nat. Bank v. Peel, 107 Fla. 413, 145 So. 177 (1932).
[FN9] Porter-Mallard Co. v. Dugger, 117 Fla. 137, 157 So. 429 (1934).

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Judgments and Decrees regarding Homestead
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