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Clements v. Farhood

United States District Court, N.D. Florida, Panama City Division

February 12, 2018

NICHOLAS FARHOOD and TOMMY FORD, in his official capacity as Sheriff of Bay County, Florida, Defendants.



         This case presents a question of Florida law: does the homestead exemption apply when the owner of a vacant lot begins construction of a house but is living elsewhere? The answer is no. This order grants summary judgment for a creditor seeking to enforce a lien against the property.


         The plaintiff Kevin Clements obtained a judgment against the defendant Nicholas Farhood in Texas. Mr. Clements properly recorded the judgment in Bay County, Florida. At the time of the recording, Mr. Farhood owned a lot in Bay County. A foundation had been poured, and construction of a house was proceeding. Mr. Farhood lived in an apartment two counties away but planned to move into the house when construction was complete.

         After the house was completed and Mr. Farhood moved in, Mr. Clements applied to the Sheriff of Bay County to levy on the property. The Sheriff scheduled a public sale, but Mr. Farhood sent the Sheriff a declaration of homestead. The Sheriff stood down pending a judicial determination of whether the property is indeed homestead. This was proper. See Grant v. Credithrift, Inc., 402 So.2d 486 (Fla. 1st DCA 1981).

         Mr. Clements filed this action under Florida Statutes § 222.10, which provides for an action by a creditor to determine the validity of a debtor's claim that property is exempt from execution, including on the ground of homestead. The case is within the court's diversity jurisdiction.

         Mr. Clements has moved for summary judgment. As allowed by Federal Rule of Civil Procedure 56, Mr. Clements filed the motion early in the case. Mr. Farhood objected, but the discovery period now has ended, and Mr. Farhood has not attempted to submit additional evidence or supplement his response. The motion has been fully briefed and is ripe for a decision.


         On a summary-judgment motion, disputes in the evidence must be resolved, and all reasonable inferences from the evidence must be drawn, in favor of the nonmoving party. The moving party must show that, when the facts are so viewed, the moving party “is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A summary-judgment motion cannot be used to resolve in the moving party's favor a “genuine dispute as to any material fact.” Fed.R.Civ.P. 56(a).


         Under Florida law, which governs this dispute, a judgment becomes a lien against real property in a county on the date when the judgment is properly recorded in that county. See Fla. Stat. § 55.10. But under Florida Constitution article X, section 4, a lien does not attach to homestead property. Mr. Clements has a lien on the property at issue unless the property was homestead on February 29, 2016, the date on which Mr. Clements properly recorded the judgment in Bay County. See Kirkland v. Kirkland, 253 So.2d 728, 730 (Fla. 3d DCA 1971) (“In Florida, the rule has been established that homestead property is subject to levy under judgments recorded prior to the time such property became the homestead of the judgment debtor.”). Both sides agree that this is a correct statement of the governing law.

         The Florida Constitution limits the acreage that may be claimed as homestead-half an acre in a municipality and 160 acres elsewhere-but does not otherwise define homestead. The Florida Supreme Court has said this: “[T]he homestead intended by our Constitution to be exempt is the place of actual residence of the party and his family . . . . The character of property as a homestead depends upon an actual intention to reside thereon as a permanent place of residence, coupled with the fact of residence.” Hillsborough Inv. Co. v. Wilcox, 152 Fla. 889, 894-95, 13 So.2d 448, 451-52 (1943) (emphasis added). The court sustained the homestead claim in Wilcox because the debtor and her family were actually living there at the relevant times. See also Anderson Mill & Lumber Co. v. Clements, 101 Fla. 523, 531, 134 So. 588, 592 (Fla. 1931) (“Actual residence is an essential quality to support a homestead . . . .”); Dep't of Revenue v. Pelsey, 779 So.2d 629, 632 (Fla. 1st DCA 2001) (Webster, J.) (citing Drucker v. Rosenstein, 19 Fla. 191, 198 (1882)) (“[A]ctual occupancy is essential to a homestead claim. Mere intent to make the property one's homestead in the future is insufficient to entitle one to the exemption.”).

         Here the critical date is February 29, 2016. At that date Mr. Farhood had begun construction on a house but did not reside there. The parties disagree on whether, at that date, Mr. Farhood intended to live there in the future, but on Mr. Clements's summary-judgment motion, this dispute must be resolved in Mr. Farhood's favor. So for summary-judgment purposes, the facts must be viewed this way: when the judgment was recorded, Mr. Farhood had started but not finished construction of a house on the lot, which he intended to occupy permanently once the house was finished.

         Because Mr. Farhood was not living there when Mr. Clements recorded the judgment-in the words of Wilcox, it was not his “actual residence”-the property ...

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