The case of In re Ensenat, 2007 WL 2029332 (Bkrtcy.S.D.Fla. May 24, 2007)(Isicoff, J.), reminds one how fact specific may be the determination of the extent of a Florida homestead exemption under Article X, Section 4(a)(1) of the Florida Constitution. This case involved a parcel of real property with two buildings. The first building was the debtors’ home and the second building was a partially detached unit that was occupied by the debtors’ niece, her son, and her boyfriend. The partially detached unit, which had its own kitchen and utility meters, was attached to the main house by a covered patio. The Court found that there was no payment of rent, but that the boyfriend paid their separate water and electric bill, mowed the lawn, and made various contributions, including the buying of groceries.
The Chapter 7 trustee argued that the second building was not part of the Debtors’ “residence” and that the Debtors’ niece (actually “half-niece”) was not a member of the Debtors’ “family.” Article X, Section 4(a)(1) limits the homestead exemption to that of the residence of the owner or his family.
The Court stated that a separate structure on what is otherwise homestead property is not disqualified merely because it is a separate structure. The Court cited a 1917 Florida Supreme Court decision that observed that the homestead exemption would “doubtless include outhouses, barns, wagon houses, wood or coal sheds, chicken houses, fences, etc. as were appurtenant and subsidiary to and used in connection with the residence as conveniences and auxiliaries.” Armour & Co. v. Hulvey, 74 So. 212 (Fla. 1917). Such improvements would be protected as “improvements” to the homestead. The Court also cited another decision that held that the homestead included a garage and overhead apartment used for storage and laundry. White v. Posick, 150 So. 2d 263, 265 (Fla. 2d DCA 1963).
The Court observed that “to the extent court have found abandonment or waiver of the homestead exemption in a separate structure it was because the homeowner at some time used that portion of the property to generate income.” But the Court noted that if the business purpose ceases, the homestead status may be regained.
After noting that Florida law recognizes “families-at-law” and “families-in-fact”, the Court held that it was not clear whether or not the niece, son, and boyfriend qualified as the Debtors’ “family” under the Article X Section 4(a)(1) of Florida Constitution. But the Court concluded that whether are not these persons qualified as the Debtors’ “family”, the debtors were entitled to claim the entire parcel as exempt homestead as the second structure was not used for a business purpose.