Can You Waive Your Constitutionally Protected Homestead Exemption? An Update on the DeMayo Opinion

Palm Beach County Bar Association Bulletin, July/August 2006

Earlier this year, I discussed the Third District Court of Appeal’s November 30, 2005 opinion in DeMayo v. Chames, 2005 WL 3180187 (Fla. 3rd DCA 2005) 1. In the DeMayo case, Mr. DeMayo executed a retainer agreement with his lawyers which, among other things, stated “the client hereby knowingly, voluntarily and intelligently waives his right to assert his homestead exemption in the event a charging lien is obtained to secure the balance of attorney’s fees and costs.” Id. Mr. DeMayo failed to pay his attorney’s fees and subsequently a final judgment was entered in the law firm’s favor. The trial court expressly enforced the waiver provisions of the retainer agreement and the case was appealed to the Third District Court of Appeals. In the “original” DeMayo opinion, the Third District Court of Appeals affirmed the trial court, thereby contradicting the long standing Florida Supreme Court precedent, as expressed in Sherbill v. Miller Manufacturing Company, 89 So.2d 28 (Fla. 1956), that a debtor’s voluntary waiver of his or her homestead exemption protections 2 is unenforceable and contrary to public policy.

Subsequently, on March 15, 2006, the Third District Court of Appeals, on its own motion, vacated its prior opinion and substituted a new opinion consistent with the long-standing precedent, i.e., finding a voluntary waiver of a homestead exemption unenforceable. DeMayo v. Chames, 2006 WL 626059 (Fla. 3rd DCA 2006). In finding that a waiver of the homestead exemption was unenforceable, the court relied on the Florida Supreme Court’s opinions in Sherbill and Carter’s Adm’rs v. Carter, 20 Fla. 558 (1884) which expressly state that Article X, section 4 of the Florida Constitution protects the homestead against every type of claim and judgment except those specifically mentioned in the constitutional provision itself.

Notwithstanding the majority opinion, in a concurring opinion, the concurring judges note that the Sherbill and Carter decisions are inconsistent with the modern view that a person’s right to exempt his homestead property from the claims of a creditor is a personal right that may be waived by that person if he or she so desires. In support of their view, the concurring judges cite the Florida Supreme Court’s recent considerations of other provisions of the Florida Constitution involving personal economic decision making, e.g., In Re: Amendment to the Rules Regulating the Florida Bar v. Rule 4-1.5(f)(4)(b) of the Rules of Professional Conduct, wherein the Florida Bar was ordered to submit a proposed rule allowing clients to waive the constitutional limit on the amount of attorney fees that a contingent fee counsel can receive in medical malpractice matters. Accordingly, the concurring judges certified the following question to the Florida Supreme Court as a matter of great public importance:

Whether, in light of subsequent precedent in Florida and other jurisdictions, and the textual changes made by the People of the State of Florida in Article X, Section 4 of the Florida Constitution in the general election of November 1984, the holding in Carter’s Adm’rs v. Carter, 20 Fla. 558 (1884), followed in Sherbill v. Miller Mfg. Co., 89 So.2d 28 (Fla.1956), that a waiver of the benefit and protection of the exemption found in Article X, Section 4(A) of the Florida Constitution is unenforceable against the claim of a general creditor, should be overruled?

As of now, the long-standing precedent that a voluntary waiver of a homestead exemption is not enforceable remains the law. However, we will have to pay close attention to see if the Florida Supreme Court overrules its previous decisions and answers the certified question in the affirmative, thereby allowing a voluntary waiver of the constitutionally protected homestead exemption.

1. See, Palm Beach County Bar Association Bulletin, February 2006.

2. 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 the payment of taxes and assessments thereon, obligations contracted for the purchase, improvement or repair thereof, or obligations contracted for house, field or other labor performed on the realty . . . Art. X, § 4(a), Fla. Const. (2004).

Our Team

Alvin S. GoldsteinAlvin S. Goldstein
Achieving success means caring about my clients, often providing financial advice to address their whole situation, not just the bankruptcy.

See Biography

Jason S. RigoliJason S. Rigoli
I utilize my understanding of business and knowledge of bankruptcy law to help clients thrive in the future.

See Biography

Marc P. BarmatMarc P. Barmat
I always keep in mind how to provide the best financial benefit to my clients, helping them to retain as many assets as possible and move forward with their lives or businesses.

See Biography

Alan R. CraneAlan R. Crane
Whether in bankruptcy or divorce, my goal is to help clients find creative solutions to complex problems so they can move forward from a very difficult time to a brighter more secure future.

See Biography

Robert C. FurrRobert C. Furr
The Bankruptcy code is complex and constantly evolving. I give clients the benefit of expertise and experience in utilizing the law successfully to protect their interests.

See Biography

Charles I. CohenCharles I. Cohen
I feel like I've accomplished something when I help people navigate a difficult stage and move forward with their lives.

See Biography