Modular Homes and the Personal Property Exemption

Palm Beach County Bar Association Bulletin, December 2008

In previous editions of the Palm Beach County Bar Association Bulletin, I have written about the July 1, 2007, amendment to Florida Statute § 222.25 which increased a debtor’s personal property exemption from $1,000 to $4,000 under certain circumstances. Specifically, Florida Statute §222.25(4) now states the following property is exempt: A debtor’s interest in personal property, not to exceed $4,000.00, if the Debtor does not claim or receive the benefits of a homestead exemption under s. 4, Art. X of the State Constitution. This exemption does not apply to a debt owed for child support or spousal support.

Since the amendment to Florida Statute § 222.25(4), there have been over a dozen opinions interpreting various aspects of the personal property exemption. Recently, however, two opinions were issued that address the application of the amended personal property exemption to modular homes. See, In re Heckman, 2008 WL 4636185 (Bankr. N.D. Fla) and In re Lisowski, 2008 WL 4602314 (Bankr. M.D. Fla.). Modular or mobile homes are afforded homestead exemption protection pursuant to Florida Statue §222.05. Florida Statute §222.05 states:

Any person owning and occupying any dwelling house, including a mobile home used as a residence, or modular home, on land not his or her own which he or she may lawfully possess, by lease or otherwise, and claiming such house, mobile home, or modular home as his or her homestead, shall be entitled to the exemption of such house, mobile home, or modular home from levy and sale as aforesaid.

In Heckman and Lisowski, the dispute arose over whether claiming a homestead exemption under Florida Statute § 222.05 is effectively the same thing as claiming a constitutional homestead exemption. In both cases the Debtors asserted that they were entitled to the expanded personal property exemption provided under § 222.25(4), because they did not “claim or receive the benefits of a homestead exemption under s. 4, Art. X” of Florida’s Constitution. The Debtors asserted that § 222.05 “acts as its own source of protection for a debtor’s home,” similar to other exemption provisions contained in Chapter 222 of the Florida Statutes.

In both cases the bankruptcy courts concluded that Fla. Stat. § 222.05 is not an extension of Article X, section 4 of the Florida Constitution and therefore, when Debtors claim their home to be exempt under Fla. Stat. § 222.05, it is not the equivalent of claiming a constitutional homestead. Both courts also found that Article X., section 4 benefits apply only to landowners and that since the Debtors do not own the land on which the mobile homes were located, the Debtors did not benefit from the constitutional homestead. As such, in both cases the Debtors were allowed to claim as exempt personal property up to $4,000 under the exemption provided under Fla. Stat. § 222.25(4).