Opinion ID: 504662
Heading Depth: 1
Heading Rank: 2

Heading: Qualification for a Homestead Exemption

Text: 10 Miss. Code Ann. Sec. 85-3-21 (Supp.1987) sets forth the qualifications for claiming a homestead exemption as well as the rights and immunities appertaining thereto. It states in pertinent part as follows: 11 Every citizen of this state, male or female, being a householder shall be entitled to hold exempt from seizure and sale, under execution or attachment, the land and buildings owned and occupied by him, or her, but the quantity of land shall not exceed one hundred sixty (160) acres, nor the value thereof, inclusive of improvements, save as hereinafter provided, the sum of thirty thousand dollars ($30,000.00).... 12 In construing the homestead statute, the Mississippi Supreme Court has established a rule of construction that requires resolution of doubt or ambiguity in the exemptionist's favor. 5 The concern of the homestead exemption provision is to protect the entire family from the misfortunes or imprudence of its primary breadwinner, 6 referred to in the statutory language as householder. 7 Accordingly, the Court has construed an earlier version of the homestead statute to permit exemption of proceeds from the voluntary sale of a homestead in all circumstances. 8 13 This exemption is not dependent, as in some other states, on the vendor's continued status as a homeowner, or on his intention to acquire another homestead with the proceeds. 9 The thrust of the homestead law, therefore, has not been merely to protect the home from forced sale, but also to withdraw from the reach of creditors property of the debtor as a source of revenue for the support of himself and his family. 14 The primary issue the Stinsons raise in their appeal is whether proceeds from the sale of the Courtland Plantation can be properly considered proceeds from the sale of a homestead. The Stinsons read the homestead statute to require that a householder claim the exemption in both land and buildings in order to qualify for taking any exemption at all. Although they concede Williamson occupied the property when he filed for Chapter 11 relief, they stress the fact that he sold only the land, but not his mobile home, and thus conclude the proceeds cannot by definition be derived from the sale of a homestead. 15 Bound as we are to construe the homestead statute to protect the debtor's investment within statutory limits, we draw a contrary conclusion from alternative premises. As Mississippi courts recognize, the controlling factor in determining the homestead character of any given parcel is whether or not the property is devoted to homestead purposes.... 10 Certainly in the usual situation, the householder will have owned and sold the family home as part of the realty. However, nothing in the statute compels or even suggests to us that land and buildings as used therein represents anything other than categories of property the householder is entitled, within limits, to hold as exempt from execution or attachment. The householder need not own, and thus need not sell, both land and buildings to qualify for an exemption in the proceeds so long as the property sold was used for homestead purposes. 16 In a similar vein, the Stinsons contend that because Williamson retained and continued to reside on a two-acre leasehold covering a portion of the property which he had occupied prior to the sale, he cannot be said to have sold homestead property, statutorily defined as land and buildings owned and occupied as a residence.... 11 That is, since Williamson continued to reside on the same land and in the same building 12 as before, nothing changed by the sale; the essential attributes of the homestead did not pass to the buyer and, thus, as the Stinsons conclude, the proceeds are not exempt. 17 We disagree, however, with the main premise of this argument--that the homestead character cannot follow a partial conversion of homestead property into money. It is clear under a companion statute, Miss. Code Ann. Sec. 85-3-23 (Supp.1987), that the householder may hold exempt insurance proceeds covering damage to homestead property in addition to the remnants of the property itself. 13 We see no reason for treating a partial liquidation by sale any differently. When Williamson sold Courtland Plantation, he liquidated practically the entire fund he had invested in a living space for his family, and so actually a great deal changed by reason of the sale. Since the homestead statute must be construed to protect this fund within specified limits, it is immaterial that Williamson has remained on the land as a lessee. 14 18 The Stinsons challenge Williamson's qualification for a homestead exemption on two additional grounds: First, citing Jones v. Lamensdorf, 175 Miss. 565, 576, 167 So. 624, 626 (1936), for the proposition that the homestead right must be predicated on ownership of some assignable interest in land, the Stinsons argue that Williamson's interest under the land sale contract could not be assigned at the time he filed for Chapter 11 relief. We disagree, noting that the terms of the land sale contract expressly applied to Williamson's successors and/or assigns. Furthermore, the requirement that the interest owned must be assignable meets the purpose of the homestead statute where, as here, the interest in question is subject to levy by a creditor. 19 If the householder owns no assignable interest in the land, then the statute does not apply because there is nothing for it to protect. 15 Under Mississippi law, the vendor under an executory contract for the sale of land is treated in equity as holding legal title in trust for the purchaser. 16 Since, moreover, a creditor can execute against the purchaser-beneficiary's interest while the title is held in trust, 17 it follows that Williamson's interest in Courtland Plantation was eligible for homestead protection at the time bankruptcy proceedings were instituted. 20 The Stinsons' other ground for contesting Williamson's eligibility for a homestead exemption is the failure on his part to designate the specific 160 acres from which the proceeds he now claims as exempt would be derived. Although this omission figures into our analysis of the valuation of his exemption, it has no bearing on the householder's qualification to declare an exemption per se in proceeds from the sale of a homestead. 18