Court Opinion

ID: 176783
Source: CourtListenerOpinion
Date Created: 2010-10-07 14:57:32+00
Date Added: 2024-06-11T17:25:39.739275
License: Public Domain

[DO NOT PUBLISH]

             IN THE UNITED STATES COURT OF APPEALS

                     FOR THE ELEVENTH CIRCUIT
                      ________________________                  FILED
                                                       U.S. COURT OF APPEALS
                             No. 10-10002                ELEVENTH CIRCUIT
                                                           OCTOBER 7, 2010
                         Non-Argument Calendar
                                                              JOHN LEY
                       ________________________                CLERK

                      D.C. Docket No. 5:08-cv-00515

In Re: TIMOTHY VERN SCHWEIZER,

                    Debtor.
__________________________________

TIMOTHY VERN SCHWEIZER,

                                                     Plaintiff-Appellant,

                                  versus

GENE T. CHAMBERS,
NC TWO, LP,
CAPITOL INDEMNITY CORPORATION,

                                                     Defendants-Appellees.

                       ________________________

                Appeal from the United States District Court
                    for the Middle District of Florida
                      ________________________
                            (October 7, 2010)

Before CARNES, MARCUS, and COX, Circuit Judges.
PER CURIAM:

      Timothy Vern Schweizer appeals the judgment of the district court affirming

the bankruptcy court’s decision holding that the bankruptcy court may not reexamine

the issue of what property is subject to the homestead exemption in ruling on a lien

avoidance motion under 11 U.S.C. § 522(f) when a state court has previously entered

a final order determining the portion of a debtor’s land that is covered by the state

homestead exemption. We affirm.

      The facts in this case are undisputed. Schweizer purchased a 320-acre parcel

of land in 2003 and lived on the property. In 2005, two creditors – NC Two, L.P.,

and Capitol Indemnity Corporation – obtained separate judgments against Schweizer

and recorded them in the two counties which the property straddles. Later that same

year, NC Two filed an action in state court to foreclose its lien. Capitol was a party

to the action and sought to enforce its subordinate lien. Under Florida law, a person

who owns and resides on property located outside a municipality may claim a

homestead exemption on up to 160 acres of contiguous land. Fla. Const. art. X, § 10.

NC Two, Capitol, and Schweizer disagreed on which 160 contiguous acres of the

320-acre parcel should be deemed homestead property. The parties briefed and

argued the issue. The state court resolved the dispute in the creditors’ favor,

specifically describing the property that was exempt and scheduling a foreclosure sale

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on the remainder of the property. Schweizer did not appeal the decision and does not

now take the position that the state court’s decision was wrong.

       After the deadline for any appeal had passed, but before the scheduled

foreclosure sale, Schweizer filed a Chapter 7 bankruptcy petition. The filing stayed

the foreclosure sale. In his amended schedule C, Schweizer claimed a homestead

exemption on 160 acres of property within the 320-acre parcel different from the 160

acres that the state court had decreed constituted his homestead. NC Two, Capitol,

and the bankruptcy trustee objected.

       Schweizer moved under 11 U.S.C. § 522(f) to eliminate NC Two’s and

Capitol’s liens from the 160 acres he claimed as exempt. The bankruptcy court

denied the motion, holding that under the Rooker-Feldman doctrine,1 it could not

reexamine the state court’s determination, and that only the land identified by the

state court was exempt. Schweizer appealed, and the district court affirmed the

decision of the bankruptcy court. Schweizer appeals; he argues that the court erred

in concluding that the bankruptcy court could not reexamine the issue of his

homestead exemption under a lien avoidance motion pursuant to 11 U.S.C. § 522(f).

       1
       See Rooker v. Fid. Trust Co., 263 U.S. 413, 44 S. Ct. 149 (1923); Dist. of Columbia Court
of Appeals v. Feldman, 460 U.S. 462, 103 S. Ct. 1303 (1983).

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      Schweizer argues that the state court’s judgment regarding his homestead

exemption may be avoided as the fixing of a judicial lien on an interest in his

property. In support of his contention, Schweizer relies on cases that examine the

scope of Section 522(f). What Schweizer fails to recognize, however, is that the key

to this case is not § 522(f), but rather § 522(b).

      After a debtor files for bankruptcy, he is entitled to retain certain assets as

exempt from the bankruptcy estate. Although the bankruptcy code provides

exemptions, a state may opt-out of those exemptions and provide alternative

exemptions. 11 U.S.C. § 522(b). In an opt-out state, debtors may exempt “any

property that is exempt under . . . State or local law that is applicable on the date of

the filing of the petition.” Id. § 522(b)(3)(A). Florida elected to opt-out and has

enacted its own exemptions. Fla. Stat. § 222.20.

      Section 541 of the Bankruptcy Code defines property of the estate as “all legal

or equitable interests of the debtor in property as of the commencement of the case.”

We have previously held that state law defines the scope and existence of the property

interest. In re Sinnreich, 391 F.3d 1295, 1297 (11th Cir. 2004) (citing Butner v.

United States, 440 U.S. 48, 55, 99 S. Ct. 914, 918 (1979)). Therefore, Florida law

governs the scope and existence of the debtor’s interest in homestead property. 11

U.S.C. § 522(b); Fla. Stat. § 222.20.

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      In this case, when the state court entered judgment delineating the extent of

Schweizer’s homestead exemption, it defined the scope and existence of Schweizer’s

§ 522(b) property interest. Thus, at the time of Schweizer’s bankruptcy filing, the

160-acre parcel determined by the state court, and not any other division of

Schweizer’s 320 acres, was subject to the lien avoidance protections of § 522(f).

Section 522(f) provides that “the debtor may avoid the fixing of a lien on an interest

of the debtor in property to the extent that such lien impairs an exemption to which

the debtor would have been entitled under subsection (b) of this section . . . .”

Consequently, § 522(f) protections are only available if a lien impairs a debtor’s §

522(b) exempt property. Here, the state court defined what property Schweizer was

allowed to claim as exempt, but Schweizer disregarded the state court’s definition,

claimed that other land was exempt, and sought to avoid liens to portions of his 320-

acre property that are not covered by § 522(b). This, clearly, is not allowed.

      We agree with the district court’s well-reasoned analysis concluding that the

bankruptcy court correctly held that it was bound by the state court’s identification

of the 160 acres covered by the homestead exemption. (R.1-21 at 3-9.) Therefore,

we hold that the district court did not err in affirming the bankruptcy court’s decision.

      AFFIRMED.

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