Sepulveda v. Westport Recovery Corp.

• Decision Date: 09 July 2014
• Docket Number: No. 3D14–223.,3D14–223.
• Citation: 145 So.3d 162
• Parties: Daniel A. SEPULVEDA, Petitioner, v. WESTPORT RECOVERY CORPORATION, Respondent.
• Court: Florida District Court of Appeals

145 So.3d 162

Daniel A. SEPULVEDA, Petitioner,

v.WESTPORT RECOVERY CORPORATION, Respondent.

No. 3D14–223.

District Court of Appeal of Florida, Third District.

July 9, 2014.

Kawel PLLC, and Andrew Paul Kawel, for petitioner.

Friedman & Greenberg, P.A., and Robert D. Friedman, Plantation, for respondent.

Before ROTHENBERG, SALTER, and FERNANDEZ, JJ.

ROTHENBERG, J.

Daniel A. Sepulveda's (“Sepulveda”) second-tier petition for writ of certiorari comes to us from the Appellate Division of the Miami–Dade Circuit Court's (“the circuit court”) denial of Sepulveda's petition for writ of certiorari, which sought relief from a Miami–Dade County Court (“the county court”) order denying his motion to dismiss for lack of subject matter jurisdiction and allowing a levy sale of his property to proceed despite Sepulveda's claimed homestead exemption. Although our second-tier certiorari review is extremely limited, because we find that the county court exceeded its jurisdiction by determining that Sepulveda's claim of homestead did not prevent the levy sale, we conclude the circuit court departed from the essential requirements of law when it denied Sepulveda's petition. Accordingly, we grant Sepulveda's petition and quash the order below.

BACKGROUND

Nearly seventeen years ago, in October 1997, First Union National Bank of Florida (“First Union”) obtained a final judgment for approximately $9,000 against Sepulveda's sister, Wilda J. Arana (“Arana”), in Miami–Dade County Court. In July 2001, First Union sold its right to enforce the judgment to Westport Recovery Corporation (“Westport”). Sometime prior to 2005, Sepulveda acquired the property in question, which is located in Polk County, Florida (“the Polk County Property”), and on October 3, 2005, Sepulveda transferred the Polk County Property to Arana. Two weeks after Sepulveda transferred the property to Arana, Westport recorded the 1997 county court judgment against Arana in Polk County. Several months later, Arana transferred the Polk County Property back to Sepulveda.

In February 2012, six and one-half years after recording the Miami–Dade judgment in Polk County, Westport reopened the 1997 county court case, substituted itself as plaintiff, and attempted to levy against Arana's alleged right, title, and interest in the Polk County Property in order to satisfy the 1997 judgment. After learning of the pending levy sale of his property, Sepulveda recorded a Notice of Claim of Homestead Real Property by Owner After Levy (“Notice of Homestead”), see§ 222.02, Fla. Stat. (2013),¹ on March 1, 2013, approximately two weeks before the levy sale was to take place.

After filing his Notice of Homestead, Sepulveda moved to dismiss the county court action on the basis that the county court lacked subject matter jurisdiction to determine the validity of his claimed homestead exemption. Sepulveda's position below and on appeal is that the determination regarding his claimed homestead exemption lies exclusively within the circuit court's jurisdiction based on section 222.10, Florida Statutes (2013).² In response, Westport argued that: (1) section 222.10 was inapplicable because the 1997 judgment against Arana predated Sepulveda's claimed homestead exemption; (2) Sepulveda's Notice of Homestead, even if valid, was wholly irrelevant; and (3) even if section 222.10 applied, the county court had concurrent jurisdiction to determine homestead exemptions so long as the other jurisdictional requirements were met.

Despite Sepulveda's Notice of Homestead, the county court denied Sepulveda's motion to dismiss and granted Westport's motion to allow the pending levy sale, finding that “the lien of the Final Judgment on the subject [Polk County] Property, recorded on October 18, 2005, in the Public Records of Polk County, Florida, has priority over the subsequently acquired title interest and homestead status of Daniel Sepulveda.” The county court, therefore, essentially found that it was ruling only on a priority of lien issue rather than making a homestead exemption determination.

Sepulveda filed a petition for writ of certiorari contesting the county court's ruling in the appellate division of the Miami–Dade circuit court, and the circuit court denied the petition, affirming the county court's reasoning and result. This second-tier petition for certiorari followed.

DISCUSSION

A district court's second-tier certiorari review—certiorari review of a circuit court sitting in its appellate capacity—is extremely limited. “The inquiry is limited to whether the circuit court afforded procedural due process and whether the circuit court applied the correct law.” Haines City Cmty. Dev. v. Heggs, 658 So.2d 523, 530 (Fla.1995). Thus, we review the circuit court's decision only for legal error, and we treat all facts found by the county and circuit courts as established. See id. (“The standard of review for certiorari in the district court effectively eliminates the substantial competent evidence component.”).

The circuit court's denial of Sepulveda's petition for certiorari, however, was based entirely on a question of law. See Nissen v. Cortez Moreno, 10 So.3d 1110, 1111 (Fla. 3d DCA 2009) (“[T]he issue of whether a court has subject matter jurisdiction involves a question of law that is reviewed de novo.”). In determining whether the circuit court departed from the essential requirements of law by denying the certiorari petition, we must consider Sepulveda's challenge to the county court's jurisdiction. Accordingly, we consider de novo: (1) whether the county court's finding that Sepulveda's Notice of Homestead was irrelevant to its determination of exemption under section 222.10 was in fact a determination of Sepulveda's homestead exemption claim; and if so, (2) whether such a determination can be made by a county court, or rather, whether section 222.10 grants exclusive jurisdiction to the circuit courts of Florida to determine whether property shall be exempt from a forced sale once a Notice of Homestead is filed pursuant to section 222.01 or 222.02.

I. Whether the county court's ruling was a determination of Sepulveda's homestead exemption claim

Article X, section 4 of the Florida Constitution provides, in pertinent part, as follows:

SECTION 4. 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 [certain exceptions not relevant to this case], the following property owned by a natural person:

(1) a homestead ....

Section 4 provides one of the broadest protections for a citizen's primary property in the nation. “[T]he constitutional homestead exemption ... ‘protects the homestead against every type of claim and judgment except those specifically mentioned in the constitutional provision itself.’ ” Osborne v. Dumoulin, 55 So.3d 577, 582 (Fla.2011) (quoting Olesky v. Nicholas, 82 So.2d 510, 513 (Fla.1955)).³ Florida courts grant a liberal construction to the constitutional and statutory provisions in favor of the homeowner, and cast a restrictive eye towards exceptions to the homestead exemption. See Havoco of Am., Ltd. v. Hill, 790 So.2d 1018, 1021 (Fla.2001) (“As previously mentioned, this Court's homestead exemption jurisprudence has long been guided by a policy favoring the liberal construction of the exemption: ‘Organic and statutory provisions relating to homestead exemptions should be liberally construed in the interest of the family home.’ ”) (quoting Milton v. Milton, 63 Fla. 533, 58 So. 718, 719 (1912)).

Chapter 222 of the Florida Statutes further clarifies the constitutional homestead protection by explaining the process by which an owner or lessee of real property can declare his or her homestead rights and prevent an execution of judgment (i.e., a levy sale) against the property. “Sections 222.01 and 222.02 provide a means whereby a person may claim property as homestead and notify judgment creditors of the property's exempt status under article X, section 4, either pre- or post-levy.” Osborne, 55 So.3d at 583; ⁴see also Grant v. Credithrift of Am., Inc., 402 So.2d 486, 488 (Fla. 1st DCA 1981) (allowing post-levy designation of homestead under section 222.02).

Once a homeowner has claimed a homestead exemption, the sheriff cannot levy against the property unless the creditor prevails against the homeowner's claimed homestead exemption. Section 222.10 provides that: “The circuit courts have equity jurisdiction ... to determine whether any property, real or personal, claimed to be exempt, is so exempt.” Westport, however, convinced the county court that it did not need to make a homestead exemption determination, thereby avoiding the necessity of applying section 222.10. Westport claimed, and the county and circuit courts found, that because Westport conceded for purposes of its motion that the Polk County Property was Sepulveda's homestead from the date Arana conveyed the property to him, the only issue the county court needed to determine was whether the timing of the recordation of the judgment predated Sepulveda's homestead. Based on Westport's arguments, both lower courts have framed the issue exclusively as a priority of liens contest, with the homestead exemption having only incidental impact, if any. Such an interpretation, however, would read a restriction into the statutory text that is not present.

Section 222.10 is worded quite broadly. It provides, in relevant part, that the circuit courts have jurisdiction “to determine whether any property ... claimed to be exempt, is so exempt ....” Thus, section 222.10 will apply in every case where a creditor is attempting to levy against property where a claim of homestead has been filed under section 222.01 or section 222.02.⁵

These prerequisites were clearly met on these facts. It is undisputed that Sepulveda filed his Notice of Homestead under section 222.02 after Westport attempted to levy against the Polk...