Listen to this post

The key to understanding this case is recognizing that one word — homestead — is used in three very distinct and different ways in Florida’s constitution:

  1. The homestead exemption from forced sale (creditor protection) is addressed in Article X, §4(a) and (b) of Florida’s constitution,
  2. The homestead restrictions on descent and devise are addressed in Article X, §4(c) of Florida’s constitution, and
  3. The homestead property tax exemption is addressed in Article VII, §6 of Florida’s constitution.

In other words, there’s no one definition of homestead that’s going to apply in all cases. The same co-op could qualify as “homestead” under one constitutional homestead clause, while at the same time failing to qualify as “homestead” under another constitutional homestead clause.

For example, under F.S. 196.041, a co-op qualifies as homestead property for purposes of Florida’s homestead tax exemption (Article VII, §6). Does this mean this same property also qualifies as “homestead” for other purposes? Not necessarily.

In In re Wartels’ Estate, 357 So. 2d 708 (Fla. 1978), the Florida Supreme Court held that a co-op can’t be homestead property under Article X, §4 of Florida’s constitution because it isn’t “an interest in realty.” Subsequent to Wartels the Florida legislature adopted a new Cooperative Act, Chapter 719, that placed co-ops on equal footing with all other “interests in realty” (as defined by Wartels), which have long qualified as homestead property under Article X, §4 of Florida’s constitution.

So did the post-Wartels legislative changes to Florida law involving co-ops settle the matter? Not for the 3d DCA.

Can a co-op be homestead property under Article X, §4 of Florida’s constitution? (Not in the 3d DCA: Part I)

In Phillips v. Hirshon, 958 So. 2d 425 (Fla. 3d DCA 2007) (a case I wrote about here), the 3d DCA questioned the continued vitality of the Florida Supreme Court’s decision in Wartels, but nevertheless concluded that their “proper institutional role obligate[d] [them] to adhere to Wartels” and that “[t]he better course [was] to affirm [a probate court’s order not extending homestead status to a co-op] and certify.” The 3d DCA also certified that its holding not extending homestead status to co-ops was in conflict with S. Walls, Inc. v. Stilwell Corp., 810 So.2d 566 (Fla. 5th DCA 2002).

After initially accepting jurisdiction, the Florida Supreme Court punted by discharging the case. So was that the end of the story? Nope.

Case Study

Walters v. Agency for Health Care Administration, — So.3d —-, 2019 WL 6691513 (Fla. 3d DCA December 4, 2019)

The linked-to case above involved a co-op in North Miami Beach. The owner passed away survived by an adult daughter. Daughter petitioned to probate the co-op as protected homestead property. The Agency for Health Care Administration filed a statement of claim against the estate in the amount of $81,276.76, and objected to the claimed homestead creditor protection on the basis that a co-op isn’t a fee simple interest in land, and thus under Wartels doesn’t qualify as protected homestead. The probate judge agreed (as she must per the 3d DCA’s Hirshon opinion), and denied homestead protection for the co-op.

On appeal the 3d DCA was asked to reconsider its stance on co-ops as not being homestead under Article X, §4 of Florida’s constitution. Since the last time the 3d DCA had addressed the issue in Hirshon, another DCA had essentially ruled the other way in Geraci v. Sunstar EMS, 93 So. 3d 384 (Fla. 2d DCA 2012) (a case I wrote about here, here).

Can a co-op be homestead property under Article X, §4 of Florida’s constitution? (Not in the 3d DCA: Part II)

So did the 3d DCA change its mind this time around? Nope. But they again made clear they would have ruled the other way but for the Florida Supreme Court’s refusal to reconsider its decision in WartelsWhich they again invited the Florida Supreme Court to do. The 3d DCA also certified that its holding not extending homestead status to co-ops was in conflict with Geraci.

We continue to adhere to the Florida Supreme Court’s decision in Wartels, and to our own decision in Hirshon, and affirm the trial court’s denial of [the] petition to declare the cooperative stock to be homestead property. We recognize that, under circumstances similar to the instant case, the Second District, in Geraci v. Sunstar EMS, 93 So. 3d 384 (Fla. 2d DCA 2012), held that the homestead protection at issue was a forced sale rather than a devise and descent, and held that the decedent’s condominium was homestead property for purposes of the exemption from forced sale even though it did not constitute a fee simple interest in land. We therefore certify conflict with our sister court’s decision in Geraci. We also certify, as a question of great public importance, the same question certified by this court in Hirshon:


Legislative Update: Cooperative Unit as Homestead

In 2021 the Florida legislature statutorily settled the question of whether a cooperative unit is real property for homestead devise and descent purposes by amending the definition of a cooperative “unit” in F.S. 719.103(26), which now clearly states that “[a]n interest in a [cooperative] unit is an interest in real property.” According to The Fund’s title note 19.03.05, this means that “a cooperative unit qualifying as homestead is both protected from creditors and treated as homestead for purposes of devise and descent.”