WHEN IS A COOPERATIVE UNIT CONSIDERED HOMESTEAD? [FLORIDA]

Well, that depends whom you ask. Or maybe it depends on for what purpose.

Florida homestead law has three general applications. First, homesteads may qualify for an exemption from ad valorem taxes. Second, they may be protected from forced sale by creditors. Third, there are specific rules governing the descent and devise of homestead.

Florida does treat cooperatives as homestead for ad valorem tax purposes.

Thirty years, ago, the Florida Supreme Court held in Re Estate of Wartels v. Wartels, 357 So. 2d 708 (Fla. 1978), that a cooperative apartment may not be considered homestead property for the purpose of subjecting it to Florida Statutes regulating the descent of homestead property. However, the 5^th District Court of Appeals subsequently held that a cooperative apartment would be considered homestead for purposes of the protection against forced sale. S. Walls, Inc. v. Stilwell Corp., 810 So. 2d 566 (Fla. 5th DCA 2002) . This result was reached even though the definition of homestead for both descent and distribution purposes, and for the protection against forced sale, is found in the same provision of the Florida Constitution.

In a recent case before the Second District Court of Appeals, the issue again came up as to whether a cooperative apartment is homestead for purposes of descent and distribution. The argument was raised that subsequent change in Florida statutory law in regard to cooperative units necessitated a change in status from the determination in Wartels. The 2^nd DCA found itself bound by Wartels and held the cooperative apartment was not homestead for descent and distribution purposes.

Nonetheless, the court did certify the issue to the Florida Supreme Court for its consideration as being in conflict with the Walls decision. While the current case dealt with homestead for descent and distribution purposes, and Walls dealt with the exemption against forced sale, since both provisions rely on the same constitutional definition of homestead, the court stated that the definitions cannot be different and thus finds its decision to be in conflict with Walls.

PEGGY ANN PHILLIPS, et al., Appellants, v. JANICE HIRSHON, etc., et al., Appellees. 3rd District. Case Nos. 3D05-620 and 3D05-619. L.T. Case Nos. 04-0429, 03-2199, 04-0430. May 2, 2007