Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

The Bankruptcy StrategistFeaturesBankruptcyCivil ProcedureLitigation

Ninth Circuit Bankruptcy Panel Holds Lack of Timely Objection Bars Objection to Homestead Value Exemption

By Lawrence J. Kotler and Geoffrey A. Heaton
May 01, 2023

In a recently published decision, In re Masingale, 644 B.R. 530 (9th Cir. BAP 2022), the U.S. Bankruptcy Appellate Panel for the U.S. Court of Appeals for the Ninth Circuit (the BAP) held that in the absence of a timely objection, debtors who claimed a homestead exemption of "100% of FMV" in their residence had a valid exemption claim for the full fair market value of the property, including post-petition appreciation. The fact that the claimed exemption far exceeded the applicable statutory limit, or that the Chapter 7 trustee never had an opportunity to object, did not change the outcome as the BAP found that the lack of a timely objection barred any challenge to the exemption.

Background

In 2015, Mr. and Mrs. Masingale filed a Chapter 11 petition in the U.S. Bankruptcy Court for the Eastern District of Washington. The Masingales owned residential real property in Greenacres, Washington. In their schedules, the debtors listed their home as having a value of $165,430, with a mortgage lien against the property in the amount of $130,724. They also scheduled a homestead exemption in the property under Section 522(d)(1) of the Bankruptcy Code for "100% of FMV." No creditor or interested party objected to this claimed exemption, let alone within 30 days after the conclusion of the Masingales' November 2015 meeting of creditors, as required by the Federal Rules of Bankruptcy Procedure (the bankruptcy rules). Mr. Masingale later passed away in July 2016.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It Image

Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?

Bankruptcy Sales: Finding a Diamond In the Rough Image

There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.

The DOJ's Corporate Enforcement Policy: One Year Later Image

The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.

A Lawyer's System for Active Reading Image

Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.

Protecting Innovation in the Cyber World from Patent Trolls Image

With trillions of dollars to keep watch over, the last thing we need is the distraction of costly litigation brought on by patent assertion entities (PAEs or "patent trolls"), companies that don't make any products but instead seek royalties by asserting their patents against those who do make products.