Frank Ostroff and Maria T. Ramirez Ostroff

UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLUMBIA
In re
FRANK OSTROFF and MARIA T.
RAMIREZ OSTROFF,
Debtors.
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Case No. 09-00594
(Chapter 7)
Not for Publication in
West’s Bankruptcy Reporter
MEMORANDUM DECISION RE OVERRULING
SECOND RENEWED OBJECTION TO EXEMPTION
American Home Mortgage has filed a second renewed objection
to the debtors’ exemption of their homestead. 	The objection will
be overruled for the following reasons.
On their Schedule C, the debtors claimed as exempt their
homestead (certain real property located at 3210 Volta Place,
N.W., Washington, D.C.), citing D.C. Code § 15-501(a)(1) (which
permits exemption of “the debtor’s interest, not to exceed $2,575
in value, in one motor vehicle”), listing the value of the
claimed exemption as $1,300,000 and the current value of the
property (without deducting the exemption) as $1,300,00.
American Home Mortgage filed an objection to exemption, arguing
that the exemption of the homestead should be denied because the
debtors cited an inapplicable D.C. Code provision in support of
The document below is hereby signed.
Signed: March 07, 2010.
_____________________________
S. Martin Teel, Jr.
United States Bankruptcy Judge
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1 	American Home Mortgage has not contended that the
property was not exemptible under § 15-501(a)(14), but even if it
did, that would fail (for reasons discussed later) to demonstrate
prejudice that would alter the outcome.
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their exemption. 	Notwithstanding that the debtors did cite a
wrong exemption provision of the D.C. Code, the court dismissed
American Home Mortgage’s objection as untimely.
When the debtors amended their schedules D and F on December
1, 2009, to treat American Home Mortgage as unsecured (based on
lack of perfection), American Home Mortgage filed a renewed
objection to the debtors’ exemption of the homestead. 	The court
overruled the renewed objection as untimely.
The debtors amended their Schedule C on December 29, 2009,
to claim the property as exempt under D.C. Code § 15-501(a)(14)
(the unlimited homestead exemption that applies in the District
of Columbia), and listed the value of the claimed exemption as
“Debtors' total aggregate interest-$1.3 million as of petition
date” and the current value of the property (without deducting
the exemption) as $1,300,000. 	American Home Mortgage filed a
second renewed objection to the claimed exemption, asserting that
it has been prejudiced by the debtors’ delay in amending their
exemptions to assert § 15-501(a)(14) as the basis for their
exemption of the homestead. 1
American Home Mortgage has not been prejudiced. 	The debtors
exempted the entire value of their homestead on their original
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Schedule C. 	When American Home Mortgage failed timely to object
to that exemption, the property became exempt, even though the
property was claimed exempt under an erroneous provision of
District of Columbia law. 	11 U.S.C. § 522(l). 	When the debtors
amended their Schedule C to assert the proper provision of
District of Columbia law for exempting the homestead, that did
not undo the exemption of the homestead that had already
occurred. 	Instead, the amendment merely made a citation to the
provision of District of Columbia law pursuant to which the
property, which had already become exempt, was entitled to be
claimed exempt.
The invocation of that exemption provision has not altered
the other exemptions that the debtors have claimed with respect
to other property. 	If a further amendment were filed making an
alteration in exemptions claimed with respect to other property,
and that amendment’s validity depended on the debtors’ having
exempted the homestead under § 15-501(a)(14) instead of under the
original provision invoked, § 15-501(a)(1), American Home
Mortgage will be able to object to that further amendment if it
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2 	Assume that when a case commenced, a debtor’s homestead
had equity of $2,575 that was not exemptible in any amount under
any provision, and that the debtor had an automobile exemptible
under § 15-501(a)(1) for $2,575. 	Assume further that on the
debtor’s original Schedule C the entire value of the homestead
was erroneously claimed to be exempt under § 15-501(a)(1), and
became exempt for lack of a timely objection. (Assume that the
automobile was not claimed to be exempt.) 	Assume further that
the debtor later amended Schedule C to change from § 15-501(a)(1)
to § 15-501(a)(14) the provision under which the homestead is
claimed to be exempt, and also to claim exempt the automobile
under § 15-501(a)(1). 	A creditor might object to the exemption
of the automobile. 	The original Schedule C claimed an amount as
exempt under § 15-501(a)(1), with respect to the homestead, that
exhausted the $2,575 available under § 15-501(a)(1), and the
creditor might argue that the $2,575 could not be restored as an
amount available to exempt the automobile via an amendment that
improperly claims the homestead to have been exemptible under §
15-501(a)(14).
4	O:\TEEL\Garrett\Decisions\Mem Decsn Denying Objection to Exemption (Ostroff).wpd
has a basis for objection. 2 	Accordingly, American Home Mortgage
is in no worse position than if the amendment had not been made.
An order follows denying the second renewed objection,
without prejudice to an objection to any future amendment of
Schedule C to claim an exemption as to other property for which
that exemption’s validity turns on the homestead having now been
claimed exempt under § 15-501(a)(14) instead of § 15-501(a)(1).
[Signed and dated above.]
Copies to: Debtors; Debtors’ attorney; Chapter 7 Trustee; Michael
N. Russo, Jr., attorney for American Home Mortgage and Ocwen Home
Loans; Office of the United States Trustee.
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