High court rules on exemption to homestead law

Tuesday, Sept. 2, 2003 | 9:49 a.m.

CARSON CITY -- The Nevada Supreme Court has ruled that a state prison inmate can enforce a default judgment to require the sale of a home, even if it is protected by the homestead law.

In the case in question, the court ruled that the money used to buy a home in Reno was obtained by fraud and added, "We cannot allow a debtor to be shielded by the homestead exemption to further a fraud or similar tortuous conduct."

A homeowner can file a homestead exemption with county officials to protect his holding from being sold to retire certain debts.

In the case before the Nevada Supreme Court, Charles J. Maki, an inmate at the state prison in Indian Springs, received a permanent partial disability check for $37,947 and turned the money over to his sister, Esther F. Chong, to hire a defense attorney to help Maki in his appeal.

Maki was serving three life terms with the possibility of parole on three counts of sexual assault with a minor under 16. He arrived at prison May 1994.

Prison records did not show why he got disability.

Instead Chong, a mother of three who was on welfare, purchased a home in Reno with the money.

She wrote to Maki that she would sell the house when he got out of prison and repay him.

Maki filed suit for breach of contract, fraud and conversion and he obtained a default judgment. He recorded a lien against the property Chong owned in March 1998. Chong then recorded a homestead declaration on Dec. 31, 1998.

District Court scheduled a sheriff's sale of the property to satisfy the debt, but 11 days before the scheduled sale, Chong filed a motion for relief from the court order.

District Judge Steve Dobrescu ruled Chong had filed a valid homestead declaration on the property and that the home was exempt from execution.