## Facts

- David Michels received the southern 20 acres of a previously co-owned 40-acre parcel after a 1998 partition stipulation.
- Michels did not live on the 20-acre parcel; his dwelling was on a different parcel.
- For property-tax purposes, Michels classified the 20 acres as an “agricultural homestead.”
- Lucy Kozitza and the Kozitza Family Partnership obtained a money judgment against Michels.
- The Nicollet County Sheriff levied on the 20-acre parcel to satisfy the judgment and scheduled an execution sale.
- Michels sought a temporary injunction to stop the sale, claiming the parcel was exempt as a homestead and that preclusion barred the creditors from disputing the exemption.

## Issues

1. Whether Minnesota’s homestead exemption from execution protects a noncontiguous parcel solely because it is classified as an agricultural homestead for property-tax purposes, when the debtor’s dwelling is on different, noncontiguous land.
2. Whether collateral estoppel (or related preclusion doctrines) barred the judgment creditors from contesting the parcel’s homestead-exempt status.
3. Whether the district court abused its discretion in denying a temporary injunction halting the execution sale.

## Decision

- The court affirmed the denial of a temporary injunction.
- The homestead exemption did not apply because the 20-acre tract was noncontiguous with the land on which Michels’s dwelling was located.
- Property-tax “agricultural homestead” classification did not determine exemption from execution.
- Collateral estoppel did not bar the creditors’ challenge because there was no prior final adjudication of the identical execution-exemption issue involving the creditors with a full and fair opportunity to litigate.
- Because Michels was unlikely to succeed on the merits, the district court did not abuse its discretion under the temporary-injunction standard.

## Legal Principles

- Minnesota’s homestead exemption from execution protects the debtor’s dwelling and qualifying land associated with the dwelling, which must be contiguous with (or part of the same parcel as) the residence.
- Property-tax homestead classification and homestead exemption from execution are legally distinct; tax treatment is not dispositive of creditor-remedy exemptions.
- Collateral estoppel requires (among other elements) identity of issues and a prior final adjudication on the merits involving the party to be estopped (or a privy) with a full and fair opportunity to be heard; administrative or tax classification decisions ordinarily do not satisfy these requirements for an execution-exemption dispute.
- Temporary injunctive relief turns substantially on likelihood of success on the merits; denial is reviewed for abuse of discretion.

## Conclusion

The court allowed the execution process to proceed because the debtor’s noncontiguous 20-acre tract was not part of the protected homestead absent residence and contiguity, and because tax “homestead” classification neither expanded the execution exemption nor precluded creditors from contesting it.


Michels v. Kozitza, 610 N.W.2d 368 (Minn. Ct. App. 2000)