Tenancy by the Entirety

(Nyack, New York)  I wanted to follow up on my prior blog post about “tenants by the entirety.”  As I pointed out in that post,

It is interesting to consider what other “ramifications” owning property as tenants by the entirety might have.   Given the “undivided” nature of the ownership relationship, a question about whether a creditor might be able to somehow “levy” against one spouses “share” of the real property might arise.   Generally, most commentators suggest that the undivided nature of the interest makes one spouse’s interest in the property indivisible, meaning that the creditor cannot force the partition of the tenancy by the entirety without the debt being against both tenants, or spouses.

In New York, when a married couple purchases real estate the interest that the married couple has in the property is called a tenancy by the entirety.  In that form of ownership, each party is said to have an undivided interest in the whole property.  It is as if the married couple is “one person” in the eyes of the law.  This type of ownership has certain benefits for the married couple.  One of those benefits is that when one spouse dies, the other spouse automatically becomes the owner of the entire interest in the real property.    So, in the above example, when one member of the married couple dies, the property would automatically pass to the surviving spouse.

This legal rule was discussed by the Judges of the Appellate Division, Second Department in a 2015 case.  The Judges stated, “Where property is held in a tenancy by the entirety, in which a husband and wife own real property as if they were one person, and one spouse dies, the surviving spouse takes the entire estate, not because of any right of survivorship, but because that spouse remains seized of the whole (Lacroix v Limogene, 132 AD3d 817, 818 [2nd Dept 2015] (NY App. Div. 2015) citing Matter of Violi, 65 NY2d 392, 395 [1985]).”

In the Limogene case, the Court reviewed tenancy by the entirety law when faced with an interesting issue.  Andre Limogene and Jeanne Limogene were a married couple.  In 1988, a third party transferred property by deed to “Andre Limogene and Jeanne Limogene, husband and wife.”   As such, this transfer created a tenancy by the entirety.  On January 29, 2013, Jeanne Limogene died.  Her will, dated January 23, 2012, stated “[i]n the event that [the subject property] is held as tenants in common, I give, bequeath, and devise all my interest in the real property … to my daughter Sherlly Lacroix.”

Andre Limogene, Jeanne’s husband, contracted to sell the property in September 2013.  At that point, Sherlly filed a legal action against him asking the lower court to declare that she is a 50% owner of the property. Ms. Lacroix contends that her mother made that provision in her will because her mother “had separated” from Mr. Limogene.  However,   Mr. and Mrs. Limogene had never obtained a judicial decree of separation or divorce.

The Appellate Court held that Ms. Lacroix was not a 50% owner of the property because Mr. Andre Limogene and Mrs. Jeanne Limogene were still legally married at the time of her death.  They did not take any legal action during their lives to terminate the tenancy by the entirety.   New York law is clear that the interest of the deceased spouse automatically transfers to the surviving spouse in a tenancy by the entirety.  Thus, Mr. Andre Limogene is the owner of a 100% interest in the property.

The Bottom Line-This case demonstrates the importance of hiring a competent New York attorney to assist you in understanding the intricacies of New York law. When you get married, purchase a home, have a child, separate from your spouse (without divorce) or experience another major life event, it is easy to focus on the exciting changes to your personal life.  However, it is important to note that these life changes also have legal implications.

Please contact us at Klose & Associates so we can protect your legal interests while you enjoy these life events.

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