HOMESTEAD - FLORIDA WHAT IS THE PURPOSE OF HOMESTEAD? The intention of the Legislature and the people of the State of Florida has always been to protect the Homestead for the benefit of the family during the lifetime of the sole owner of the homestead. Before the 1985 Constitutional Amendment, the sole owner had to be the head of a household. After the Amendment the exemption is in favor of any natural person. This protection is from forced sale for debts and improper conveyances without joinder of spouse; and to protect the homestead in favor of the surviving spouse or minor child of the sole owner after the sole owner dies. The courts have told us that homestead "character" is not determined solely by the record title but also by the use of the property and the intention of the party in title as to the use of the property. STATUTORY AND CONSTITUTIONAL PROVISIONS Article X, Section 4 of the Florida Constitution provides: (a) There shall be exempt from forced sale under process of any court, and no judgment, decree or execution shall be a lien thereon, except for the payment of taxes and assessments thereon, obligations contracted for the purchase, improvement or repair thereof, or obligations contracted for house, field or other labor performed on the realty, the following property owned by the head of a family (individual per 1984 Constitutional Amendment, effective January 8, 1985): (1) A homestead, if located outside a municipality, to the extent of 160 acres of contiguous land and improvements thereon, which shall not be reduced without the owner's consent by reason of subsequent inclusion in the municipality; or if located within a municipality, to the extent of one-half acre of contiguous land, upon which the exemption shall be limited to the residence of the owner or his family; (2) personal property to the value of $1,000.00. (b) These exemptions shall inure to the surviving spouse or heirs of the owner. (c) The homestead shall not be subject to devise if the owner is survived by spouse or minor child, except the homestead may be devised to the owner's spouse if there be no minor child. The owner of homestead real estate, joined by the spouse if married, may alienate the homestead by mortgage, sale, or gift and, if married, may by deed, transfer the title to an estate by the entirety with the spouse. If the owner or spouse is incompetent, the method of alienation or encumbrance shall be as provided by law. Florida Statute 732.401 entitled "Descent of Homestead" provides: (1) If not devised as permitted by law and the Florida Constitutional, the homestead shall descend in the same manner as other intestate property; but if the decedent is survived by a spouse and lineal descendants, the surviving spouse shall take a life estate in the homestead with a vested remainder to the lineal descendants in being at the time of the decedent's death. (2) If the decedent was domiciled in Florida and resided on the real property that the decedent and surviving spouse owned as tenants by the entirety, the real property shall not be homestead property. Florida Statute 732.4015 entitled "Devise of Homestead": As provided by the Florida Constitution, the homestead shall not be subject to devise if the owner is survived by a spouse or minor child, except that the homestead may be devised to the owner's spouse if there if no minor child. (1) As provided by the Florida Constitution, the homestead shall not be subject to devise if the owner is survived by a spouse or minor child, except that the homestead may be devised to the owner's spouse if there is no minor child. (2) For the purposes of subsection (1), the term: (a) "Owner" includes the settlor of a trust evidenced by a written instrument in existence at the time of the settlor's death pursuant to which the settlor retained the right either alone or in conjunction with any other person to amend or revoke the trust at any time before his death. (b) "Devise" includes a disposition by trust of that portion of the trust estate which, if titled in the name of the settlor of the trust, would be the settlor's homestead. Florida Statute 733.607 entitled "Possession of the Estate": Except as otherwise provided by a decedent's will, every personal representative has a right to, and shall take possession or control of, the decedent's property, EXCEPT the homestead . . . Florida Statute 733.608 entitled "General Power of the Personal Representative": All real and personal property of the decedent, EXCEPT THE HOMESTEAD, within the State . . . shall be assets in the hands of the personal representative; (1) For the payment of devises, debts, family allowance, estate and inheritance taxes, claims, charges and expenses of the administration, (2) To enforce contribution and equalize advancement, (3) For distribution. Florida Statute 732.108 entitled "Adopted Persons and Persons Born out of Wedlock" provides: (1) For the purpose of intestate succession by or from an adopted person, the adopted person is a lineal descendant of the adopting parent and is one of the natural kindred of all members of the adopting parent's family, and he is not a lineal descendant of his natural parents, nor is he one of the kindred of any member of his natural parent's family or any prior adoptive parent's family, except that: (a) Adoption of a child by the spouse of a natural parent has not effect on the relationship between the child and the natural parent or the natural parent's family. (b) Adoption of a child by a natural parent's spouse who married the natural parent after the death of the other natural parent has no effect on the relationship between the child and the family of the deceased natural parent. (c) Adoption of a child by a close relative, as defined in s. 63.172(2), has no effect on the relationship between the child and the families of the deceased natural parents. (2) For the purposes of intestate succession in cases not covered by subsection (1), a person born out of wedlock is a lineal descendant of his mother and is one of the natural kindred of all members of the mother's family. The person is also a lineal descendant of his father and is one of the natural kindred of all members of the father's family, if: (a) The natural parents participated in a marriage ceremony before or after the birth of the person born out of wedlock, even though the attempted marriage is void. (b) The paternity of the father is established by an adjudication before or after the death of the father. (c) The paternity of the father is acknowledged in writing by the father. Florida Statutes 63.172 defines close relatives as being the child's brother, sister, grandparent, aunt or uncle. THE AMENDMENT The January 8, 1985 Constitutional Amendment to Article X, Section 4, of the Florida Constitution substituted the words "natural person" for that of "owned by head of a family". The change in wording was made to Section 4(a) dealing with the situation where the homestead could be subject to a forced sale. Does this change have an effect on Article X, Section 4(c) relating to the devise or passage of title of homestead property? The 1982 decision of the Florida Supreme Court in the case of Holden v. In Re Estate of Gardner, 420 So.2d 1082 (Fla. 1982) answers the question in the affirmative. While this case was decided prior to the 1983 Amendment it has been cited as applying to the current situation. The court said: "It is important to read Section 4 in its entirety . . . We believe that this refers to homestead as it is otherwise used in Section 4. To adopt the construction suggested by the petitioner would create two distinct definitions of homestead; one definition under subparagraph (a) and (b) of subsection 4 and another definition under paragraph (c) concerning the devise of homestead". CONVEYANCE OF HOMESTEAD BY PERSONAL REPRESENTATIVE Florida Statute 733.607 and 733.608 as set forth above provide that the homestead is not part of the administration of the estate. The statutes follow earlier case law interpreting the Constitution on this point. See In Re Noble's Estate, 73 So.2d 873 (Fla. 1954) and secondly, Spitzer v. Branning, 184 So. 770 (Fla. 1938). THEREFORE, ONCE ESTABLISHED AS HOMESTEAD, IT HAD ALWAYS BEEN THOUGHT THAT TITLE CANNOT BE INSURED BASED UPON A PERSONAL REPRESENTATIVE'S DEED PURSUANT TO A POWER OF SALE IN A WILL OF THE HOMESTEAD, OR PURSUANT TO A COURT ORDERED SALE OF THE HOMESTEAD IN A INTESTACY ESTATE. BUT . . . . . . . In City National Bank of Florida et.al. v. Tescher, 578 So.2d 701 (Fla. 1991) case, the court determined that where homestead property was subject to claims against the estate, the decedent was not survived by spouse or minor child and the property was devised to persons who were not heirs, that the homestead could then be validly conveyed by the personal representative. The rationale appears to be that since creditors could reach the homestead property to satisfy claims, by selling the property, the personal representative would hold to the proceeds for that purpose before any distribution to the devisees. Title Standard 18.10 has been adopted following this rationale. ACCORDINGLY, CHICAGO TITLE INSURANCE COMPANY WILL INSURE TITLE TO HOMESTEAD PROPERTY THAT WAS DEVISED TO A NON-HEIR WHERE THE DECEDENT WAS NOT SURVIVED BY SPOUSE OR MINOR CHILD WHETHER OR NOT THE PROBATE COURT MAKES A DETERMINATION THAT A DECEDENT WAS NOT SURVIVED BY A SPOUSE OR MINOR CHILD. IN LIEU OF A COURT DETERMINATION OF HOMESTEAD, THE COMPANY WILL RELY ON AN AFFIDAVIT FROM THE ATTORNEY FOR THE ESTATE. The court need not decide whether the property was homestead or not because even if it was homestead, under this rational title could be conveyed by the personal representative so long as there were no surviving spouse or minor child. CLAIMS AGAINST THE PROBATE ESTATE Public Health of Dade County v. Lopez, 531 So.2d 946 (Fla. 1988) decided by The Supreme Court determined that the homestead exemption formerly only enjoyed by the head of the family can now be enjoyed by any natural person and where there is no will the homestead descends directly to the spouse or lineal descendants free of creditors claims. Then in In Re Estate of Hill, 552 So.2d 1133 (Fla.App. 3 Dist. 1989) an exception appears to be created. Here the homestead was devised to a stepdaughter for life, who at time of death was not a minor. The decedent was also survived by an adult son. The son filed a petition to set aside the devise of the condominium unit. Holding that since the decedent was not survived by a spouse or minor child, the devise was proper, BUT was subject to the claims of creditors, the court said "there is a real and substantial difference between an 'heir' and a 'devisee'". Heirs, under s. 731.201(18), Florida Statutes 1987, are those persons who are entitled under the statutes of intestate succession to the property of a decedent. Devisees, on the other hand are those persons designated by will to receive real or personal property. Article 4(b) of the Constitution states "these exemptions shall inure to the surviving spouse or heirs of the owner". The appellate court determined that the devisees would take title to the homestead but, the title would be subject to creditors claims. The Third District Court of Appeals decided the case of Bartelt v. Bartelt, 579 So.2d 282 (Fla.App. 3 Dist. 1991) where the decedent's creditors had claims against the estate which greatly exceeded the value of all of the decedent's assets. The primary asset the decedent had at time of death was his homestead property. The decedent was survived by two adult children, one of whom was the residuary devisee. The court was asked to determine whether the homestead property was subject to the claims against the estate where the will devised property to one of the children who was an "heir". The court stated "the test is not how title was devolved, but rather to whom it passed. Our holding is controlled by the decision of the Florida Supreme Court in Public Health Trust of Dade County v. Lopez, 531 So.2d 946 which held that Article X, Section 4(c)'s exemption from forced sale by creditors inured to the decedent's adult heirs." The court went on to state that "when the decedent's homestead property passed to the son by devise upon the decedent's death, the Constitutional exemption from forced sale by the decedent's creditors inured to the son. Article X, Section 4 of the Florida Constitution defines the class of persons to whom the decedent's exemption from forced sale homestead property inures; it does not mandate the technique in which the qualified person must receive title . . . to hold otherwise would discourage Florida residents from making wills and promote the passage of property through intestacy laws." The court discussed its previous holding in the case of In Re Estate of Hill, 552 So.2d 1133 cited above. That case involved a devise to a stepdaughter. The court there said the property was subject to claims of the estate's creditors. "We distinguished between 'heirs' and 'devisees' holding that devisees 'were not entitled to receive the property exempt against the claims of creditors of the estate'. The result we reached was correct. The stepdaughter was not a member of the class designated as the decedent's heirs. However, we expressly recede from Hill to the extent it can be read to bar devisees who are also the decedent's heirs under Florida law from seeking the protection of Article X, Section of the Florida Constitution upon inheriting the decedent homestead property." Accordingly if we are asked to insure title to homestead property in the names of devisees who are not heirs at law of the decedent, in addition to any other appropriate exceptions, (such as Florida and U.S. Estate Taxes and requirements for determination of passage of title), Schedule B must contain the following exception: "Claims which may be made against the estate of _____________". We should also take this exception where the devisees want to sell the property to third parties, or to mortgage the property. Of course, if the claims period has passed and no claims have been filed, the exception may be deleted. If claims have been filed and have not been disposed of, we should not insure title unless satisfactory arrangements are made to see that all claims would be disposed of either out of the proceeds of this sale or from other assets of the estate. HOMESTEAD REQUIREMENT Remember, the homestead character of the property must be first determined before any rules can be applied. Just because we have an individual in title does not mean we can rely upon a probate inventory which discloses the property to be the residence of the decedent. Prior to January 8, 1985 head of family status must be determined. It would be appropriate to have a requirement in the title commitment which would read as follows: "Order of the Circuit Court determining whether the land being insured would constitute homestead of the decedent. If the decedent died prior to January 8, 1985, the determination would have to include whether the decedent was or was not survived by spouse or minor child and was the head of a family. If the decedent died after January 8, 1985, the court must determine whether the decedent was survived by spouse or minor child and that the property was the decedent's homestead. Notice of the petition to determine homestead must be served on those persons who would take by intestate succession and by will. If these persons are not known or properly served with notice a guardian ad litem must be appointed to accept notice and represent those persons not properly served or who are not known. If the land is determined to be homestead, the order must fix or determine the names of the parties who take title to the homestead." The recent decision in Cavanaugh v. Cavanaugh, 542 So.2d 1345 (Fla.App. 1 Dist. 1989) on reconsideration by the appellate court states that it would be appropriate for the court to determine whether or not the property could be homestead. SURVIVED BY SPOUSE? ANTENUPTIAL AGREEMENTS There have been several appellate court decisions involving the issue of whether an antenuptial agreement was binding to bar a spouses' claim to homestead property after the death of the spouse who owned the homestead. These cases are Hulsh v. Hulsh, 431 So.2d 658 (Fla.App. 3 Dist. 1983); Hartwell v. Blasingame, 564 So.2d 543 (Fla.App. 2 Dist. 1990); Wadesworth v. First Union National Bank of Florida, 564 So.2d 634 (Fla. App. 5 Dist. 1990); City National Bank of Florida et.al. v. Tescher, 557 So.2d 615 (Fla.App. 3 Dist. 1990) and In Re Guardianship of Betty Wyle Tanner, 564 So.2d 180 (Fla.App. 3 Dist. 1990). In the case of City National Bank of Florida et.al. v. Tescher, 557 So.2d 615 (Fla.App. 3 Dist. 1990) the Third District Court of Appeal followed its earlier ruling and held that a valid antenuptial agreement which was signed by the homesteader's husband before their marriage was legally equivalent of his having predeceased the decedent. The court held that if the decedent was not survived by a spouse or minor child she could freely devise a homestead without restriction to third parties. The Tescher case was appealed to the Supreme Court. The Supreme Court's decision, found at 578 So.2d 701 (Fla. 1991), affirms the decision of the Third District Court of Appeal. The Supreme Court stated: "Although the decedent's husband was physically alive at the time of her death, he had waived all rights to homestead through the antenuptial agreement which he executed. Such a waiver is valid under Florida law . . . the spouse's antenuptial waiver of rights in the homestead is the legal equivalent of predeceasing the decedent, for the purposes of Article X, Section 4(c). Thus, decedent died with no one entitled to the protection of Article X, Section 4(c), and the property could pass by devise under the residuary clause of the will." DESCENT AND DISTRIBUTION PASSAGE OF TITLE TO HOMESTEAD UPON DEATH OF RECORD TITLE HOLDER - PROBATE From 1885 until the 1968 revision of the Florida Constitution effective January 8, 1968, the devise of homestead property by will was prohibited where the decedent was survived by spouse and or children. The January 2, 1973 revision made slight changes which are reflected below. PRIOR TO THE 1985 CONSTITUTIONAL AMENDMENT, IF THE HEAD OF A FAMILY OWNING THE HOMESTEAD IN HIS OR HER OWN NAME DIED (AND SINCE THE 1985 CONSTITUTIONAL AMENDMENT IF A NATURAL PERSON OWNING THE HOMESTEAD IN HIS OR HER OWN NAME DIED), THE FOLLOWING RULES APPLIED: (1) SURVIVED BY SPOUSE AND MINOR CHILD: The surviving spouse takes a life estate in the homestead with a vested remainder in the lineal descendants in being at the time of the decedent's death. If there was no spouse the lineal descendants take all. Do not insure title either coming through a personal representative's deed or a will devising the property to third parties, or to the surviving spouse. (2) SURVIVED BY A SPOUSE BUT NO MINOR CHILD: The homestead may be devised to the spouse. Do not insure title coming through a personal representative's deed or a will devising property to others. If not devised to the surviving spouse, the spouse takes a life estate with a vested remainder in the lineal descendants. Here prior to January 1, 1976 the above only applied if survived by a widow. If the owner was survived by a husband, the law would not treat this as homestead property and title would pass in accordance with the decedent's will or probate. SURVIVED BY A MINOR CHILD WITH NO SPOUSE: Do not insure title coming through a personal representative's deed or through a will devising property to others. Title to the property is in the lineal descendants in being at the time of the decedent's death. (4) SURVIVED BY NEITHER SPOUSE OR MINOR CHILDREN but for example adult children: Title may be devised to third parties but not through a probate court sale. LIFE AFTER THE 1985 AMENDMENT The factual illustrations set forth above as applying to the pre 1985 Amendment still apply. After the date of the amendment we remove from our consideration whether the decedent was the head of a family. Where a sole owner dies and from our review of the title, the probate file or other facts we determine that the decedent was survived by a spouse or minor children, we must look further. Did the decedent reside on the premises at date of death or was the decedent's last residence before he or she went to a nursing home? A single person who was never married but who was the parent (natural or adoptive) of a minor child can have his or her home classified as homestead for the purposes of Section 4(a). Same for a divorced person whether or not remarried. Both statements are true even if his or her children reside with the other parent or someone else. Any person who has a spouse or minor child whether or not the minor child is supported or acknowledged who dies after January 8, 1985, cannot devise his or her residence and the homestead descends to the spouse if any for life with vested remainder in the lineal descendants in being at date of death. We now add a fifth category for your consideration, based on the changes to the constitution: (5) IF THE OWNER IS SURVIVED BY A SPOUSE AND OR A MINOR CHILD even if they do not live with the decedent or are not supported by the decedent, nevertheless the property will be considered homestead and will pass in accordance with the rules described above depending on whether there is a spouse and or minor children. Remember, since the property could be deemed to be the homestead of the decedent, even though not survived by a spouse or minor child, the property may be devised, but it may not pass through the estate pursuant to a personal representative deed or court ordered sale. The following chart may be helpful to graphically show when homestead property may be devised. The headings identify whether the decedent was survived by a certain type of person. The chart answers the question "may the homestead be devised if the decedent was survived by ____________?" SURVIVED BY: Spouse Minor Spouse Spouse Adult Adult Only Child and and Adult Children Children Only Minor Children and/or Child others YES But YES But YES YES only to only to Spouse Spouse Otherwise Otherwise NO NO NO NO If the homestead is not validly devised it descends as other intestate property unless the decedent was survived by a spouse or minor child in which case the spouse takes a life estate and lineal descendants in being at date of death take a vested remainder. The test for homestead before January 7, 1985 regardless of whether it would be in a city or in a rural area would be as follows: (1) A sole owner in title. (2) Who was the head of a household consisting of spouse or minor children and possibly others who would make a household. Which household constituted the homestead of the family. (3) Wherein the record title holder had the obligation to support the family. (4) And that the property is where the family unit resided. After January 7, 1985 the test for homestead would be that: (1) A sole owner in title. (2) The land was the individual's residence or homestead. (3) The individual was survived by spouse or minor child. The spouse or minor child need not reside with the record title holder nor did the record title holder need to support same. Prior to the January 8, 1985 Amendment the test for determining who is the head of the family for homestead purposes is a set of facts showing a continual communal living by at least two individuals under circumstances that one is recognized as the person in charge. The courts have frequently applied the test of an obligation to support as being the test of whether a person is in charge; and have held that a divorced man living by himself with an obligation to support minor children creates constitutional homestead. Also with the various married woman acts, the obligations of support between husband and wife are mutual. A wife who is the sole title holder and who has the obligation of support would therefore be entitled to homestead. In Re Hersch 23 Bankruptcy Reporter 42, (1982) it was decided that a divorced spouse may claim the benefit of the homestead exemption laws as being the head of the household even though the former husband furnished practically all support money for the entire family. It was found that the wife actively supervised the children's education and upbringing and generally discharged the duties and responsibilities of the head of the household. The real property being claimed as homestead must be owned by the head of the family (the person as discussed above who has the obligation of support) and must cover contiguous lands 160 acres outside of or 1/2 acre within a municipality upon which exists a dwelling house. Since January 8, 1985, for conveyancing purposes, the test of ownership and family is changed to whether the sole owner is married regardless of questions of support of others. If married, joinder by spouse is necessary. IS EVERYONE ENTITLED TO CLAIM HOMESTEAD? No, homestead does not inure to the benefit of persons who are not U.S. citizens or permanent residents of the United States. The Florida Supreme Court decided the case of In Re John Cook v. Uransky, 412 So.2d 340 (Fla. 1982) on a certified question from the Court of Appeals which asked whether Florida allows foreigners visiting the United States as tourists to place a residence owned in this state beyond the reach of creditors under the Florida Homestead Exemption. The Court stated that although it is not necessary that the head of the family reside in the state or intend to make the property in question his permanent residence, he must establish that he intended to make this property his family's permanent residence. The Court went on to cite from a prior opinion the fact that citizenship is not a prerequisite for claiming the Homestead Exemption. The Court distinguished between a person who is in the United States with a permanent visa and who would have the freedom and right with certainty to make and declare a bona fide intention of permanent residence in the home owned and located in the state; from a citizen of a foreign country who is here under the authority of nothing more than a temporary visa because such a person has no assurance that he can continue to reside in good faith for any fixed period of time in this country. Recently one of our appellate courts decided the case of Alcime v. Bystrom, 451 So.2d 1037 (Fla. App. 3 Dist. 1984), holding that notwithstanding the fact that Ancel Alcime has resided in the United States for over twenty years, has resided in the State of Florida for ten years, and has been employed in local government for over six years, because he is an alien without a permanent visa, he cannot under the prevailing interpretation of the applicable statute (196.012 (16, 17)), prove an intention to become a permanent resident of the state for homestead tax exemption purposes. The court ruled that a person who does not hold a permanent visa cannot be a permanent resident of this state and thus cannot place a residence owned in Florida beyond the reach of creditors under homestead exemption from forced sale. EXEMPTION FROM FORCED SALE The homestead as a matter of law, can be conveyed free and clear of the lien of a judgment (but not federal tax lien) that may be of record against a sole owner or the title holder's spouse. For title insurance purposes we require that the lien be satisfied or a judicial determination of homestead be had because there is no procedure to prove homestead of record that will make title marketable. There is no constitutional homestead in an estate by the entireties. See Florida Statute 222.19 however specifically grants to the survivor of an estate by the entireties the constitutional homestead exemption prohibiting forced sale by judgment creditors, even if the survivor lives alone. CONVEYANCE OR DEVISE OF HOMESTEAD TO A TRUSTEE In Re Estate of Donovan, 550 So.2d 37 (Fla.App. 2 Dist. 1989). Before his death the decedent executed a revocable trust. In his will he devised the real estate to the trustee of the trust. The beneficiary of the trust was his wife. The court reading the Trust Agreement and the will to determine his intent, stated that it was the intent of the decedent to pass the property through the residuary clause of his will to a trust; that under the terms of both documents, upon his death vested the homestead property in his wife, if she survived him. The court determined that the decedent's homestead vested in his spouse to the same extent as if there had been no trust. The court stated "we think that the devise complied with Article X, Section 4(c) of the Florida Constitution." What if you encounter a voluntary conveyance by the sole owner of the property for no consideration to an inter vivos trust in which it would appear that the sole owner is a trustee and a beneficiary. What happens if the trust is revocable? Is the property still homestead? Consider the decision of In Re Estate of Johnson, 397 So.2d 970 (Fla.App. 4 Dist. 1981), wherein the decedent executed a revocable trust agreement and designated himself as the trustee and life time beneficiary of the trust. He then executed a quit claim deed transferring his residence from himself individually to himself as trustee, which was recorded. The court found that as between the various heirs and descendants and settlor, the property was homestead at date of death even though held in a trust. It was easy to make this decision as the settlor was both the trustee and income beneficiary. Title passed as though it has not been conveyed to the trust. What if the trust was irrevocable? What if there were other trustees or other beneficiaries? RICO FORFEITURE ACTION (CHAPTER 895 VS. HOMESTEAD EXCEPTION UNDER ARTICLE X, SECTION 4) The Fifth District Court of Appeals in DeRuyter v. State, 521 So.2d 135 (Fla.App. 5 Dist. 1988) was asked to decide whether homestead property could be subject to a State of Florida RICO Forfeiture Action. The court stated as follows: No appellate decisions on this question has been cited and none have been found by our search. However, we view forfeiture of property due to its use in a criminal enterprise, to be entirely different from the "forced sale" language in the Constitution. The purpose of the Constitutional provision is to protect homestead property from forced sale for debts of the owner. Tullis v. Tullis, 360 So.2d 375 (Fla. 1978). Forfeiture here is not predicated upon debts incurred by the owner but rather is based solely on the illegal uses to which the property is being put. Article X, Section 4, Florida Constitution was simply not designed to immunize real property for use in criminal enterprise. OTHER HOMESTEAD ISSUES PARTIAL DEVISE What if the decedent is survived by a spouse? Can less than the entire title to the homestead be devised to the surviving spouse with the balance to another? In two recently decided cases the answer given is NO. In Re Estate of Cleeves, 509 So.2d 1256 (Fla.App. 2 Dist. 1987), the decedent had devised all real property to the decedent's son and to the decedent's wife is she survives him as tenants in common. This would have given a 1/2 interest to the surviving spouse and a 1/2 interest to one of the decedent's children to the exclusion of the decedent's other children. All children were adults. After much discussion, citing the Supreme Court case of In Re Estate of Finch, 401 So.2d 1308 (Fla. 1981) the Court found that the decedent's attempt to devise an undivided 1/2 interest to a surviving spouse as well as the attempt to devise a comparable interest to his son is contrary to the constitutional and statutory homestead provisions as well as the decision of the Supreme Court in the Finch case and that the property must descend in accordance with the provisions of Florida Statute 732.401(1). Accordingly, the surviving spouse took a life estate in the entire homestead with a vested remainder to the lineal descendants in being at the time of the decedent's death (being all of the decedent's children and grandchildren). Also in Iandoli v. Iandoli, 504 So.2d 426 (Fla.App. 4 Dist. 1987) the Appellate Court ruled that an attempt to convey less than a 100% interest to the decedent's widow where there were no minor children was invalid. The widow received a life estate with the remainder to the lineal descendants. SELECTION OF HOMESTEAD The Second District Court of Appeal in Frase v. Branch, 362 So.2d 317 (Fla.App. 1978) decided the question of whether homestead rights will defeat an agreement for deed in which the Grantor's spouse did not join where the Grantor owned the property separately and the grantor and his spouse retained more than 160 contiguous acres of rural land in excess of the property subject to the agreement. The agreement for deed was held to operate as a selection of homestead; that is, the homestead did not include the 40 acres which the land owner had contracted to sell. The Court noted that this rule continued to provide maximum protection to the landowner and his family while preventing the homestead laws from becoming a means to escape debt. The maximum amount of rural land, 160 acres, qualified to be selected as homestead was retained by the grantor. Therefore, since the grantor displayed an "unequivocal intent" not to use the land specified in the agreement for deed, it was not homestead and therefore could be alienated without the joinder of his wife. HOMESTEAD STATUS - MOVING In Brown v. Lewis, (520 F.Supp. 1114) an action was commenced on a judgment lien against the land involved where the judgment debtor had vacated the property after executing a contract for sale but before the closing and conveyance. The court decided that the property was not subject to the judgment lien because the judgment debtor did not abandon the property in order to terminate his homestead status, but had surrendered possession of the property pursuant to the provisions of the overall sales transaction. This as you can see is a question of what was the intention of the parties. CONVEYANCE OF HOMESTEAD GRATUITOUSLY A 1962 conveyance of homestead from a record title holder to himself and his new spouse was held to be void ab initio under Article X, Section 4 of the 1885 Constitution. The appellate court in Nelson v. Boyer, 412 So.2d 31 (Fla.App. 2 Dist. 1982) held that since at the time of the marriage the parties were residing in the home it immediately had become homestead property. ADDITIONAL POINTS TO REMEMBER (1) Homestead must be listed in the probate inventory and designated as such (RP & GP 5.340(a)). However this is not conclusive proof. (2) Determination of Homestead should be by judicial order in the circuit court or probate proceedings. Do not rely upon the petition in the probate case as that does not disclose surviving spouse and lineal descendants. (3) Should we rely upon an affidavit to establish heirship? It must not be relied upon from any party who would have a pecuniary interest such as the spouse, lineal, real estate brokers etc. (4) If homestead, may land be devised in a testate estate? Yes if no spouse or minor child. A residuary clause is sufficient to pass homestead if a specific devise is not used. In Re Estate of Murphy, 340 So.2d 107 (Fla. 1976). Of course a devise to the spouse of less than the entire fee simple is invalid In Re Estate of Finch, 401 So.2d 1308 (Fla. 1981). (5) Before homestead can be validly devised to third parties a judicial determination must be made that the decedent left neither a spouse or minor child. (6) If the homestead is not validly devised it descends as other intestate property unless the decedent was survived by a spouse or minor child in which case the spouse takes a life estate and lineal descendants in being at date of death take a vested remainder. (7) If not validly devised the identity of the persons entitled to receive a homestead should be judicially determined. (8) Homestead is not an asset of the estate. The Personal Representative is not empowered to possess it, sell it or deal with it in any manner except to list it in the inventory. (9) If validly devised is it a probative asset? It is not and the personal representative is not empowered to convey property even where the homestead is validly devised. (10) Homestead devised to a spouse or heir passed free of decedents debts. Homestead devised to persons not heirs may be subject to debts. (11) If the sole owner has died but is not a U.S. citizen or a permanent resident, the property would not be homestead for purpose of decedent and distribution; conveyancing purposes; exemption from forced sale; or taxation purposes. However, a court order would have to be obtained establishing these facts.
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