NY Estate Can’t Recover Funds For Upkeep of Shared Home

The New York estate of a deceased woman may not sue her long-time domestic partner for half of the payments the deceased woman made toward the purchase and upkeep of their shared home, the New York Appellate Division, Second Department has ruled. The deceased woman, Susan, and the defendant, Charles, bought a vacation property in Pennsylvania in 1992 where they subsequently lived together. Susan paid a total of $226,500 toward the property, including the initial payment, mortgage payments, insurance, repairs and utilities.When she died in 2008, she was estranged from Charles.

The Brooklyn, New YorkSurrogate’s Court appointed Gloria executor of her estate. After the estate made a $7,500 mortgage payment toward the shared property, Gloria sued Charles in Brooklyn Supreme Court. She alleged that Charles had paid nothing toward the purchase or upkeep of the shared property, or, if he had, it was not equal to what Susan had paid. She sought to recover half of what Susan had paid on behalf of the estate plus the $7,500 mortgage payment.

Charles moved to dismiss, saying that, because he and Susan had never sought to partition the property, he had inherited full ownership of it after her death. Therefore, the estatehad no claim to recover any share of her payments toward it. In opposing the motion, Gloria argued that §1201 of the New York Real Property Actions and Proceedings Law (RPAPL), which governs legal actions between joint tenants, allows a joint tenant or the executor of a deceased joint tenant’s estate to recover a just portion of money paid toward the upkeep of a joint property. She also argued that if the estate were not allowed to recover, Charles would be unjustly enriched by inheriting a property to which he did not equallycontribute.

A joint tenancy is held by two or more persons jointly who have equal rights to share in its enjoyment during their lives and where each joint owner has a right of survivorship — that is, a right of each owner to inherit the entire estate if the other died. Accordingly, the court ruled that Susan, while she was alive, was the only person who could have affirmatively sought a partition of the property and an equitable adjustment of the interests that she and Charles held in the property. She never attempted to sever her joint tenancy with Charles. When she died, he automatically inherited the property as the surviving joint tenant.

The court noted that during her lifetime, Susan was free to manage her finances and spend her money as she saw fit, even if, with the benefit of hindsight, her decision to purchase the property and hold title with Charles, as a joint tenant, and to continue to pay its ongoing expenses after he moved to another address, inured to his financial benefit. There is no authority by which RPAPL 1201 has been applied in a retroactive fashion to allow a decedent’s estate to reach back in time and undo the financial acts of a decedent with regard to the acquisition and management of real property which the decedent, during his or her lifetime, held jointly with another.

However,thecourt held that the estate had a viable claim to the $7,500 because it is against equity and good conscience to permit Charles to retain the value of those payments. By the time these payments were made, ownership of the property had already passed to Charles “by operation of law.”

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