Real Property Problems – The Dilemma of the Unmarried Couple

I just received a call from a local realtor.  She was understandably concerned because a purchase and sale transaction she was working on had stalled.  The reason:  the property was owned by an unmarried couple and one of the partners had recently died.  The title search revealed the couple had taken title as John Doe, an unmarried person and Susie Que, an unmarried person.  There was no indication on the deed that title should have been as joint tenants with rights of survivorship.

In Florida, when a deed is silent as to the type of joint ownership, the presumption is the property is owned as tenants in common – each party owns a respective share, usually 50/50.  Tenants in common means that each person’s individual share can be sold or devised without restriction.  So, when the first partner died, his interest in the property passes according to his will (and in the absence of a will, according to Florida’s intestate succession rules).

Individually owned property requires probate at the time of death.  As a result, the pending sale will be postponed until such time as a proper estate administration (probate in this case) can be commenced and completed.  This means the closing will have to be delayed until the will is submitted to probate, approved by the court and the property is properly transferred to the deceased’s intended beneficiaries.

This issue might have been avoided if the couple had received legal counsel at the time they took title to the property so they would have understood the difference between tenants in common and joint tenants with rights of survivorship (JTWROS).  Property owned as JTWROS passes by operation of law at the death of the first owner.  All that would be required is the filing of a death certificate in the county where the property is located.

This is one of those cases where a little counselling on the front end (when the couple took title) may have resulted in a significant savings of time and money on the back end.  Be sure to consult with a legal professional any time you are taking title to property – real or personal – as your decision may impact your estate planning in the future.