Friday, August 22, 2014

Real Estate Conveyance Involving Same-Sex Marriage

As of today, there are currently only 19 States (plus Washington, D.C.) which recognize same-sex marriage, as follows:

Court Decision
State Legislature
Popular Vote
California (06/28/13)
Connecticut (11/12/08)
Iowa (04/24/09)
Massachusetts (05/17/04)
New Jersey (10/21/13)
New Mexico (12/19/13)
Oregon (05/19/14)
Pennsylvania (05/20/14)
Delaware (07/01/13)
Hawaii (12/02/13)
Illinois (06/01/14)
Minnesota (08/01/13)
New Hampshire (01/01/10)
New York (07/24/11)
Rhode Island (08/01/13)
Vermont (09/01/09)
Washington, D.C. (12/18/09)
Maine (12/29/12)
Maryland (01/01/13)
Washington (12/09/12)

There are a  number of law suits challenging state bans on same-sex marriage that are working their way through the courts in all the remaining states (except North Dakota). In addition, thousands of same-sex couples were married during brief periods of time when it was allowed in some states before an appeal was filed and/or a stay was granted, leaving those persons in a state of limbo. Despite the full faith and credit clause of the U.S. constitution, recognition in one state has not translated to recognition in all other states. As such, this matter is very likely to go to the U.S. Supreme Court for the next term.

Any conveyance of property to/from same-sex couples in states that do not recognize such marriages at the time of the conveyance could present a challenge (and a title nightmare). Traditionally, deeds to/from married couples (of opposite sex) were often written to include "husband and wife" or "tenants by the entireties" after the names of the parties. Such language ensured that ownership and succession of title would remain with a surviving spouse. With the evolution of marriage in some states to include same-sex couples while still being unrecognized in others, care must be taken with the language on deeds of conveyance both to ensure survivorship upon the death of one party, but also to reduce potential problems with a subsequent transfer of the property if the same-sex couple wishes to dispose of it.

For states in which same-sex marriages are recognized, "tenants by the entireties" may be the most accurate language, although rather formal and perhaps not well understood by non-attorneys or real estate professionals. Another option might be "a married couple." However, for states in which same-sex marriages are not recognized, such language may have no legal effect, meaning the couple would own the property as joint tenants (two individuals instead of one married couple). Title held in such a manner means that each person owns 50% of the property and upon the death of one party, his/her interest will be conveyed pursuant to his/her will or the intestacy statutes of the state in which the property is located. That means the heir(s) of the decedent could take ownership jointly with a surviving owner. It could also present a challenge when trying to transfer the property. To help prevent any subsequent transfer problems and to ensure that a surviving spouse in a same-sex marriage takes ownership of the property, I recommend that title be conveyed in non-recognition states as "joint tenants with right of survivorship." If the relevant state later recognizes same-sex marriages, the couple may choose to deed the property to themselves as "a married couple", "tenants by the entireties", or whatever nomenclature is prevalent in that jurisdiction.