Daily Development for Tuesday, November 30, 2004
by: Patrick A. Randolph, Jr.
Elmer F. Pierson Professor of Law
UMKC School of Law
Of Counsel: Blackwell Sanders Peper Martin Kansas City, Missouri email@example.com
The editor has a little trove of “quick hit” cases from the Southern Reporter, and during the next few DD’s will include more than one each time, because two bites here make a better meal. So don’t miss the second case - below.
HOMESTEAD; DEVISABILITY: Under Florida law, the devise of a homestead is protected from the reach of creditors, and when there is no surviving spouse or minor child, the homestead property may be devised without limitation.
Warburton v. McKean, 877 So. 2d 50 (Fla. App. 2004)
The question addressed by the court was whether the proceeds of the sale of the homestead passed as part of the bequests under the will or whether it passed as part of the residuary under the estate, devised to others. There was not enough other value in the estate to fill the decedents bequests.
The beneficiaries under the residual clause argued, and the trial court held, that the property should pass to them, because the will did not direct that the homestead be sold to satisfy bequests, and that the homestead was not therefore a part of the probate estate at all, but simply passed as residuary property.
There apparently was dicta in another Florida case suggesting that a homestead that was not specifically devised was not part of the probate estate. But the appeals court here concluded that the issue in th precedent case was quite different from the issue in this case. The appeals court further concluded that, because the homestead can be freely devised in Florida, it is necessarily part of the probate estate. Consequently, under ordinary probate rules, the property may be sold to satisfy bequests.
The appeals court, however, certified the case to the Florida Supreme Court for further consideration.
The statement in the caption is accepted as established law under the Florida Constitution and cases interpreting it. The instant case involves a further subtlety, but the information about the devisibility of homesteads is new to the Editor, and this DD is in part to share this information with readers.
PROBATE; ADEMPTION: Where vendor contracts to sell property prior to death, but dies prior to closing, a specific devise of that property in the vendor’s will is “adeemed” and the proceeds of the sale go to residual beneficiaries under the will.
Estate of Pickett, 879 So. 2d 467 (Miss. App. 2004)
Vendor authorized her attorney in fact to sign a real estate sale agreement. Shortly after the attorney in fact executed the agreement, the vendor died unexpectedly.
Vendee sought specific performance of the contract, and issues arose about the distribution of the proceeds if specific performance were to be granted.
The first issue in the case concerned the authority of this attorney in fact- specifically whether the authority given to the decedent’s attorney in fact continued valid to support the sale of the property after the decedent passed away. The court held that the contract remained valid, despite the general rule that an appointment as an attorney in fact expires when the appointing party dies.
The next issue - distribution of the proceeds - concerned the continuing vitality of the doctrine of ademption in Mississippi. The doctrine states that when there is a specific devise of certain real property in a will, and the decedent sells that property prior to death, the devise is effectively revoked, and the devisee of the property is not entitled to the property or the proceeds. In effect the sale of the property constitutes a modification of the will. The court noted that some other jurisdictions have found this doctrine troubling at times, and inconsistent with the probable intent of the devisor, and have refused to apply it. Alabama, apparently, has changed the doctrine by statute so that it does not apply where the proceeds of a sale have not been distributed at the time of death (which was the case here.) But Mississippi has no such authority, and the court here concluded that the doctrine of ademption is alive and well in that state.
The court went on to hold that the established doctrine of ademption applies equally when property has been contracted to be sold but the closing does not occur until after the testator’s death. The doctrine of equitable conversion applies to change the estate’s title to “bare legal title,” and equitable title has already passed to the vendee. Therefore, the treatment of the devise is exactly the same as if the testator had no title to the property at all at time of death. The fact that the sale has not closed or that the proceeds have not been distributed has no impact on the result.
Comment: The doctrine of ademption is something that the Editor once knew but has since forgotten, and he includes this item in order to help others who may suffer from the same problem ( mortality).
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