Gay Couples Shouldn’t Assume New Laws Give Them All the Protection They Need
Same-sex marriages are now protected under the law in Florida, along with many other states. But while the recognition of marriage is legally recognized, that doesn’t automatically mean that same-sex couples can assume they have the same legal rights as heterosexual couples in every area of the law. This is especially true given that we still don’t know how the courts or insurers will treat property jointly owned by homosexual couples.
Tenancy by the Entireties
When a couple marries and owns property together, the property is said to be owned as “Tenancy By the Entireties.” (TBE). To be considered TBE, the property must:
- Be jointly owned and controlled by husband and wife;
- Be owned by a couple with the same interest in the property, which arose at the same time; and
- Have come into ownership at the time the couple was married.
There are big benefits to TBE property. TBE property will automatically go to the spouse upon the other’s death, even without a will, and without the need for court intervention.
TBE property can also be exempt from creditors. A creditor of a spouse may never be able to take property that is owned as TBE with the other spouse. In bankruptcy, TBE property may be exempt from being taken by a bankruptcy trustee.
Of course, TBE laws have historically been applied to heterosexual couples. But now that homosexual couples can be legally married, the question is whether the law will treat their property the same way.
Insurers May Have Questions As Well
It’s not just the legal system that may have problems adapting. Title insurers may have issues as well.
For example, assume a gay couple owns a house presumably as TBE, and a spouse dies. The surviving spouse, who under TBE inherited the property automatically, then wants to sell the house. But does the surviving spouse actually own the property? Did the property devise to the spouse, the same way it would if they were heterosexual?
Many title insurers may say no, creating additional legal hurdles for homosexual couples. With no title insurance, a house practically can’t be sold. Thus, the rights of homosexual couples may rely as much on industry practice as the law itself.
The problem illustrates why it’s still best to have even a basic will expressing your intentions, even if the law recognizes homosexual marriage.
Other Issues Homosexual Couples Should Consider
Homosexual married couples taking any property in their name will have to give thought even to phrasing. There’s no guarantee taking property as “wife-wife,” will be treated the same as “husband-wife.”
Just like heterosexual couples, a title company, closing agent, or attorney, may require that both members of the couple consent to property sales, or modification of deeds or loan instruments.
It’s also unclear if the laws are retroactive—i.e. whether the law will recognize gay marriages that occurred previously when the law didn’t recognize them. If laws don’t apply retroactively, couples may need to consider how to put the other couple’s name on deeds and titles to preserve their interests.
All couples, gay or not, should make sure their property is titled in a way that gives them the most benefit under the laws. Creditor protection and devise upon death all should be considered. Contact Tampa business attorney David Toback to discuss your needs and make sure your property is safe.
