Rice v. Greene, 2006 WL 3327665 (Fla. 5th DCA Nov 17, 2006)

It’s not often that a probate-related case forces the parties to distinguish between Equitable Title in real property (i.e., the present right to possession with the right to acquire legal title once a preceding condition has been met) and Marketable Title in real property.  Well that’s exactly what happened in this case.

Here widow inherited real property from her husband in 1994 pursuant to her late husband’s will . . . but she never got around to probating the will.  Ten years later widow sells the same property to two different buyers.  "Buyer A" bought the property in June 2004 and received a warranty deed from widow.  A few months later in October of 2004 widow sold same property to "Buyer B" and also gave him a warranty deed.  Buyer B recorded his deed before Buyer A. 

So who owns what?

  • Upon husband’s death, widow instantly vested as an equitable owner of the property . . . even though she never probated his will.  F.S. 732.514.
  • Although she had equitable ownership, widow’s failure to probate her husband’s will meant she never acquired marketable titleF.S. 733.103(1).
  • Buyer A was out of luck under Florida’s recording statute (F.S. 695.01(1)), because Buyer B recorded his deed first.  This doesn’t mean Buyer B had clear title, only that Buyer A is now out of the picture and Buyer B has first dibs on working with one apparently easily confused widow on cleaning up the title mess she created.

Here are a few excerpts from the linked-to case summarizing the points above:

[Buyer A] is correct that under section 733.103, Mr. Schwartz’s unprobated will was ineffective to “prove title” to the property, under section 732.514. But, it was Mr. Schwartz’s death that vested Mrs. Schwartz’s rights in the property. Reading these statutes in concert, it is clear that because Mrs. Schwartz never offered Mr. Schwartz’s will for probate, she lacked marketable title to the property. However, she clearly acquired equitable title to the property upon her husband’s death, assuming, as have the parties, that Mr. Schwartz’s will, which was presented to the court below, is authentic. Admittedly, because Mrs. Schwartz’s title was not marketable, under certain circumstances, it might have been subject to divestment for the payment of claims, expenses of administration or taxes. Regardless, those are matters that affect the quality of the title, which is not at issue here. Instead, the only issue is which party has a priority claim to the property as between [Buyer A] and [Buyer B].

“[A]n unrecorded deed is not good or effectual in law or equity against creditors or subsequent purchasers for valuable consideration who are without notice of the transaction.” Fryer v. Morgan, 714 So.2d 542, 545 (Fla. 3d DCA 1998). Therefore, because [Buyer B] had no notice of the earlier warranty deed between [Buyer A] and Mrs. Schwartz and paid valuable consideration for the property, [Buyer B’s] recording of his warranty deed before [Buyer A] gives [Buyer B] priority to the property. Since there is no genuine issue of material fact and [Buyer B] is entitled to judgment under section 695.01(1), the trial court did not err in granting [Buyer B’s] motion for summary judgment.

We do note that the language of the final judgment is overly broad, in that it purports to quiet title to the property in [Buyer B]. While the final judgment adjudicated the dispute between [the buyers] .  .  .  much more work is necessary before [Buyer B] will have marketable title to the property.