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There are all sorts of reasons for why you may want to litigate your case in federal court. As explained in an excellent blog post by NY commercial litigator Will Newman:

Litigants often prefer federal court for several reasons. Many believe the judges are better. Federal courts also usually have fewer cases and more resources, and so they may handle cases more quickly than state courts. Federal courts may have broader jury pools that span multiple counties than state courts, which may limit their juries to residents of one particular county. And federal courts may be less political than state courts, since federal judges are not elected, are hard to remove from office, and are often not as connected to local political organizations as state judges.

But many litigants prefer state court. They may want a specific jury pool of county residents or a local judge who may be more sympathetic to the case than strangers from further away. Or they may prefer the procedures in state court, which may require the case proceed differently than in federal court. These differences may be a permissive attitude towards delays, an accelerated discovery schedule, or different discovery or disclosure rules altogether. They may also observe differences in how state and federal courts may interpret the same law and prefer the state court’s interpretation.

For trusts and estates litigators the key point is that federal court is a very real possibility for many of our cases if we can overcome two jurisdictional hurdles.

First, you’re not getting your inheritance case adjudicated in federal court if you can’t establish diversity jurisdiction under the special — and distinct — rules applied to trustees and personal representatives. Second, think “probate exception”. You’re not getting your inheritance case adjudicated in federal court if you can’t get past this roadblock to a federal court’s diversity jurisdiction.

What’s the “probate exception” and why should trusts and estates litigators care?

According to the U.S. Supreme Court’s 2006 decision in Marshall v. Marshall the probate exception to a federal court’s diversity jurisdiction applies only if a federal judge is being asked to: (1) probate a will, (2) administer a decedent’s estate, or (3) interfere with property already in the custody of a probate court. Marshall dramatically narrowed the probate-exception bar, opening the door to “federalized” inheritance litigation to an extent previously unimagined. Following Marshall, federal courts have continued to grapple with how narrowly or broadly to interpret the new ground rules, including in the two Florida cases discussed below.

Case Study No. 1

Can you ask a federal judge to administer a guardianship estate? NO

Baker, Donelson v. Chopin, 2022 WL 4090841 (11th Cir. September 07, 2022)

The backstory to this case involves an ugly guardianship battle for control of the care — and vast fortune — of the widow of automobile tycoon Henry Ford II. The widow’s daughter ultimately lost that guardianship case and appealed. All of this played out in Florida’s state court system.

While the guardianship-case appeal was pending the daughter filed a request with the guardianship court for a formal determination of entitlement to fees and costs for her counsel. F.S. 744.108 tells us this kind of a fee determination is “part of the guardianship administration process.”

The guardianship court stayed consideration of daughter’s fee request until the conclusion of the pending appeal. While that appeal was pending the widow died. Widow’s daughter then sued the estate in federal court seeking a ruling on her pending claim for guardianship fees. The estate sought to have the case dismissed on the grounds that this kind of fee claim was part of the guardianship administration process, which triggers the probate exception to the court’s federal diversity jurisdiction. At the hearing the federal trial judge observed he was being asked to step into the guardianship court’s shoes.

But for me to even know what amount is appropriate, I would essentially be doing the work of the probate court or the guardianship court in surveying all of the work that was done over the lengthy trial, et cetera.

Against this backdrop it probably surprised no one when the federal trial judge dismissed the case. Did the trial judge get this one right? Yup, so saith the 11th Circuit:

We conclude that the instant case falls within the probate exception. We conclude that determination of Baker Donelson’s claim for attorney’s fees is part of the guardianship administration process, and therefore falls within the second category of cases which the case law indicates is subject to the probate exception—i.e. cases in which the federal court is called upon “to administer an estate.” Florida Statute section 744.108(8) expressly provides “When court proceedings are instituted to review or determine a guardian’s or an attorney’s fees under subsection (2), such proceedings are part of the guardianship administration process.” Moreover, sections 744.108(1) and (2) clearly contemplate that the court which should determine entitlement to attorney’s fees and the amount thereof is the court which appointed the guardian—that is Probate Judge Suskauer in this case. This only makes common sense. …

Moreover, the Florida law contemplates that entitlement to attorney’s fees and the amount thereof should take into account the benefit to the ward provided by the services. Zepeda v. Klein, 698 So.2d 329, 330 (Fla. 4th DCA 1997). The guardianship court actually administering the estate is clearly the most appropriate court to evaluate the benefit to the ward resulting from the attorney’s services—i.e. to continue to handle this part of the administration of the estate.

Case Study No. 2

Can you ask a federal judge to adjudicate a creditor claim v. a probate estate? YES

Moore & Co., P.A. v. Kallop, 17-CV-24181-DPG, 2020 WL 4505645 (S.D. Fla. Aug. 5, 2020)

This case involved another attorney’s fee claim asserted against a probate estate, but this time the case turned on an alleged breach of contract. There’s nothing about a breach-of-contract claim that would involve a federal judge in the administration of an estate. However, at the end of that kind of case the plaintiff could be awarded a judgment against the estate’s assets (converting the plaintiff into a “creditor” of the estate). Does that count as “administering” an estate? Usually not, here’s why:

[F]ederal courts have the authority to “entertain suits to determine the rights of creditors, legatees, heirs, and other claimants against a decedent’s estate, ‘so long as the federal court does not interfere with the probate proceedings.’ ” Marshall, 547 U.S. at 310–11 (emphasis in original) (quoting Markham v. Allen, 326 U.S. 490, 494 (1946)). The Eleventh Circuit describes the scope of the probate exception as follows:

[A] creditor may obtain a federal judgment that he has a valid claim against the estate for one thousand dollars, or a devisee may obtain a declaratory judgment that a probated will entitles him to twenty percent of the net estate. What the federal court may not do, however, is to order payment of the creditor’s thousand dollars, because that would be an assumption of control over property under probate.

Stuart, 757 F. App’x at 809 (quoting Turton v. Turton, 644 F.2d 344, 347 (5th Cir. 1981)).

OK, so most creditor claims don’t trigger the probate exception because they don’t require a federal court to involve itself in the internal workings of the estate-administration process. Once your federal case is completed the best you can hope for is a judgment against the estate. After that it’s up to the probate judge to decide if and when that judgement is ever satisfied with assets of the estate. So is that what happened here? Yup, probate exception wasn’t triggered, so saith the court:

The Court does not find that the probate exception bars it from exercising jurisdiction over this case. While the resolution of this action in Plaintiff’s favor might result in a judgment against Decedent’s estate, “[t]he probate exception does not foreclose a creditor from obtaining a federal judgment that the creditor has a valid claim against the estate for a certain amount.” Mich. Tech. Fund, 680 F.2d at 740. Plaintiff claims that it is owed money for legal services rendered before Decedent’s death. Should Plaintiff prevail on its claims, it would stand as a creditor of the estate. Plaintiff would then, like any other creditor, submit its judgment to the Probate Court. Accordingly, Defendant’s motion to dismiss on the basis of the probate exception is denied.

Interpleader and federal jurisdiction: A more welcoming door to federal court

The two cases discussed above both dealt with existing estate proceedings, one a guardianship estate and the other a probate estate. This is familiar territory for most trusts and estates litigators. Perhaps not surprisingly, these estate cases receive most of our attention. That focus is outdated.

Today, life insurance and other beneficiary-designated non-probate assets such as annuities, pay-on-death accounts, and retirement planning accounts have become the dominant testamentary transfer mechanism for most middle class families (trusts remain favored by the wealthy). As reported in A Fair Presumption: Why Florida Needs a Divorce Revocation Statute for Beneficiary-Designated Nonprobate Assets:

Life insurance and other nonprobate assets such as annuities, pay-on-death accounts, and retirement planning accounts have become increasingly popular as estate planning tools. In 2004, Americans purchased $3.1 trillion in new life insurance coverage, a ten percent increase from just ten years before. Purchases made by Floridians accounted for nearly $154 million of this national total. At the end of 2004, there was $17.5 trillion in life insurance policy coverage in the United States.

So it’s not surprising that trusts and estates litigators are often involved in inheritance cases revolving entirely around life insurance proceeds and other non-probate assets having nothing to do with a contested estate. These non-probate cases often play out as interpleader actions, and usually in federal court. That’s not by accident.

The doors to federal court are especially welcoming for these cases under 28 U.S.C. § 1335, a special-purpose federal interpleader statute making it easier to invoke federal jurisdiction than in a typical diversity jurisdiction case. As explained in Interpleader and federal jurisdiction: A more welcoming door to federal court:

Many federal civil litigators are familiar with interpleader under Rule 22 of the Federal Rules of Civil Procedure, but the interpleader statute, 28 U.S.C. § 1335, exists independent of Rule 22. … [The interpleader statute] provides its own basis for federal jurisdiction. Rule 22 does not confer jurisdiction, and a party that uses Rule 22 interpleader still needs to establish jurisdiction on some other basis — usually diversity under 28 U.S.C. § 1332(a). But the interpleader statute provides jurisdiction and venue requirements that are more liberal than the familiar diversity jurisdiction statute: The amount-in-controversy requirement is only $500 rather than $75,000, and it requires only “minimal diversity” — meaning that there are at least two adverse claimants in the suit that are not citizens of the same state — rather than the familiar “complete diversity” requirement under 28 U.S.C. § 1332(a).

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If you’re going to sue a decedent’s probate estate, the first question you’ll need to ask yourself is if your lawsuit is going to be subject to Florida’s ultra-short limitations periods for probate creditor claims. And to answer that question you’ll need to figure out if the relief you’re seeking falls under the broad statutory definition for probate creditor “claims” found in F.S. 731.201(4), which provides as follows:

“Claim” means a liability of the decedent, whether arising in contract, tort, or otherwise, and funeral expense. The term does not include an expense of administration or estate, inheritance, succession, or other death taxes.

When you’re reading this definition it’s important to note the type of claims that are categorically excluded. In other words, if you’re suing the estate to recover “an expense of administration” or if you’re suing the estate to recover unpaid “estate, inheritance, succession, or other death taxes,” you’re not litigating a Florida probate creditor claim.

Are real property title disputes probate creditor “claims”? YES

But what if you’re suing the estate to dispute ownership of real property titled in a decedent’s name? Is that a probate creditor “claim”? If Florida had adopted the Uniform Probate Code’s definition of “claim” the answer would be simple: it’s not a creditor claim because all title disputes are categorically excluded from the definition of “claim” found in UPC sect. 1-201(6), which provides in relevant part as follows:

“Claims,” in respect to estates of decedents and protected persons, includes liabilities of the decedent or protected person, whether arising in contract, in tort, or otherwise … The term does not include … demands or disputes regarding title of a decedent … to specific assets alleged to be included in the estate.

Since Florida’s definition of “claim” is silent on the issue of real property title disputes you might be tempted to argue they’re not included in the definition and therefore your lawsuit isn’t subject to the creditor-claim filing deadlines. And you’d be wrong.

Case Study

Ford v. In Re Estate of Ford, — So.3d —-, 2023 WL 5249664 (Fla. 3d DCA August 16, 2023)

In this case the claimant filed a statement of claim against the estate disputing, on equitable grounds, ownership of four items of real property titled in the decedent’s name. The probate court denied the claim finding “that the relief sought by Mr. Ford is not a probate claim against the Estate.” Wrong answer; real property title disputes are creditor claims. So saith the 3d DCA:

[T]he probate court found that the relief sought by Billy was not a probate claim against the estate. The statement of claim provides that Billy sought the “return of the properties via equitable relief.” On appeal, Billy cites to Arwood v. Sloan, 560 So. 2d 1251 (Fla. 3rd DCA 1990), for the proposition that probate claims can involve issues of disputed ownership in real property. In Arwood, “Plaintiff filed a claim against Decedent’s probate estate, claiming that the real property, funds in the bank, and other assets in Decedent’s name, were his sole property, and that title to the same had been placed in Decedent’s name for his convenience.” Id. at 1251. Billy also cites to Sanchez v. Sanchez De Davila, 547 So. 2d 943 (Fla. 3rd DCA 1989), in which the parties claimed injunctive relief to enjoin distribution of funds. Id. at 944. The probate claim involved the question of ownership of approximately $2,000,000 held in trust bank accounts. Id. We therefore find that the trial court erred as Billy’s claim for equitable relief involving the disputed ownership of the four real properties is not outside the purview of probate claims.

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Florida’s new Community Property Trust Act is the subject of two excellent Florida Bar Journal articles by Orlando attorney Joseph Percopo (see here and here). But nothing quite beats an insider’s view on new legislation from the person primarily responsible for its development and passage, which in this case is Naples attorney Travis Hayes.

And it’s against that backdrop that I had the good fortune to attend the recent ATO conference where Travis shared his unique insights for estate planners considering this new tool. I was so impressed with Travis’ thoughtful explanations, practical advice, and sample trust clauses (always gold for practitioners), that I asked if I could help spread the word by posting his written materials on the blog. Being the good guy that he is, Travis graciously agreed.

Here’s an excerpt from Travis’ presentation entitled To Share and Share Alike: an Examination of the Treatment of Community Property in Florida and the new Florida Community Property Trust Act, which I highly recommend.

A vastly increasing amount of married couples are moving to the State of Florida to take up residency. Due to the high growth in the number of people moving to Florida, the state’s population surpassed 20 million in 2015, and the state is adding over 1,000 people per day. And those statistics are from the pre-COVID population boom in Florida! In today’s ever-increasing mobile society, many of these couples may have come to Florida from a community property jurisdiction or may have acquired property in a community property jurisdiction at some point during their marriage.

With the increased emphasis on income tax planning caused by the higher estate and gift tax exemptions, as well as portability, many practitioners are revisiting the issue of “stepped-up” basis, which has favored joint owners who live in community property states. Passage of the Patient Protection and Affordable Care Act of 2010, the American Tax Payer Relief Act of 2012, and the Tax Cuts and Jobs Act of 2017 have made income tax planning, specifically with respect to capital gains, an issue to be brought to the forefront of any estate planning strategy, regardless of net worth. It has therefore become even more important for attorneys in Florida to be able to identify and determine the community property status of Florida couples’ assets, and to examine the treatment of community property for Florida residents under Florida law.

Florida has also now taken the monumental step of enacting legislation which will permit the creation of community property trusts in our state. This is a very significant development in the treatment of community property under Florida law. Every trusts and estates practitioner in Florida should be familiar with the provisions of the Florida Community Property Trust Act, what type of clients would benefit from the implementation and usage of Florida Community Property Trusts, and the situations in which Florida Community Property Trusts should be recommended and considered. If you want to dive right into the Florida Community Property Trust Act, the discussion of the Act is contained in Section VI of this outline. But first off, the outline contains a detailed discussion of community property and its current treatment under Florida law, as it is important to have a working knowledge of those subjects if you want to become a Florida Community Property Trust expert!

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As reported in A jury rules a handwritten will found under Aretha Franklin’s couch cushion is valid:

A jury in Michigan has ruled that a [2014] note handwritten by the late soul singer Aretha Franklin is valid as her will, according to The Associated Press. In 2019, Franklin’s niece found three handwritten documents around the singer’s home in suburban Detroit. One, dated 2014, was found underneath a couch cushion. Two of Franklin’s sons, Kecalf and Edward Franklin, argued through their lawyers that they wanted the latter note to override a separate will written in 2010.

This litigation would have never happened in Florida

Why? Because neither handwritten document was attested to by two witnesses. Some jurisdictions, including Michigan, will accept un-witnessed wills if they’re handwritten (holographic). Not Florida. If Aretha Franklin had died a resident of this state both un-witnessed wills would have been automatically rejected as a matter of law. She would have died intestate, which means her children would have split her estate equally by default.

This case is a prime example of the benefits of “channeling”

Most of us would be hard pressed to look at Ms. Franklin’s handwritten 2010 “will” or her handwritten 2014 “will”, both of which are barely legible — with crossed-out words and scribblings in the margins — and say with certainty, yeah, that’s a will. Fortunately, we rarely (if ever) have that problem in Florida. Why? Think: channeling.

One of the benefits of requiring execution formalities to be scrupulously complied with for a will to be legally enforced in Florida — such as the two-attesting-witnesses requirement of F.S. 732.502(1) — is that these requirements have the side effect of standardizing what most Florida wills look like. As a result, Florida wills are generally going to follow a standard format that’s easily identifiable.

Academics call this “channeling.” Here’s how the channeling effect is described in Wills Formalities in the Twenty-First Century:

The statutory requirements for formal wills serve useful ends. They take the vast array of testamentary things and channel them into a form that is readily recognizable as a will, thus easing the transfer of property at death. By imposing a standard form on testamentary writings, they enable probate courts to identify documents as wills solely on the basis of readily ascertainable formal criteria, thereby permitting probate to proceed in the vast majority of cases as a routine, bureaucratic process.

Because wills in Florida have to follow strict execution formalities and be attested by two witnesses, most are going to follow a standard format that’s easily identifiable. And that means you’re not going to find yourself pondering whether mom’s barely legible hand written notes with crossed-out words and scribblings in the margins that she hid under the sofa cushions years before she died is her will — which is basically what happened in the Aretha Franklin case.

Was the family acrimony caused by this will contest worth it?

The primary economic difference between the two competing wills appears to be who gets Ms. Franklin’s main home in Bloomfield Hills, valued at $1.1 million when she died. But both wills apparently equally split the estate’s music catalog. And that’s where almost all of the value of this estate lies. According to celebritynetworth.com:

Aretha’s royalty income in the years after her death has been $3-4 million per year. The value of her catalog and royalty income would likely push her actual net worth at death closer to $50 – $80 million.

A $1.1 million house is a rounding error compared to a $50 – $80 million music catalog. If the value of the catalog is split equally among the brothers under both wills, was a family fight over the house — with all the stress and acrimony that accompanies any will contest — really worth it?

By the way, if Ms. Franklin’s estate generates the royalty income that’s currently estimated she’ll be typical for artists of her stature — many of whom generate huge sums of wealth long after they’ve died, as gleefully reported by Forbes in its annual list of the highest paid dead celebrities. Here’s an excerpt from its 2022 list, as reported in The Highest-Paid Dead Celebrities Of 2022—A Writer Earns Half-A-Billion From The Great Beyond:

Seems not even the boneyard is immune from inflation. The 13 departed artists, athletes and entertainers on this year’s list of the top-earning dead celebrities earned a record $1.6 billion, making it a 72% increase over last year’s total. It’s by far the biggest 12-month haul since we started tracking graveyard earnings in 2001 – and, for the first time ever, the top five made more than $100 million each. …

Overall, the music of yesteryear is seen by investors as a reliable income stream. Nearly $700 million of the $1.6 billion in total earnings came from the estates of the nine musicians on the list, including David Bowie ($250 million), Michael Jackson ($75 million) and “Hallelujah” songwriter Leonard Cohen ($55 million). Some of those earnings came from one-time sales. The estate of Toto drummer Jeff Porcaro, for instance, sold his publishing and recording royalties for $25 million in November 2021. Others, like Beatles John Lennon and George Harrison remain mainstays on the list due to their annual recurring royalty streams.

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Heirs property generally refers to family-owned property inherited by multiple generations without formal legal proceedings, resulting in a lack of clear title proving ownership. As explained in a 2018 Florida Bar Journal article entitled The Disproportionate Impact of Heirs Property in Florida’s Low-Income Communities of Color, these arrangements can lead to all sorts of negative consequences for family wealth creation. In response, in 2020 Florida adopted the Uniform Partition of Heirs Property Act (F.S. Ch. 64, Part II), which was hailed by housing advocates as an important and necessary step in closing the “racial wealth gap.”

Following that legislative reform the challenges faced by families with heirs property continues to garner much needed attention, including from national corporate actors like Wells Fargo. As recently reported by the Miami Herald in Heirs to Black-owned homes face ramped-up foreclosures. Here’s who’s pushing back:

In April, Legal Services of Greater Miami received a $600,000 grant from the Wells Fargo Foundation, which will partly be used to brief Miami-Dade residents about the issue and provide free legal assistance to heirs’ property owners in untangling titles, building on the organization’s work so far in Liberty City funded by Bank United.

Legal Services has fielded approximately 30 requests for help with potential heirs’ property matters.

“At a time like now, where affordable housing is becoming scarcer and scarcer, keeping a family home that you’ve had for decades is perhaps one of the most affordable ways to stay housed,” said the organization’s advocacy director, Lisa Lauck.

What’s the fix? Think Lady Bird Deeds

One of the primary causes of heirs property is a lack of basic estate planning. So not surprisingly, there’s a big push to get more property owners to engage in that kind of planning. For example, under the USDA’s loan program designed especially for heirs property you can’t qualify for one of these farm loans unless you first complete a “succession plan”.

The most commonly suggested solution for this lack of planning is a will. That may work if you’re focusing on farms and ranches but it’s clearly not the best option for the vast majority of Floridians, whose most common form of heirs property is going to be a single family home. All of the heirs-property examples reported on in the Miami Herald article involved single family homes. Most (probably all) of these families would be better served by “Lady Bird Deeds”.

Lady Bird Deeds (also referred to as “enhanced life estate deeds”) are ideally suited for the single most valuable asset most people own when they die: their home. Why? Because these deeds offer a simple, inexpensive way to transfer real estate at death without the costs and delays of probate (vs. a will, which has no legal effect unless it’s probated). And in another contrast to wills, Lady Bird Deeds should be publicly recorded as soon as they’re signed (there’s no mechanism in Florida for publicly recording wills prior to the testator’s death). So there’s no risk of the deed getting lost or misappropriated years later. (A lost will is an invitation for litigation.)

If you’re a practitioner and want to dive into the weeds on the technicalities of these deeds, a good starting place is Lady Bird Deed: An Inexpensive Probate Avoidance Technique. And if you’re looking for a plain English summary of why these deeds are so popular as well as a chart showing the differences between Lady Bird Deeds and traditional life estate deeds, look no further than Giving the Bird. Lady-Bird Deeds:

And last but not least, thank you to Orlando real estate attorney Norman W. Nash, who reminded me of another great resource for practitioners preparing (or even just considering) lady bird deeds. It’s the Florida Uniform Title Standards published by the Real Property, Probate, and Trust Law Section of the Florida Bar. The following three title standards address lady bird deeds directly:

For more on the backstory to these title standards you’ll want to read Enhanced Life Estates Are Now Standard Practice. Here’s an excerpt:

The issue, as noted in the comments to all of the uniform title standards to be discussed in this article, is, “although Lady Bird Deeds are used prevalently in Florida for various purposes, there is no Florida Statute governing such conveyances and scant judicial authority supporting the practice.” Recognizing the lack of authority available, last year the Uniform Title Standards Committee of the Real Property, Probate and Trust Law Section of The Florida Bar approved three new title standards regarding enhanced life estates to “represent the consensus view of the Real Property, Probate, and Trust Law Section of The Florida Bar.” Each uniform title standard contains the title standard, examples of hypothetical fact patterns illustrating the application of the title standard, and commentary about the title standard.

Rohan Kelley doesn’t use Lady Bird Deeds

Rohan Kelley is Florida’s leading thought leader on all things homestead and author of the famous Kelley’s Homestead Paradigm. So when Rohan says he’s not a fan of Lady Bird Deeds, we all need to stop and listen. With Rohan’s permission I’ve quoted below an email he was kind enough to send me in response to this blog post. Here’s the bottom line for Rohan:

The clear intent of an enhanced life estate deed is as a will substitute.  At least to the extent the property is protected homestead, it simply doesn’t work even though the use of this will substitute nearly always involves homestead.

Rohan’s point is well taken … as far as it goes. If the subject property is your personal residence it’s also going to be “homestead” property that’s subject to the restrictions on devise contained in Article X, §4(c) of Florida’s constitution. And if you’re survived by a spouse or minor child and you invalidly devise your homestead property — be it by Will or Lady Bird Deed — that devise is going to fail. For an example of a failed devise of homestead property via a Lady Bird Deed, see Problem 2 of Florida Bar Title Standard 6.12.

On the other hand, if you’re not survived by a spouse or minor child or if you otherwise validly devise your homestead property — be it by Will or Lady Bird Deed — that devise is going to work. For multiple examples of successful devises of homestead property via a Lady Bird Deed, see Problems 1, 3 and 4 of Florida Bar Title Standard 6.12.

And that’s my point. If a devise of homestead property is subject to the same restrictions be it by Will or Lady Bird Deed, why not default in favor of the self-executing probate-avoidance benefits of a Lady Bird Deed? For example, in both family stories reported on in the Miami Herald article a devise of the subject homestead property via a Lady Bird Deed would have worked without the costs and delays of probate (vs. a will, which has no legal effect unless it’s probated).

But I’ve been doing this lawyering thing long enough to fully concede I could be wrong. Here’s the full text of Rohan’s thoughtful and scholarly comment (which I highly recommend):

I don’t use lady bird deeds because I’m concerned that they might be subject to challenge in some circumstances, especially if enough money were involved.  There is only one case in Florida that discussed what has become known as an enhanced life estate deed, Oglesby v. Lee, 73 Fla. 39, 73 So. 840 (Fla 1917).

The “remainder” interest created is an unvested interest, not as argued by some that it is a vested remainder subject to divestment.

In Oglesby, in dictum, the court stated “That such conveyance was in effect a will . . . .” (At page 41.)  The other fact in Oglesby that makes it inapplicable to the modern use of a lady bird deed is the fact that “[Grantor, who was also the remainderman’s father] was appointed guardian of [remainderman], then a minor, ‘to protect and preserve the consideration received from J. W. Oglesby for the land.’” Another relevant fact that distinguishes Oglesby is “. . . said land is wild, unimproved, and unoccupied except such occupancy as that of cutting timber therefrom.”  Hence it was not protected homestead.

This case has never been cited by any other Florida case.

Only one other Florida case involved an enhanced life estate.  Agee v. Brown, 73 So.3d 882 (Fla 4th DCA 2011). That case involved the issue of whether a lawyer who prepared an earlier will for a client that included himself and his wife as beneficiaries, and was alternate personal representative of the earlier will, was an interested person who could challenge the later will.   Judge Speiser held that because the lawyer was presumed to have exerted undue influence thereby rendering the will he prepared void, he had no interests under which he could contest the later will.  The 4th DCA reversed.  However, the validity or effect of the enhanced life estate was not an issue in the case.

The other consideration is Title Standard 6.12 Problem 2, that states:

STANDARD 6.12

ENHANCED LIFE ESTATE: REMAINDERMAN AND HOMESTEAD PROPERTY STANDARD: THE REMAINDERMAN IN HOMESTEAD PROPERTY, WHEREIN THE LIFE TENANT RESERVED THE POWER TO SELL, CONVEY MORTGAGE AND OTHERWISE MANAGE THE FEE SIMPLE ESTATE, ACQUIRES FEE SIMPLE TITLE UPON THE DEATH OF THE LIFE TENANT ONLY WHEN NOT IN VIOLATION OF CONSTITUTIONAL RESTRICTION ON DEVISE OF HOMESTEAD.

Problem 1: A remainder in Blackacre was conveyed by John Doe, a single man, to Jane Smith with John Doe reserving for himself without any liability for waste, full power and authority in himself to sell convey, mortgage or otherwise manage and dispose of the property in fee simple with or without consideration, without joinder of the remainderman, and full power and authority to retain any and all proceeds generated by such action. John Doe died without a spouse or a minor child. Upon the death of John Doe, is fee simple title vested in Jane Smith? Answer: Yes.

Problem 2: Same facts as in Problem 1, except that John Doe died while married to Sally Brown. Upon the death of John Doe, is fee simple title vested in Jane Smith? Answer: No.

According to the Title Standard, an enhanced life estate deed doesn’t work where the grantor is survived by a spouse of minor child.  See Art. X s. 4(c) Fla. Const.

You will recall the case In re Johnson’s Estate, 397 So.2d 970 (4th DCA 1981):

“By retention of the complete control of the property with the absolute right to revoke [the enhanced life estate deed], it is apparent that the testator intended to circumvent the constitutional restriction on testamentary disposition of the homestead while at the same time treating the property as his own during his lifetime. Any statutory basis for permitting said transaction would abrogate the constitutional protection accorded to a homestead as provided in Article X, Section 4 of the Constitution of the State of Florida, which must prevail over any statutory enactment.” (At page 971) (“enhanced life estate deed” substituted for “trust instrument”)

“That which the law forbids to be done directly cannot lawfully be done by indirection.  If an attempted conveyance of homestead real estate is in legal and practical effect and operation a will, it may not be effective when the owner of the homestead leaves a wife or child.” (At page 972)

The clear intent of an enhanced life estate deed is as a will substitute.  At least to the extent the property is protected homestead, it simply doesn’t work even though the use of this will substitute nearly always involves homestead.

In summary, what we have in widespread use by Florida lawyers is an untested device that is widely misused.  The justification for why it is used is because everybody uses it.  What if everybody is wrong?

I subsequently asked Rohan for clarification based on my thoughts above, and he kindly agreed. Rohan’s point is that there is a lack of clear legal authority for these deeds, especially as applied to homestead property. Statutory authority explicitly validating these deeds would clear up any doubt on that front, as advocated in Transfer on Death Deeds: It Is Time to Establish the Rules of the Game. In the absence of explicit statutory authority the best we have are the Florida Bar’s title standards listed above (6.10, 6.11, and 6.12), all of which confirm the validity of Lady Bird Deeds. Against this backdrop here’s the full text of Rohan’s follow up comment, which I again highly recommend:

Your point is if decedent’s homestead is not protected homestead (as defined in s. 731.201(33), why not use a lady bird deed. It would appear from the Title Standards that is an acceptable procedure.

I believe Jerry Solkoff, Esq. is generally credited with having “invented” the lady bird deed, similar to Norman Dacey having “invented” the revocable living trust.

My concern with the validity of a lady bird deed, whether or not involving unprotected homestead, is two-fold.

First, as I alluded in my earlier e-mail, only one Florida case has ever involved the procedure known as an enhanced life estate deed and the facts were significantly different from the ordinary usage of that procedure. What has evolved is literally hundreds of thousands of documents involving real estate probably worth many billions of dollars that has no basis in Florida case law or statutes.

My usual reaction to a lawyer who makes a statement regarding existing law is to ask “what is your authority” and the answer in this instance is “none.”

My second concern relates to the fact that such a deed is a “will substitute.” 736.0403(2)(b) fla.Stat. provides in part:

“The testamentary aspects of a revocable trust, executed by a settlor who is a domiciliary of this state at the time of execution, are invalid unless the trust instrument is executed by the settlor with the formalities required for the execution of a will in this state.”

If I walks like a will and quacks like a will, it must conform to the statute of wills. The formalities for execution are different for execution of a will than they are for execution of a deed. Compare 732.502 Fla.Stat with 689.01 Fla.Stat.

Hence, in my opinion, it is uncertain whether an enhanced life estate deed “works” even for non-homestead real property. You might say “Well, just execute lady bird deeds with the formalities required for the execution of a will in this state.” There seems a lot of uncertainty there as well. Can a document that professes to be and states that it is a deed, then be construed as a will, regardless of the formalities of its execution.

My view is that there are just too many uncertainties with an enhanced life estate deed to make it a viable option.

If I’m preparing a document for a client that I’m not sure is valid to accomplish its intended purpose, as a lawyer I think I have the professional responsibility to so advise the client. I am certain that NEVER happens.

I’m certain that I stand among less than 1% of lawyers on this point.

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F.S. 46.021 tells us that “[n]o cause of action dies with the person. All causes of action survive and may be commenced, prosecuted, and defended [against the decedent’s estate].” However, how you go about prosecuting a case — and the length of time you have to file your lawsuit — changes dramatically after someone dies.

Before someone dies you usually only have to sue them in one courtroom and worry about one set of statute-of-limitations periods. After they’ve died you’ll now have to sue them in at least two separate court proceedings and worry about two distinct sets of statute-of-limitations periods: (a) whatever limitations period applies to your civil case under F.S. Ch. 95, and (b) the second set of ultra-short limitations periods applicable in probate proceedings under F.S. 733.702 and F.S. 733.710. Litigants who forget this dual-track gauntlet for cases involving deceased defendants do so at their peril.

Florida’s layered approach for probate limitations periods, and the dangers of the “unknown unknown”

You might ask yourself why we need two different limitations periods for probate proceedings. Answer: sections 733.702 and 733.710 serve two very different functions.

733.702 is a typical statute of limitations that gets triggered after a probate proceeding is actually commenced, and under 733.702(3) it can be extended “upon grounds of fraud, estoppel, or insufficient notice of the claims period.” Key point: no probate proceeding = no application of 733.702.

733.710 establishes a maximum two year filing deadline following a decedent’s death for all unsecured claims (e.g., all tort claims), regardless of whether or not a probate proceeding’s ever commenced, and it isn’t subject to extension on any of the equitable grounds applying to 733.702. Key point: no probate proceeding = 2-year filing deadline. (In fact, one very effective defensive maneuver is to simply wait two years before opening the probate proceeding, thereby automatically barring all unsecured creditor claims).

This kind of absolute filing deadline’s referred to as a “statute of repose” or “non-claim statute”. Because 733.710 applies even if there’s no probate proceeding (and thus no notice), it’s a classic example of the kind of “unknown unknown” that keeps litigators up at night. No matter how meritorious and just your cause might be, this non-claim statute could get your case tossed out of court. And because this limitations period’s buried deep in our probate code, your average civil litigator could be forgiven for never even knowing it exists. Yup, that’s a big unknown unknown.

Are casualty insurance claims exempt from 733.702? YES

Consider this common scenario: you’re driving a delivery truck and you harm someone in an accident because of your negligence. Usually, your casualty insurance policy will step in to compensate the person injured by your negligence. In other words, this insurance money goes to the victim, not the negligent driver or the negligent driver’s estate.

If an injured victim is suing the estate of the deceased negligent driver only to trigger his casualty insurance coverage, that lawsuit shouldn’t have an impact on the estate because you’re not going after any assets of the estate (the insurance money’s going to the victim not the estate). Against this backdrop 733.702(4)(b) tells us plaintiffs aren’t subject to the statute of limitations for probate claims if you’re only suing the decedent’s estate “to establish liability that is protected by the [decedent’s] casualty insurance,” and if your claim is limited exclusively to “the limits of [the decedent’s] casualty insurance protection only.”

Florida supreme court decides split among appellate courts

The question then becomes, are these same casualty insurance claims also exempt from 733.710, our two-year non-claim statute? There are all sorts of good reasons for why the answer to that question might be yes. And our appellate courts have split on the issue, some extending the exemption for casualty-insurance claims to 733.710, others not. Florida’s supreme court has now stepped in to resolve that split, ruling that casualty insurance claims are not exempt from 733.710. If you’re a probate attorney, this is a big deal.

Case Study

Tsuji v. Fleet, — So.3d —-, 2023 WL 4246120 (Fla. June 29, 2023)

This case involved a truck driver who injured two people in a car accident while he was on the job. The driver died a few weeks after the accident for reasons unrelated to the accident. According to the supreme court, more than three years later the victims sued the driver “for negligently operating the car,” and sued his employer “for vicarious liability under the doctrines of respondeat superior and dangerous instrumentality.” When the plaintiffs found out the driver had died they substituted in the driver’s estate and “reduced their request for damages against the estate to the limits of [the decedent’s] casualty insurance coverage.”

Are casualty insurance claims exempt from 733.710? NO

Again, there are all sorts of good reasons for why we have a line of appellate authority exempting these claims from our two-year non-claim statute. On the other hand, the statute itself is clear. F.S. 733.702(5) tells us: “Nothing in [section 733.702] shall extend the limitations period set forth in s. 733.710.” And does anything in 733.710 exempt these claims? Nope, so saith the Florida supreme court:

There are only two exceptions to this statute of repose or nonclaim. Subsection (2) provides that section 733.710(1) “shall not apply to a creditor who has filed a claim pursuant to s. 733.702 within 2 years after the person’s death, and whose claim has not been paid or otherwise disposed of pursuant to s. 733.705.” § 733.710(2), Fla. Stat. And subsection (3) provides that section 733.710(1) “shall not affect the lien of any duly recorded mortgage or security interest or the lien of any person in possession of personal property or the right to foreclose and enforce the mortgage or lien.” § 733.710(3), Fla. Stat. Neither of these exceptions addresses casualty insurance.

When no exception applies, an untimely claim is “automatically barred.” Barnett Bank of Palm Beach Cnty. v. Estate of Read, 493 So. 2d 447, 448 (Fla. 1986). Section 733.710(1) is in that sense “a self-executing, absolute immunity to claims filed for the first time … more than 2 years after the death of the person whose estate is undergoing probate.” May, 771 So. 2d at 1156 (quoting Comerica, 673 So. 2d at 167).

If you’re a plaintiff and your plan is to sue an estate for one reason only — to trigger casualty insurance coverage — you’ll want to file your lawsuit before the more forgiving deadline under 733.702 is triggered. But if you blow that deadline, 733.702(4)(b) says you might get a pass under certain circumstances. But 733.710 tells us that pass only lasts for two years after the decedent’s death. Once that date rolls around you need to have filed your lawsuit (even if that means you open the probate proceeding just so you can sue the estate) or it’s game over — so saith the Florida supreme court.

Does this change really matter? Maybe not

Thank you to Naples probate attorney extraordinaire Laird Lile who pointed out to me that the court’s decision in Tsuji may not have the impact it once would have. Why? Because effective March 24, 2023, the statutory limitations period for all general negligence claims is cut in half from four years to two years under F.S. 95.11(4), which tracks the two-year statute of repose for probate claims under F.S. 733.710.

The negligence claim filed in Tsuji would have been subject to the new two-year limitations period if it had accrued after March 24, 2023, mooting the question of whether the two-year statute of repose for probate claims under F.S. 733.710 also applied. If your case is time barred under either statute, it doesn’t matter.

Here’s an excerpt from a Jimerson Birr blog post reporting on the new shorter limitations period for negligence claims:

For decades prior to the recent tort reform, the statute of limitations on negligence causes of action in Florida had been four years from when the cause of action accrued.  However, effective March 24, 2023, Fla. Stat. § 95.11, was amended to reduce the statute of limitations for negligence claims from four years down to only two years.  Fla. Stat. § 95.11(4)(a) (2023).  This generally means that a plaintiff that fails to file a lawsuit for negligence within two years of when the cause of action accrues, rather than four years, will be barred from bringing the suit under the new statute of limitations.

What Claims Does This Change Effect?

The change of the statute of limitations from four years to two years applies to general negligence claims.  General negligence claims encompass the vast majority of personal injury claims due to negligence, including by automobile accidents, slip and fall, etc., and also includes negligence claims for property damage.

However, the new shorter statute of limitations only applies to negligence claims which accrue after the effective date of the new statute, which is March 24, 2023. See H.B. 837 (“The amendments made by this act to s. 95.11, Florida Statutes, apply to causes of action accruing after the effective date of this act.”). “A cause of action accrues when the last element constituting the cause of action occurs.” Fla. Stat. § 95.031(1). A negligence cause of action generally accrues when the plaintiff is injured or suffers damages due to the act or omission of the defendant. See Dep’t of Transp. v. Soldovere, 519 So.2d 616 (Fla. 1988) (“A cause of action for the negligence of another accrues at the time the injury is first inflicted.”).

Accordingly, the new shorter two-year statute of limitations should be applicable to all general negligence claims where the plaintiff first suffered the injury or damages due to the defendant’s negligent conduct after March 24, 2023. Negligence causes of action accruing prior to March 24, 2023, should be under the prior law’s four-year statute of limitations for negligence claims.

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The same evidence that authorizes a probate judge to remove a personal representative nominated in your will could get her reversed on appeal for refusing to appoint this same person as personal representative at the outset. Same facts, same players, opposite legal results.

How is this possible?

Answer: there are dramatically different statutory criteria for the appointment and removal of personal representatives. Removal proceedings are governed by the broad scope of F.S. 733.504, disqualification-from-appointment proceedings are governed by the much narrower F.S. 733.303.

For example, if the nominated personal representative under your will has “conflicting or adverse interests against the estate that will or may interfere with the administration of the estate as a whole,” a probate judge is statutorily authorized to remove that person from office under F.S. 733.504(9). Unfortunately, as the 1st DCA told us over a decade ago in Werner and reminds us again in its recent Araguel opinion discussed below, this same conflict of interest doesn’t disqualify a nominated personal representative from getting appointed in the first place under F.S. 733.303. Same facts, same players, opposite legal results. That’s a problem.

Case Study

Araguel v. Bryan, — So.3d —-, 2022 WL 2712117 (Fla. 1st DCA July 13, 2022)

After holding a hearing on an objection to the appointment of the nominated personal representative under the decedent’s will, the trial court determined that there were “tangible and substantial reasons to believe that damage [would] accrue to the estate if [the nominated person] were appointed Personal Representative … because the facts presented display[ed] an adverse interest to the Estate.”

Based on this evidence the trial court entered an order denying the appointment of the nominated personal representative. It’s a sensible ruling. If these facts warrant removal, why expose the estate to harm by appointing the personal representative in the first place? Too bad this kind of common sense is contrary to state law. So saith the 1st DCA:

To the extent the trial court relied upon Schleider v. Estate of Schleider, 770 So. 2d 1252 (Fla. 4th DCA 2000), in concluding that it had discretion to deny the appointment of the person named in the decedent’s will, that reliance is misplaced because Schleider recognized a degree of discretion that is inconsistent with this court’s binding precedent. For instance, in Schleider, the Fourth District relied upon the dissenting opinion in Pontrello v. Estate of Kepler, 528 So. 2d 441, 445 (Fla. 2d DCA 1988) (Campbell, J., dissenting), for the proposition that the trial court may refuse to appoint a personal representative named in a will upon the basis of facts presented to the court at the time of appointment that—if presented after the appointment—would support removal of the personal representative. 770 So. 2d at 1254. However, this court in Werner recognized that there are different statutory criteria for the appointment and removal of personal representatives. 943 So. 2d at 1008; accord Pontrello, 528 So. 2d at 444 (“[S]ince the legislature has provided separate and distinct statutes to deal with the appointment of the personal representative, the terms of the removal statute should not be read into the explicit appointive statutes.”).

The appoint-then-remove solution

While the current state of the law may not be ideal, there’s nothing to be gained from simply ignoring it and wasting time and money on an appeal you’re likely to lose anyway. For example, as the 1st DCA itself noted in its Werner opinion, while a conflict of interest may not disqualify a named personal representative from getting appointed, there’s nothing stopping you from immediately seeking his removal post appointment:

We note that, to the extent that, on remand, there exists a legitimate concern about whether appellant has a conflict of interest, section 733.504(9), which lists causes for removal of a personal representative once appointed, includes as a ground “[h]olding or acquiring conflicting or adverse interests against the estate that will or may interfere with the administration of the estate as a whole.”

There’s gotta be a better way

The appoint-then-remove solution works legally, but as a practical matter it’s a hurdle that for many may be insurmountable. Estate proceedings are usually low budget, intra-family affairs. Procedural barriers that unnecessarily add expense and delay to an already emotionally charged court process are often outcome determinative. As in, families are left with an unjust result (e.g., a personal representative whose personal financial interests are in conflict with his fiduciary duties to the decedent’s heirs) simply because they can’t afford to pay for all the lawyering that’s needed to get to the just outcome. That may be “legal” but it’s not “right.”

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If you’re a Florida probate attorney, sooner or later you’re going to have to figure out if a will or trust that was perfectly valid and legal in some other state or country, works in Florida. It’s not a matter of if, but when.

Why? Because this state’s a magnet for people. Florida is the first choice for relocating retirees within the U.S., the largest recipient of domestic state-to-state migration within the U.S., the largest recipient of migrants to the mainland U.S. from Puerto Rico, and the largest recipient of international migration to the U.S.

Florida’s no exceptions, strict-compliance approach to execution formalities

Many new residents never get around to executing new Florida-law compliant estate planning documents. That’s a mistake.

Retirees from Colorado may be surprised to learn their wills don’t always work in Florida, same goes for all those retirees from Illinois with revocable trusts that pass muster back home, but fail once they’ve moved to Florida. And just because your will’s valid in Argentina, doesn’t make it so in Florida; same goes for that will you signed in Belgium.

All of these non-Florida wills and trusts failed not because they were the product of foul play or weren’t otherwise legally prepared back home, they simply didn’t comply with Florida’s exacting execution formalities. Scholars will tell you these process-oriented requirements serve four key functions: a cautionary function (causing testators to take their wills seriously); a protective function (shielding testators against bad actors at the time of execution); an evidentiary function (preserving a written record); and a channeling function (forcing testators to use standard will formats that are easily identified and understood by courts).

Many of these same scholars will also tell you Florida’s no exceptions, strict-compliance approach to these formalities outlived its usefulness long ago. For a good example of that school of thought you’ll want to read Wills Formalities in the Twenty-First Century, which deserves a prize for best ever opening line in a trusts and estates law journal article:

Testicle gripping had solemn significance in ancient pre-Roman times. When a man took an oath, the action’s importance was underscored by the equally memorable act of publicly holding either his own or another man’s genitals. In early Bavaria, a legally completed transfer of real property required the conveyor to hit a young boy on the side of the head. … Anecdotal evidence suggests that across cultures and time, some sort of ritual accompanies significant acts.

Case Study

Caveglia v. Heinen, — So.3d —-, 2023 WL 2395314 (Fla. 4th DCA March 08, 2023)

This case involved a Louisiana man who retired to Florida and later died a resident of this state. Back when he still lived in Louisiana the decedent executed a will in 2014 that all sides agree is also valid in Florida; he then executed a second will in 2015 revoking his 2014 will. The 2015 will, which was handwritten (holographic), wasn’t witnessed. This kind of un-witnessed handwritten will is perfectly legal and valid in Louisiana (and a lot of other states), not so in Florida. When the 2015 Will was challenged … it failed.

What’s interesting about this case isn’t the outcome, it’s the legal dots the Florida court connected in arriving at its final conclusion. For starters, the case for honoring the 2015 will was simple and compelling as a matter of fairness, which makes it especially dangerous because it’s the kind of argument any of us could easily fall into if we’re not careful. The focus here is on the decedent’s reasonable expectations based on his place of residence (domicile) at the time he executed his wills in 2014 and 2015:

Appellants contend that Louisiana law should determine whether the 2015 Will revoked the 2014 Will, since the decedent was domiciled in Louisiana when both wills were executed. They claim that the fact that the decedent moved to Florida in 2018 could not operate to “revive or resurrect” the 2014 Will that had been revoked under Louisiana law by the 2015 Will.

This argument would have worked if Florida had adopted section 2–506 of the Uniform Probate Code (UPC) (more on this point later). Unfortunately for the testator, we’re not there yet. Here’s why the Louisiana will failed.

First, it’s your domicile at death — not at the time you executed your will — that matters under Florida law.

Because a testamentary instrument’s validity is determined by the law of the state where the testator is domiciled at death, which in this case is Florida, the 2015 Will cannot be recognized as revoking the decedent’s 2014 Will. …

These principles are embodied in the Restatement. Restatement (Second) of Conflict of Laws § 263 (Am. L. Inst. 1971) provides:

(1) Whether a will transfers an interest in movables and the nature of the interest transferred are determined by the law that would be applied by the courts of the state where the testator was domiciled at the time of his death.

(2) These courts would usually apply their own local law in determining such questions.

(Emphasis added). With respect to revocation of a will, Restatement (First) of Conflict of Laws § 307 (Am. L. Inst. 1934) states:

Whether an act claimed to be a revocation of a will is effective to revoke it as a will of movables is determined by the law of the state in which the deceased was domiciled at the time of his death.

Second, no matter how valid or legally enforceable your handwritten (holographic) will might have been at the time it was made back home, if it’s not executed in strict compliance with Florida’s witness requirements — it’s going to fail in Florida. So saith the 4th DCA:

While Louisiana law permits holographic wills, Florida does not unless the instrument is witnessed with the same formalities as any will. Florida law expressly does not recognize holographic wills executed by non-residents. Section 732.502(2), Florida Statutes (2019), states:

Any will, other than a holographic or nuncupative will, executed by a nonresident of Florida, either before or after this law takes effect, is valid as a will in this state if valid under the laws of the state or country where the will was executed. A will in the testator’s handwriting that has been executed in accordance with subsection (1) shall not be considered a holographic will.

(Emphasis added). With respect to revocation, section 732.505(2), Florida Statutes (2019), provides that a will is revoked “[b]y a subsequent will, codicil, or other writing executed with the same formalities required for the execution of wills declaring the revocation.” Id. (emphasis added). Here, because the 2015 Will was not executed with the formalities of section 732.502(1), it cannot be probated as a will in Florida, nor can it act as a revoking document.

It doesn’t have to be this way

At the opposite end of the spectrum from Florida’s “gotcha” approach to non-Florida wills and trusts is section 2–506 of the Uniform Probate Code (UPC). According to the UPC, the “purpose of this section is to provide a wide opportunity for validation of expectations of testators.”

Florida’s economic growth and prosperity is due in large part to the wealth — both in financial and human capital terms — that the flow of new residents bring to this state every year. We owe it to these new residents to make sure their perfectly valid and legal estate planning documents don’t get wiped away simply by moving to Florida. Adopting UPC section 2-506 would go a long way towards making that happen.

The UPC’s approach would have validated all of the non-Florida wills and trusts noted above, including the Louisiana will rejected in the Caveglia case. Here’s what UPC section 2-506 would look like if adopted in Florida:

SECTION 2-506. CHOICE OF LAW AS TO EXECUTION. A written will is valid if executed in compliance with [F.S. 732.502(1)] or its execution complies with the law at the time of execution of the place where the will is executed, or of the law of the place where at the time of execution or at the time of death the testator is domiciled, has a place of abode, or is a national.

UPC Comment to Section 2-506

This section permits probate of wills in this state under certain conditions even if they are not executed in accordance with the formalities of [F.S. 732.502(1)]. Such wills must be in writing but otherwise are valid if they meet the requirements for execution of the law of the place where the will is executed (when it is executed in another state or country) or the law of testator’s domicile, abode or nationality at either the time of execution or at the time of death. Thus, if testator is domiciled in state 1 and executes a typed will merely by signing it without witnesses in state 2 while on vacation there, the court of this state would recognize the will as valid if the law of either state 1 or state 2 permits execution by signature alone. Or if a national of Mexico executes a written will in this state which does not meet the requirements of [F.S. 732.502(1)] but meets the requirements of Mexican law, the will would be recognized as validly executed under this section. The purpose of this section is to provide a wide opportunity for validation of expectations of testators.

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Oral (nuncupative) wills and un-witnessed handwritten (holographic) wills aren’t valid in Florida under any circumstances, no matter how strong the evidence is that they’re otherwise legitimate.

On the other hand, if a handwritten will’s properly witnessed it’s as valid as any other will. Yes, handwritten wills work in Florida — as long as they’re properly witnessed. The controlling statute is F.S. 732.502(2), which provides as follows:

Any will, other than a holographic or nuncupative will, executed by a nonresident of Florida, either before or after this law takes effect, is valid as a will in this state if valid under the laws of the state or country where the will was executed. A will in the testator’s handwriting that has been executed in accordance with subsection (1) shall not be considered a holographic will.

This is basic stuff for Florida probate practitioners. So do we really need an appellate decision to clarify this simple statute? Apparently we do.

Case Study

Morrow v. Morrow, — So.3d —-, 2023 WL 1807799 (Fla. 3d DCA February 8, 2023)

In this contested probate case the petitioner sought to probate a handwritten will that on its face complied with the execution formalities for a valid will under Florida law. The probate judge appears to have concluded that just because the will’s handwritten it’s not valid and struck the will. Wrong answer. Handwritten wills work in Florida as long as they’re properly witnessed. So saith the 3d DCA:

In these adversarial probate proceedings, appellant, Matthias Morrow, challenges an order striking the purported last will and testament of the decedent, Bunny Lee Morrow, as violative of section 732.502, Florida Statutes (2018). On appeal, appellant contends the trial court erred in striking the document without first conducting an evidentiary hearing. Upon appellee’s commendable confession of error and our own independent review of the record, we reverse. Although the will was handwritten, it reflected the signatures of the testator, two witnesses, and a notary, along with a notary seal. § 732.502(1), Fla. Stat. (“Every will must be in writing and executed as follows: … The testator must sign the will at the end …. The testator’s … [s]igning, or … [a]cknowledgment … [t]hat he or she has previously signed the will … must be in the presence of at least two attesting witnesses …. The attesting witnesses must sign the will in the presence of the testator and in the presence of each other.”); § 732.502(2), Fla. Stat. (“A will in the testator’s handwriting that has been executed in accordance with subsection (1) shall not be considered a holographic will.”). Consequently, it did not facially violate the Florida Probate Code. Accordingly, we reverse and remand for further proceedings.

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Article X, section 4(c) of the Florida Constitution consists of two operative sentences, each of which deals with a totally distinct facet of Florida homestead law. The first governs restrictions on the devise of homestead property, which is an issue we deal with all the time as probate practitioners. Here’s what that sentence says:

The homestead shall not be subject to devise if the owner is survived by spouse or minor child, except the homestead may be devised to the owner’s spouse if there be no minor child.

The second operative sentence governs how married couples can mortgage their homestead property, which is an issue real estate attorneys deal with all the time; probate lawyers not so much. Here’s what that second sentence says:

The owner of homestead real estate, joined by the spouse if married, may alienate the homestead by mortgage, sale or gift and, if married, may by deed transfer the title to an estate by the entirety with the spouse.

We run into trouble when the same homestead property gets tangled up in a dispute involving both of these constitutional protections (each of which is freighted with its own long and convoluted body of case law), which is what happened in the Feldman case.

Case Study

Feldman v. Schocket, — So.3d —-, 2022 WL 4360599 (Fla. 3d DCA September 21, 2022)

This case involved a $2+ million homestead property in the Florida Keys owned by a married woman. In 2015 she mortgaged the property twice. As explained by the 3d DCA, her husband signed two separate waivers to facilitate the mortgages:

Both mortgages contained identical waivers, providing, in relevant part: “Mortgagor, [husband], is joining in the execution of this mortgage for the sole purpose of waiving his or her homestead rights under Article X, Section 4 of the Florida Constitution, and shall not be bound by the terms, conditions or warranties contained in this instrument.”

The following year, in 2016, wife executed a will two days before her death containing an invalid devise of her homestead property.

After wife’s death surviving spouse executed a third waiver, which specifically referenced his testamentary homestead rights. The spousal waiver provided:

I, JEFFREY SCHOCKET, herby [sic] waive, any and all right, title, and interest I have in the property . . . . Specifically . . . any rights, title and/or interest that I may have to claim that the aforementioned property is exempt and/or excluded from my wife, Patricia M. Silver’s estate pursuant to Florida Statute §732.401 or Florida Statute §732.4015.

According to the surviving spouse, he “didn’t read the document” and “wasn’t aware of [his] rights or interest in the property at that time.”

When wife’s personal representative sought to take control of the homestead property surviving spouse objected, claiming the property for himself — in spite of his three signed homestead waivers. In an opinion that should be required reading for any probate practitioner navigating homestead issues (which is all of us), the 3d DCA ruled in favor of surviving spouse. He got the $2+ million house — in spite of his wife’s contrary will provisions and in spite of his three signed homestead waivers. Here’s why.

Is a homestead mortgage waiver the same as a homestead devise waiver? NO

Buried in the boilerplate of any mortgage on a Florida homestead property that’s owned by a married person is going to be some variation on the homestead waiver buried in the boilerplate of the two mortgages at issue in this case. Does that mean we should assume all homestead rights have been waived anytime homestead property’s mortgaged? Of course not.

If a waiver’s clearly intended only to facilitate a mortgage, it can’t be bootstrapped into a universal waiver of all spousal homestead rights. So saith the 3d DCA:

“In order to find that a survivor spouse has waived/relinquished homestead protection, evidence must demonstrate the survivor’s intent to waive the constitutional and statutory claim to homestead property.” Rutherford, 679 So. 2d at 331. In this context, waiver is statutorily circumscribed. …

[N]owhere do the mortgage waivers [in this case] reference the constitutional prohibition on devise in the event a decedent is survived by a spouse or minor child. Instead, by their plain language, the mortgage waivers were executed for a qualified purpose. Without [husband’s] signature, the mortgages would not constitute a valid lien on the property. See Pitts v. Pastore, 561 So. 2d 297, 301 (Fla. 2d DCA 1990). Thus, his signature was necessary to facilitate the constitutionally permissible purpose of “alienat[ing] the homestead by mortgage.” See art. X, § 4(c), Fla. Const.

Further, in Chames v. DeMayo, 972 So. 2d 850 (Fla. 2007), echoing the words of this court, Justice Cantero sagaciously cautioned against enforcing boilerplate homestead waivers buried within documents of other legal significance …

In this case, the qualified mortgage waivers were buried within documents of other legal significance. Under these circumstances, we conclude, as did the trial court, that the mortgage waivers are … insufficient to “evince an intent by [husband] to waive [his] homestead rights.” Rutherford, 679 So. 2d at 330.

Is a surviving spouse’s post-death waiver of invalidly devised homestead property legally enforceable? NO

OK, so the two mortgage-related waivers didn’t defeat surviving spouse’s claims to the homestead property. But what about the third waiver he signed, after his wife had died, which specifically referenced his testamentary homestead rights? Surely that sunk his claims? Nope. There are two reasons why this third waiver also failed.

First, F.S. 732.702 — the statute governing spousal waivers of testamentary homestead rights — does NOT apply post death. In other words, both spouses have to be alive for this kind of waiver to be legally enforceable. Because the third waiver in this case was signed after wife’s death, it’s not enforceable. So saith the 3d DCA:

[S]ection 732.702(1), Florida Statutes, anticipates that a party will contract with “a present or prospective spouse” or in anticipation of “separation, dissolution of marriage, or divorce.” The statute does not contemplate contracting with a deceased spouse. … [I]n placing their imprimatur upon waiver, courts have embraced the legal fiction that a waiver executed before or during marriage is the “legal equivalent of the prior death of the [spouse].” Jacobs v. Jacobs, 633 So. 2d 30, 32 (Fla. 5th DCA 1994) (quoting Wadsworth, 564 So. 2d at 635); see also In re Slawson’s Est., 41 So. 2d 324, 326 (Fla. 1949). This legal fiction removes the constitutional impediment to devising the homestead property. See Jacobs, 633 So. 2d at 32; Wadsworth, 564 So. 2d at 635. In the absence of a waiver, however, the property passes by operation of law to the surviving spouse upon the death of the decedent. See Rutherford, 679 So. 2d at 331. Here, because the mortgage waivers failed, Schocket’s property interest vested upon Silver’s death. Thus, the post-death spousal waiver was too little, too late.

Second, if homestead property’s invalidly devised, at the moment of death the property passes outside of probate and vests “in a twinkle of an eye” in the surviving spouse. So even if post-death homestead waivers under F.S. 732.702 were enforceable (they’re not), it doesn’t matter, what you’re really talking about at this stage of the game is a post-death disclaimer of an already inherited property right.

So if your post-death “fix” of a botched homestead devise involves the surviving spouse giving up his claims to the property, you need to make sure your deal complies with the strict requirements of F.S. 739.104(3) for a valid post-death disclaimer of inherited property rights. If you don’t nail these requirements, your deal’s going to unwind, as happened in this case. So saith the 3d DCA:

Feldman alternatively argues that the spousal waiver should be construed as a disclaimer. This argument fails on both procedural and substantive grounds.

Critically, the waiver is not statutorily compliant. It does not purport to be a disclaimer, it was not acknowledged before “a judge, clerk, or deputy clerk of any court; a United States commissioner or magistrate; or any notary public or civil-law notary of this state,” and it was not recorded. § 695.03(1), Fla. Stat.; see § 739.104(3), Fla. Stat.; § 695.26(1), Fla. Stat. (2022). The disclaimer statute makes no provision for partial compliance.

Notwithstanding these deficiencies, Feldman relies upon Youngelson v. Youngelson’s Estate, 114 So. 2d 642 (Fla. 3d DCA 1959), for the proposition that the spousal waiver is enforceable under our precedent. …

Although the holding in Youngelson remains undisturbed, the instant case is distinguishable. There was no post-death settlement here, and, perhaps more importantly, long after Youngelson was decided, the legislature exercised its prerogative to enact chapter 739 of the Florida Statutes. This statute now represents the exclusive means by which an individual may disclaim an interest in property. § 739.103, Fla. Stat. (2022) (“[T]his chapter is the exclusive means by which a disclaimer may be made under Florida law.”); see also Lee, 263 So. 3d at 827 (“The Florida legislature has codified the requirements for disclaimer of property in chapter 739, the Florida Uniform Disclaimer of Property Interests Act.”). Consequently, Youngelson cannot serve as a conduit for reviving a statutorily noncompliant disclaimer.