Last month a Florida appellate court issued a homestead decision which held that a spouse’s signature on a standard warranty deed conveying title to the couple’s homestead effectively waives the spouse’s post-death homestead rights. The case is important as it touches on a controversial issue of what constitutes a valid waiver of homestead rights in general.
The facts simplified were that a couple jointly owned a house. The spouses both signed a deed conveying title of the homestead to the wife. The wife’s will left a life estate in the house to the husband and a remainder interest (after the husband’s death) to the wife’s sister. The wife died first. After both spouses died the husband’s estate challenged the remainder interest to the wife’s sister on the grounds that absent a waiver of homestead rights by the husband a devise of less than fee simple interest to the sister would be invalid, and that since the wife had no descendants, the homestead should pass outright to Mitchell upon the wife’s death The wife’s estate argued that the husband waived homestead rights when he deeded the property to the wife during their lifetimes.
The court held that the transfer to the wife validly waived the husband’s homestead rights because of technical legal terminology in a standard warranty deed. Specifically, the warranty deed which referred to “all hereditaments” effected a transfer of all interests in the property capable of being inherited. Therefore, the conveyance of all hereditaments to the wife was a waiver of post-death homestead rights.
This case did not deal directly with homestead asset protection. Still, the case is important for asset protection because it found there was a valid waiver of homestead rights by legal mistake or “gotcha” provision. Other cases have previously held that waivers of homestead must be informed and intentional. This decision seems to retreat from the strict requirements of a knowing waivers of homestead, and it opens the door to creditor arguments that spouses may inadvertently lose including creditor protection by warranty deeds executed as part of basic estate planning. Habeeb v. Linder 2011 WL 613392