Creditors who have a sizable claim against on spouse residing in Florida sometimes will assert creative theories to impose liability on the other spouse so in order to overcome tenants by entireties protection. When a judgment is against only one spouse the debtor spouse may protect all joint marital assets because marital assets are presumed to be owned as tenants by entireties, and entireties assets are immune from collection under Florida law.
One of my clients was sued outside of Florida by a former business partner for breach of a contract. The suit alleged that the client, a married man, had improperly received over $1 million of compensation from the business. The court entered a judgment against the husband. Thereafter, the creditor sought a judgment against the husband’s wife for the same amount of money because the wife received the benefit of the money . The creditor argued that because the husband deposited the funds in joint bank accounts the wife had benefitted equally from the husband’s breach of contract, and that the wife was liable to the creditor for “unjust enrichment” notwithstanding the fact that the wife was not involved in the business and had not signed any business agreements. The same court entered a separate judgment against the wife for the full amount of damages.
Actually, I believe either spouse still may protect their joint assets as tenants by entireties property. Even though the same creditor has judgments against both spouses for the same amount of money, the creditor does not possess a joint judgment. The court entered separate judgments against each spouse. Only a joint judgment against both spouses can overcome tenants by entireties protection.
The case illustrates that some creditors will use creative theories to anticipate tenants by entireties protection asserted by Florida debtors.
Last updated on May 22, 2020