Lance R. Pomerantz
Attorney at Law

Land     Title     Law

“Constructive Notice”  The  Newsletter

Excerpted from the November 25, 2011 mailing of "Constructive Notice":
New Precedent Re: JTWROS

For the first time in any New York appellate court, the Appellate Division, Second Department, recently decided whether the estate of a deceased joint tenant may sue a surviving joint tenant to recover one-half of payments made by the decedent for the purchase and upkeep of the property. Trotta v. Ollivier, 2011 NY Slip Op 8349, 2nd Dept., 2011 (decided Nov. 15, 2011) .

In 1992, Susan Leone and Charles Ollivier took title to the real estate as JTWROS. Between 1992 and 2008 Susan expended $226,500 from her own funds for acquisition, closing and construction costs, insurance, repairs, utilities and the like. She and Charles lived together for some period of time as an unmarried couple, until Charles “moved to another address.” Susan died unexpectedly in 2008 and Trotta was appointed executor of Susan’s estate. Trotta’s lawsuit alleged that Charles did not contribute to the purchase and carrying charges of the property or, if he ever did, his contributions were not equal to those of Susan. The lawsuit sought, inter alia, reimbursement from Charles for a just proportion of the monies expended by Susan, pursuant to RPAPL §1201. That section provides that "[a] joint tenant or a tenant in common of real property, or his executor or administrator, may maintain an action to recover his just proportion against his co-tenant who has received more than his own just proportion, or against his executor or administrator" (emphasis supplied).

The Court pointed out that Susan, while alive, sought neither a partition nor other severance of the JTWROS, nor an equitable adjustment of the expenditures. When she died, Charles became the sole owner of the premises. While the statute makes no mention of money, the Court held that the purpose of RPAPL §1201 is only to provide a right to recover monies (i.e. not “indirect benefits”) "received" by the co-tenant that exceed his or her proportionate share. “The statutory focus upon monies ‘received’ by the co-tenant, rather than upon expenses ‘paid’ by the tenant, suggests that the right of recovery is limited to rents and income generated by jointly held property. The absence of language in RPAPL [§]1201 extending the right of recovery to expenses ‘paid’ by a tenant beyond his or her equitable share means, under the doctrine of expressio unius est exclusio alterius, that the legislature, by inference, intentionally omitted or excluded joint tenant expenditures from the scope of the statute.”

Many unmarried couples acquire real estate as joint tenants to avoid succession problems following the death of one of the “partners.” While equitable apportionment of past expenditures is routine in the divorce context, an unmarried joint tenant should take steps to protect her investment following the dissolution of the relationship. At the very least she should understand the possible consequences of her failure to do so.