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Home > Underwriting > Title News > Twenty-One Volume Eight

SERIES: Twenty-One VOLUME: Eight DATED: August, 2006


A recently decided Appellate Division case, In The Matter Of The Estate Of Lillian M. Mischler (Appellate Division, Third Department, decided June 22, 2006), the Appellate Court affirmed a Surrogate Court decision which denied the petitioner husband's claim against his decedent wife's estate which alleged that an outstanding mortgage on property held by them as tenants by the entirety should be satisfied out of the decedent's estate. The decision of the court is as follows:



Decedent died in October 2003 and was survived by petitioner, who was her second husband, and her three children from her prior marriage. During decedent's lifetime, she conveyed title to her various properties to both herself and petitioner as tenants by the entirety, including one upon which a mortgage had been taken out approximately two months before her death. Petitioner commenced this proceeding, by order to show cause . . ., claiming that this outstanding mortgage be satisfied out of decedent's estate. Surrogate's Court denied petitioner's request by concluding that the basis for his claim, EPTL 3-3.6 - the provision addressing when a beneficiary will take an inheritance subject to an encumbrance - was inapplicable. This appeal ensued.

The sole issue is whether decedent's will brings this mortgage on the property owned by decedent and petitioner as tenants by the entirety within the parameters of EPTL 3-3.6. The will provides as follows: . . . 'all of my legal debts and funeral expenses be paid as soon as may be practicable after my death, except that the payment of any debts secured by a mortgage or pledge of real or personal property may be postponed by the Executor or Executrix in his or her own discretion.'

With it established that in the tenancy by the entirety, a surviving spouse will take the entire estate when the other spouse dies, 'not because of any right of survivorship, but because that spouse remains seized of the whole' . . . the estate of the deceased spouse is not deemed to have an interest in the property . . . Since EPTL 3-3.6, by its express language, limits its applicability to property that 'is specifically disposed of by will or passes to a distributee' (EPTL 3-3.6 [2]), Surrogate's Court properly concluded that EPTL 3-3.6 is not applicable and that the language of decedent's will did not clearly express an intention otherwise.

Accordingly, petitioner was properly precluded from seeking the satisfaction of this outstanding mortgage from decedent's estate . . .

ORDERED that the order is affirmed, with one bill of costs."

  Copyright 2006 by Monroe Title Insurance Corporation