Property Exam Question: Same Sex Marriage Community Property in Texas

May 22nd, 2014

For this question, I teased together a fairly complicated fact pattern about two men who live in Texas, get married in New York, and hold property of various types in both a common law and community property regime. The students were asked to consider this question both in light of current law, and if the current law in Texas changes. I suspect we will see a lot of complicated property issues in the very near future, just as sketched out here. You can see the A+ answer here.

Instructions. You are a junior associate at a Houston, Texas law firm. Your senior partner recently told you about a complicated case involving a same-sex couple with property in Texas and New York City. She instructs you to write a memo of no more than 500 words, addressing five issues present in this case.

Three of the issues will be litigated in New York Courts. New York applies all modern property rules, as articulate in the Restatement (Third) of Property, and applies common law property rules for marital property. New York also recognizes same-sex marriages.

The final two issues will be litigated in Texas Courts. Texas applies all modern property rules, as articulated in the Restatement (Third) of Property, and applies community property rules for marital property. Presently, Texas has a constitutional amendment prohibiting same-sex marriages. However, you have been asked to address this issue both under current law, and if same-sex marriages will be recognized in Texas in the future.

On January 1, 2013 Carl acquired Blackacre, a property in Austin, Texas on an installment contract. The installment contract provided for the payment of $500 on the first of each month, for 120 months (10 years). If all payments are made on time, Carl would acquire Blackacre in fee simple on January 1, 2023.

On January 2, 2013, Domer acquired Whiteacre, a property in New York City. Domer owned Whiteacre in fee simple.

On January 1, 2014, Carl and Domer travelled to New York where the two men were married. New York law permits the celebration of same-sex marriages, and fully recognizes the property rights of same-sex married couples from other states. Carl and Domer did not sign a prenuptial agreement.

Shortly after their marriage on February 1, 2014, Carl and Domer purchased together Greenacre, a property in New York City, and titled it as a tenancy by the entirety. The couple immediately took up domicile on Greenacre.

On March 1, 2014, Carl and Domer moved back to Austin, where they became domiciled on Blackacre. Carl executed a deed titling Blackacre as a joint tenancy between Carl and Domer. Prior to executing the deed, Carl and Domer agreed that they would each pay half of the monthly payments on the installment contract equally; Carl would pay $250 a month and Domer would pay $250 a month. Domer drew the checks from his personal bank account at the Monopoly Savings Bank in Staten Island, New York. Both Carl and Domer made payments starting on March 1, 2014.

On April 1, 2014, Domer won the one million dollar ($1,000,000) lottery jackpot, and deposited that money in his personal bank account in New York.

The couple began to have marital problems. On January 1, 2015, Domer packed his bags at Blackacre, and flew back to New York, where he moved back onto Greenacre. Domer did not pay his share of the installment contract on January 1, 2015, or any month thereafter.

On January 2, 2015, Carl called to reconcile, but Domer told him he should stay in Texas. Domer then placed a lock on the front gate of Greenacre. Carl never traveled to New York to see Domer.

On February 1, 2015, Domer executes a lease to the back half of Greenacre to Fapu. The lease reads:

“The lease shall continue for and during the term of quiet enjoyment from February 1, 2015 for the sum of $1,000 a month. Fapu has the privilege of terminating this agreement at a date of his own choice.

Unbeknownst to Domer, who wasn’t particularly observant, Fapu opens a convenience store on his half of Greenacre on March 1, 2015.

On June 1, 2015, Domer has a heart attack and suddenly dies. Domer did not leave anything in his will for Carl, but left everything to his daughter from a previous marriage, Edna. Domer’s estate is schedule for probate in New York on August 1, 2015.

On June 2, 2015. Carl learns about Domer’s death, and also learns about the lease of Fapu. Carl gives Fapu notice to vacate. Fapu refuses. Edna also gives notice to vacate. Fapu also refuses.

On June 3, 2015, Edna asserts an interest in Blackacre, based on contributions Domer made towards the installment contract (totaling $2,500).

On July 1, 2015, at the Houston Rodeo and Livestock Show, Carl is trampled in a tragic Mutton Bustin’ stampede, and dies the next day. Carl dies without a will. Carl’s only heir is his daughter, Aggie. Carl’s estate is schedule for probate in Austin, Texas on September 1, 2015.

In your memo, please address fully the following five issues.

1. Aggie, Carl’s daughter, challenges the estate of Domer in New York court. Aggie claims that on Domer’s death, Carl owned Greenacre in Fee Simple. Because her father died intestate, and Aggie is her father’s only heir, she should inherit Greenacre in fee simple. Aggie also claims an interest in the rent Fapu paid. Edna counterclaims that upon Domer’s return to New York on January 1, 2015, Carl no longer had any interest in Greenacre, and Aggie takes nothing. Does Aggie have an interest in Greenacre? What interest, if any, does Edna have?

2. Aggie also claims an interest in Whiteacre and Domer’s personal bank account in New York. Edna, the executor of Domer’s will, counterclaims that Domer did not leave anything to Carl, and thus Aggie inherited nothing. Does Aggie have any interest in Whiteacre or the personal bank account?

3. Aggie files suit to evict Fapu in New York court. Fapu counterclaims that Aggie cannot evict him. Can Aggie evict Fapu in New York? Could Enda evict Fapu?

4. Edna files suit claiming an interest in Blackacre, as she inherited all of her father’s assets. Under current law, Texas does not recognize the validity of same-sex marriages. Address this question under current law.

5. The Texas Supreme Court is currently considering a case that could invalidate Texas’s constitutional amendment prohibiting the ban of same-sex marriage. Please address the previous question in the event that Texas now recognizes same-sex marriage.