Borghi v. Gilroy

Owens, J.

¶21 (dissenting) — Citing a 1914 case, the lead opinion holds that the name or names on a deed have no impact on whether property is community or separate and thereby throws out settled law that Washington families have relied on for over 20 years. By rejecting the community titling presumption, the lead opinion provides little, if any, additional protection for families, but inevitably invalidates the choices that some spouses have made with regard to their property. This holding unnecessarily complicates the lives of Washington families, and I strongly dissent.

¶22 The community titling presumption simply states that when one spouse changes the title of separate property to list both members of the couple as owners, there is a rebuttable presumption that the spouse intended to change the property to community property. In re Marriage of Hurd, *49369 Wn. App. 38, 51-53, 848 P.2d 185 (1993). This presumption is solidly based in our precedent and protects families from inadvertent changes while giving legal effect to their decisions regarding their property. The rule’s basis in both law and common sense has led the majority of states to adopt the rebuttable presumption of community property in community titling situations. See Steinmann v. Steinmann, 2008 WI 43, ¶ 51, 309 Wis. 2d 29, 749 N.W.2d 145 (“ ‘The joint title gift presumption is presently recognized in a majority of American jurisdictions.’ ” (quoting Brett R. Turner, Equitable Distribution of Property § 5:43, at 476 (3d ed. 2005))). Because the presumption is rebuttable, families are still protected against inadvertent or fraudulent changes. If there is any evidence that the families did not intend to change the character of the property or that the title was changed due to fraud or duress, the presumption of community property can be rebutted.

¶23 The lead opinion contends that its rejection of the joint title presumption will not hinder spouses who intend to change separate property to community property, lead opinion at 488, but it absolutely does. Any layperson would reasonably think that retitling his or her separate property in the names of both spouses would cause that property to be jointly owned. It is eminently reasonable for both members of the couple to assume that jointly titled property is thus community property. But under the lead opinion’s new rule, families attempting to change the nature of their property by retitling their property will be unable to do so. Instead, families will be forced to use more complex legal forms, likely requiring legal counsel. While the lead opinion’s holding may not hinder those affluent families who are able to afford adequate legal assistance, those unable to afford legal counsel will now face unreasonable legal formalities that are counter to common sense. In a day where legal assistance is sadly out of reach for many working *494families,8 this new requirement unnecessarily hinders their ability to dispose of their property without engaging in complex legal formalities.

¶24 The lead opinion also fails to address how this new rule will apply to unmarried couples in committed, intimate relationships. If one partner in a committed, intimate relationship adds the other partner to the deed of his or her separate property, is the property not considered joint property? What happens to the partner added to the deed, who likely (and reasonably) believed he or she was a joint owner of the property? The idea that this change in title “tells us nothing,” lead opinion at 489, ignores the reality of how many families — particularly those without access to legal counsel — organize their property. As a result, the lead opinion refuses to give legal effect to those choices. This decision gives no recourse to those partners who relied on the belief that being added to the deed would provide some protection upon dissolution of a committed, intimate relationship. Instead, the lead opinion would tell those partners they have no legal rights because they did not fill out the correct set of forms. I cannot agree with this reasoning or result.

¶25 The community titling presumption is in line with our precedent, in particular Scott v. Currie, 7 Wn.2d 301, 308-09, 109 P.2d 526 (1941). In Scott, this court held that when a husband had purchased property with his separate funds and the property was put in his wife’s name, a rebuttable presumption arose that the property was a gift to the wife and therefore her separate property. Id. The community titling presumption applies this same principle to property put in the names of both spouses. By rejecting the community titling presumption, the lead opinion now calls into question this other area of law.

*495¶26 Further, the community titling presumption provides stability in the field of family law, as the community titling presumption announced in Hurd has been relied on by families, courts, and family law practitioners in Washington since being published in 1993. See, e.g., In re Marriage of McVay-Tackett, noted at 138 Wn. App. 1042, 2007 WL 1417297, at *5, 2007 Wash. App. LEXIS 1119, at *11; Moseley v. Mattila, noted at 127 Wn. App. 1027, 2005 WL 1178063, at *9-10, 2005 Wash. App. LEXIS 1039, at *26.

¶27 Contrary to the lead opinion’s assertion, In re Estate of Deschamps, 77 Wash. 514, 137 P. 1009 (1914), and Merritt v. Newkirk, 155 Wash. 517, 285 P. 442 (1930), do not stand for the proposition that a court cannot consider the name chosen to be listed on the deed when evaluating the character of the property. Instead, both of those cases indicate that the property’s title is not binding on the court as to the character of the property.

¶28 In Deschamps, the court noted that presumptions are rebuttable and that “courts will not be bound by the terms of the deed.” 77 Wash, at 518. The court held that the evidence indicated that the couple intended the property to remain the wife’s separate property, including the fact that in the wife’s will, she specifically left the apartment building to her daughter and that after his wife’s death, the husband’s behavior indicated that he did not regard the property as his. Id. at 514-16. Deschamps does not contradict a rebuttable presumption of community property because the evidence demonstrates that the parties did not intend for the property to be community property, even though they listed both spouses on the deed.

¶29 Unlike the couple in Deschamps, there is no evidence that the Borghis did not intend for the property to be community property. Quite the opposite, the evidence in this case demonstrates that the Borghis did intend the property to be community property. In re Estate of Borghi, 141 Wn. App. 294, 304, 169 P.3d 847 (2007); Clerk’s Papers (CP) at 130-31. The deed was issued in both of their names, *496and they accepted the deed when they jointly mortgaged the property. Borghi, 141 Wn. App. at 303-04; CP at 130-31. The lead opinion contends that the Borghis’ joint mortgage of the property is immaterial to the characterization of the property, but it is relevant to the extent that it indicates acceptance of the jointly titled deed by the Borghis.

¶30 The lead opinion’s reliance on Merritt, where the court dismissed the evidentiary value of a name mistakenly placed on a deed, is similarly misplaced. In Merritt, the property had been purchased with the wife’s separate funds and the deed was inadvertently put in the name of the husband. 155 Wash. at 520-21. As a result, the court held that the name on the deed was essentially irrelevant to the determination of whether the property is community or separate. Id. Certainly, a name that is listed on the deed as a result of an error is not entitled to be given any evidentiary weight. Id. Indeed, under the community titling presumption, the wife’s property in Merritt would remain the wife’s separate property because the presumption would be rebutted by the evidence that the husband’s name was put on the deed in error — another example of the community titling presumption’s built-in protection against inadvertent changes.

¶31 Actions have consequences, and listing your spouse on the deed to your property should result in a presumption that you want the property to be community property. The joint titling presumption is based on simple common sense, and Washington families have relied on it for over 20 years. Reversing this policy will unnecessarily complicate the field of family law and lead to unfortunate consequences for the many families unable to afford legal counsel.

¶32 I respectfully dissent from the lead opinion.

C. Johnson, Fairhurst, and J.M. Johnson, JJ, concur with Owens, J.

Reconsideration denied March 3, 2010.

Low income people in Washington are able to obtain legal assistance in family law matters only 30 percent of the time. See Task Force on Civil Justice Funding, Wash. State Supreme Court, The Washington State Civil Legal Needs Study (Sept. 2003), available at http://www.courts.wa.gov/newsinfo/content/taskforce/CivilLegal Needs.pdf (last visited Oct. 29, 2009).