The judicially created doctrine of “Tenants by the entireties” is one of the best protections for married couples against creditors but it does have certain limitations. In the early twentieth century the Supreme Court of Florida adopted a common law rule whereby property held by husband and wife that satisfy certain ownership criteria will be protected from creditors of either individual spouse. The characteristics of ownership necessary to create a tenancy by the entireties are:
- Unity of Possession (both husband and wife must have joint ownership and control of the property);
- Unity of Interest (both husband and wife must have the same type of ownership of the property and own it 50/50);
- Unity of Title (both husband and wife must have acquired ownership of the property by the same document of title);
- Unity of Time (both husband and wife must have acquired ownership at the same time);
- Survivorship (both husband and wife must have the right of survivorship and 100% ownership of the property should the other die); and
- Unity of Marriage (the property must have been acquired during the marriage of the husband and wife).
If all six (6) characteristics are met the Supreme Court of Florida has held that all qualifying property, whether real property (land) or personal property (everything else) is protected from individual creditors of either spouse. However, if all six (6) unities are met the burden of disproving the presumption tenants by the entries protects certain property shifts to the creditor or judgment holder to disprove.
Limitations of Tenants by the Entireties:
While the protections offered by tenants by the entireties against claims of creditors are great, they are not without limitation. Limitations include:
- The protection is not applicable to joint debts for which both husband and wife are liable;
- If you are divorced the property is stripped of any protection offered by tenants by the entireties; and
- If either party dies the protection is stripped. This is really only an issue when the debtor spouse survives the non-debtor spouse resulting in their 100% ownership of the property after death.
For more information about tenants by the entireties or assets protection please contact Matthew C. Bothwell, Esq. today for a FREE CONSULTATION. We are here to help.