Opinion ID: 1981972
Heading Depth: 1
Heading Rank: 2

Heading: The Rights of a Surviving Spouse

Text: Maryland Code (1974, 1989 Cum.Supp.), § 3-203 of the Estates and Trusts Article (ET) provides in pertinent part: (a) General.  Instead of property left to him by will, the surviving spouse may elect to take a one-third share of the net estate if there is also a surviving issue, or a one-half share of the net estate if there is no surviving issue. (b) Limitation.  The surviving spouse who makes this election may not take more than a one-half share of the net estate. It is settled law that a widow is entitled to no part of her husband's estate except that of which he died seized or possessed. Grove v. Frame, 285 Md. 691, 695, 402 A.2d 892 (1979), and cases therein cited at 695-696, 402 A.2d 892. As we have seen, the conveyancing here had the effect of reducing the size of Mr. Knell's estate at his death by excluding the real property. See ET § 1-301. Prior to 1970, our decisions dealing with the right of a husband to transfer his personal property recognized that he had this right provided that he relinquishes all dominion and control over the property during his lifetime. Grove at 696, 402 A.2d 892 (emphasis added). Almost 150 years ago, the Chancellor said in Hays v. Henry, 1 Md. Ch. 337 (1848), which was concerned with a house and lot subject to a ground rent: [T]here can be no doubt of [Hays's] power to dispose absolutely of this description of property during his life, independently of the concurrence, and exonerated from any claim of the wife, provided the transaction is not merely colorable, and be unattended with circumstances indicative of fraud upon the rights of the wife. If the disposition by the husband be bona fide, and no right is reserved to him, then, though made to defeat the claim of the wife, it will be good against her, because, as was observed in the argument, an act cannot be denounced as fraudulent which the law authorizes to be done. Id. at 338. But, the Chancellor added: [I]f it be a mere device or contrivance, by which the husband, not parting with the absolute dominion over the property during his life, seeks, at his death, to deny his widow that share of his personal estate which the law assigns to her, then it will be ineffectual against her. Id. at 339. Rabbitt v. Gaither, 67 Md. 94, 104-105, 8 A. 744 (1887), stated: [A] husband may alienate his personal property and his equitable interest in land, either by sale or gift, without the concurrence or assent of his wife, and if the transfer be absolute and unconditional, and without any reservation of interest in, or control over, the property to himself, and if the possession be parted with or delivered in pursuance of the conveyance, it is valid even though his intent and purpose in making it, may have been to deprive his wife of her dower or thirds therein, provided there be no fraudulent participation on the part of the grantee or donee in such intent or purpose. In fact, this power of the husband over such property, has been so long recognized by the courts, and so often exercised, as to have become not only a well-established principle of law, but a settled rule of property upon which a large number of titles depend. But on the other hand, if the transfer be colorable merely, that is to say, if it be a mere device or contrivance by which the husband does not part with the absolute dominion over the property during his life, but seeks thereby to defeat the claims of his widow at his death, the law pronounces it a fraud upon her rights, and this fraud may be proved and established by his retention of possession, during his life, by a reservation of an interest to himself on the face of the conveyance, or by an outside agreement or arrangement between him and his grantee or donee, to the effect that he shall receive the benefit of, or have control over, the property, during his life, or by any other fraudulent participation on the part of the grantee or donee to aid him in his purpose of defeating the rights which the law gives to his widow upon his death. We quoted Rabbitt in Grove 285 Md. at 696-697, 402 A.2d 892, and see cases cited in Grove at 697, 402 A.2d 892. This rule of law now applies to real property as well as to personal property. We pointed out in Grove: Prior to 1970, the test to determine whether there had been a fraud on a widow's marital rights applied to personalty only because the transfer of legal title to real property, without the wife's consent, did not destroy her right of dower upon her husband's death. Id. at 697, 402 A.2d 892. Judge Cole, speaking for the Court, said: However, when the General Assembly abolished the estates of dower and curtesy by Chapter 3, § 1 of the Laws of Maryland 1969, now Code (1974), § 3-202 of the Estates and Trusts Article, it effectively destroyed any valid distinction between the rights of a surviving spouse to share in the personalty or real property of the deceased spouse. Therefore the only manner in which a widow may now seek to set aside an inter vivos transfer of property made by her husband is by proof that he defrauded her by not absolutely and unconditionally relinquishing control over the property during his lifetime. In the absence of fraud, the only interest she can assert in lieu of taking under her husband's will is to a share of the property owned by her deceased husband at the time of his death [pursuant to Code, § 3-202 of the Estates and Trusts Article]. Id. In Allender v. Allender, 199 Md. 541, 550, 87 A.2d 608 (1952), quoted in Whittington v. Whittington, 205 Md. 1, 11, 106 A.2d 72 (1953), we said: The doctrine of fraud on marital rights represents an effort to balance the social and practical undesirability of restricting the free alienation of personal property against the desire to protect the legal share of a spouse. It has always been recognized that a husband, in the absence of statutory regulation like that in the case of dower, has an unqualified right to give away his personal property [and now, his real property] during his life time, even though the effect is to deprive the wife of her statutory share. But if the gift is not absolute and unconditional and the donor retains dominion and control over the property during his lifetime, the courts have held that the gift is colorable and may be set aside. See Shimp v. Huff, 315 Md. 624, 556 A.2d 252 (1989). It may be that [n]o general and completely satisfactory rule to determine the validity or invalidity of transfers alleged to be in fraud of marital rights has yet been evolved in this State. Whittington, 205 Md. at 14, 106 A.2d 72. See Klosiewski v. Slovan, 247 Md. 82, 88, 230 A.2d 285 (1967). But here, it is perfectly clear that Mr. Knell retained control of the property during his lifetime by establishing a life estate in himself with unfettered power in him, while living (except by will), to dispose of all interests in the property in fee simple. He did not part with the absolute dominion of the property during his life. His conveyance, through a straw man, of the remainder of the property was not complete, absolute, and unconditional. The law pronounces this to be a fraud on the marital rights of Mrs. Knell. His reluctance to relinquish control over the disposition of the property during his lifetime defeated his intention. JUDGMENT OF THE COURT OF SPECIAL APPEALS REVERSED; CASE REMANDED TO THAT COURT WITH DIRECTION TO REMAND THE CASE TO THE CIRCUIT COURT FOR KENT COUNTY WITH DIRECTION TO ENTER A JUDGMENT IN ACCORDANCE WITH THIS OPINION; COSTS IN THIS COURT AND IN THE COURT OF SPECIAL APPEALS TO BE PAID BY JESSE ANNABELLE PRICE.