Court Opinion

ID: 5796836
Source: CourtListenerOpinion
Date Created: 2022-01-12 18:20:02.823289+00
Date Added: 2024-06-11T08:42:26.762146
License: Public Domain

Moskowitz, J. (dissenting).
I would affirm. The reversal the majority propounds disregards completely centuries-old black letter law controlling joint ownership of property.
Pamela Richard with her then husband Adam Richard purchased a cooperative apartment in 1978. The stock certificate indicates that they took title to the co-op shares as “tenants with rights of survivorship.” They never changed the form of ownership of these co-op shares.
In December 1989, Pamela and Adam divorced via a separation agreement dated April 12, 1989. The separation agreement erroneously stated that Pamela and Adam owned the co-op shares as “tenants by the entirety” as opposed to joint tenants with rights of survivorship as the stock certificate reflects. The separation agreement provided that Pamela would have exclusive possession during the minority of her and Adam’s only child, Alexander, after which they would sell the apartment and split the proceeds. The separation agreement became incorporated into the parties’ judgment of divorce that provided for the distribution of the marital property pursuant to the separation agreement.
Some time later, Adam remarried. On September 23, 1999, Adam died. His will granted plaintiff, his widow, what he thought was his continued ownership interest in the apartment.
Once Alexander completed college, defendant and plaintiff entered into an agreement dated November 21, 2007, in which they agreed to sell the apartment and split the net proceeds. This agreement too assumed that defendant was the owner of only a one-half interest in the apartment and that plaintiff, by virtue of Adam’s will, was the beneficiary of his one-half interest.
In January 2008, plaintiff and defendant both entered into a contract to sell the apartment to a third party. However, prior *109to the closing, the managing agent of the co-op required an amendment to the contract of sale to omit plaintiff s name. Defendant subsequently contested plaintiffs legal interest in the apartment and its proceeds.
Plaintiff commenced this action seeking to enforce the separation agreement and the November 2007 contract between herself and defendant. Before issue was joined, plaintiff moved for an order substituting the estate as plaintiff for the purposes of enforcing the separation agreement. Defendant cross-moved for an order declaring that plaintiff was not entitled to share in the proceeds of the sale of the apartment. She also moved to rescind the November 2007 agreement because she was the sole owner of the apartment and had entered the November 2007 agreement under the mistaken assumption that she was not. The motion court directed that Michele was not entitled to share in the proceeds of the sale of the apartment because upon Adam’s death, defendant became the sole owner.
The estate has no property interest in the apartment because the separation agreement did not change the status of the property from a joint tenancy with right of survivorship. A “joint tenancy” is “a tenancy with two or more co-owners who take identical interests simultaneously by the same instrument and with the same right of possession” (Black’s Law Dictionary 1505 [8th ed 2004]). A “tenancy in common” is a “tenancy by two or more persons, in equal or unequal undivided shares, each person having an equal right to possess the whole property but no right of survivorship” (id. at 1506). A joint tenancy differs from a tenancy in common because each joint tenant has a right of survivorship to the other’s share. Another form of joint property ownership is “tenancy by the entirety.” This type of property ownership is only available to a husband and wife. It is similar to joint tenancy because, upon the death of either husband or wife, the survivor automatically acquires title to the share of the deceased spouse (id. citing Robert Kratovil, Real Estate Law, at 198 [6th ed 1974]). Upon divorce, a tenancy by the entirety automatically converts to a tenancy in common (Matter of Violi, 65 NY2d 392, 395 [1985]).
However, defendant and Adam did not hold the shares in the apartment as tenants by the entirety, but rather as joint tenants with rights of survivorship. A joint tenancy with rights of survivorship does not convert to a tenancy in common upon the divorce of the parties. Thus, defendant and Adam’s divorce could not convert the form of ownership to a tenancy in common. Ac*110cordingly, once Adam died, defendant became the sole owner of the apartment.
I do not agree with the majority that the separation agreement’s mere expression of Adam and defendant’s mistaken belief that they held the co-op shares as tenants by the entirety changed the status of the property from a joint tenancy with right of survivorship to tenants in common or any other form of ownership. First, as the majority recognizes, prior to 1996 it would not have been legally possible for defendant and Adam to have held the co-op shares as tenants by the entirety. They entered the separation agreement in 1989. Accordingly, it is irrelevant that defendant and Adam thought they held the shares as tenants by the entirety. Nor would it have been possible for the parties to evince an intent in the separation agreement to hold the shares as tenants by the entirety, because to do so would have been a legal impossibility.
Nevertheless, even if they could have held the co-op shares as tenants by the entirety in 1989, “[a]s a general matter, title to estates in land should be altered only by clear expressions of intent” (Matter of Violi, 65 NY2d at 396). While General Obligations Law § 3-309 permits a husband and wife to “make partition or division of. . . real property held by them as tenants in common, joint tenants or tenants by the entireties,” the separation agreement at issue merely established the event that would trigger the time in the future to sell the property. The parties’ mistaken assumption that they held the property as tenants by the entirety is just that, a mistake. “There is no language in the agreement evincing an intent to alter the form of ownership.” (Violi at 396.) The separation agreement was therefore insufficient to satisfy the requirements of General Obligations Law § 3-309 to “make partition or division of. . . real property.”
Nor is defendant’s recognition in the November 2007 agreement that “Adam Richard . . . died owning the other one-half (V2) interest in said apartment” sufficient to change the form of ownership. Defendant’s adoption of that language in the 2007 agreement relied on the same mistaken assumption she made in the separation agreement, namely that she owned the property as a tenant by the entirety. Similarly, when Adam bestowed his one-half interest in the apartment to plaintiff, this was also based on the same mistaken assumption.
While this result may contradict the assumption of the parties, that assumption was based on a mistake that kept repeating itself with each step Adam and defendant took concerning *111the property. As the majority admits, “there is no direct assertion of intent to alter their joint tenancy.” But, a “direct assertion of intent” is precisely what is necessary to alter the form of ownership (Violi at 396). It remains that there was nothing Adam and defendant did, no action they took, to change the form of ownership of the shares to the apartment. For example, they could have changed the stock certificate to hold the co-op shares as tenants in common.
Respect for the form of property ownership and the concomitant public policy favoring certainty in title to real property dictate this result (see Violi, 65 NY2d at 396 [“(i)n reaching this conclusion, we are mindful also of a public policy favoring certainty in title to real property, both to protect bona fide purchasers and to avoid conflicts of ownership which may engender needless litigation”]).
Finally, contrary to the majority’s conclusion, it was correct for the motion court to rescind the November 2007 agreement between plaintiff and defendant to split the proceeds of the apartment. A contract entered into under mutual mistake of fact is voidable and subject to rescission (Matter of Gould v Board of Educ. of Sewanhaka Cent. High School Dist., 81 NY2d 446, 453 [1993]).
Buckley, McGuire and Acosta, JJ., concur with Saxe, J.P.; Moskowitz, J., dissents in a separate opinion.
Order and judgment (one paper), Supreme Court, New York County, entered December 2, 2008, reversed, on the law, without costs, the rescission of the agreement vacated, the complaint reinstated, and the matter remanded for further proceedings.