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You Shoulda Put a ring on it!  – Estate Planning Advice for Lovers.

Issues related to joint ownership of property among non-married couples.

Determining ownership of property after the death of an individual can be tricky at best.  That trickiness can get downright complicated and expensive in the case of non-married individuals who own property jointly with another.  Here are a few examples of problems I have seen as an Estate Planning and Probate attorney.

Shared Property

In our first real life example, Peggy lived with John for over 20 years. They never officially married but did purchase property together.  Neither Peggy nor John had any children.  When John passed away suddenly from a heart attack, Peggy assumed the house would be hers since she and John had purchased it together.  In truth, Peggy retained only her interest in the property she owned, her one-half property interest.  John’s half of the property now belonged to his estate.  Eventually, we would find out that his entire estate would now go to his heirs which happened to be some cousins that Peggy had never met and John hadn’t seen in many years.  This is where we get the term “laughing heirs.”  These cousins received property even though they had no personal or emotional connection to John.

Had John and Peggy been married when they purchased the home together, it would have been considered community property.  Peggy would have received all of John’s interest in his community property rather than the laughing heirs.  If Peggy and John were adamant that they weren’t going to marry, they should have at least each created their own Last Will and Testament to ensure their property went where they intended.

Medical Care

Our second situation involves a medical emergency.  Jake and Laura had been dating and now living together for several years.  Laura ended up in a bad car accident where Jake was driving.  Truthfully, it was just an accident.  However, Laura’s family blamed Jake for the accident.  Even though Jake had been living with Laura for several years, he had no official rights to be with her while she recovered.  The family told the hospital staff that Jake was not allowed near their daughter.  There was nothing Jake could do at that point.  Had Jake and Laura been married, Jake would have been able to step in and care for Laura.  In the case where you don’t have a spouse, it is important to designate a Medical Power of Attorney to assist in decision making.  Had Laura named Jake on the Medical Power of Attorney, he would have been allowed to see her and assist in her recovery regardless of marital status.

Common Law Marriage

In our third and final example, I want to talk about informal marriage, or as most of us say it “common-law marriage.”  In Texas, an informal marriage is just as enforceable as a standard marriage.  However, it is proving that informal marriage that often is the problem.  I have seen several situations where the battle begins at the funeral home.  Let’s use the example of Mike and Molly.  Mike and Molly had both been through marriages and divorces before.  They were both shy about taking the plunge into marriage again and decided they didn’t want to go through official ceremonies.  When Mike passed away suddenly from a heart attack, his kids stepped in and began to take control of the funeral planning.  Molly stepped in and stated that she should be allowed to determine how to deal with Mike’s remains as they had talked about it for years.  She was, after all, his wife.  The children disputed the claim stating that Mike never mentioned a marriage and demanded to see a marriage license.  Molly explained that they were married informally and that only their closest friends were told.  The funeral home in this case decided that they could do nothing, except wait for the parties to work it out.  Meanwhile, they began charging the estate for every day that there was not a resolution and they held Mike’s remains.  Both parties went to court trying to prove their side of the story.  While Mike and Molly may have chosen to be married, not having an official certificate left them fighting it out.  Mike and Molly could have avoided this by doing a simple declaration of informal marriage that they both signed or in the alternative having a form titled “Designation of Agent for Disposition of My Remains.”

To be clear, getting married doesn’t immediately fix all these situations.  While putting a ring on it may help in several situations, even married folks have issues that can arise when death and illness strikes.  The only way to ensure your loved ones are properly cared for or that your loved ones are able to properly care for you is to have a well thought out estate plan.  An estate plan will include all of the documents to allow the person you choose to both help with your care and receive your estate upon your death.