In re Estate of Felhofer (WI)

Summary: Property is classified as survivorship marital property when (1) there is a homestead acquired after the determination date, (2) the homestead must be "held exclusively between spouses" at the time it is acquired, and (3) there must be "no intent to the contrary" expressed in the instrument of transfer or in a marital property agreement.


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In re Estate of Felhofer, 2014 WI App 6, 352 Wis. 2d 380, 843 N.W.2d 57 (Wis. App. 2013).



Facts: Mary Lynch ("Felhofer") and Gregory Felhofer ("Decedent") purchased a vacant lot in Franklin, Wisconsin without counsel. The warranty deed for the property listed the grantees as “single persons.” A few days later, Felhofer and the Decedent closed on a construction loan to build a home on the property. While the home was still being constructed, Felhofer and the Decedent married. A few months after their marriage, The City of Franklin issued a Certificate of Completion/Occupancy. Felhofer and the Decedent then occupied the home until the Decedent’s death.

Decedent died intestate, and was survived by Felhofer and Decedent's three children from a previous marriage ("Felhofer Children"). In April 2011, Felhofer filed a Petition for Formal Administration, and the probate court appointed Felhofer as personal representative of the estate. Felhofer filed a Petition to Assign Home to Surviving Spouse, and following a hearing, the circuit court ordered assignment of the property to Felhofer.

In January, 2012, Felhofer filed an Inventory of the estate’s assets, but did not include the value of the property. The Felhofer Children filed an Objection to the Inventory because of the property’s omission, arguing that, because the property was purchased prior to the Felhofers’ marriage and neither retitled the property after the marriage, Felhofer and the Decedent owned the property as tenants in common. Therefore, the property was not survivorship marital property and was subject to probate administration. Felhofer countered, arguing that she and the Decedent acquired the property as a homestead after their marriage, which made the property survivorship martial property pursuant to Wis. Stat. § 766.605.

The circuit court found for Felhofer, reasoning that pursuant to Wis. Stat. §766.605, the couple did not “acquire” homestead until the City issued the occupancy permit for the residence. Because Felhofer and the Decedent acquired the homestead after their marriage, the property became survivorship martial property.

The Felhofer Children appealed.



Holding: Affirmed. On appeal, the appellate court stated that the statute's plain language classifies survivorship marital property as (1) a homestead acquired after the determination date, (2) the homestead must be "held exclusively between spouses" at the time it is acquired, and (3) there must be "no intent to the contrary" expressed in the instrument of transfer or in a marital property agreement. The Felhofer Children argue that the three elements were not established.

The court began by addressing the Felhofer Children’s argument that the Decedent and Felhofer acquired the property as a homestead before the determination date. The parties all agreed that the determination date was the date the couple married. The court held that §766.605 required the property to consist of a dwelling for use as a home before it was considered a homestead under the statute. Therefore, because the Decedent and Felhofer were married before construction was completed and the Certificate of Occupancy issued, the property did not become a homestead until after the determination date.

Next, the court addressed when the homestead was acquired and held exclusively between spouses. The Felhofer Children argued §766.605 did not apply, because the property was held by a warranty deed stating Decedent and Felhofer were “single persons.” The court disagreed, stating, because the Decedent and Felhofer could not live on the property until after they were married due to ongoing construction, the homestead was “held exclusively” between the Decedent and Felhofer as spouses “when acquired” (i.e., the date the Certificate of Occupancy was issued). Their “single persons” status when the lot was purchased was deemed irrelevant because only their status when they occupied the home was determinative.

The Felhofer Children also argued the warranty deed, as “the instrument of transfer,” set forth the intent to classify the property as something other than survivorship marital property. However, the court held that the term “single persons” failed to express any recognized real property classification, and as such was not sufficient evidence of Felhofer and the Decedent’s intent.

Finally, the court addressed the Felhofer Children’s argument that the circuit court’s order created an absurd result by making it “unduly difficult” for a party to hold and transfer their share of real estate, held in joint names with a spouse, to a party other than the spouse. The court disagreed, noting the Decedent had opportunity to clearly state his intentions to leave his one-half interest in the property to his children when he signed the warranty deed. He could have also stated his intentions in a martial property agreement, or could have asked Felhofer to sign off on a conveyance on his one-half interest to his children prior to his death. Further, the court surmised that the statute’s plain language bound them to their holding.


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By: ATG Underwriting Department | Posted on: Thu, 04/02/2015 - 12:38pm