We Look Married, But Aren’t

HAROLD J BRUNWASSER V. ESTATE OF RHONDA SCHARF ET AL

WHAT HAPPENED Harold Brunwasser and Roni Scharf were long-term unmarried partners who, in 2017, bought an apartment at Murray Hill Mews, a co-op at 160 East 38th St. They had moved from New Jersey where they co-owned a condo apartment as joint tenants with right of survivorship, and they assumed that this designation would be recorded for their new co-op apartment. That didn’t happen, however, and the recording of the shares, stock certificate and proprietary lease was as Tenants by the Entirety. This was a mistake, as only married couples qualify for this form of ownership.

Then, in May 2021, Roni died. A few months later Roni’s sister was appointed as administrator of her estate. Although not married, Harold and Roni had arranged their affairs to insure that upon the death of either one, the other would inherit each other's principal assets. But because of co-op documents being incorrectly recorded as Tenants by the Entirety, Roni’s sister claimed that Roni’s share of the co-op apartment should go to the estate, rather than to Harold, because the stock and lease would be deemed to be held as tenants in common. Harold alleges that Roni had consistently expressed intense dislike for her sisters, and her intent was clear that they should not inherit anything from her. Because of this, Harold filed suit.

IN COURT The issue before the court was whether Harold owned the apartment outright as a surviving joint tenant or held only a 50% interest in the apartment as a tenant in common with the estate. The cooperative and its managing agent, as transfer agent, were named as defendants in the suit but took no position as to the underlying dispute and agreed to follow the court’s determination.

New York’s Estate Powers and Trust Law provides that a disposition of stock to persons who are not legally married but who are described as husband and wife or spouses creates a joint tenancy unless expressly declared to be a tenant in common. Harold argued that use of the phrase tenancy by the entirety should dictate the presumption that a joint tenancy was created. The estate argued that since the words “husband and wife” or “spouse” were not used on the documents, the presumption should be of a tenancy in common.

The general rule is that a disposition to two or more persons creates a tenancy in common unless expressly declared to be a joint tenant. The court agreed with the estate that the documents did not describe the co-owners as husband and wife, but noted that the presumption of a tenancy in common can be overcome by "clear and convincing evidence that decedent intended to create a joint tenancy rather than a tenancy in common, and that language manifesting such an intent was mistakenly omitted from the instrument of conveyance by the scrivener.” 

Harold submitted an affidavit from the attorney who represented them that he had made a mistake, believing that Harold and Roni were married. Had he known the true facts, he would have designated the title as joint tenants.  Harold also submitted evidence that other property the parties owned was held as joint tenants with right of survivorship. The court found that the burden was met in proving that the intent was to create a joint tenancy and ordered that the stock and lease should be reformed to reflect ownership as joint tenants. This meant that Harold owned a 100 percent interest in the apartment. Nevertheless, the estate has filed a notice of appeal. 

COUNSEL for Harold Brunwasser  MATTHEW WORNER; for the estate of Rhomda Scharf EDWARD GEWIRTZ Bronstein, Gewirtz & Grossman; for the co-op and management company ERIC KOLLE Kagan Lubic Lepper Finkelstein & Gold: Justice Paul A. Goetz

TAKEAWAY The failure to get proof of one fact – whether the parties were in fact married – has led to this ongoing 3 year contentious lawsuit and provided the opportunity for there to be a nasty intra family squabble over money.  While the cooperative or the managing agent suffered no liability here, it is a reminder that transfer agents must take care to verify key facts such as the marital status of the owners.  It is not difficult to foresee that a party may seek to hold a transfer agent liable for permitting parties to take title in a manner which is not proper. While it does not appear that the issue arose in this case, it is easy to see how the cooperative's flow of maintenance could be disrupted while the parties fought for years as to who is the rightful owner of the apartment.