THE FAMILY USE DOCTRINE IS ALIVE AND WELL

January 18, 2011 § 3 Comments

It is well settled in our jurisprudence that a gift to or inheritance by one of the parties during the marriage is separate property unless it loses its separate character through some act of the parties.  Title, for instance, may be changed from individual to joint.  Or separate funds may be commingled to the extent that they lose their separate character.  Or there may be investment of marital assets in the separate property so that the marital estate has a substantial stake in it. 

In 2000, the concept of the “family use doctrine” made its appearance in Mississippi in the case of Brame v. Brame, 98-CA-00502-COA, ¶20 (Miss. App. 2000), in which the husband’s clock, piano and dining set, all of which had been gifted to him took on a “new personna [sic] of full family use,” and was converted from separate into marital property.

In Rhodes v. Rhodes, decided by the court of appeals on January 11, 2011, the court found that a Florida vacation home purchased by the husband three years before the marriage was converted into marital property under the family use doctrine based on the facts that:  the wife engaged in “extensive efforts” in the property’s upkeep and maintenance; the wife “undertook efforts” to improve the property; the wife decorated the home on her own; the husband made payments on the home from his earnings through the marriage; the wife made contributions through deposits into a joint checking account; the wife contributed housekeeping efforts to the home; the wife and “her family” regularly vacationed and spent holidays there; the wife lived there for a considerable time and considered it her second home; and she and her daughter used it as a residence for “several months” after Hurricane Katrina.  Rhodes at ¶ 36.  The court held that as a result of the combination of factors, “the vacation home lost its character” as separate property of the husband.  Thus, as of January 2011, the family use doctrine is alive and well.

On the facts of this case, with the many factors apparently supported by the evidence, it’s hard to quibble with the outcome.  Most practitioners and trial judges grasp without any difficulty the equitable principles involved in finding a conversion from separate to marital when there has been financial investment of marital money and/or “sweat equity” in the property. 

What gives most of us at the trial level pause, though, is the concept that an item may be converted from separate to marital property simply because it is used in the marriage by the family. 

If I were a lawyer whose client just inherited a mortgage-free beach home in Gulf Shores and was concerned about the future of his marriage, would I not be wise to advise him under our current law: to prohibit any use of the property by his wife and children; and to pay all taxes and expenses of the property from entirely separate funds and not from any current income.  Or what if the wife inherits an antique Baldwin grand piano from her aunt, would she not be best advised to store it where neither the husband nor the children could touch it and possibly convert it into marital property, even though the daughter has considerable musical skills and would benefit from its use?     

Assuming I am correct about the above advice, how in the world does such a policy promote what is best for the family as a whole?  Policy and its consequences often have a strong influence on people’s actions.  Is this one of those unintended consequences we’ve talked about here before?

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