McKean v. Warburton

• Decision Date: 08 September 2005
• Docket Number: No. SC04-1243.,SC04-1243.
• Citation: 919 So.2d 341
• Parties: Thomas McKEAN, et al., Petitioners, v. Peter WARBURTON, Respondent.
• Court: Florida Supreme Court

Page 341

919 So.2d 341

Thomas McKEAN, et al., Petitioners, v. Peter WARBURTON, Respondent.

No. SC04-1243.

Supreme Court of Florida.

September 8, 2005.

As Revised on Denial of Rehearing January 5, 2006.

Bruce D. Barkett of Collins, Brown, Caldwell, Barkett and Garavaglia, Chartered, Vero Beach, FL, for Petitioner.

Troy B. Hafner, LL.M of Gould, Cooksey, Fennell, O'Neill, Marine, Carter and Hafner, P.A., Vero Beach, FL, for Respondent.

Robert W. Goldman of Goldman Felcoski and Stone, P.A., Naples, Florida and John W. Little, III of Brigham and Moore, LLP, West Palm Beach, Florida on behalf of Real Property Probate and Trust Law Section of The Florida Bar, as Amicus Curiae.

QUINCE, J.

We have for review a decision of the Fourth District Court of Appeal which certified the following question to be of great public importance:

WHERE A DECEDENT IS NOT SURVIVED BY A SPOUSE OR ANY MINOR CHILDREN, DOES DECEDENT'S HOMESTEAD PROPERTY, WHEN NOT SPECIFICALLY DEVISED, PASS TO GENERAL DEVISEES BEFORE RESIDUARY DEVISEES IN ACCORDANCE WITH SECTION 733.805, FLORIDA STATUTES?

Warburton v. McKean, 877 So.2d 50, 53 (Fla. 4th DCA 2004). We have jurisdiction. See art. V, § 3(b)(4), Fla. Const. For the reasons discussed below, we answer the certified question in the negative, and hold that where a decedent is not survived by a spouse or minor children, the decedent's homestead property passes to the residuary devisees, not the general devisees, unless there is a specific testamentary disposition ordering the property to be sold and the proceeds made a part of the general estate.

FACTS

Henry Pratt McKean II died testate and was not survived by a spouse or minor child. When he died, McKean owned a condominium which was his homestead. The condominium was sold and netted $141,000. McKean also had nominal assets valued at approximately $10,000. The estate's liabilities amounted to $14,000, plus personal representative's fees and attorney's fees.

McKean's will states in pertinent part as follows:

ARTICLE III

I hereby give, devise and bequeath the following amounts of money to the following named individuals, per capita:

Russell Cappelen, Jr. of Vero Beach, Florida. . . . . . . . . $ 20,000.00;

and

Peter Warburton of Hamilton, Massachusetts. . . . . . . . . . $150,000.00.

ARTICLE IV

I hereby give, devise and bequeath the automobile which I own at the time of my death to Glenn Van Hest of Vero Beach, Florida.

ARTICLE V

I hereby give, devise and bequeath to my half-brother ROBERT McKEAN, all of the oil interest I own and royalties due me in Exxon Well, Webster Field.

. . . .

ARTICLE VII

All the rest, residue and remainder of my property which I may own at the time of my death, real, personal or mixed, tangible or intangible, of whatsoever nature and wheresoever situate, including all property which I may acquire or be given title to after the execution of this Will, including all lapsed legacies and devises or gifts made by this Will which fail for any reason, including all insurance(s) on my life payable to my estate or receivable by my Personal Representative, and including any property over or concerning which I may have any power of appointment, I give, devise and bequeath to my half-brothers, THOMAS McKEAN, JOHN W. McKEAN, ROBERT McKEAN and DAVID McKEAN, in equal shares, share and share alike, per stirpes.

Absent the homestead proceeds, the estate assets are insufficient to satisfy any creditor's claims and the cash bequests. Peter Warburton, McKean's nephew, argues that the assets from the homestead property should be used to fund the cash gift to him, free from creditor's claims, as preresiduary property. McKean's half brothers argue that the homestead property passes through the residuary clause of the will to them.

LAW AND ANALYSIS

The issue before this Court is who is entitled to homestead property that is not specifically devised in a testator's will when the testator does not have a surviving spouse or minor children.¹ Although section 731.201, Florida Statutes (2004), does not define homestead, it defines "protected homestead" as that property described in the Florida Constitution "on which at the death of the owner the exemption inures to the owner's surviving spouse or heirs." § 731.201(29), Fla. Stat. (2004). The Florida Constitution² defines and protects homesteads in three distinct ways: it provides homesteads with an exemption from taxes; it protects homesteads from forced sale by creditors; and it places certain restrictions on a homestead owner from alienating or devising the homestead property. See Snyder v. Davis, 699 So.2d 999, 1001 (Fla.1997). The public policy furthered by a homestead exemption is to "promote the stability and welfare of the state by securing to the householder a home, so that the homeowner and his or her heirs may live beyond the reach of financial misfortune and the demands of creditors who have given credit under such law." Public Health Trust v. Lopez, 531 So.2d 946, 948 (Fla. 1988). To that end, issues of homestead protections have been interpreted broadly by the courts. See Snyder, 699 So.2d at 1002; Tramel v. Stewart, 697 So.2d 821 (Fla.1997) (liberally construing the homestead provision in the face of an attempted forfeiture action against homestead property). It is with these policy considerations that we consider the issue in this case.

The parties agree that McKean's property was protected homestead property. Because McKean had no surviving spouse or minor child at the time of his death, the devise of his homestead property to certain family members was protected from creditors. See Snyder v. Davis, 699 So.2d 999, 1005 (Fla.1997). Florida's intestacy statute, section 732.103, Florida Statutes (2004), includes the following family members: the surviving spouse, the lineal descendants, the decedent's mother or father or both, the decedent's brothers and sisters, and then the descendents of the brothers and sisters. Petitioners are McKean's half brothers. Section 732.105, Florida Statutes (2004), provides:

When property descends to the collateral kindred of the intestate and part of the collateral kindred are of the whole blood to the intestate and the other part of the half blood, those of the half blood shall inherit only half as much as those of the whole blood; but if all of the half blood they shall have whole parts.

Thus, McKean's half brothers and his nephew are "heirs" pursuant to Florida's intestacy statute.

It is an elementary principle that a person can dispose of his or her property by will as he or she pleases so long as that person's intent is not contrary to any principle of law or public policy. See, e.g., Mosgrove v. Mach, 133 Fla. 459, 182 So. 786, 790-91 (1938). Moreover, once the intent of the testator is ascertained, the entire will should be considered and construed liberally to effectuate the testator's intent. See Marshall v. Hewett, 156 Fla. 645, 24 So.2d 1, 2 (1945). The primary objective in construing a will is the intent of the testator. Id.

When McKean died, he had approximately $10,000 in assets, plus his homestead condominium. The condominium was sold and netted approximately $141,000.00.³ The estate's liabilities included funeral expenses, credit card debt, the personal representative's fees, and the attorney's fees. The $10,000 in assets was insufficient to settle the liabilities and the specific cash gifts. Warburton, one of the general devisees, seeks to have the $141,000.00 in proceeds from the sale of the homestead satisfy his cash gift, and as an "heir," he seeks to have the cash gift satisfied with protected homestead assets free from all creditor's claims. The Fourth District agreed with Warburton and considered the proceeds from the sale of the protected homestead as part of the general assets of the estate and available to satisfy specific and general devises under the will. Relying on section 733.805, Florida Statutes (2004),⁴ the Fourth District concluded that residuary gifts abate or fail before general or specific devises. It then applied the estate assets, including the $141,000, in accordance with section 733.805 and found that the residuary gift abated or failed.

While it is true that a decedent may devise protected homestead property in his or her will if there is no surviving spouse or minor child, the property may only pass as a general asset of the estate by a specific devise. In the absence of a specific devise, the property may pass through the residuary, which is a sufficiently precise indicator of testamentary intent to pass protected homestead property. See Estate of Murphy, 340 So.2d 107 (Fla.1976) (finding that a specific devise of homestead property is preferred, but the general language of a residuary clause is a sufficiently precise indicator of testamentary intent). In this case, the will did not specifically devise the protected homestead property to Warburton, and therefore the homestead passed under the residuary clause to the four half brothers.

This result is consistent with Snyder v. Davis, 699 So.2d 999 (Fla.1997). In Snyder, the decedent left a will devising cash gifts to her children. In the residuary clause of her will, the decedent left the "rest, residue and remainder" of her property to her granddaughter, Kelli Snyder. Her only surviving child was Milo Snyder, Kelli Snyder's father. The personal representative attempted to sell the homestead property to satisfy the cash gift to Milo and creditors' claims and to pay the costs of administration. The personal representative argued that Kelli would not have qualified as an heir under the intestacy statute because Milo was first in line and would have been the sole taker of the protected homestead. The personal representative reasoned that Kelli should not be permitted to receive the homestead free from protection. The personal representative advocated the forced sale of the homestead to pay the general cash bequest to Milo. Guided by the...