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Unwed Couples’ Property Rights And In-Law Apartments

On Behalf of | May 4, 2015 | Divorce & Family, Real Estate Law

Unwed couples may live together for many years, have children together, and share property. It could be that one or both of them had a divorce in the past, are widowed, or one of them may receive more benefits from a prior spouse’s retirement plan, pension, or other benefits so long as he or she does not remarry. However, upon a breakup, no matter how long they live together they will not have the same rights to a property division as married couples.

New Hampshire does not recognize common law marriage, except for the limited exception provided under New Hampshire Statute RSA 457:39 which only apply to people’s cohabitating, acknowledging each other as husband and wife, and reputed to be such for three years until the decease of one of them. In other words, the common law spouse statute in New Hampshire only applies to the right for one to claim a spousal share to the estate of the deceased partner. It has nothing to do with a break up between domestic partners. Further, the common law statute only applies to the probate estate of the deceased. For example, if the deceased domestic partner has a local adult daughter with whom he kept his bank accounts and real estate in joint tenants with rights of survivorship or otherwise set up such to be automatically transferred to the daughter upon his death, those assets would not be probate assets since they did not stay in his name after his death and therefore, his domestic partner, even if she was the common law spouse, would have no right to claim an interest in those bank accounts and real estate unless she had a claim to those assets on her own and not solely as the common law spouse.

That statute requires the domestic partners to acknowledge each other as husband and wife; it is not enough to merely cohabitate together. One could also imagine the sad situation of two widowed individuals living together in one of their homes and the homeowner moving into a nursing home for the last several months of his life with no chance of ever moving back home and thereafter passing away. The question would arise under the statute as to whether or not the domestic partner still living in the house would have any rights to the house since for the last six months they were not cohabitating, even through no fault of their own for three years, because one of them had to be in a nursing home. However if a domestic partner has provided an improvement in real estate it is possible that she may have some claim to the real estate even though her name in not on the deed. For example, Jill upon moving into Jack’s house, spends $100,000 of her own money to make improvements (remodeling kitchen, repairing roof, replacing windows, updates exterior of house, and further interior remodeling) that increases the value of the house by $100,000. Jack dies with the house solely in his name without them being married. If the Executor of Jack’s estate was to claim that she is entitled to sell the house without giving Jill any monetary benefit from the increased value of the house, there can be an argument made by Jill of a constructive trust or other such equitable claim wherein she would say that the heirs of Jack would be unjustly enriched by her contribution of $100,000 worth of improvements in Jack’s house if she was not paid. Those heirs may respond that for some period of time, Jill lived in Jack’s house rent free which provided her back value for her contribution and that Jill made a gift of those monies to Jack and therefore should not be able to get it back. All those issues would need to be resolved in Court. Jill’s $100,000 contribution, if it can show a direct monetary improvement in the house, could be considered differently than if she was on a monthly basis contributing towards a mortgage on Jack’s house with that amount being similar to what she might otherwise pay in rent to live elsewhere.

The same constructive trust arguments are possible in the area of in-law apartments. For example Jill and Jack own a home and decide to have Jill’s widowed mother move in and Jill’s mother uses her monies to create an in-law apartment with both the mother and the couple hoping that the relationship will work and keep Jill’s mother out of assisted living. The mother will need to appreciate that her daughter and son-in-law have their own lives and perhaps while the mother-in-law may enjoy short visits with her granddaughter she may not enjoy the grandchildren being in the same household. If the mother decides to move out after spending her money on the in-law apartment within the home, the mother may make a claim that her daughter and son-in-law would be unjustly enriched by the in-law apartment. That argument may have more merit to a judge if the daughter and son-in-law thereafter rented the in-law apartment to take in income. It is also possible that the daughter and son-in-law are unwilling to have anyone else in their household and therefore the in-law remains vacant. As such, the in-law apartment is not producing income and increases the property taxes the daughter and son-in-law have to pay on the house thereby not benefiting them until and unless they sell their home years later.

I have seen these realities in litigation and it may very well be tough for the mother to be able to get her money back if that living arrangement does not work out. With that said, I have seen others of these arrangements last for the years, keeping the mother out of assisted living for a substantial period of time because the daughter and son-in-law help her as part of the extended family. The mother should make sure that her finances allow for a contingency plan because the monies she spends on improvements on her daughter’s house may not easily be reimbursed if the arrangement does not work out and if she does not have enough money for a long-term care in an assisted living facility, she needs to consider that substantial risk. It is possible that the contributions she made to her daughter’s and son-in-law’s house may impact her Medicaid eligibility if she needs to go to a nursing home. She may also find, as with anything else, money buys options such as private pay nursing homes which may be more expensive but provide better care, visiting nurses to her apartment, or other long-term care solutions.

For more information regarding unwed couple breakups, please check out our archived radio program accessible also on our website in which Kevin Rauseo and I discuss that issue in detail in an April 28, 2015 radio program that you can listen to as a podcast directly from our website. The radio show is also available from the radio station’s website at www.wfea1370.com, click “Voices” and then “Law Matters”.

J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at [email protected].

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