Larman v. Larman
1999 WL 967684, 1999 OK 83, 991 P.2d 536 (1999)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
When a spouse places separate property into joint tenancy with the other spouse for a reason collateral to making a gift, such as to satisfy a lender's mortgage refinancing requirements, the rebuttable presumption of an interspousal gift is overcome, and the property retains its separate character.
Facts:
- Leslie Larman and Frankie Larman married in 1983.
- In 1993, Leslie inherited two properties, named Churchill and Luglena, from her deceased mother.
- Shortly after, Leslie sought to refinance the existing mortgages on both Churchill and Luglena to secure a lower interest rate.
- The lending institution informed Leslie that to qualify for the refinancing loan, title to both properties had to be held in the names of both spouses as joint tenants.
- Solely to meet this requirement, Leslie placed the deeds to Churchill and Luglena into joint tenancy with Frankie.
- Leslie never told Frankie that she intended to make a gift of the properties to him.
- Frankie testified that he was not aware he had an ownership interest in the properties until after the divorce proceedings began.
Procedural Posture:
- Leslie Larman filed for divorce from Frankie Larman in an Oklahoma trial court.
- The trial court issued a divorce decree which classified the 'Churchill' property as marital property and awarded it to the husband, while classifying the 'Luglena' property as the wife's separate property.
- The wife, as appellant, appealed the property division to the Court of Civil Appeals (COCA), an intermediate appellate court.
- The husband, as appellee, counter-appealed, challenging the trial court's classification of 'Luglena' as separate property.
- The Court of Civil Appeals reversed the trial court in part, holding that both the 'Churchill' and 'Luglena' properties were marital property.
- The wife petitioned the Supreme Court of Oklahoma for a writ of certiorari to review the COCA's decision classifying her inherited properties as marital assets.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does transferring a spouse's separately-owned, inherited real estate into joint tenancy with the other spouse for the sole purpose of refinancing mortgages convert the separate property into marital property?
Opinions:
Majority - Opala, J.
No. Placing separately-owned property into joint tenancy for a purpose clearly collateral to any intent to make a gift does not convert it into marital property. Oklahoma law presumes that when one spouse transfers their separate property into a joint tenancy with the other spouse, it is an interspousal gift. However, this presumption is rebuttable and can be overcome by clear and convincing evidence of a contrary intent. Here, the evidence is undisputed that the sole reason the wife, Leslie, placed her inherited properties into joint tenancy was to satisfy the lender's requirements for refinancing the mortgages. This constitutes a purpose collateral to any donative intent. The husband, Frankie, even confirmed that he was never told the transfer was a gift and was unaware of his name being on the deeds until the divorce. Because the wife has successfully rebutted the presumption of a gift, the burden shifts to the husband to prove a gift was intended, which he failed to do. Therefore, the Churchill and Luglena properties remain the wife's separate property.
Analysis:
This decision solidifies the principle that donative intent is the paramount element in determining whether a transfer of separate property to a marital joint tenancy constitutes a gift. It establishes a significant precedent that using a clear, documented business or financial necessity, such as a lender's requirement for refinancing, serves as powerful evidence to rebut the presumption of a gift. This ruling provides a shield for spouses who must commingle titles for practical reasons but do not intend to relinquish the separate character of their assets. Future cases will likely look to this decision to analyze whether the reason for a joint titling was truly 'collateral' or was, in fact, indicative of an intent to gift the property to the marital estate.
