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Tenancy by the Entirety Extinguished When Both Husband and Wife Convey their Interests to Same Grantee, Who then Conveys His Interest Back to the Husband and Wife

Both the appellant and her husband had separately transferred their interests in property to the same grantee, defendant Feliciano.  Feliciano then mortgaged the property and executed a deed transferring 99% of the property back to appellant and her husband. Feliciano was alleged to have defaulted.  The appellant moved for summary judgment in the foreclosure action contending the tenancy by the entirety, created when she and her husband first bought the property, was never terminated.  In affirming the denial of appellant’s motion to dismiss, the Second Department wrote:

…[W]here a tenancy by the entirety is created, “there is nothing in New York law that prevents one of the co-owners from mortgaging or making an effective conveyance of his or her own interest in the tenancy . . . subject to the continuing rights of the other” …. “[T]he interest acquired by a grantee or mortgagee of such a unilateral conveyance is not denominated a tenancy by the entirety, but rather is labeled a tenancy in common”; however, “the grantee’s or mortgagee’s rights in the property are essentially the same as those possessed by the grantor or mortgagor: a right to shared possession and ownership subject to the original cotenants’ reciprocal rights of survivorship” … .  …[W]here, as here, the interests separately conveyed away by both spouses are unified in a single grantee, the tenancy by the entirety is extinguished by merger, since the sequence in which the grantors die will no longer affect the disposition of title …. “Separate conveyances by each tenant to the same grantee . . . terminate the tenancy by the entirety vesting the entire estate in that grantee” ….   Deutsche Bank Nation Trust Co v Feliciano, et al, 2013 NY Slip Op 02531, 2012-00130, Index No 18752/08, 2nd Dept, 4-17-13

 

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