The Surviving Spouse in Same-Sex Marriages: A New Federal Approach in New York

Several foreign countries, eight states, and the District of Columbia now permit gay couples to marry.  Many gay couples who are New York domiciliaries have been married in these jurisdictions.  New York recognizes these marriages, granting these couples equal protection under state law.  As to federal law, these duly married couples have until now been denied the same protection under federal law. 

On 23 February 2011, the Obama administration took a new legal position with respect to the 1996 Defense of Marriage Act (DOMA), in effect granting federal legal protections to married gay couples.  Section 3 of DOMA states: “In determining the meaning of any Act of Congress, or of any ruling, regulation, or interpretation of the various administrative bureaus and agencies of the United States, the word ‘marriage’ means only a legal union between one man and one woman as husband and wife, and the word ‘spouse’ refers only to a person of the opposite sex who is a husband or a wife.”

The administration’s position does not go to the issue of whether same-sex couples should be allowed to marry.  Instead, the focus is on preventing federal discrimination against same-sex couples after they have been legally married.

Under this new approach, the burden of proof will now shift from a gay spouse or same-sex couple who challenges a federal statute to show that they are not prohibited under DOMA from making the claim and places the burden on the federal government to show that DOMA does not impermissibly discriminate against the gay spouse or couple.   

Courts will now apply a heightened standard of legal review to cases involving DOMA.  Since the passage of the law, courts have applied a legal standard of review called rational basis to all sexual orientation discrimination cases that concern federal issues.  For instance, same-sex couples who sought equal protection of the law under the Fifth Amendment (the Fourteenth Amendment’s equal protection clause applies to the states) were generally denied equal protection so long as the government could state a rational basis for the existence of DOMA.  The government almost always won a legal challenge under rational basis review because the challenger of DOMA had the burden to show that there was no legitimate purpose to the law and that the means used to enforce the law were not rationally related to its purpose. 

But moving forward, the government will no longer defend the law under rational basis review.  Instead, a heightened standard will used by the federal courts in cases involving DOMA.  Henceforth, the burden will fall on the government to show that the law is substantially related to an important government objective.  The government will base its position on the legislative record used to pass the law. 

One case that will be affected by this new position is Windsor v. United States, No. 1:10-cv-8435,  filed in U.S. District Court in the Southern District of New York on November 9, 2010.  In the complaint, the plaintiff Edith Windsor seeks “a refund of the estate tax levied on a married same-sex couple, which would not have applied to a married straight couple, and which consequently violates the United States Constitution.”  In 2007 Edith Windsor and Thea Spyer were married in Canada after an engagement lasting 40 years.  Two years later, Spyer passed away as a result of complications from a heart condition.

26 U.S.C. § 2056(a) permits an unlimited marital estate-tax deduction that allows property to pass from a decedent spouse’s estate to the surviving spouse free of the federal estate tax.  But because of DOMA, married same-sex couples are denied this marital estate-tax deduction that is enjoyed by every other married couple.

Both spouses had done extensive estate planning, each creating revocable trusts.  According to the complaint, Edith “in her capacity as executor of Thea’s estate, filed a Claim for Refund and Request for Abatement (Form 843) and a Disclosure Statement (Form 8275) with the IRS on April 7,2010, stating that Edie and Thea were lawfully married in Toronto, that New York State recognizes that marriage under local law, and that DOMA unconstitutionally discriminates on the basis of sexual orientation. As a result, Edie argued, Thea’s estate is entitled to the marital deduction and to a refund in the amount of $363,053.00.” (Windsor, at 19).

The IRS replied and denied the refund because “under DOMA ‘… the words [sic] “spouse” refers only to a person of the opposite sex who is a husband or a wife’. Section 2056 is inapplicable because the surviving spouse is not a spouse as defined by DOMA (Id.).”

But under the new Obama administration position, the federal government will no longer defend the legal position articulated by the IRS.  According to the letter from Attorney General Eric Holder to Speaker of the House John Boehner dated 23 February 2011, “heightened scrutiny is the appropriate standard of review and that, consistent with that standard, Section 3 of DOMA may not be constitutionally applied to same-sex couples whose marriages are legally recognized under state law.”

The net effect of the Holder memorandum is that the government will not file a motion to dismiss on or before March 11, 2011.  The case will move forward with the government still a party in the case, but the court will be instructed to apply a heightened standard to the case, and to remove Section 3 of DOMA as a barrier to possible recovery in this case.

If you would like to discuss your own personal situation with me, review your current Will, or put together an estate plan that is tailored for your needs, you can get a free 30-minute consultation simply by filling out this contact form. I will get back to you promptly.

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Mental Capacity and Marriage in New York, Part 2: Surviving the Surviving Spouse

In New York, a person is considered a surviving spouse even if the marriage is subsequently annulled or voided.  This is particularly problematic where a sham marriage has occurred, such as when a caregiver marries a person with known dementia.   Under the current law in New York, even if the marriage was annulled after the death of the mentally incompetent spouse, the surviving spouse may still claim his/her right of election against the estate.  This may have the effect of nullifying the decedent’s Will provisions or intestate distributions.

The issue is complicated in New York by the fact that there are several statutes that touch upon the issue of mental capacity and marriage.  Together they create a patchwork of referring statutes that nonetheless leave open the possibility that a surviving spouse from a voidable marriage may still take against the estate. 

Domestic Relations Law §7 provides that a marriage contracted between two people where one person “is incapable of consenting to a marriage for want of understanding” is deemed “void from the time its nullity is declared by a court of competent jurisdiction.”  In other words, such a marriage is voidable, that is, it remains valid until such time as a court declares it void.  When a court declares such a marriage void, then it has the effect of being void from its beginning.  Voidable marriages are distinguished in the law from void marriages, such as incestuous marriages.  These are considered void from the start, and require no judicial action to render them void. 

The Domestic Relations Law § 140 [c] provides that “[a]n action to annul a marriage on the ground that one of the parties thereto was a mentally ill person may be maintained at any time during the continuance of the mental illness, or, after the death of the mentally ill person in that condition, and during the life of the other party to the marriage, by any relative of the mentally ill person who has an interest to avoid the marriage”

Nevertheless,  EPTL 5-1.1-A defines a “surviving spouse” as having a right of election against the deceased spouse’s estate “unless it is established satisfactorily to the court having jurisdiction of the action or proceeding that: (1) A final decree or judgment of divorce, of annulment or declaring the nullity of a marriage (. . .) was in effect when the deceased spouse died,” or that in the instant case “(2) The marriage was void as incestuous under section five of the domestic relations law, bigamous under section six thereof, or a prohibited remarriage under section eight thereof ” (EPTL 5-1.2 [a]).  There are no provisions that address what happens to the surviving spouse’s right of election if the marriage is annulled by a court due to the diminished capacity of the deceased at the time of the marriage.

As Presiding Judge Prudenti noted in Campbell v Thomas (2010 NY Slip Op 02082 [2d Dept 2010],   “New York, however, does not yet have a statute specifically addressing a situation in which a person takes unfair advantage of an individual who clearly lacks the capacity to enter into a marriage by secretly marrying him or her for the purpose of obtaining a portion of his or her estate at the expense of his or her intended heirs. When a marriage to which one of the parties is incapable of consenting due to mental incapacity is not annulled until after the death of the nonconsenting party, a strict reading of the existing statutes requires that the other party be treated as a surviving spouse and afforded a right of election against the decedent’s estate, without regard to whether the marital relationship itself came about through an exercise of overreaching or undue influence by the surviving party. On this appeal, we have occasion to consider whether the surviving party may nonetheless be denied the right of election, based on the equitable principle that a court will not permit a party to profit from his or her own wrongdoing.”

In  Campbell v Thomas, New York’s Second Department addressed the issue of mental capacity with respect to sham marriages.   In February 2001 Nancy Thomas left for a well-deserved one-week vacation, leaving the care of her 72 year-old Alzheimer-suffering father Howard in the care of Nidia Colon whom Nancy hired.  Unbeknowst to Nancy, Nidia married Howard during Nancy’s vacation.  She then had valuable assets transferred into her name, specifically putting her name as joint owner of Howard’s $150,000 bank account, and naming herself as sole beneficiary of Howard’s New York City Teachers’ Retirement System account then valued at $147,000.

Howard Thomas died in August 2001.  In November 2001 Nancy and her brothers Christopher and Keith commenced an action in Supreme Court asking that the court declare Nidia’s marriage to Howard as null and void, as well as the subsequent transfer of assets.  In their pleadings, they alleged undue influence, conversion, and fraud and moved for summary judgment.  On October 1, 2004 the Supreme Court denied the plaintiffs’ motion for summary judgement.  The Thomas children appealed.

The Appellate Court for the Second Department heard the appeal and found that the Thomas children had succeeded in demonstrating that Howard “lacked the capacity to understand his actions before his marriage, and that his mental state only diminished thereafter” (Campbell v Thomas, 36 AD3d 576, 576 [2007]).  The court reversed the Supreme Court and granted the plaintiffs’ motion for summary judgment.  Further, the court sent back the matter to the Supreme Court “for the entry of a judgment declaring null and void (1) the marriage between the defendant Nidia Colon Thomas and the decedent Howard Nolan Thomas, (2) a change in beneficiary in Howard Nolan Thomas’ Teacher’s Retirement System of the City of New York account, and (3) a change in the ownership of Howard Nolan Thomas’ Citibank accounts” (id.).  The Supreme Court so ordered on June 21, 2007.  Nidia Colon Thomas appealed.

In her appeal, Nidia alleged  that, under the applicable statutes, even if the marriage had been annulled, she was still considered the surviving spouse.  As such, she was entitled to the spousal elective share of Howard’s estate.  Since the marriage to Howard had been annulled almost six years after his death, the strict application of the statutes in question would have resulted in Nidia having a claim to the greater of $50,000 or one-third of the net estate.

However, the court demurred from such a strict application of the statutes on the principles of equity and public policy, so that “(n)either in criminal nor in civil cases will the law allow a person to take advantage of his own wrong” (Diaz v United States, 223 US 442, 458 [1912], quoting Falk v United States, 15 App DC 446, 460 [1899]).  Due to her overreaching and undue influence in marrying Howard, the court denied Nidia the benefit of her marriage to Howard.  Through her conduct, the court found that she had forfeited any benefit that stemmed from her marriage so that she would not be unjustly enriched.

In my next installment, I will examine another case where the mental capacity of one spouse was the determining factor.  If you would like to discuss your own personal situation with me, you can get a free 30-minute consultation simply by filling out this contact form.   I will get back to you promptly.

I invite you to join my list of subscribers to this blog by clicking on “Sign me up!” under Email Subscription on the left-hand side of the page so that you can receive a notification when the next installment has been published.   Thank you.