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Tuesday, December 08, 2009

2 WITNESS RULE FOR LEASES [FLORIDA]

In a recent Florida case, a landlord and tenant entered into a 10 year lease. Each signed the lease, but no witnesses signed. The landlord sought to void the lease because the signatures of the parties were not witnessed by two witnesses.

Fla.Stats. §689.01 reads in part "How real estate conveyed.--No estate or interest of freehold, or for a term of more than 1 year, or any uncertain interest of, in or out of any messuages, lands, tenements or hereditaments shall be created, made, granted, transferred or released in any other manner than by instrument in writing, signed in the presence of two subscribing witnesses by the party creating, making, granting, conveying, transferring or releasing such estate, interest, or term of more than 1 year, or by the party's lawfully authorized agent, unless by will and testament, or other testamentary appointment, duly made according to law; and no estate or interest, either of freehold, or of term of more than 1 year, or any uncertain interest of, in, to, or out of any messuages, lands, tenements or hereditaments, shall be assigned or surrendered unless it be by instrument signed in the presence of two subscribing witnesses by the party so assigning or surrendering, or by the party's lawfully authorized agent, or by the act and operation of law."

At first reading, there is no mention of a lease in the statute. However, since a lease is considered a transfer of an interest in land, the statute applies and leases for more than 1 year require two signatures.

The case does not make new law on this issue, but since it is a nonobvious issue, it bears mentioning, especially for those that don't practice regularly in the real estate area.

The case also held that the 2 witness requirement was not overridden by Fla.Stats. §608.4235, which authorizes a transfer of an interest in real property by a limited liability company on the signature of any member and makes no mention of required witnesses.

Skylake Insurance Agency, Inc. v. NMB Plaza, LLC, 3rd DCA, Case No. 3D07-454, October 28, 2009

3 comments:

Jeff Goethe said...

For estate planners and probate practitioners, the Estate of Wartels decision should come to mind where a leasehold cooperative is at issue. This form of ownership involves a lease and is codified in Chapter 719, Florida Statutes. Even though every real estate attorney I know says an interest in a leasehold cooperative is an interest in real estate, the Florida Supreme Court in 1979 said a 99 year lease is not an interest in land for purposes of the restrictions on devise in Article X, section 4. (In re Estate of Wartels) The Florida Supreme Court recently accepted jurisdiction, but then dismissed an appeal involving the Third DCA's request that Wartels be reviewed. (Philips v. Hirshon). Although bankruptcy courts and many state courts have applied Article X, section 4 in the context of exemption from creditor claims, many trial courts (and the 2nd DCA in a recent appeal I handled) hold that the exemption from creditor claims ends on the death of the owner and does not apply in the probate/creditor setting, despite the clear language of Article X, section 4(b) and the definition of "protected homestead" in the Probate Code. Under Wartels, it does not matter that the lease interest qualifies as real estate and homestead during the owner's lifetime, the lease term extending beyond the owner's lifetime is stripped of its protected homestead status. It is crucial to know if you are dealing with a leasehold at the planning and administration stages. Thanks for bringing the lease issue to everyone's attention.

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