Inherited property is generally characterized as separate property in a Washington divorce, but what if the spouse signs a quitclaim deed adding the other spouse to the title? The Washington Supreme Court has clarified that the joint title gift presumption does not apply when a court divides property in a divorce. The court must instead determine whether the spouse intended to convert the property to community property.
According to the opinion, the wife’s mother died the year after the parties married and left half her estate to the wife, some of which would be through future distributions. The wife inherited a 50% interest in a property in Arlington and the parties moved there.
In 2003, the parties started a horse breeding and training business. They decided to purchase property in Ford in 2005 with a loan secured by the Arlington property. The lender required the husband to be added to the Arlington property title. The wife executed a quitclaim deed conveying her interest to her husband and herself “to establish community property.” She did not remember signing the deed and said she had only done so because it was required by the loan. She claimed they only intended to keep the loan until they could sell the Arlington property. She testified she did not intend to convert it to community property.