A. Except for purchase-money mortgages and except as otherwise provided in this subsection, the spouses must join in all transfers, conveyances or mortgages or contracts to transfer, convey or mortgage any interest in community real property and separate real property owned by the spouses as cotenants in joint tenancy or tenancy in common. The spouses must join in all leases of community real property or separate real property owned by the spouses as cotenants in joint tenancy or tenancy in common if the initial term of the lease, together with any option or extension contained in the lease or provided for contemporaneously, exceeds five years or if the lease is for an indefinite term.
Any transfer, conveyance, mortgage or lease or contract to transfer, convey, mortgage or lease any interest in the community real property or in separate real property owned by the spouses as cotenants in joint tenancy or tenancy in common attempted to be made by either spouse alone in violation of the provisions of this section shall be void and of no effect, except that either spouse may transfer, convey, mortgage or lease directly to the other without the other joining therein.
Except as provided in this section, either spouse may transfer, convey, mortgage or lease separate real property without the other's joinder.
B. Nothing in this section shall affect the right of one of the spouses to transfer, convey, mortgage or lease or contract to transfer, convey, mortgage or lease any community real property or separate real property owned by the spouses as cotenants in joint tenancy or tenancy in common without the joinder of the other spouse, pursuant to a validly executed and recorded power of attorney as provided in Section 47-1-7 NMSA 1978. Nothing in this section shall affect the right of a spouse not joined in a transfer, conveyance, mortgage, lease or contract to validate an instrument at any time by a ratification in writing.
History: 1953 Comp., § 57-4A-7, enacted by Laws 1973, ch. 320, § 8; 1975, ch. 246, § 5; 1993, ch. 165, § 1.
Cross references. — For necessity of joinder of spouses in contracts of indemnity, see 40-3-4 NMSA 1978.
The 1993 amendment, effective June 18, 1993, made stylistic changes in Subsection A; and in Subsection B, substituted "47-1-7 NMSA 1978" for "70-1-6 NMSA 1953" at the end of the first sentence and added the second sentence.
Effect of transfer to partnership. — Once community property is contributed to a partnership, its status is not transmuted from community to separate or partnership property. Although the community no longer has a right to the specific piece of property the community still has an interest. The community merely trades its interest in the specific asset for a community interest in the partnership. Dotson v. Grice, 1982-NMSC-072, 98 N.M. 207, 647 P.2d 409.
Conflict between this section and 14-9-3 NMSA 1978 should be resolved in favor of the latter statute which protects the rights of innocent purchasers for value without notice of unrecorded instruments. Jeffers v. Martinez, 1979-NMSC-083, 93 N.M. 508, 601 P.2d 1204; Jeffers v. Doel, 1982-NMSC-116, 99 N.M. 351, 658 P.2d 426.
No limit on who may claim benefit. — This section is directed at the conveyance itself and not at the identity of the person claiming the conveyance is void. It contains no limitations regarding for whose benefit it may be used. C & L Lumber & Supply, Inc. v. Texas Am. Bank/Galeria, 1990-NMSC-056, 110 N.M. 291, 795 P.2d 502.
Husband and wife must join in all deeds and mortgages affecting community real property. Pickett v. Miller, 1966-NMSC-050, 76 N.M. 105, 412 P.2d 400.
"Join in" means "sign". — Under this section a contract for the sale of an interest in community real property, which has not been signed by both husband and wife, is unenforceable, void and of no effect absent a validly executed and recorded power of attorney, because the words "join in" as used in this section mean "sign". Hannah v. Tennant, 1979-NMSC-009, 92 N.M. 444, 589 P.2d 1035.
Neither husband nor wife can transfer real property without the other. — As the court construes the section by its plain terms at the present time, neither husband nor wife can make a transfer or conveyance of the real property of the community without the other joining in such conveyance or transfer, and if such transfer or conveyance is attempted of such real property of the community by either husband or wife alone, such transfer or conveyance is void, and of no effect. Marquez v. Marquez, 1973-NMSC-084, 85 N.M. 470, 513 P.2d 713.
Signatures of both spouses required. — Contracts to transfer an interest in community real property are void and of no effect unless signed by both husband and wife. Hannah v. Tennant, 1979-NMSC-009, 92 N.M. 444, 589 P.2d 1035.
Federal coal leases are real community property, and a husband cannot effectively convey them without his wife's signature. Padilla v. Roller, 1980-NMSC-037, 94 N.M. 234, 608 P.2d 1116.
Joining of both spouses. — If both spouses do not join, an attempt by one spouse to transfer, convey or mortgage community real property is void. Swink v. Sunwest Bank (In re Fingado), 113 Bankr. 37 (Bankr. D.N.M. 1990).
Section not applicable to executory contract to sell community. — The failure of seller's wife to sign does not render agreement void or unenforceable, but was sufficient where she was named in the agreement and was ready, willing and able to convey her community interest. This section, requiring the wife to sign deeds and mortgages affecting community property, has no application to an action for damages on the husband's executory contract for the sale of community realty, and it is immaterial whether the action is by the vendor or the vendee. Pickett v. Miller, 1966-NMSC-050, 76 N.M. 105, 412 P.2d 400.
Community contributions and improvements to separate property. — Community contributions and improvements to real property do not affect the title of separate ownership; the right of the community to be reimbursed for the amount of the lien does not change the character of the property from separate to community, and separate property may be conveyed by the owner without the joinder of a spouse. Hickey v. Griggs, 1987-NMSC-050, 106 N.M. 27, 738 P.2d 899.
No specific performance where wife not joined. — A contract purporting to sell community real estate would not be ordered to be specifically performed where the wife did not join in the husband's agreement to sell. Pickett v. Miller, 1966-NMSC-050, 76 N.M. 105, 412 P.2d 400.
Requirements to overcome presumption of fraud in community conveyance. — The burden was on husband's heirs to overcome the presumption of fraud in action to nullify conveyance of community property for fraud. They were required to show (a) payment of an adequate consideration; (b) full disclosure to the wife as to her rights and the value and extent of the community property; and (c) that the wife had competent and independent advice in conferring the benefits upon her husband. Trujillo v. Padilla, 1968-NMSC-090, 79 N.M. 245, 442 P.2d 203.
Invalidity of contract as affirmative defense. — A contract's invalidity under this section, which states that a contract to sell land held in joint tenancy by a husband and wife is void unless the wife either signs the contract or gives the husband a power of attorney to sell the land, is an affirmative defense which the defendant bears the burden of proving by showing that he made some effort to ascertain the existence of the power of attorney. Otero v. Buslee, 695 F.2d 1244 (10th Cir. 1982).
Spouse's failure to sign bank note did not preclude subsequent encumbrance. — Subsection A should not be construed to require both spouses to join in creating a community debt merely because a later judgment on the debt might encumber community real property. To the extent that New Mexico common law suggests otherwise, those decisions are overruled. Accordingly, the trial court did not err when it ordered the judicial sale of the spouse's residence to satisfy the creditor bank's judgment on note defaulted on by the husband individually. Huntington Nat'l Bank v. Sproul, 1993-NMSC-051, 116 N.M. 254, 861 P.2d 935.
Effect of one spouse's signature on promissory note can do no more than commit his separate property and his share of the community personal property to repayment of the obligation stated in the note because he is without power to encumber the community real property for its repayment without the other spouse's joinder. Shadden v. Shadden, 1979-NMCA-078, 93 N.M. 274, 599 P.2d 1071, cert. denied, 93 N.M. 172, 598 P.2d 215; overruled by Huntington Nat'l Bank v. Sproul, 1993-NMSC-051, 116 N.M. 254, 861 P.2d 935.
Regardless of the wording of a guaranty contract, unless his wife joins in the execution of the guaranty, a husband can only encumber his own separate property and his share of the community real property. First State Bank v. Muzio, 1983-NMSC-057, 100 N.M. 98, 666 P.2d 777, overruled by Huntington Nat'l Bank v. Sproul, 1993-NMSC-051, 116 N.M. 254, 861 P.2d 935.
Fraudulently executed promissory note. — Underlying obligation represented by a fraudulently executed promissory note was a separate debt of the wife, and the proceeds received did not benefit the community, where the wife committed fraud against her husband by allowing her brother to impersonate her husband and forge his name on financial documents. Beneficial Fin. Co. v. Alarcon, 1991-NMSC-074, 112 N.M. 420, 816 P.2d 489.
Aggrieved party's remedies limited where contract void for lack of spouse's signature. — Where an option contract to convey community property is void for lack of one spouse's signature, the aggrieved party may not obtain specific performance or damages for breach of contract. Sims v. Craig, 1981-NMSC-046, 96 N.M. 33, 627 P.2d 875.
Alternative remedies. — Where the aggrieved party may not sue on a contract to convey community property because it is void for failure to join one spouse, an action for negligent misrepresentation may be maintained. Sims v. Craig, 1981-NMSC-046, 96 N.M. 33, 627 P.2d 875.
Although misrepresentation of the legal status of property could be grounds for other theories of recovery than breach of contract, plaintiff could not maintain an action for damages on either a real estate exchange agreement or its addendum because they were void and unenforceable under this section. Arch, Ltd. v. Yu, 1988-NMSC-101, 108 N.M. 67, 766 P.2d 911.
Effect on after-acquired property. — An otherwise valid and fully enforceable real estate sales contract, executed by a single spouse, was not rendered wholly void under Subsection A because the asset later was acquired by the community. The contract was void as to after-acquired community property, but was valid as to the after-acquired real estate when it was transmuted and owned by the seller as his separate estate. English v. Sanchez, 1990-NMSC-064, 110 N.M. 343, 796 P.2d 236.
Section is inapplicable to conveyance of separate property. — Where husband and wife, prior to husband's death, entered into a sole and separate property agreement that transmuted the couple's community property to husband's separate property, and where husband then executed a reverse mortgage transaction on this separate property, which was assigned to plaintiff mortgage company, and where husband subsequently re-conveyed the property back to husband and wife, and where, after husband's death, plaintiff filed a complaint seeking a judgment foreclosing on its security interest in wife's property pursuant to the reverse mortgage, the district court erred in granting wife's motion for summary judgment on the basis that the reverse mortgage executed by husband was void because wife did not execute it as well, because the sole and separate property agreement transmuted the property into husband's separate property and he had authority to unilaterally grant a mortgage. The reverse mortgage was not void pursuant to this section. Nationstar Mort. LLC v. O'Malley, 2018-NMCA-029, cert. denied.
Community debt to be paid from community funds even after divorce. — A community debt incurred prior to the dissolution of the marital community, and for the benefit thereof, would properly be payable out of "community" funds notwithstanding the fact that such community property had been transmuted into separate property by virtue of a decree of divorce. Moucka v. Windham, 483 F.2d 914 (10th Cir. 1973).
Signatures on loan commitment, not on contract. — Without more, the signature of both spouses on a loan commitment is insufficient to overcome the affirmative defense that both spouses did not execute the actual contract conveying real property. Arch, Ltd. v. Yu, 1988-NMSC-101, 108 N.M. 67, 766 P.2d 911.
Where wife did not join mineral deed and evidence did not show separate purchase. — Where plaintiff claimed predecessor's prior mineral deed to another was void for failure of predecessor's wife to join in deed, the burden of the prior grantee of showing by preponderance of evidence that interest in question was purchased with separate funds and not community property was not met and deed was void. Mounsey v. Stahl, 1956-NMSC-110, 62 N.M. 135, 306 P.2d 258.
Easement agreement void where wives not joined. — Where 1918 agreement between married men purports to establish easement rights in community property without having their respective wives join therein is void under this section, use of such easement until 1959 is permissive. Batts v. Greer, 1963-NMSC-037, 71 N.M. 454, 379 P.2d 443.
Quitclaim deeds not proper where wife did not join agreement to sell. — Proposed agreement to shift the property lines of the parties executed by quitclaim deeds is clearly improper since both the husband and the wife must join in all deeds and mortgages affecting community real property and a contract purporting to sell community real estate will not be ordered specifically performed where the wife did not join the husband's agreement to sell. Sanchez v. Scott, 1973-NMSC-115, 85 N.M. 695, 516 P.2d 666.
Real estate listing agreement not transfer of community property. — A real estate listing agreement is not a transfer, conveyance, mortgage or contract to transfer, convey or mortgage community property within the meaning of this section. Execu-Systems v. Corlis, 1980-NMSC-121, 95 N.M. 145, 619 P.2d 821.
Husband's breach of listing agreement subjected community to debts without wife's concurrence. — The fact that, upon the breach of a real estate listing agreement by the husband, the listing agent can bring suit, obtain a judgment and levy on the property without the wife's signature on the agreement is not violative of this section, inasmuch as a husband can subject the community to certain debts without the concurrence of his wife. Execu-Systems v. Corlis, 1980-NMSC-121, 95 N.M. 145, 619 P.2d 821.
Presumption not rebutted. — The words and conduct of a disingenuous spouse in misrepresenting that real estate was his separate property were not sufficient to rebut a presumption that property was held as a community interest. Arch, Ltd. v. Yu, 1988-NMSC-101, 108 N.M. 67, 766 P.2d 911.
Law reviews. — For comment on Thaxton v. Thaxton, 75 N.M. 450, 405 P.2d 932 (1965), see 6 Nat. Resources J. 298 (1966).
For article, "The Community Property Act of 1973: A Commentary and Quasi-Legislative History," see 5 N.M.L. Rev. 1 (1974).
For note, "Coal Leases Held Real Property," see 21 Nat. Resources J. 415 (1981).
For note, "Clouded Titles in Community Property States: New Mexico Takes a New Step," see 21 Nat. Resources J. 593 (1981).
For article, "Survey of New Mexico Law, 1979-80: Commercial Law," see 11 N.M.L. Rev. 69 (1981).
For article, "Survey of New Mexico Law, 1979-80: Estates and Trusts," see 11 N.M.L. Rev. 151 (1981).
For article, "Survey of New Mexico Law, 1979-80: Property," see 11 N.M.L. Rev. 203 (1981).
For annual survey of New Mexico law relating to domestic relations, see 12 N.M.L. Rev. 325 (1982).
For note, "Community Property - Spouse's Future Federal Civil Service Disability Benefits are Community Property to the Extent the Community Contributed to the Civil Service Fund During Marriage: Hughes v. Hughes," see 13 N.M.L. Rev. 193 (1983).
For survey of 1990-91 commercial law, see 22 N.M.L. Rev. 661 (1992).
Am. Jur. 2d, A.L.R. and C.J.S. references. — 41 Am. Jur. 2d Husband and Wife § 49 et seq.
Recovery of damages for breach of contract to convey homestead where only one spouse signed contract, 5 A.L.R.4th 1310.
Proceeds or derivatives of real property held by entirety as themselves held by entirety, 22 A.L.R.4th 459.
41 C.J.S. Husband and Wife § 168.
Structure New Mexico Statutes
Section 40-3-1 - [Law applicable to property rights.]
Section 40-3-2 - [Methods for holding property.]
Section 40-3-3 - [Separation of property; admission to dwelling of spouse.]
Section 40-3-7 - Purpose of act.
Section 40-3-8 - Classes of property.
Section 40-3-9 - Definition of separate and community debts.
Section 40-3-9.1 - Gambling debts are separate debts of spouse incurring debt.
Section 40-3-10 - Priorities for satisfaction of separate debts.
Section 40-3-10.1 - Unreasonable debt.
Section 40-3-11 - Priorities for satisfaction of community debts.
Section 40-3-14 - Management and control of other community personal property.
Section 40-3-15 - Joinder of minor spouse in conveyances, mortgages and leases.