Emma Elder and Colonel Percy Elder were divorced in 2002 in
the Circuit Court for Baltimore City. Ms. Elder was awarded $31,500 as a marital
award and was supposed to receive one half of the proceeds of a sale property
located in Anne Arundel County known as "Beales Trail." Ms. Elder never reduced
her award to judgment, so it remained unsatisfied at Mr. Elder's death in 2005.
Subsequently, Ms. Elder obtained an order from the Circuit Court of Baltimore
City reducing her marital award to a judgment against Mr. Elder. She then
recorded the judgment in Anne Arundel County intending to attach a lien against
the Beales Trail property. Prior to the sale of Beales Trail, the Orphans' Court
for Baltimore County ordered Ms. Elder to release her lien because her award
which was reduced to judgment after Mr. Elder's death was not entitled to
priority within the context of estate administration. Ms. Elder appealed to the
Court of Special Appeals.
The Court of Special Appeals of Maryland held that a
creditor may not enhance a pre-death claim to priority after the debtor dies.
Ms. Elder then petitioned the Court of Appeals for certiorari, which was
granted. The Court of Appeals affirmed.
Ms. Elder argued that the plain language meaning of three
statutory provisions allowed her to enforce her judgment in Anne Arundel County.
First, she pointed to MD. CODE ANN., CTS. & JUD. PROC. § 11-402© which provides:
Judgment of another court – is indexed and recorded as
prescribed by the Maryland Rules, a monetary judgment constitutes a lien on the
judgment debtor's interest and land located in a county other than the county in
which the judgment was originally entered . . .
The second provision is MD. CODE ANN., ESTATES & TRUSTS §
8-103, which provides in relevant part:
(a) Except as otherwise expressly provided by a statute with
respect to claims of the United States and the state, all claims against an
estate of a decedent, whether due or to become due, absolute or contingent,
liquidated or unliquidated, founded on contract, tort, or other legal basis, are
forever barred against the estate, the personal representative, and the heirs
and legatees, unless presented within the earlier of the following dates: . . .
(d) Liens Not Affected. – Nothing in this section
shall affect or prevent an action or proceeding to enforce a mortgage, pledge,
judgment or other lien, or security interest upon property of the estate.
The final provision is MD. CODE ANN., ESTATES & TRUSTS §
8-114, which provides in pertinent part:
(a) General – an execution or levy shall not issue nor be
made against property of the estate under a judgment against a decedent or a
personal representative. Exception. – the provisions of this section do not
apply to the enforcement of mortgages, pledges, liens, or other security
interests upon property in an appro- priate proceeding.
A review of the legislative history of § 11-402© revealed
that the section was first enacted in 1890. Since then, the Court found no
discussion of the provision recognizing the validity of a lien recorded against
real property after the debtor's death.
The Court also looked to the legislative history of §§
8-103(d) and 8-114(b) of the Estates & Trusts Article. Again, the Court found no
mention in the legislative history suggesting that the General Assembly would
allow a pre-death claim reduced to judgment and recorded as a lien after the
debtor's death to be valid.
The personal representative of Mr. Elder's estate argued
that Ms. Elder actually had no interest in Beales Trail because the real
property passed immediately from the decedent's estate upon death. The Court
found this argument was dispositive of the case. Upon death, title to real
property passes out of the hands of the decedent. Therefore, the Court concluded
that the judgment obtained and recorded as a lien against Beales Trail after Mr.
Elder's death is not afforded priority under the statutory scheme embodied by
the Maryland Code because title to real property passes out of the decedent's
hands after death.
Accordingly, the Court affirmed the lower court's judgment.
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