Charter One Bank v. Estate of Spillane

Summary

The Vermont Supreme Court affirmed summary judgment for Charter One Bank in a foreclosure action involving an intervening widow’s homestead rights. The court held that mortgage liens created by future advances without the spouse’s written consent were voidable rather than void ab initio, and that the widow’s inchoate homestead interest was extinguished by divorce before her later remarriage. The court also held that the discovery dispute was moot because the requested loan-advance history could not affect the result.

Holdings

1. Liens created by advances without the required spousal consent are voidable, not void ab initio.
2. Mary's divorce from Phillip extinguished her inchoate homestead interest, so she could no longer challenge the advances made during that marriage on the ground that she had not consented to them.
3. Janice's death extinguished her homestead rights, thereby curing any irregularities in advances that required her signature.
4. Mary's post-remarriage homestead interest was derivative of Phillip's interest and therefore subject to the mortgage, because all advances had occurred before the remarriage and the mortgage was a voluntary secured interest.
5. The discovery issue was moot because the requested history of the advances was no longer relevant after resolution of Mary's homestead claim.

Questions Presented

1. Whether advances under a mortgage that included a homestead were void because the spouses had not given the written consent required by Vermont homestead statutes.
2. Whether divorce and death extinguished the spouses' inchoate homestead interests and thereby cured any defects arising from the lack of consent.
3. Whether Mary's homestead interest after her remarriage was subordinate to the mortgage because her interest was derivative of Phillip's interest.
4. Whether Mary's discovery dispute concerning the history of the loan advances remained justiciable after the court resolved her homestead claim.

Disposition

affirmed