Grimes v. Gouldmann, 157 A.3d 331

In 1990 Dianne Hudson conveyed a life estate to herself and granted the remainder to Gouldmann, Mierzwinski, and Ciekot as joint tenants, reserving to herself the power to “sell, mortgage, lease or otherwise encumber” both her life estate and the remaindermen’s interest, and stating she could “extinguish” those interests “in such manner as she may deem proper,” but could not will or devise the property.
In 2009 Hudson executed a second deed purporting to reserve a life estate to herself and to gift the remainder (for no consideration) to appellants Grimes and Hellenbrand.
After Hudson’s death in January 2015, the remaindermen (appellees) sued in the Circuit Court for Baltimore County seeking a declaratory judgment that the 2009 deed was invalid under the 1990 deed’s terms. Appellants challenged that ruling on appeal.
At trial the only evidence was the two deeds; no testimony or extrinsic evidence was introduced. The trial court interpreted the 1990 deed as not authorizing disposition by gift and declared the 2009 deed void.
The appellate court reviewed deed interpretation de novo and affirmed: it held the 1990 deed’s enumerated powers were limited to sale, mortgage, lease, or other encumbrance, and did not authorize an inter vivos gift of the remaindermen’s interest.

Issue	Plaintiff's Argument (Appellees)	Defendant's Argument (Appellants)	Held
Whether the 1990 deed granted the life tenant power to transfer the remaindermen’s remainder by gift	The 1990 deed limits the life tenant to selling, mortgaging, leasing, or otherwise encumbering; a gift is not an encumbrance, so the 2009 conveyance is void	The clause allowing the life tenant to "extinguish" interests "in such manner as she may deem proper" permits gifting; later deeds and conduct show Hudson intended that power	The court held the 1990 deed did not authorize disposition by gift; the 2009 deed is invalid

Willoughby v. Trevisonno, 202 Md. 442 (deed language granting broad power to "sell, lease, mortgage, convey or otherwise dispose" supports disposition beyond mere encumbrance)
Robb v. Berryman, 215 Md. 161 (similar treatment of broad disposition powers in life-estate deeds)
Knell v. Price, 318 Md. 501 (life-tenant power to sell, mortgage, lease, convey and dispose except by will interpreted as broad disposition power)
Burke v. Burke, 204 Md. 637 (deed with language closely parallel to this case held limited to sale/mortgage/lease/encumbrance; court examined whether a particular transfer was a sale)
Magraw v. Dillow, 341 Md. 492 (definition and scope of "encumbrance" discussed)