03/12/07: Resolving Disputes Among Your Heirs
By Benny L. Kass
Q: My great-grandmother died in l935 and left a plot of land with a house to her heirs. Since that time, family members who needed a place to live were allowed to stay in the house, on the condition that they pay the real estate taxes and make whatever repairs were needed.
My father was the last to live in the house. He died several years ago, and I have been paying the real estate taxes ever since. There are about 50 heirs, and all but one has asked me to sell the property.
What should I do?
A: If there are 50 heirs today, next year there may be many more, so you really have to act immediately.
The very first thing you should do is obtain a title report. Your attorney can assist you in this process. Although your father lived in the house for several years, even if the real estate tax bills were in his name, this does not mean that legal title is vested with your father.
Do you know if your great-grandmother’s estate was probated when she died? Did she have a will? I suspect that the answer to both questions is NO.
When a person dies, his or her estate must be probated. If there is a Last Will and Testament, the Probate Judge will honor the requirements of that Will in order to properly distribute the property in the estate. If there is no Will, this becomes an “intestate estate, and the Court will follow the applicable State intestacy statutes. These laws spell out how property is to be distributed when there is no Will.
The title report will also advise you whether your great-grandmother’s estate was, in fact, probated.
Let’s play this out. First, let us assume that the estate was, in fact, determined by the Probate Court. That Court determined (either based on the Will or by the Intestacy Statutes in the State where the property was located) who became the new owner of the property. Let’s assume that this was your grandmother.
But when your grandmother died, was her estate probated? Keep in mind that after each death, there must be a Probate to resolve ownership of the property. So, you (or your attorney) will have to do a lot of research, going all the way back to l935.
If this sounds complicated, let’s further confuse you. Let us assume that on your great-grandmother’s death, the property was left to her five children, jointly, rather than to just one of them. But over the years, those children died, leaving many children of their own. Each of the children have an interest in the property, and every one of them must sign off in order to allow you to be able to sell it. And to complicate this even further, when any of the heirs died, once again their estate must be probated – regardless of the percentage interest they may own in the property.
But now let’s change the picture. If your great-grandmother’s estate was not probated, you will have to arrange to do that. Over the years, our probate laws have changed, and your attorney will have to research the laws back to 1935 to determine how to proceed. Furthermore, the attorney will have to locate all of the heirs – which will obviously include children, spouses, and even grandchildren.
This is a complex matter. The process can become expensive, and the bottom line question you have to decide is whether the value of the property is worth all of the effort – and the costs involved – in clearing up the title.
You decide you want to go forward. You finally clear up the title, resolve all probate issues and now want to sell the property. How do you deal with the one holdout?
In every state in this Country, there is a process known as “partition”. You file a lawsuit, asking the Court to force the sale of the property. The Courts have consistently taken the position that when two or more owners cannot agree on issues dealing with property ownership, any one owner can file a partition suit. The Court will order that the property be sold – either at a private sale arranged through a real estate broker or at a public sale held in the Courthouse – and the sales proceeds be divided proportionately among all of the owners.
However, it has been my experience that the only ones who win at such a sale are the attorneys involved in the litigation and the speculators who may get a good deal when they buy the property.
Finally, you should advise all of the heirs that if they really want to sell the property, they; have to contribute to the litigation costs, the upkeep of the property, as well as the real estate taxes. And don’t forget to keep the insurance current. If the house is now vacant, most insurance companies will want to significantly increase the annual premium costs, and the heirs should bear these costs also.