Three Heirs, a Reserved Life Estate, and a Listing That Needs Signatures
Rosa executed a deed conveying her farm 'to my children, Alma, Bernard, and Carmen, as joint tenants with right of survivorship, reserving to myself a life estate.' Bernard died last spring; his will leaves 'all my real property' to his wife, Denise. The farm is being marketed at $420,000. Alma and Carmen want to list with a broker immediately. Denise has demanded one-third of the proceeds and refuses to sign anything. Rosa, now 82, says she will sign 'whatever the girls want.' The title company has asked for signatures from 'all parties having an interest.' Alma believes Denise's demand is 'just grief' and wants to close without her.
1. Who owns what interest in the farm today? Does Denise have a claim?
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Rule. An express joint tenancy with right of survivorship carries the survivorship feature: when one joint tenant dies, that share is extinguished and the survivors take by operation of law. A will cannot defeat survivorship because the decedent owned nothing at death to devise.
Application. Alma and Carmen each hold a one-half undivided remainder interest, subject to Rosa's life estate. Denise takes nothing in the farm under Bernard's will.
Watch-outs before you rely on this.
- Confirm the recorded deed actually recites survivorship language. Without it, the presumption is a tenancy in common, and Bernard's one-third of the remainder would pass to Denise (Alma 1/3, Carmen 1/3, Denise 1/3 of the remainder).
- Check for a prior severance. Any conveyance, mortgage, or written agreement by Bernard during his life would have converted his share to a tenancy in common.
- Get a title opinion. Even with a correct answer, the title company may demand a quitclaim from Denise as a practical cure.
2. Whose signatures should appear on the listing agreement and on the deed?
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Listing agreement. The brokerage wants authority from everyone whose signature a buyer will need: Alma, Carmen, and Rosa. A listing signed only by the remaindermen markets a future interest subject to a life estate, which is hard to sell and harder to finance.
Deed. Rosa (life tenant) plus Alma and Carmen (remaindermen) should all convey. Rosa's deed of her life estate and the remaindermen's deed of the remainder can be combined in one instrument; the buyer then holds the fee simple. If Rosa's life estate simply expires, the buyer takes subject to her possession until death, which most buyers and lenders will not accept.
Denise. Not required. Her refusal is not a cloud on title if the survivorship analysis is right.
Practical step. If Rosa's capacity is questionable, do not accept 'whatever the girls want.' Obtain a durable power of attorney that expressly covers real property, or a conservatorship order, before she signs.
3. If Denise sues for partition, what is the likely result, and what other risk should the heirs plan for?
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Partition requires co-tenancy. Denise is not a co-tenant under the survivorship deed, so a partition action should fail at the threshold. If severance had occurred, Bernard's interest would have passed to Denise and partition could force a sale over Alma's and Carmen's objections.
Real risks to plan for.
- A title company may still refuse to insure without Denise's quitclaim, forcing a quiet-title action or a negotiated payment. That is a business decision, not a legal entitlement.
- Rosa's life estate reduces market value; a buyer paying $420,000 for possession today is paying for something the seller cannot deliver until Rosa dies. Price the listing accordingly or structure the sale to include Rosa's conveyance.
- If Rosa needs Medicaid or long-term care planning, her retained life estate may create transfer-of-resources issues. Refer to an elder-law attorney before closing.