[WSBARP] Anyone know what this ownership interest is called?

[Eric Nelsen]

That sounds like fee simple ownership:  she lives on it as long as she wants and she can sell it if she wants. Or do the proceeds go to someone else when it's sold?

If that's the case and proceeds go to someone else, then I think it's technically a defeasible life estate with an executory (remainder) interest, with either an automatic trigger (terminable life estate) or a right of re-entry (life estate subject to condition subsequent) at the time she decides to stop living at the property. Technically I think it could be set up in deed language but it's much easier to set up in a trust, to have lots of room to define what it means to "move out."

I have set up similar situations in several different ways depending on exact circumstances, from vesting fee in the remainder beneficiaries and giving the surviving spouse a lease, to setting up a trust, to granting a life estate with conditions, etc.

The point about a title company is a good one, but the solution really depends on all circumstances. Every solution has its set of title issues that need to be thought through ahead of time.

Sincerely,

Eric

Eric C. Nelsen
SAYRE LAW OFFICES, PLLC
1320 University St
Seattle WA  98101-2837
phone 206-625-0092
fax 206-625-9040



From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Heather Kolbly
Sent: Tuesday, April 21, 2015 1:22 PM
To: 'WSBA Real Property Listserv'
Subject: [WSBARP] Anyone know what this ownership interest is called?

Hi All,

To make a long story short, Client was left a “life estate” in certain real property “until she dies or decides to move off the property” in her mother’s will.  As I understand it, this is not a true life estate, and the will was drafted incorrectly regarding a life estate.  We are thinking of trying a TEDRA Agreement with other beneficiaries to address ownership interests in the property.  Client wants to be able to live on the property as long as she wants and sell it if and when she wants, and to do away with the notion of life estate (so, she basically wants the second part of what’s stated in the will above honored, and not the life estate part).   Does anyone out there know what this type of property ownership interest is called?  It’s ownership, but with restrictions.  I have never seen anything like this, and I’m not convinced it can be done outside of a trust.   I am also thinking the title company will not approve of this.  Any thoughts?

Thanks for any help you can offer,

Heather Kolbly


Heather Tobin Kolbly
Mobile Attorney
KOLBLY LAW FIRM, P.C.
Mail:  704 228th Ave. NE #122, Sammamish, WA  98074
Office:  (425) 522-4234 • Cell:  (425) 444-1888
Heather at KolblyLaw.com<mailto:Heather at KolblyLaw.com>
www.KolblyLaw.com<http://www.kolblylaw.com/>

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