[WSBARP] Administrator/Creditor Pursuing Claim Against WA Property Sold by SS under "Lack of Probate Affidavit."

Tue Apr 5 00:56:55 PDT 2022

Josh:

Assuming the creditor prevails in a lawsuit over the claim, either in the probate action or a separate TEDRA action (if the creditor is also the PR), I think a judgment can be enforced against the house in the hands of the buyer. In a somewhat similar set of circumstances a few years ago my partner did that. What happened was the title company took over defense of the case, settled, and pursued the seller, either on the SWD or the Affidavit. 

We’ll see. I just think if that’s an available route, it might work better than pursuing abatement against the SS in a CA court (maybe requiring an ancillary probate down there).

John J. Sullivan

From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Josh Grant
Sent: Monday, April 4, 2022 12:57 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] Administrator/Creditor Pursuing Claim Against WA Property Sold by SS under "Lack of Probate Affidavit."

What about suing the new owner and letting the new owner apply for benefits from the title co?

Joshua F. Grant

P. O. Box 619
Wilbur, WA 99185
509 647 5578

From: JOHN J SULLIVAN 

Sent: Friday, April 01, 2022 1:45 PM

To: wsbarp at lists.wsbarppt.com <mailto:wsbarp at lists.wsbarppt.com>  

Subject: [WSBARP] Administrator/Creditor Pursuing Claim Against WA Property Sold by SS under "Lack of Probate Affidavit."

Listmates: 

Bear with me. I'm trying to figure out whether this is even worth pursuing. 

"Hypothetical" Fact Pattern: PC bought business from buyer who died before he could be sued for breach of asset sale agreement. Still within two years of death and no SOL problem. But ... SS sold main asset - house - and moved with net proceeds to CA. SS did not open probate, but instead sold house without probate. Title company relied upon a "Lack of Probate Affidavit."

Possible recourse: Petition to be appointed Administrator of Decedent's estate. (Notice to SS in CA of course.) Then, if PC appointed Administrator, file and serve Creditor Claim. Under RCW 11.40.140, claim must be "addressed, resolved, and settled" under RCW 11.96A TEDRA. So far so good. 

Assuming the PC prevails in the TEDRA action and obtains a judgment, can he execute it against the house here in WA now "titled" in the name of the buyer the SS sold it to? The Affidavit is not a deed or other legally enforceable method of conveying title. Arguably, the probate estate has authority to reach the property to satisfy the claims of creditors. The buyer might have recourse against the SS because the Affidavit does not satisfy the requirements of the SWD she used to close the sale? 

Or, would the judgment creditor/Administrator have to take the judgment to CA, maybe open an ancillary probate, and then seek to recover the sales proceeds from SS?

This all sounds maybe effective, but very complex and expensive. I suppose some of the fees involved might be rolled into a TEDRA judgment, but still. I'm not sure it's worth pursuing. 

Anyone have experience chasing a claim against a Decedent in similar circumstances? The Affidavit is a convenient tool, but here it seems to have been abused, and may even have constituted insurance fraud, if a Title Company issued coverage based upon its representation all the liabilities of the Decedent had been satisfied.

Thoughts on a Friday afternoon?

Best regards, 

John J. Sullivan 

Attorney 

Lyons | Sullivan 

10655 NE 4th Street, Suite 704 

Bellevue, WA  98004 

425·451·2400 tel 425-451-7385 fax 

www.dljslaw.com <http://www.dljslaw.com/>  

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