Request for another signed deed to transfer property causes confusion
Mr. Feichthaler:
We visited with an attorney in Fort Myers in 2018 for an estate plan. We didn’t get a good feeling about the attorney when we met, but we wanted to make sure our house wouldn’t go through probate if we died. So, the attorney suggested that we form a “Living Trust” and transfer the property to it, which we did. However, in the deed that made the transfer to trust, it also reserved a life estate in us, so that we could use the property during our lives. Why would we need to reserve this right when we own and control the trust?
Last year, we sold the property, and the title company appeared to ignore the trust, and had us deed out as husband and wife. We thought they knew what they were doing, so we didn’t question it. Now, that same title company, six months later, is asking us to sign another deed to transfer to the same buyers, this time from the trust. After all that has happened, we don’t know if we should sign this or not.
– Don P.
Dear Don:
First, you and your spouse should be commended for taking the steps necessary to avoid probate. The peace of mind typically gained through planning, along with serious cash and time savings for your heirs, is very valuable. However, as I have noted in prior responses, some attorneys may suggest extensive planning, even when it does not provide a benefit to the client. From the facts provided, this may have occurred here.
It appears your goal was to ensure the home passed to your heirs without probate. If so, having an Enhanced Life Estate deed prepared naming your heirs is the most cost-effective and efficient way to meet this goal. If you also had other objectives, such as managing assets like your home after death due to needs of your family, then a trust may have been appropriate. The initial problem you faced is using an attorney that may not have extensive experience in real estate or estate planning. The deed you describe, as you note, both conveyed the property to the trust AND retained a life interest. This shows a lack of understanding of living trusts and/or life estate deeds.
Your issue was further compounded by the title company you used. Once you signed the deed giving a life interest to you and your wife, and the trust retaining the remainder interest, any sale or transfer would need to include both of you AND the trust as sellers/grantors. The title company erred in excluding your trust from the deed out to your buyer, which led to the property not being legally transferred. This is what has led to your recent communication from them asking for you to sign the additional deed.
The good news is that the multiple errors that have led to today should not lead you to any financial harm. So long as this title company isn’t asking you for money, signing should not create any liability to anyone, and should settle the disposition of the property.
Whether you are seeking legal services, law firm or title company escrow services, roofers or any other professional service, research the reputation and experience of who you intend to use. The majority of clients I represent with disputes put their trust in the wrong professional. In your case, it sounds like the only harm you suffered in addition to wasted time was paying for a trust you likely didn’t need.
You may want to seek counsel from an attorney to ensure you are signing nothing more than a deed to correct the mistake made by the title company, but you should be fine.
Eric P. Feichthaler has lived in Cape Coral for over 35 years and graduated from Mariner High School in Cape Coral. After completing law school at Georgetown University in Washington, D.C., he returned to Southwest Florida to practice law and raise a family. He served as mayor of Cape Coral from 2005-2008, and continues his service to the community through the Cape Coral Caring Center, Cape Coral Museum of History, and Cape Coral Kiwanis. He has been married to his wife, Mary, for over 20 years, and they have four children together. He earned his board certification in Real Estate Law from the Florida Bar. He is AV Preeminent rated by Martindale-Hubbell for professional ethics and legal ability, and is a Supreme Court Certified Circuit Civil Mediator. He can be reached at eric@capecoralattorney.com, or 239-542-4733.
This article is general in nature and not intended as legal advice to anyone. Individuals should seek legal counsel before acting on any matter of legal rights and obligations.
To reach ERIC P. FEICHTHALER, please email news@breezenewspapers.com