I have a real life situation going on and I would like your thoughts about it....names have been changed to protect the innocent. I am not a part of this, but it does effect some people I know, and they have been in touch with me, asking questions about how title, etc.
Scenario:
Uncle John holds title to the home his mother owned with three of his siblings, as tenants in common.
Uncle John is on his second wife, and has two grown children from his previous marriage.
Uncle John dies last week at the age of 73.
Uncle John leaves the rights to the property to his two children, but gives his wife a life estate.
The wife is under the impression she has sole ownership to the property and can do what ever she wants as long as she lives. The kids believe they have rights to the property in present day.
In come the Lawyers
1) Lawyer number one tells the wife and two children that each of them owns one third of the property (remember, this is just for the portion of the property Uncle John owned as Tenants in Common with his other siblings).
2) Lawyer number two tells the children that they have no current rights to the property and cannot even set foot on it until she dies. Pretty much tells them they are SOL.
My Opinion
Having real estate licenses in three states, one thing I have learned is that the ways one can hold property pretty much stay the same across state lines. In my opinion, both lawyers have no idea what they are talking about.
My belief is that there is nothing in the will that gives the wife any actually ownership in the property. She only holds a life estate. Should she want to sell her portion, the only thing she could sell would be her life estate. Anyone who buys it would only hold it for as long as the wife lives...once she dies, no matter who has bought her life estate, the property goes to the kids as Tenants in Common. It is also true for any renters that she rents the property to...when the wife dies, the kids have every right to NOT honor any lease agreement.
So the lawyer who says the property ownership is split into thirds is smoking crack, or needs to freshen up his legal interpretation skills.
One thing that a Life Tenant must do is keep the property in good shape, pay all taxes, insurance, etc. Not doing so is legally called "waste". If she "wastes" the property, then her life estate could go bye-bye. The second lawyer has said that since the two children only have "future" rights to the home, that they have no current rights and cannot even step onto the property.
I have to say he is dead wrong.
The two kids are Remaindermen. The property reverts to them upon the wife's death. So since the property will become theirs no matter what, they HAVE present day rights to the property. For one, they have every right to make sure she is not neglecting the property, not paying taxes, etc, because if she was, she would be damaging their future interest in the property.
In the long run, I have told the party involved to seek a third lawyer's opinion, and to find one that has a lot of experience in real estate law - will interpretation.
What are your thoughts on this matter? Have you ever represented a transaction where a life estate was involved?
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