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| CAN YOU ACCIDENTALLY BECOME A LAND OWNER WITH A STRANGER? In Los Angeles, two sisters came in for estate planning and told us that they owned a large tract of land in the rapid-growing Inland Empire. When we asked exactly how they owned it, they said, "We own it together." Without putting them down, we tried to explain that there is no such form of ownership as owning something "together." After some investigation, we found that they owned the land, Tenants in Common. This means, of course, that each owns an undivided half of the property. To explain, there is no dividing line down the middle of the property showing who owns which half. Their ownership is "undivided." One of the sisters continued, "Well, we have a sort of a problem." Her sister nodded, "We get along just great. We travel together, go shopping together and just really enjoy each other's company." Sister A chimed in, "But, neither of us gets along very well with the other one's kids. And, we wanted to ask you a question. We wanted to ask if it might be possible that either of us would become partners with the other one's kids if one of us died?" "Not exactly a partner. But, a co-owner," I nodded. "You see, if Sister A died ... and if her will called for her 3 children to own the land, each of them would become an owner. In that case, Sister B would own 1/2 and each of the three children of the deceased Sister A would own a 1/6 interest. So, in the broadest sense of the word, one Sister could be partners with the other Sister's kids." "We don't want that to happen," Sister B said emphatically. So, I went on to show them different ways to solve the problem. 1.) They could change their ownership to "Joint, with Right of Survivorship." In this case, if one dies, the other owns the property. 2.) They could each give the other a "Right to Purchase" the deceased party's interest. Sometimes such a right is also funded with life insurance on the first to die. 3.) They could use one of many trust scenarios. See also, Deeds to Real Estate |
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