Full question:
My father set up a family trust in which he indicated that his present wife would have the right to continue living in the house owned by the trust until her death or voluntarily leaving the house, whichever occured first. Nowhere in the trust agreement does it state the term Life Estate, yet that is what his widow is choosing to construe it as. The members of the family trust are concerned that if she believes it is hers to do with whatever she wants, she will attempt to sell it, or set up insurance that will name only her (not the family trust) as the beneficiary should something happen to the house. Is she right in her assumption that my father's proviso allowing her to live there creates an ownership interest in the house? What are the limitations? What rights do the members of the family trust have with regard to maintaining their ownership interest in the house? The property is located in Arizona.
- Category: Trusts
- Date:
- State: California
Answer:
A life estate is where a person owns all the benefits of ownership in the property during their life, or the life of another, with the property going to a remainder person after the death of the life tenant. It is an interest in real or personal property that is limited in duration to the lifetime of its owner or some other designated person or persons. A life estate may be transferred, such as selling the interest to the remainder men. A life estate may be transferred in property by means of a deed or bill of sale. A bill of sale is a document that transfers title of an asset from a seller to a buyer. One common type of deed used to reserve a life estate is a warranty deed. Both the person who owns all the benefits of ownership in the property during their life and the remainder person are typically named in the deed.
Based on the information you have provided, it appears that the trust itself would own the property, and therefore, only the trust would be able to dispose of it. The language of the trust (which does not reference a life estate provision or deed) would prevail. You may wish to consult a local attorney as many trust issues are very complex and require legal advice and expertise. Please see the link to our attorney directory below.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.
