Ask the TITLEMAN™ - Deed to Minor; Beneficiary Deed
by John T. Lotardo aka TITLEMAN™
Sr. VP/General Counsel, Stewart Title & Trust of Phoenix, Inc.
Q. My sister-in-law married a man from Canada, had a child and then divorced him and moved back to California. Their son has duel citizenship and is a teenager now. She is terminally ill, but she owns a small condo. It was decided that her son need not be present in the final days before she passes on and is now living in Canada. The question is can she quick - deed this to her son even if he is a minor living in Canada. Also there is the consideration that she has been on “Medical Cal” because the cost of the treatment was so high, that they may wish repayment after her death. Can you advise on this?
A. I would suggest getting some local advice. I get many questions about deeds and yours is a classic case where a little legal advice can go a long way to prevent a lot of problems in the future. By the way, the deed you are referring to is a “quit-claim” deed not a quick-claim deed. There are many variables here including the ramifications of transferring the property from a taxing perspective. Also, is she healthy enough to be considered competent to deed the property? Having a minor hold title is problematic and appointing a guardian/conservator may make sense. Since she has been on Med Cal, the title transfer may be challenged. Therefore, you need someone who can advise her how to provide for her son in a way that will make it easier rather than harder in the long run.
Q. I have a question about the validity of a beneficiary’s deed if the parties are joint tenants? In my case mom, dad and daughter are all joint tenants with rights of survivorship. Mom dies. Death certificate for mom is recorded leaving Dad and daughter as surviving joint tenants. The dad then signs a beneficiary deed to the two minor grandchildren. Now the dad is dead. I have always been taught that if a joint tenant purports to convey their interest it breaks the joint tenancy estate. In this case I called for the dad’s death certificate to be recorded and a conservatorship for the minor children since they cannot deal with the property. Am I wrong? Is the beneficiary’s deed “Void” since daughter did not execute with dad?
A. It depends. Please take a look at Arizona Revised Statutes Section 33-405. In section 33-405(D) it addresses specifically your situation. It states that if the property is held as joint tenants and fewer than all of the joint tenants signed the beneficiary deed, then the deed is only good if the one signing is the last to survive. Meaning, if the last surviving joint tenant did not execute the beneficiary deed, then “the transfer shall lapse and the deed is void.” The statute goes on to state that the joint tenancy is not effected and does not lapse by reason of the grant of a beneficiary deed executed by fewer than all of the joint tenants—the surviving joint tenants prevail over the beneficiary deed grantees. So if daughter dies first then the grandchildren will get the interest to the property when dad (their grandfather dies). However, if dad dies before the daughter, then the daughter gets the property and not the grandchildren.
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Copyright John T. Lotardo. All rights reserved. John Lotardo (aka the TITLEMAN™) is Senior Vice-President and General Counsel for Stewart Title & Trust of Phoenix, Inc., and State Underwriting Counsel for Stewart Title Guaranty Company. He is a member of the National Advisory Councils for GoGetEscrow.com, GoGetLoan.com, GoGetNotary.com and GoGetRealEstate.com. The information supplied is of a general nature and should not be relied upon as comprehensive legal advice. Please consult with your own local legal counsel. For more about John, visit: www.GoGetEscrow.com/Get/Titleman or www.AskTheTitleman.com.