HomeESTATE PLANNINGJoint Tenancy is Trumped by a Living Revocable Trust

While most knowledgeable attorneys would say that a living trust is superior overall to owning property in joint tenancy, a joint tenancy with right of survivorship is the poor man’s trust. While American’s love their idioms, do you really want to stake your future on something not as good as the former. We will all come to that point in time when our planning must fail or succeed.

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Take this case for what actually happed when joint tenancy planning was used. A mother caused a warranty deed to be drafted to her eighty acre parcel in LeFlore County, Oklahoma. The warranty deed conveyed the property to her daughter and her niece (child of mother’s sibling), as joint tenants with right of survivorship and not as tenants in common. The mother attempted to add trust type language to the deed by having it also state, “IT IS THE INTENTION of all the parties of this deed that title shall vest in the grantees as joint tenants, so that on the death of one of them the survivor will take the whole estate herein conveyed.” The daughter was 12 years younger than the niece. Of course, why use an attorney for such a documents. Instead, the mother paid nothing for her legal services, using instead a clerk with the LeFlore County Clerk’s Office to draft her deed. The deed was signed at the clerk’s office and given to the daughter by the mother. The mother died a short time thereafter. The daughter did not tell the niece about the joint tenancy ownership until several years later.

The niece wanted to change the arrangement. She deeded her share of the eighty acre parcel to her daughter. The next day her daughter deeded the eighty acres back to the niece. Then a few months later, the niece deeded her share of the 80 acres to herself and her two children as Trustees of her own living trust, which she made at the same time.

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As we might imagine, the daughter felt that the niece had taken advantage of her mother and her mother’s wishes. A lawsuit was filed. The daughter argued that the niece should not be allowed to do what she did because it was not her mother’s intent. That she wanted a joint tenancy deed that could not be broken. She argued that the acts of the niece amounted to fraud and inequitable conduct. Here is what the Oklahoma Court of Civil Appeals held: “…the only action [the niece] took in this case was to transfer her interest in the [eighty acres] to a [living] trust, thus severing the joint tenancy and creating a tenancy in common. Such action is perfectly legal. ‘In the case of two joint tenants, the concept of joint tenancy with right of survivorship permits each owner to alienate and hold his share at the same time he ‘and the other or others hold the entire property as by a single ownership.’”

The Court of Civil Appeals went on to state that the only mistake was the mother’s “mistaken impression that a joint tenancy could never be broken [wonder who might have told her that-certainly not an experienced attorney]. The Court then stated the old maxim, “ignorance of the law is no excuse and every person is presumed to know the law.” If you want to read the entire case go to www.oscn.net. The case is Kail v. Knudeson, 328 P.3d 1235, 2014 OK CIV APP 28. The best money you can spend in for expert legal advice. For someone who actually knows the law, or knows how to find the law, and the correct answer. An experienced lawyer knows that the hardest part of solving a problem is putting one’s mind to the task, looking up the law, and thinking about it. Brent D. Coldiron has over 39 years of law practice experience. He is a skillful living trust attorney.

The main thing to learn from this sad story, is that the niece obtained expert legal advice. Her attorney knew what to do. He put her share of the eighty acres into a living trust. The mother relied upon what lay people told her would work. It was free advice, or was it after all. The above case was tried in the District Court of LeFlore County, and then appealed to the Oklahoma Court of Civil Appeals. Anyone want to estimate what that might have cost. Probably 1000 to 2000 times what an experienced living trust attorney would have charged the mother. What could have been done for the mother by a skillful living trust attorney. The same thing Brent D. Coldiron has done for many similar clients. A living trust would have been drafted. The bequest of the eighty acres would have had all of the “what ifs” thought out and provided for by the directions in the living trust itself. And, it would have worked. The title would have stayed in the trust until the first of the daughter or the niece died. Then it would have been deeded out of the trust to the survivor. The niece would never have had the opportunity to do what she did. What she did might have been perfectly legal, as the Court noted, but it didn’t make it right, at least not in the eyes of the daughter. They will probably never speak again. Do you want your planning to have this result? No, of course not!

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BRENT IS A LONG TIME MEMBER OF THE NATIONAL ACADEMY OF ELDER LAW ATTORNEYS

An experienced living trust lawyer, such as Brent D. Coldiron, is aware of the tendencies of heirs. They generally do not care what someone dead wanted or intended. They want what they want. What suits their own interests best. An experienced living trust attorney, like Brent D. Coldiron, knows what to do for you, to insure that your wishes will be carried out. His fees are reasonable. Contact Brent at (405) 478-5655 or 737-2244. His website is www.coldironlaw.com.


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