In a recent estate litigation case, Keystone defended the administrator of an estate involved in a tenant dispute. The creditor’s claim and subsequent lawsuit filed by a tenant claimed that she was the rightful owner of the decedent’s home based on promises made to her by the decedent to give her the home.
About the Tenant Dispute
In her petition filed against the estate, the tenant claimed that the decedent allowed her to stay in the home and agreed to give it to her if she agreed to make certain improvements and pay for future repairs, taxes and maintenance. The tenant further claimed that she and the decedent agreed not to add her name to the title of the home for fear of the tenant’s abusive husband discovering where she was living. While these alleged promises were oral, the tenant also produced a handwritten note signed by the decedent from 1996 identifying the tenant as a “co-owner” of the home. However, during the estate litigation, Keystone’s client was able to locate a copy of the same 1996 note, but this version identified the tenant as a “co-resident” of the home with the decedent, so Keystone argued the version presented by the tenant was a forgery. Keystone also argued that because the decedent met the tenant around 1996, it is unbelievable that the decedent would want the tenant to have an ownership interest in the home when they were practically strangers at the time the note was written.
Tenant Dispute Settlement
At mediation, the parties reached a settlement regarding the tenant dispute. It was agreed that the tenant could purchase the home from the Estate for a fixed amount, using a loan against the home as leverage to pay the Estate. This structure suited the Estate’s interests because it needed to sell the home to divide the proceeds among the many heirs, some of whom had different percentage interests in the Estate.
Keystone filed a petition with the court to approve the settlement negotiated by the administrator and none of the interested parties objected. Then, after the settlement proceeds were received, Keystone filed a final petition to close the Estate, to distribute the assets to the heirs and to authorize the administrator to pay statutory and extraordinary fees to herself and to Keystone, all of which was granted in full.[1]
Amicable Outcome
Despite the complicated nature of this estate litigation, Keystone resolved all the issues and closed the estate to the satisfaction of its client, the administrator, and the heirs.
[1] Interestingly, the other real property owned by the decedent was inherited from his predeceased wife who had died only 5½ years prior. Accordingly, the decedent’s stepchildren were entitled to 50% of the proceeds from the sale of that property under Probate Code section 6402.5. For detailed information about stepchildren inheritance rights under this statute, read our blog, “California Intestate Succession: Did You Know that Stepchildren Sometimes Have Priority Intestacy Rights Over Other Heirs?”
