{"id":333,"date":"2010-07-16T01:31:31","date_gmt":"2010-07-16T08:31:31","guid":{"rendered":"http:\/\/fiduciarydutiesblog.com\/?p=333"},"modified":"2010-07-16T01:31:31","modified_gmt":"2010-07-16T08:31:31","slug":"deed-to-estate-planning-trust-%e2%80%93-struggling-for-the-right-result","status":"publish","type":"post","link":"https:\/\/fresnolawyerblog.com\/?p=333","title":{"rendered":"Deed to Estate Planning Trust \u2013 Struggling for the Right Result"},"content":{"rendered":"<p>A recent decision involving a deed to an estate planning trust  achieved the correct result, but with unnecessary effort.<\/p>\n<p>The facts in <strong>Luna v. Brownell<\/strong> (June 15, 2010) 2010 DJDAR 8811  were simple.<\/p>\n<ul>\n<li>\u201cOn August 13, 2006, Al executed a quitclaim deed transferring his  interest in the Property as an individual to himself as trustee of the  Trust.\u201d<\/li>\n<\/ul>\n<ul>\n<li>\u201cOn August 29, 2006, Al executed the declaration of trust for the  Trust.\u00a0 The declaration of trust stated that Al was the trustee.\u201d<\/li>\n<\/ul>\n<ul>\n<li>\u201cOn September 8, 2006, the grant deeds transferring plaintiffs&#8217;  interest in the Property to Al as trustee of the Trust were recorded.\u201d<\/li>\n<\/ul>\n<ul>\n<li>\u201cAl died on September 19, 2006.\u201d<\/li>\n<\/ul>\n<p>The hitch in the analysis arises because the court implicitly  considered Al\u2019s revocable estate planning trust to be different from  Al.\u00a0 It is not:\u00a0 the trust is not different from a Will, at least during  Al\u2019s lifetime.<\/p>\n<p>The court presented its discussion as follows. \u201cA deed does not  transfer title to the grantee until it has been legally delivered.\u00a0  Delivery is a question of intent.\u00a0 A valid delivery of a deed depends  upon whether the grantor intended that it should be presently  operative.\u201d<\/p>\n<p>The court starts pushing in the wrong direction from the beginning.\u00a0  This is should be treated as a wills question, not as a conveyancing  question.<\/p>\n<p style=\"text-align: center;\"><a href=\"http:\/\/www.krbecheklaw.com\/wp-content\/uploads\/2010\/07\/Big-Sur-State-Park.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" title=\"Fresno lawyers\" src=\"http:\/\/www.krbecheklaw.com\/wp-content\/uploads\/2010\/07\/Big-Sur-State-Park.jpg\" alt=\"Big Sur State Park\" width=\"500\" height=\"307\" \/><\/a><\/p>\n<p>&#8220;In addition, acceptance by the grantee is necessary to make a  delivery effective and the deed operative.\u00a0 Whether the deed was  accepted by the grantee so as to complete a transfer of title to him is  likewise a question of fact for the trial court.&#8221;<\/p>\n<p>The court continued.\u00a0 \u201cOn August 8, 2006, after understanding that Al  wanted his property in his own name for purposes of creating a trust,  the plaintiffs did not dispute his ownership . . . The [real] question  before this court therefore is whether the quitclaim deed executed by Al  on August 13, 2006, transferring the Property from Al as an individual  to Al as trustee of the Trust was void because the Trust did not exist  on the date the deed was executed.\u201d<\/p>\n<p>Following decisions from other jurisdictions, the court held the  conveyance was effective.\u00a0 For example, in <em>John Davis &amp; Co. v.  Cedar Glen # Four, Inc.<\/em> (Wash. 1969) 450 P.2d 166, the court  considered the validity of a quitclaim deed transferring real property  to a corporation.\u00a0 Held the court, \u201cA deed to a corporation made prior  to its organization, is valid between the parties.\u00a0 Title passes when  the corporation is legally incorporated.\u00a0 This is particularly true as  against one who does not hold superior title when the corporation goes  into possession under the deed.\u201d<\/p>\n<p>Similarly, in <em>Heartland v. McIntosh Racing Stable<\/em> (W.Va. 2006)  632 S.E.2d 296 the court held that &#8220;A deed drawn and executed in  anticipation of the creation of the grantee as a corporation, limited  liability company, or other legal entity entitled to hold real property  is not invalidated because the grantee entity had not been established  as required by law at the time of such execution, if the entity is in  fact created thereafter in compliance with the requirements of law and  the executed deed is properly delivered to the entity, the grantee,  after its creation.&#8221;<\/p>\n<p style=\"text-align: center;\"><a href=\"http:\/\/www.krbecheklaw.com\/wp-content\/uploads\/2010\/07\/Nicaragua.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter\" title=\"Fresno attorneys\" src=\"http:\/\/www.krbecheklaw.com\/wp-content\/uploads\/2010\/07\/Nicaragua.jpg\" alt=\"Nicaragua\" width=\"500\" height=\"364\" \/><\/a><\/p>\n<p>Both are solid analyses under corporate law.\u00a0 What the recent  California court should have looked at in Al\u2019s case was the following:<\/p>\n<p>(1)\u00a0 Did Al want his property to be handled in a probate?<\/p>\n<p>A.\u00a0 He did not.\u00a0 He wanted to provide for a non-probate transfer via  an estate planning trust.<\/p>\n<p>(2)\u00a0 Did Al intend for his trust to control the disposition of his  real property?<\/p>\n<p>A.\u00a0 Yes.<\/p>\n<p>Unfortunately, current trust law invites confusion by (sometimes)  treating a revocable estate planning trust as a separate entity.\u00a0 Having  considered authorities from other states, the California court held as  follows:<\/p>\n<p>\u201cA quitclaim deed transferring property to the trustee of a trust is  not void as between the grantor and grantee merely because the trust had  not been created at the time the deed was executed, if (1) the deed was  executed in anticipation of the creation of the trust and (2) the trust  is in fact created thereafter.\u00a0 Such a deed is valid between the  grantor and grantee on the date the trust was formed.\u201d<\/p>\n<p>That\u2019s a nice, concrete statement of law, and obviously the result  intended by the decedent.\u00a0 But the conveyancing gloss detracts from a  focus on the decedent\u2019s intention.<\/p>\n<p><strong>Luna v. Brownell<\/strong> (June 15, 2010) 2010 DJDAR 8811<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A recent decision involving a deed to an estate planning trust achieved the correct result, but with unnecessary effort. The facts in Luna v. Brownell (June 15, 2010) 2010 DJDAR 8811 were simple. \u201cOn August 13, 2006, Al executed a quitclaim deed transferring his interest in the Property as an individual to himself as trustee [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,9],"tags":[],"class_list":["post-333","post","type-post","status-publish","format-standard","hentry","category-case-law","category-trusts-and-estates"],"_links":{"self":[{"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=\/wp\/v2\/posts\/333"}],"collection":[{"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=333"}],"version-history":[{"count":0,"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=\/wp\/v2\/posts\/333\/revisions"}],"wp:attachment":[{"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=333"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=333"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fresnolawyerblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=333"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}