Processing a Transaction Upon Death of Owner

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Mike Shepard has asked we share an update on how to properly time and complete a purchase and sale agreement when there is a death of one of the owners. He has provided some very informative timelines and suggestions to help you navigate this process.  Please note: Any estate situation must be disclosed to all parties so appropriate timelines can be managed.

  • JOINTLY OWNED PROPERTY – Upon the death of one of the joint owners, the title automatically passes to the surviving joint owner.  NO PROBATE NECESSARY.  Jointly owned property includes property held by a husband and wife as TENANTS BY THE ENTIRETY. The death certificate has to be issued (and can take longer if an autopsy is required) and the lawyer should be contacted asap to determine if there are estate taxations issues that could slow things.
  • WILL WITH POWER OF SALE – The Will of the Decedent must be filed with the Probate Court and can be filed as an INFORMAL PROBATE as long as there is a Power of Sale contained in the Will.  This proceeding is expeditious and normally the Probate Court will appoint the PERSONAL REPRESENTATIVE in less than one (1) month.
  • WILL WITH NO POWER OF SALE – The Will of the Decedent must be filed with the Probate Court and must be filed as a FORMAL PROBATE, which can take 6-8 weeks for the Court to appoint the Personal Representative.  Once the Personal Representative is appointed, the Seller’s estate must petition the Court for a LICENSE TO SELL.  It normally takes an additional 2-3 weeks to secure the License to Sell after filing the request with the Court.
  • NO WILL – Interested parties to the Estate of the Decedent (heirs) would file a petition with the Probate Court to appoint a Personal Representative.  The timeline for appointment and the necessity for a License to Sell are the same as a Will with No Power of Sale.

Please keep in mind that a Purchase and Sale Agreement for property of the deceased (other than joint/tenants by the entirety) must be signed by the duly appointed Personal Representative of the Estate of the deceased property owner.  It is extremely important to stress to prospective sellers that they need to get to a Probate attorney ASAP to get the process started.  Given the current market, property can be listed and put under contract faster than the attorney can get through the Probate Court; hence, the importance of getting a head start. Please be aware that until a personal representative has been appointed by the courts, they cannot bind the estate.

In filling out the Purchase and Sale, at the top of the first page “Parties”, the correct way to fill it out is to complete as follows:

The Seller should be listed as “Estate of_____(Deceased) by ___________(Personal Representative)”.  This should also be carried through to the last page for signature.  The Personal Representative can use their own initials at the bottom of each page of the P&S.

Mike
Michael J. Shepard, P.C.
55 Church Street
Pittsfield, MA  01201
Phone: 413-499-0316
Fax: 413-443-7125
Email: Info@mjshepardlaw.com