Usually, the quitclaim deed overrides the instructions in a will. But the devil is in the details.
At age 60, Letitia bought her Sacramento home, as a sole owner. Twenty years later, aged 80, Letitia went into a care home. Letitia subsequently signed a quitclaim deed and gave the home to Jackson, the only one of her three children who was not already a homeowner. Thanks to the modern convenience of remote online notarization, this was simple for Letitia to do.
☛ Some homeowners use quitclaim deeds when the parties know the home’s history and do not expect a title search. See more at: Transferring a Deed Without a Lawyer? Here’s What You Should Know.
At age 84, Letitia passed away, survived by the three children: Jae, Jasper, and Jackson.
Letitia left a will that appears to give 50% of the home’s value to Jackson, with the other half divided equally between the other two siblings. But Jackson is unwilling to give up any interest the home.
Who’s in charge? First, we know a quitclaim is a legally binding transfer of a home title. If the deed was correctly transferred, then Letitia legally relinquished the property. The will’s statement about the house is irrelevant. No one but Jackson, the rightful owner, may make decisions about the house.
And a Last Will has no power or effect until after its maker dies. It does not prevent transfers during life.
But will disputes do happen, even in the face of clear-cut principles. Should you face such a situation, here’s what you need to know.
☛ If you’re not a sole owner, your home title can make sure your wishes are followed after your life. Learn more from our guide to how real estate is vested.
A Valid Quitclaim Overrides the Will’s Instructions
Let’s review what we know so far. With a quitclaim, Letitia transferred her entire claim of ownership to Jackson. On that day, Letitia gave up the right to use a Last Will to transfer ownership to anyone else. The property was no longer Letitia’s to bequeath, regardless of anything written in a will before or after the quitclaim.
Now, Jae and Jasper feel unfairly cut out. All they received from their mother’s estate are personal effects and a depleted bank account. They believe they have the right to inherit and sell the home, and divide the proceeds in the percentages written in the Last Will.
Jae and Jasper decide to speak to a local estate litigation attorney. They think Jackson put undue influence on Letitia to give him the entire interest in the home. They also claim their mother lacked the mental capacity to understand the quitclaim she signed. And they want to file a quiet title action against Jackson’s claim of full ownership.
The attorney tells them it’s important to move fast. Most states have statutes of limitations — short windows of time to challenge a real estate transfer by quitclaim. In many states, that time period is only two years, but Letitia’s probate case is in California, which allows a longer period for legal challenges.
Defending the Quitclaim in Court
Jackson’s situation brings up an interesting reason a person might use a quitclaim — to avoid putting a house into probate court, by moving the asset out of the estate prior to death. Of course, it would have been wise for Letitia to update the will after deciding to pass the house to Jackson alone. Letitia could have spoken clearly in the updated will about the reason for giving Jackson the deed to the home — and perhaps even made a small settlement with Jae and Jasper to show clear and conscious intent.
But that didn’t happen. The deed alone states the fact: Letitia quitclaimed her home out of her estate.
That said, if his siblings can file their challenge in time, Jackson will have to defend the quitclaim deed. Jackson will point out the notarization, which indicates that Letitia transferred the deed voluntarily and with understanding.
Now, Jackson could run into trouble if he neglected to ensure the quitclaim was signed, notarized and recorded with the county where the house exists.
☛ Deliberate decisions to leave deeds unrecorded create legal hazards. Many state laws penalize secret deed transfers. Texas voids unrecorded deeds to protect the integrity of later transactions. See: The Monster Under the Bed: When a Home’s Past Holds an Unrecorded Deed.
Why Recording a Quitclaim Is So Important
The recording of the quitclaim deed shows the new ownership status for tax assessment purposes. In this case, Letitia was no longer obliged to pay property taxes after the title was transferred, recorded and filed.
Plus, a recorded and filed deed puts the public on “constructive notice” of the property transfer. That gets the statute of limitations running. Constructive notice means the deed transfer was made public for all to see, and any interested party should have known. In other words, if someone learns about the recording at some point in the future, they may not say the statute of limitations starts for them at that point. If they could, people would have a chance to challenge deeds at any time.
Under California law, which applies to Jackson’s home, even a forged or otherwise void deed becomes settled and cannot be litigated after the statute of limitations runs out! Twenty years ago, the California the Court of Appeals stated in Robertson v. Superior Court:
[A]ctions relating to either the possession of or title to real property (or, of course, both) must be commenced within five years from the end of possession or seizin of that property by the claimant or his or her predecessor in interest, unless his or her chain of title includes a person who was either a minor or insane…
As the Sacramento Public Law Library (PDF) observes, the statute of limitations is different for different kinds of legal action. For example, in cases not directly seeking real estate recovery, the statute of limitations is a shorter, four-year period. On top of that, California quiet title actions have a set of special rules for when the statute of limitations period starts, as explained in Salazar v. Thomas (2015).
And what if we tweaked the fact set? Say the shoes were on the other feet, and Jae and Jasper were the ones who have lived in the home since Letitia moved out. Under the Salazar case, they could claim “exclusive and undisputed” possession of land, and might prevail in a quiet title action against Jackson.
Each case needs legal research to pinpoint (a) whether time limits apply and (b) when the clock began running. And states vary on how much time must flow before a lawsuit is time-barred. On top of all that, lawmakers periodically revise state statutes. Always check with your attorney regarding your own set of circumstances.
Have You Chosen a Beneficiary for Your Home?
A quitclaim deed is one of the simplest deeds for conveying real estate from one owner to the next.
☛ How to you make a quitclaim deed? You can refer to this website’s guide to quitclaim deeds, including helpful information, forms and examples.
But sometimes, circumstances are complicated! So, a quitclaim may not be the best fit for your estate planning goals. To learn more about your options as you prepare to sit down with your attorney, see Homeowner Estate Planning: Real Estate Tips from Deeds.com.
We’ve said it before, but it bears repeating. There’s no better time than now to make an estate plan, or review the one you have now.
California Statute of Limitations: California Code of Civil Procedure § 38(d), § 338(d), and § 343.
Robertson v. Superior Court, 90 Cal. App. 4th 1319 (2001).
Salazar v. Thomas, 236 Cal. App. 4th 467 (2015).
Schorr Law’s Real Estate Blog: Quieting Title to Forged Deeds of Trust (undated).
Christopher P. Hahn for The Consumer Financial Services Blog (Maurice Wutscher LLP): Calif. App. Court (1st Dist) Holds Homeowner’s Quiet Title Action Against Lienholder Was Not Time-Barred (Jun. 10, 2020).
Photo credits: StartupStockPhotos via Pixabay.