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Is There any Statute of Limitations for a “Life Estate” Holder to Enforce Her Rights to Property in Tennessee?

Posted on Jan 26 2014 11:11PM by Attorney, Jason A. Lee

A recent Tennessee Court of Appeals decision of Alma Long v. Raymond Creekmore, No. E2012-01453-COA-R3-CV, 2013 WL 1320515 (Tenn. Ct. App. 2013) discussed whether there is a statute of limitations that is applicable to a life estate holder for a piece of real estate property in Tennessee.  In this case a dispute arose between mother (who held the life estate interest in the property) and her son.  A life estate interest is where an individual has a right to occupy and use a piece of property during their life.  It terminates upon their death.  The son received a conveyance of the property from the mother subject to her life estate interest in the property.  Various disputes arose between the mother and son over who should be able to live on and use the property.  Finally, in 2008 the mother filed suit to enforce her right to possession of the property during her life.  The son asserted a statute of limitations and laches defense to his mother’s claim (basically arguing it was too late for her to assert this claim).  The trial court dismissed the lawsuit by the mother and asserted it violated a ten year statute of limitations applicable to this type of action.

 

The Tennessee Court of Appeals disagreed with the trial court.  The court found that a claim possessed by a life tenant against someone who exceeded her permission on the property is not subject to a statute of limitations.  The court specifically found, that “mother merely needed to assert her right as a life tenant and obtain a declaratory judgment when Son's use of the property exceeded her permission. Such a claim is not subject to a statute of limitations because a life tenant holds the property for the duration of his or her life.  Long at 4.  The court acknowledged the son may be able to prove he has a superior right to the property pursuant to other doctrines like the doctrine of adverse possession, however, the statute of limitations does not bar this claim.  Simply, there is no statute of limitations for this type of claim according to this case. 

 

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TAGS: Real Estate, Statute of Limitations Comments [0]
  
 

In Tennessee When Does Property Become the State of Tennessee's (Escheats to the State) When an Individual Dies?

Posted on Jan 19 2014 10:55PM by Attorney, Jason A. Lee

Under Tennessee law if there are no beneficiaries or heirs under a will or under intestate succession laws then the property of someone who dies is simply paid to the State (this is called “escheats to the State”).  Basically, if you do not have any close family members that are living and you do not have a will, then all of your money and assets are passed to the State of Tennessee.  T.C.A. § 31-6-101 provides as follows:

 

(a) If a decedent, whether or not domiciled in this state, leaves no one to take the decedent's estate or any portion of the estate by the decedent's will and no one other than a government or governmental subdivision or agency to take the decedent's estate or a portion of the estate by intestate succession, under the laws of this state or any other jurisdiction, the estate escheats as of the time of the decedent's death in accordance with this chapter.

(b) Property passing to the state under this chapter, whether held by the state or its officers, is subject to the same liens, charges and trusts to which it would have been subject if it had passed by will or intestate succession.

 

As a result, it is very important to have a will in Tennessee even if you do not have any close family members.  My advice would be to pick a charity or even close friends to leave your money and property to in this circumstance.  Certainly it is better for you to decide who gets your assets as opposed to simply sending them to the State of Tennessee treasury.  Very few people would make this decision voluntarily if they knew this would be the result of not having a will designating some heir or beneficiary to receive their property.  Additionally, even if you do have a will, make sure there are backup beneficiaries listed in the will so that if your primary beneficiary dies at the same time as you, o...

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TAGS: Wills, Probate Assets, Tennessee Probate Law Comments [0]
  
 

In Tennessee is Life Insurance a Probate Asset that Requires a Probate Proceeding?

Posted on Jan 11 2014 5:39PM by Attorney, Jason A. Lee

The answer is almost always no.  As long as the life insurance policy has named beneficiaries (other than the estate) it is not subject to probate in Tennessee and passes outside of probate. (for a discussion on other assets that are no probate assets read this article here).  Most often, the named beneficiaries simply need to fill out some forms that the life insurance company has and the money will be distributed rather quickly.  This payment is not subject to creditors of the person who died (See T.C.A. § 56-7-201).

T.C.A. § 56-7-201 also provides that even if the estate is listed as a beneficiary of the life insurance policy, the money is still not subject to the debts of the decedent unless specifically stated in the will.  The entire text of T.C.A. § 56-7-201 provides as follows:

On the death of an insured, any life insurance acquired by the insured or the insured's spouse and payable to the intestate insured's estate benefits the surviving spouse and children and the proceeds shall be divided between them according to the statutes of distribution without being in any manner subject to the debts of the decedent. If the proceeds of the insurance are payable to the estate of a testate decedent or the trustee of a revocable trust of which the decedent was a settlor, the proceeds shall pass as part of the estate or trust and under the dispositive provisions of the will or trust agreement, as ordinary cash, whether or not the will or trust agreement uses any apt or express words referring to the insurance proceeds, but the proceeds shall not be subject to the debts of the decedent unless specifically charged with the debts in the will or trust agreement.

As a result, even naming the estate as a beneficiary in your life insurance policy does not have all of the potentially negative baggage for other probate assets.  In fact, there is a good argument that doing so can be a good decision in certain circumstances.  You would need to consult with an experienced Tennessee estate planning attorney to discuss your specific circumstance more.  For a listing of assets that are probate assets, read this article here.

Follow me on Twitter at @jasonalee for updates from the Tennessee Wills and Estates blog.

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TAGS: Life Insurance, Debts of Estate, Creditor claims, Probate Assets, Tennessee Probate Law Comments [0]
  
 

Can a Guardian or Conservator Sell Property of a Minor or Disabled Person Without Permission of the Court in Tennessee?

Posted on Jan 5 2014 10:23PM by Attorney, Jason A. Lee

Under Tennessee law, a guardian or conservator must obtain prior approval of the court in order to sell certain property of a minor or disabled person under the guardianship or conservatorship.  T.C.A. § 34-1-116 provides as follows:

 

(a) Except as provided in subsections (b) and (d), no property of a minor or person with a disability may be sold without prior approval of the court that appointed the fiduciary.

(b) Unless the fiduciary is holding tangible property for the benefit of a minor or person with a disability pursuant to the terms of a will, trust or other written document, the fiduciary has the authority to sell each item of tangible property with a fair market value of less than one thousand dollars ($1,000) or a motor vehicle without specific court approval…

(d) This section shall not apply to any fiduciary who is not required to file a property management plan or who has had its investment plans approved as part of its property management plan.

 

There is an exception for any item of tangible property that has a fair market value of less than $1,000.00 or for any motor vehicle.  Sales of these items can be completed without specific court approval unless it is being held pursuant to the terms of a will, trust, or other written document.

 

If you are a guardian or conservator in Tennessee, this is a very important statute to remember.  Just because you have the powers provided to you by the court does not mean that the powers ar...

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TAGS: Real Estate, Tennessee Conservatorship, Minor Children Comments [0]
  
 

Tennessee and Federal Estate Tax Exemptions Raised Today for 2014.

Posted on Jan 1 2014 10:20AM by Attorney, Jason A. Lee

Today the Tennessee inheritance tax exemption (for 2014) is raised to $2,000,000.00.  Next year it will increase to $5,000,000.00 and then it will be abolished in 2016.  The Federal inheritance tax exemption (for 2014) was raised to $5,340,000.00 today.  As a result, these taxes rarely come into play when dealing with estate planning in Tennessee unless you have a very large estate.  Happy New Year!

 

Follow me on Twitter @jasonalee for updates from the Tennessee Wills and Estates Blog.
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TAGS: Tennessee Inheritance Tax, Taxes, Federal Estate Tax Comments [0]
  
 
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Jason A. Lee is a Member of Burrow Lee, PLLC. Contact Jason at 615-540-1004 or jlee@burrowlee.com for an initial consultation on wills estate planning and probate issues.

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Tennessee Wills and Estates Blog
Jason A. Lee, Member of Burrow Lee, PLLC
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Phone: 615-540-1004
E-mail: jlee@burrowlee.com

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