Real Estate Transfer Upheld Even Where Transferor-Heir to Real Estate Never Opened Probate Estate

            In 1984 Lyall and June Aldrich signed a quit claim deed that transferred ownership in some land to their three children, Kim Aldrich, Randy Aldrich, and Kit Price as tenants in common.   Randy Aldrich died without a Will in 1998.  No probate estate was opened at the probate court after his death.  In June 2001 Randy’s wife, Carol,  signed a deed transferring her interest in the property as survivor of her husband, to Randy’s brother, Kim Aldrich, and his sister, Kit Price.  After both Lyall and June died, Kim and Kit filed suit to quiet title in the property claiming they legally held all the interest.    Kim and Kit filed a motion for summary disposition, claiming that under the statute pertaining to intestate succession, MCL 700.2102 (1), Carol had interited  her husband’s entire estate, so that when she quitclaimed the property to Kim and Kit, she effectively transferred her husband’s one-third interest in the property to them.   Randy’s children, on the other hand, claimed that since Randy’s estate was not probated, Carol had never received a deed transferring the property to her and thus she could not transfer her interest to Kim and Kit. 

                The trial court ruled for Kim and Kit.  The trial court ruled that by executing the June 2001 quitclaim deed, Carol Aldrich in effect elected to take her survivor’s share in her husband’s estate.   The children appealed. The Court of Appeals affirmed.  The Court of Appeals noted that under Michigan law, title to real property vests in a decedent’s heirs at the moment of the decedent’s death, even if no probate estate is opened.  Hence, Carol received Randy’s 1/3 intere4st immediately when Randy died.  Thus, she could properly quit claim the 1/3 interest to Kim and Kit.   A quitclaim deed effectively transfers whatever interest in the property that the grantor had at the moment of the transfer. Because title to her husband/s one-third interest vested in her at the moment of her husband’s death, Carol Aldrich owned the one-third interest when she executed the quit claim deed.  Accordingly, there was nothing left for Randy’s children.

 

 What This Means For Heirs:

 If a person dies without a Will or Trust, a probate estate does not have to be opened at the probate court in order for legal title to real estate to pass to the decedent’s heirs.   However, be aware that this is not the rule for personal property.  The Court of Appeals specifically stated that title to personal property does not transfer to a decedent’s heirs at the moment of death; rather, it passes to the executor of the decedent’s estate upon appointment as executor by the probate court.  So, for all assets other than real estate, you should always have a probate estate opened in order to properly pass title to the heirs. 

You can view the entire Court of Appals opinion here.

Authored by Barbara A. Assendelft