Take steps to ward off unscrupulous interlopers
The information in this column is intended to provide a general understanding of the law, not legal advice. Readers with legal problems, including those whose questions are addressed here, should consult attorneys for advice on their particular circumstances.
Q: A few weeks ago, you wrote about a nephew who had his aunt sign a transfer on death deed for her house two days before she died. What good is it to do all of these legal documents when unscrupulous people can take what is rightfully yours, forcing your beneficiaries to spend thousands to try to claim it? I see similar scenarios time and again in your column and every time I get angry that it appears legal documents really don’t matter. In the case of the above referenced column, who made the transfer on death deed legal, and didn’t it raise any red flags? I just don’t get it!
A: You bring up a number of very good points.
There have always been, and there always will be, people who will try to take advantage of others for financial gain. It’s especially easy when the person with the money and property is ill, elderly, lacking in capacity or is simply too trusting by nature.
With regard to the transfer on death deed you mentioned, all the nephew had to do was fill out a very simple statutory form, take his aunt to a notary, and then record the document in the county deed records. There are no red flags in a situation like that. It would have been just as easy for him to write himself large checks from her checking account, and make himself the beneficiary on her life insurance and retirement accounts. He could even have gotten her to sign a new will leaving everything to him.
The courts are filled with cases being litigated in circumstances just like that.
So, how do you prevent this from happening? Fortunately, there are steps that can help.
One way is to plan ahead by signing a power of attorney or revocable trust (or both) naming someone to take over for you when assistance is needed. Often there is an honest and trustworthy relative or friend who can step in to take over the finances. Backup agents and trustees should be named as well.
Of course, someone like the nephew could still get all these documents changed over to him if given the chance.
Another option for people with a large enough estate, or for people who have nobody they can trust, is to hire a trust company to take over their finances. A trust company would almost certainly have prevented the situation with the nephew and the transfer on death deed.
Some states let people probate their wills before they die. This is a great way to be sure the plan you want gets implemented when you die because the law doesn’t allow for challenges to the will after you have died, as long as the persons were all properly notified. Texas does not have this kind of law.
Again though, the nephew could still do plenty of stealing if others are not there to make sure nothing like that happens.
Ronald Lipman of the Houston law firm Lipman & Associates is board-certified in estate planning and probate law by the Texas Board of Legal Specialization. Email questions to email@example.com.