Articles Posted in Real Estate

There are many issues which a New York estate administrator may need to deal with.  The basic function of an estate executor or administrator involves identifying and collecting assets and resolving claims and other obligations affecting an estate.  The New York Probate Lawyer Blog contains many articles describing various aspects of estate settlement.

A decedent may own different types of assets.  These may include financial accounts and business interests.  However, one of the most common and valuable assets is a real estate residence.  While the decedent’s house may be the most valuable item in an estate, a number of problems may exist regarding the property.  For instance, there may be a mortgage which needs to be paid, or real estate taxes that are due.  The property may need repairs in order to maintain its value and structural integrity.  In many cases, an estate does not have sufficient assets to pay for such expenses.  As a result, the property would need to be sold to satisfy these items.  Also, real estate assets may need to be sold to be able to make payment of estate funds to various beneficiaries.

A major issue which often arises is that the real estate which is to be sold may be occupied by third parties or other family members. When this occurs, the administrator or executor must commence Court proceedings to obtain the eviction of the occupants.  This Probate Blog has discussed this issue in previous posts.

In New York there are many different types of residences that may have been occupied by a decedent.  The settlement of an estate may be impacted by the nature of such home.  For instance, a person may have been living in a rental apartment, or in a cooperative or condominium unit.  Another possibility is that a decedent owned and resided in a single or multi-family home.

An estate attorney in New York who is also experienced with landlord-tenant and real estate issues can assist with administrating such properties.  Where a decedent lived in a rental apartment, the estate does not own any equity in the apartment and it does not have any value that can be sold or collected.  However, some apartments, such as rent-stabilized or rent controlled units, are given certain rights which allow designated family members to continue to live there.  Such rights are called succession rights and these can be very valuable especially where the rent is low.

The protection of residence rights can be complicated.  In a recent Brooklyn case entitled College Apartments, LLC v. Gedeon decided by Civil Court Judge Hannah Cohen on December 18, 2020, a landlord had commenced a non-payment of rent eviction case against the tenant.  As it turned out, the tenant had died before the case was commenced.  The son of the decedent tried to settle the case with the landlord and alleged that he was entitled to succession rights.  After reviewing the case following a settlement, the Court dismissed the proceeding since the death of a defendant prior to the commencement of an action results in the action being a nullity.  Fortunately for the son, he was able to retain counsel who sought to dismiss the case even after the settlement.

Time after time, estate executors and administrators seem to be confronted by a common problem – the sale of estate realty occupied by a family member.  The duty or obligation of the estate fiduciary is to collect and protect the estate assets and satisfy the decedent’s debts and obligations and finally, to effectuate distribution of estate assets according to the provisions of a Last Will and Testament or the laws of intestacy.  The many facets of estate settlement have been discussed in numerous articles posted in the New York Probate Lawyer Blog.

Real estate, typically the residence of the decedent, is the largest asset in an estate.  Very often after the death of the decedent, the residence continues to be occupied by a family member or a third party.  When the real estate must or should be liquidated to allow an estate to be administered and finalized, the individuals remaining in occupancy must be evicted.  As is commonly known, evicting persons from their homes is neither pleasant nor easy.

In the case of a decedent’s estate, commencing summary proceedings in the local landlord tenant Court may be the most efficient avenue as to non-related third-party occupants.  However, when a case involves relatives or estate beneficiaries, the Surrogate’s Court procedures often offer a more accommodating forum.  Depending upon the preferences of the local court, a proceeding to remove an occupant from estate property may be commenced in the form of a turn-over proceeding or possibly as an ejectment case.  Article 19 of the Surrogate’s Court Procedure Act entitled “Disposition of Real Property” also provides a procedure to have the Court direct a sale or disposition of the realty.  My Blog, referred to above, has discussed these eviction matters in earlier posts.

The settlement of an estate typically focuses on the protection and collection of estate assets.  These assets may include bank accounts, retirement funds and other financial holdings.  However, the major asset in most estates is an interest in real estate.  Real estate may be in the form of a single family home, a multi-family residential building, commercial property or even a condominium unit.  While a cooperative apartment is not real property, since the interest is in the cooperative corporation, its value and ownership are generally equivalent to real estate holdings.

The decedent’s interest in real property is determined by the ownership document existing at the time of death.  This is typically a deed.  A deed can show different types of ownership interests.  The decedent may own a property as a joint tenant with a right of survivorship or he may just own the property in his name alone.

Problems arise when an estate property is held in the name of a number of owners as tenants in common.  In such a case, the decedent’s interest passes to his beneficiaries who then own the property along with the other owners, all as tenants in common.

Many decedents’ estates contain assets in the form of real estate.  A decedent may have owned a home or rental property or a commercial building containing a business.  Such items are typically the most valuable items among the decedents’ assets.

If a decedent left a Last Will, such document may provide for the disposition of a specific parcel of real estate to a named person.  When the Will does not contain such a provision or when a decedent dies intestate without a Will, the real property is part of the general estate.  In most of these situations, the property is typically sold to provide for the payment of estate obligations such as an outstanding mortgage or the disposition of funds to a number of estate beneficiaries.  The New York Probate Lawyer Blog contains many articles concerning estate administration.

The sale and closing of real estate by an executor or administrator is usually comparable to the process when a sales transaction is entered into among living individuals.  However, there are a number of important aspects regarding estate closings that should be taken into consideration.  Here are a few important items:

A New York decedent may have many different interests in property and assets. Such interests may include real estate such as a residence and financial and bank accounts. These assets are disposed of after death through a number of methods. There may be a Last Will and Testament which, after being admitted to probate, controls the disposition of items held in the decedent’s name alone. Also, assets that are owned jointly or that contain designated beneficiaries are distributed by operation of law to the designee. The New York Probate Lawyer Blog has published many posts talking about asset distribution from an estate.

Another very important right that may flow from a decedent is a right to succeed or take over the tenancy of a decedent’s New York City rent stabilized or rent controlled apartment. This right which is typically afforded to certain family members identified in the rent regulations is important because it preserves the tenancy and rent limitations for the successors. The rent laws and regulations provide very specific guidelines for someone to qualify for this favored treatment.

In addition to family members, the rules allow for so-called non-traditional family members to obtain these rental rights under certain conditions. Where individuals have relationships that in effect amount to financial and family-type interdependence, the law will recognize the need to allow the survivor to take over the apartment tenancy. In these cases, a Court will scrutinize the nature and extent of the relationship to see whether the statutory criteria have been satisfied.

A New York Estate is usually comprised of many different types of assets. There can be bank accounts, brokerage accounts, retirement funds, and business interests in the form of limited liability companies, partnerships and corporations. However, one of the most common and valuable assets of an estate is real estate. There may be commercial properties or residential properties.

The estate fiduciaries, whether an Administrator or Executor, must protect and manage the estate properties. This is part of the fiduciaries’ duties and is necessary for effective estate settlement. In many instances an executor or administrator may be faced with the problem that the real estate is occupied by individuals who refuse to vacate the premises and who do not have a legal right to remain in possession. The New York Probate Lawyer Blog has published earlier articles regarding this estate dilemma. As will be discussed in this blog post, the issue is very common.

When a property owned by the estate is occupied by third parties without any possessory rights, the fiduciary is forced to engage in estate litigation to evict them. Sometimes these eviction cases can be commenced in Landlord-Tenant Court. This is usually the procedure to be used with occupants who have no family or other connection to the decedent. However, when a family member or someone with a close relation to the decedent is improperly refusing to leave the real estate, such as a house, relief may be sought through the procedures in the Surrogate’s Court. As an estate attorney, I have represented many fiduciaries in these types of cases. A recent Manhattan estate case decided by Manhattan Surrogate Nora Anderson on December 19, 2019 entitled Estate of Flender shows how these matters are handled by the Court. In Flender, the decedent’s Last Will directed that the estate real estate be sold. The Will also had a provision that the estate beneficiaries could purchase the real estate if they complied with certain guidelines and timeliness. One of the beneficiaries provided notice that they wanted to buy the estate property where they were presently residing. However, the beneficiary failed to comply with the purchase requirements. As a result, the fiduciary commenced a Surrogate’s Court Procedure Act turnover proceeding to have the beneficiary evicted. The beneficiary argued that the trustees of trusts established under the Will wrongfully refused to make a discretionary payment to the beneficiary that would have provided the financing for the purchase. After a hearing, the Court found that the trustees did not act in bad faith in refusing to distribute trust assets to facilitate the purchase. The Court granted the relief requested in the turnover proceeding and directed the issuance of a warrant of eviction. The beneficiary was allowed 60 days to vacate the estate property.

An Article 81 Guardian appointed to safeguard the person and property of an incapacitated person may need to deal with an assortment of issues.  Similar responsibilities are given to the Executors and Administrators of an estate.

In particular, the property interests of both an incapacitated person and a decedent’s estate may involve an apartment where the person was residing.  When a person dies, if the apartment was not owned in nature of a co-op or condominium unit, the estate fiduciary must arrange to obtain access to the apartment.  The need for access can include securing valuable articles of tangible personal property, locating asset information such as tax returns, bank account statements and brokerage and retirement fund information.  Additionally, the apartment will need to be cleaned out at some point and returned to the possession of the landlord.  Of course, if there are other family members living in the apartment who refuse to leave or provide access or who have claims to continue to occupy the premises in the nature of succession rights, then the fiduciary must grapple with these issues.  The New York Probate Lawyer Blog has published numerous articles concerning problems in obtaining possession of a decedent’s real property.

The Guardian for an incapacitated person may face similar issues particularly if the ward is now residing in a nursing home or other location.  An issue may arise as to whether the incapacitated person intends to return to the community to live in the apartment.  A landlord may want the ward evicted, particularly if the apartment is rent regulated.

Estate assets may include bank accounts, security investment accounts and retirement funds.  However, real estate ownership typically accounts for the largest value in most estates.  Moreover, due to the many ways that real property may be owned and the lack of attention by owners to title formalities, an estate’s interest in such property may be frought with complexity.

Real property in New York can be owned individually or by more than one person as tenants in common or as joint tenants with rights of survivorship.  A married couple can own real estate as tenants by the entirety.  When a property owner dies, the post-death transfer of the property is typically going to be determined by a number of factors.  One consideration is the manner in which the property is owned.  If it is owned in joint tenancy with survivorship rights or as tenants by the entirety, the ownership will be automatically vested in the survivor by operation of law.  However, if the property is held in the decedent’s individual name, it will pass either pursuant to the provisions in a decedent’s Last Will, or transferred by intestacy to the decedent’s next of kin.

As an Estate Attorney in New York City, I have represented clients in Brooklyn estates and Queens estates and Manhattan estates, for example, where the title to estate property was clouded by issues of ownership that preceded the decedent’s death.   In many of these cases real estate that is technically owned by the decedent is still in the name of pre-deceased relatives since no formal action was taken to transfer the title after the death of the older relative.  I have seen property still held in the name of deceased parents and grandparents of the decedent.  Sorting out the current ownership of such property can be a monumental task and might delay the transfer or sale of the property for many months.  This can lead to estate litigation.

One of the most valuable assets compromising an estate is real estate.  Typically, a decedent may own a home which he occupied with other individuals or which third parties occupied alone.

When the Surrogate’s Courts appoints an Administrator or Executor, the duties of the fiduciary often include securing and selling the real estate.  The real estate may need to be sold to satisfy estate obligations such as a mortgage or credit card bills or other debt obligations.  Also, the property may need to be liquidated to divide up the proceeds among a number of beneficiaries.

There are many situations where the persons residing in the estate property refuse to vacate.  I have represented numerous estates where landlord tenant eviction proceedings were required to evict persons occupying estate property.  Additionally, there are estate litigation proceedings that can be commenced in the Surrogate’s Court to remove persons from estate property.  These proceedings can be ejectment cases or turn-over proceedings pursuant to Surrogate’s Court Procedure Act 2103 entitled “Proceeding by fiduciary to discover property withheld or obtain information”.