Property Ownership

rapidtornado

Apologies if this thread is in the wrong location, I couldn't really find a suitable sub-category.

The situation we face is this...
Approximately 20 years ago my wife and her sister were both left a % equity share in a property from their grandmother and their mother had the remaining equity share. The property in question was in the process of being renovated for the mother and father to live in as their main residence. The mother sought legal advice as the will of the grandmother was clear that a certain % was to go to each of her granddaughters but the mother could not afford to bu their share out, naively both daughters signed a legal document, 'gifting' their share of the property to the mother so they could continue to live in the house.
A lot of time has past and husbands and kids are now in the equation and the topic has resurfaced about the ownership and equity share of the property, it would appear the property is now jointly owned by the mother and father and no provision is in place for the 2 daughters in the event of a sale or if either parent dies... Is there a way of getting this decision reversed on the basis of bad counsel or can a legal document be drafted now to correct this and have both daughters own a % equity in the property as I'm sure there will be inheritance tax issues if it is left to probate... any advice would be appreciated

lincroft1710

If your wife and sister-in-law voluntarily gifted their shares in the property to their parents, then the property belongs wholly to the parents. It is up to each parent to write a will setting out to whom they wish their estate to be left. Or not write a will and upon their passing their estate will be subject to the rules of intestacy.

unholyangel

What age were they when they signed it? Given you say they signed so they could continue to live in the property.

Fire_Fox

rapidtornado wrote: »

Apologies if this thread is in the wrong location, I couldn't really find a suitable sub-category.

The situation we face is this...
Approximately 20 years ago my wife and her sister were both left a % equity share in a property from their grandmother and their mother had the remaining equity share ...

The mother sought legal advice as the will of the grandmother was clear that a certain % was to go to each of her granddaughters but the mother could not afford to buy their share out, naively both daughters signed a legal document, 'gifting' their share of the property to the mother so they could continue to live in the house.

This makes no sense. Why did anything need to change? Where does 'bad counsel' come into the story?

How old were your wife and her sister? Are they willing to hold one or both parents legally accountable for financial abuse of a dependent?

rapidtornado wrote: »

A lot of time has past and husbands and kids are now in the equation and the topic has resurfaced about the ownership and equity share of the property, it would appear the property is now jointly owned by the mother and father and no provision is in place for the 2 daughters in the event of a sale or if either parent dies...

Is there a way of getting this decision reversed on the basis of bad counsel or can a legal document be drafted now to correct this and have both daughters own a % equity in the property as I'm sure there will be inheritance tax issues if it is left to probate ... any advice would be appreciated

What do the parents want to do, if anything? Inheritance tax and probate assumes that: the parents will die intestate or bequeath the property to their daughters, and that some or all of the estate will not be used to fund the parents' care in their twilight years.

Cancel, reverse, revoke, correct, regularise ... implying that your wife and her sister believed the transfer to be temporary or on paper only? And that they were led to believe they still had a beneficial interest in that property?

If the daughters had each had a legal right to a quarter share of a property that they did not live in it could be considered an asset. This asset would have had to have been declared when their respective families or households applied for any means-tested benefit over the last twenty years. Did that happen?

System

rapidtornado wrote: »

Apologies if this thread is in the wrong location, I couldn't really find a suitable sub-category.

The situation we face is this...
Approximately 20 years ago my wife and her sister were both left a % equity share in a property from their grandmother and their mother had the remaining equity share. The property in question was in the process of being renovated for the mother and father to live in as their main residence. The mother sought legal advice as the will of the grandmother was clear that a certain % was to go to each of her granddaughters but the mother could not afford to bu their share out, naively both daughters signed a legal document, 'gifting' their share of the property to the mother so they could continue to live in the house.
A lot of time has past and husbands and kids are now in the equation and the topic has resurfaced about the ownership and equity share of the property, it would appear the property is now jointly owned by the mother and father and no provision is in place for the 2 daughters in the event of a sale or if either parent dies... Is there a way of getting this decision reversed on the basis of bad counsel or can a legal document be drafted now to correct this and have both daughters own a % equity in the property as I'm sure there will be inheritance tax issues if it is left to probate... any advice would be appreciated

Wife and sister will get the house anyway. At least the way I've read it.

rapidtornado

Thanks all for your replies. To clarify, the property had been empty for years. The parents were in the process of renovating it. The grandmother owned the property 100% during the renovation. Pretty much after the renovation was complete the grandmother died leaving 50% to her daughter and 25% to each granddaughter. As the mother could not afford to buy out the 50% off each of the daughters, she decided to see a solicitor and draft a legal document for both daughters to sign, basically gifting their mother their share so that they did not have to sell the property and in effect become homeless... the daughters were about 19 when they signed over their share to their mother, the daughters were not residident in the property. The issue is that there was never any backstop arrangment to 'repay' the equity to the granddaughters in the event of the property being sold or if the parents passed away. When I mention bad counsel, I think the Solicitor advising the mother at the time did not make it explicitly clear to the daughters that they were in effect signing over their share of the property with no means of securing it when the property is sold in the future. For sure a will can be put in place to ensure both daughters have their fair share when the parents pass away but it is more likely the property will be sold in the next couple of years... and as it stands they have no legal entitlement to any of the proceeds from the sale.

rapidtornado

About 19 or 20

Tom99

You have missed the deadline for any sort of professional negligence claim, the absolute limit is 15yrs from the date of negligence.

MEM62

rapidtornado wrote: »

When I mention bad counsel, I think the Solicitor advising the mother at the time did not make it explicitly clear to the daughters that they were in effect signing over their share of the property with no means of securing it when the property is sold in the future.

Why would you think that the mother's lawyer had that obligation? If the lawyer was engaged by and acting on behalf of the mother they would have no obligation to advise the daughters.

If the daughters have been fooled that is unfortunate. However, with both parents still living their is an opportunity to approach them to redress the situation in their wills but this would require their willingness to do so as it sounds as if the daughters gave away any ownership rights they had.

Fire_Fox

rapidtornado wrote: »

Thanks all for your replies. To clarify, the property had been empty for years. The parents were in the process of renovating it. The grandmother owned the property 100% during the renovation. Pretty much after the renovation was complete the grandmother died leaving 50% to her daughter and 25% to each granddaughter.

As the mother could not afford to buy out the 50% off each of the daughters, she decided to see a solicitor and draft a legal document for both daughters to sign, basically gifting their mother their share so that they did not have to sell the property and in effect become homeless... the daughters were about 19 when they signed over their share to their mother, the daughters were not residident in the property..

First paragraph is crystal clear. The emboldened makes no sense.

Why would the daughters have to sell or have to be bought out by the mother?

Why did anything have to change? Three owners registered as tenants-in-common, 50%/25%/25% split.

rapidtornado wrote: »

The issue is that there was never any backstop arrangment to 'repay' the equity to the granddaughters in the event of the property being sold or if the parents passed away. When I mention bad counsel, I think the Solicitor advising the mother at the time did not make it explicitly clear to the daughters that they were in effect signing over their share of the property with no means of securing it when the property is sold in the future.

For sure a will can be put in place to ensure both daughters have their fair share when the parents pass away but it is more likely the property will be sold in the next couple of years... and as it stands they have no legal entitlement to any of the proceeds from the sale.

At nineteen years old they did not understand the implications. When in the intervening twenty years did they realise what they had signed over with no security?

If the solicitor was only instructed by the mother, not clear how they could be held liable for not advising the daughters.

IMO it is this mother who financially abused her daughters. They need legal advice now. See if they can lodge an interest in or implied trust on the property.

thriftylass

I own part of a property with my parents, but rather than gifting them my part we drew up an agreement whereby they have livelong right to remain so no need to become homeless or we sell together.

Was it for the mum's security in case the daughters wanted to sell? Or was it a criterium to own 100% to get credit for the renovations . Either way the daughters should have known that's it, it belongs now to their parents till they die unless they sell before hand (what did the daughters imaging would happen in case of a sale?) I don't think the mother financially abused the daughters unless they were misinformed or intentionally misled or made false promises ?