Why Use a Warranty Deed?

A Warranty Deed is one of the most commonly used forms of conveying property in the United States today.  

The Warranty Deed is primarily used by "arms-length" parties (i.e. not friends or relatives) because it provides the buyer with certain assurances related to the seller's right to sell the property.  

A "Special Warranty Deed" assures the buyer that the seller has not done anything to the property while the seller owed it that would damage the title or marketablility of the property.

What is a Power of Attorney?

A Power of Attorney or POA is a document granting one person written authority to legally act on behalf of someone else.  POA's can be used in real estate transactions when one party (buyer or seller) cannot attend the closing.  A third party can be given POA to sign the closing documents on behalf of the absent party.

Life Estate Deed v. Enhanced Life Estate Deed

I am often asked by clients whether the Life Estate Deed and the Enhanced Life Estate Deed work the same way when it comes to transferring and owning property.  

The simple answer to this question is: No.  

Although both deeds sound similar in name, each has its own unique benefits and limitations.

Life Estate Deed

For instance, when you execute a Life Estate Deed naming a "life tenant" and a "remainderman", both the "life tenant" and "remainderman" have a vested interest in the property at the time the deed is executed.  

The "life tenant" may use the property during his or her lifetime, but owes a duty to the "remainderman" not to dispose of or otherwise destroy the property.  

View my other post on the Life Estate Deed for more information on how it works.

Unlike the Life Estate Deed, the Enhanced Life Estate Deed does not grant a vested interest in the property to the "remainderman" at the time the deed is executed. 

Enhanced Life Estate Deed

The owner of the property may dispose of the property at any time without the consent of the "remanderman."  

Read my other post on the Enhanced Life Estate Deed for more information on how it works.

Both deeds also contain certain similarities.  

The biggest similarity in the two deeds is that they are both designed to avoid probate by passing property to a remainderman without having to go through the court process.

What is an Agent?

An agent is a person (or business) who is authorized to act on behalf of another person.  A general agent is an agent who is authorized to conduct multiple transactions involving a continuity of service.  For instance, a general agent might be someone who has guardianship or conservatorship of another person and is responsible for writing checks or making financial decisions for the ward.

A special agent is authorized to conduct a single transaction or a series of transactions not involving continuity of service.  An agent who has been given a limited power of attorney for the purpose of closing a real estate transaction would be considered a special agent.

Master, Servant and Independent Contractor
Two types of agency relationships include the Master and the Servant.  A Master is a principal who employes an agent to perform service in the Master's affairs and who controls or has the right to control the physical conduct of the other in the performance of the service.

A Servant is an agent employed by a Master to perform service in his affairs whose physical conduct in the performance of the service is controlled or is subject to the right to control by the Master.

Another type of relationship is that of the Independent Contractor.  An Independent Contractor is a person who contracts with another to do something for him but who is not controlled by the other nor subject to the other's right to control with respect to his physical conduct in the performance of the undertaking.  The Independent Contractor may or may not be an agent.

Tungsten Wedding Bands

Tungsten Wedding Bands Lawsuit
In a recently filed court case involving the manufacture of tungsten wedding bands, jewelry manufacturer Quality Gold, Inc. is attempting to turn the tables on fellow jewelry designer Trent West.  On December 19, 2011, QGI filed a declaratory action in the U.S. Southern District of Ohio asking the Court to either hold that a patent owned by West for the manufacture of tungsten rings is either invalid or that QGI is not in violation of the patent. 

In filing suit, QGI appears to be firing back at West for continuing to send QGI "cease and desist" letters regarding QGI's manufacture of tungsten rings.  It is not uncommon in the jewelry manufacturing business for one company to feel like another company is copying its designs.  It is less common for the party accused of copying the design to file suit against the purported "victim." In this case, the dispute between QGI and West has taken place over several years and involves more than one patent.

Why all the Fuss over Tungsten?
Tungsten is one of the hardest materials used to make wedding bands.  Once people discovered how difficult it is to scratch, it quickly became a popular substitute for gold, silver and other metals traditionally used for wedding bands.  Other alternative materials include palladium and titanium.  It is also possible to engrave tungsten bands with gold or silver to give it a different look.

Florida's Will Reformation Statute Turns Estate Planning Upside Down

Florida's Will Reformation Statute Section 732.615

In 2011, the Florida Legislature revised its Probate Code to allow any interested person to reform a deceased person's Will even when the terms of the Will are unambiguous.  In doing so, hundreds of years of Estate Planning Precedent has been turned upside down.  The new Statute cuts against Florida's strict requirements for creating a valid Will and opens the door for abuse by disgruntled persons either left out of the Will or who want a larger portion of the Estate's assets.  The exact language of the Statute is as follows: 

732.615 Reformation to correct mistakes.—Upon application of any interested person, the court may reform the terms of a will, even if unambiguous, to conform the terms to the testator’s intent if it is proved by clear and convincing evidence that both the accomplishment of the testator’s intent and the terms of the will were affected by a mistake of fact or law, whether in expression or inducement. In determining the testator’s original intent, the court may consider evidence relevant to the testator’s intent even though the evidence contradicts an apparent plain meaning of the will.

One affect of this Will Reformation Statute has been to cause some to question whether executing a Will is the best way to leave property to their loved ones. 

As a not-so-hypothetical example of the Statute's absurdity, suppose that as a husband and father I want to leave all of my property to my wife and children when I die.  Not so hypothetical to most of my clients.  Under the current Florida Statute, if I die intestate (without a Will) the Florida Probate Code requires distribution of my property to my wife and children in various proportions. 

Now assume that instead of dying intestate, I die leaving a validly executed Will distributing my property to my wife and children in the same proportions as if I had died intestate.  Under the new Will Reformation Statute, "any interested person" can now disrupt the probate process by filing suit for Reformation of my Will seeking a portion of my estate.  That same person can now file the same lawsuit for any estate in Florida as long as the person can show he or she is an "interested person." 

Success on the merits of such a lawsuit could depend on oral testimony of the person drafting the Will (i.e. "I wrote that down wrong, what the Testator really meant to say was..."), a letter written by the Testator in the heat of passion before or after execution of a Will, or he said/she said discussions from any number of interested parties.  I know that each of these three examples are currently being used in Reformation Lawsuits currently pending in Florida courts. 

To make matters worse, suppose a Will was probated thirty years ago with the provision that the corpus of a trust set up by the Will was only to be distributed upon the death of the trust beneficiary.  The trust beneficiary then dies after the Reformation Statute has taken effect.  According to at least one interpretation of the Reformation Statute, the distribution of the Trust corpus gives rise to a Will Reformation lawsuit over a Will probated thirty years ago.

On another note, there is a jaded part of me that wonders whether counseling my clients to execute a Will can open me up to a malpractice suit when the facts are as stated in my not-so-hypothetical hypothetical.  The statute turns Wills and Trusts law upside down.

Special Warranty Deed

Special Warranty Deed Protects Seller

What makes a Special Warranty Deed different from a General Warranty Deed?  In short, a Special Warranty Deed adds a measure of protection for the seller that a General Warranty Deed does not.  When you purchase property and the seller transfers title to you in the form of a Special Warranty Deed, the seller is esentially saying that he will guarantee (or warrant) that nothing has happened to cloud the title to the property while he has owned it.

DUI Charges

DUI Charges
One of my clients was recently pulled over for drunk driving (DUI).  He has to take prescription drugs which can dull his senses, but never drives during the prohibited time period after taking his medication.  He happened to ask me some weeks ago while dealing with an estate planning issue what I thought he should do if he ever was pulled over for DUI.  He thought it might be difficult to pass a drug test because his medication can linger in his system even after the "drunken" feeling has worn off.  As it turns out, our conversation turned into reality when he was pulled over after crossing a double yellow line this past weekend.  He had actually been on his cell phone and wasn't paying attention; not that I approve of either.

DUI Advice
During our conversation I gave him the following advice:

1. Do not answer any of the police officers questions.  You don't have to be rude, but the officer is not your friend no matter how nice he may act towards you.  They mean it when they say "Anything you say can AND WILL be used against you."  The words "I'm sorry" can be interpreted in a court of law as an admission of guilt even if what you are sorry for has nothing to do with drunk driving. 
2. Do not take the officer's field sobriety test.  It can be difficult for even the most sober person to count backwards from 100, walk in a completely straight line (one false step can be viewed as evidence against you), or touch his or her nose with a fingertip in a way that satisfies the officer.  This test is not even legally required in most states.
3. Do not take a breath test until you are arrested.  If you have been arrested you are required to take a breath test and, in most states, if you refuse they can perform a blood test.

My client followed this advice to a T.  In the end he was arrested but passed his breath test and is not facing charges for DUI.

DUI California

California DUI Laws
California DUI Laws become more complex and difficult to mitigate the more offenses a person has committed.  For instance, a first offense DUI may not require any more time in jail than the time spent upon arrest.  The harshest penalties assessed as a result of a first offense DUI usually deal with monetary fines and a suspension of a person's drivers license.  On the other hand, a second offense DUI requires the Court to give at least a four day jail sentence or work release.  The fine is increased as is the time for suspension of drivers license.

A third offense DUI requires at least four months of jail time, house arrest or rehabilitation.  DUI school will also likely be required in addition to the penalties faced under a second offense DUI.  Each of the first three offenses is generally deemed a misdemeanor unless there are Enhanced DUI Penalties which merit a felony charge.

A fourth offense DUI in California usually brings felony charges with it.  Penalties include a three year prison sentence and license being permanently revoked.

As a practical matter, you should always consult a DUI attorney if you are charged with DUI in any state.  Most prosecuting attorneys would rather work with a DUI attorney they know than someone they don't.  Most prosecuting attorneys are also overburdened with heavy caseloads and the opportunity to get a case off his or her desk without spending a ton of time on it is welcomed.  DUI attorneys generally know this and can use it to a client's benefit.  

What is a Quit Claim Deed?

Quit Claim Deed
A Quit Claim Deed (sometimes misspelled "quick claim deed") is a legal document used to transfer one person's interest in a parcel of property to someone else.  The Quit Claim Deed is often used between family members and friends because the transfer is made without any warranties or representations.  Of particular note, the Quit Claim Deed does not warrant that title to the property is clear or that the person executing the deed is even an owner of the property.  All the Quit Claim Deed does is transfer any interest the grantor has in the property to the grantee. 

Warranty Deed
If you are purchasing a parcel of real estate and you want to ensure that title to the property is clear, you will need to execute another form of deed.  A Warranty Deed requires the grantor to ensure that title to the property is clear.  This includes the Special Warranty Deed.  Read my other post for more information on the difference between the Warranty Deed and Quit Claim Deed.