Requirements for Transfer of Title

ESTATES:

This section provides information regarding how to convey the real property of a decedent. This section is divided into four parts.

1. VALID WILL AUTHORIZED EXECUTOR:
If the owner of real property dies leaving a valid will, the conveyance will be valid so long as the will authorizes the executor/executrix to convey real property. In order to convey good title, the deed must state that the will authorizes the executor/executrix to convey real property.

2. VALID WILL NO AUTHORIZATION:
As a general rule, an unauthorized executor/executrix may not unilaterally convey real property of the decedent. In order to convey real property, an unauthorized executor/executrix must prepare a Motion for Land Sale with the Probate Court. The Motion must contain all parties who have an interest in the real property, including perfected lien holders and all next of kin. Probate Court must grant an Order authorizing the sale in order for the conveyance to be effective.

A. Exception:
An unauthorized executor/executrix MAY convey the real property of a decedent if ALL Devisees, Legatees and Heirs at Law of the decedent sign a writing which authorizes the transaction. The writing must be filed in the Probate Court in order to be effective.

3. THE DECEDENT DIED INTESTATE (no will):
As a general rule, an administrator/administratrix may not unilaterally convey the real property of a decedent who has died intestate. In order to convey real property, the Administrator/Administratrix must prepare a Motion for Land Sale with the Probate Court. The Motion must contain all parties who have an interest in the real property, including perfected lien holders and all next of kin. The Probate Court must grant an Order authorizing the sale in order for the conveyance to be valid.

A. Exception:
An unauthorized administrator/ administratrix MAY convey the real property of a decedent who has died intestate if ALL Legatees and Heirs at Law of the decedent who would be entitled to inherit under the laws of Intestate Succession (See Generally O.R.C.2105.O6) sign a writing which authorizes the transaction. The writing must be filed in the Probate Court in order to be effective.

4. CO-TENANCIES:
When the decedent owner of real property holds title with one or more parties, they are co-tenants in the real estate. One must determine whether the decedent and others who have an interest in the property share title as tenants in common or as joint tenants with right of survivorship.

A. Joint tenants with rights of survivorship:
If the decedent held the real property as a joint tenant with right of survivorship, the interest passes to the other joint tenants upon his death. Thus, marketable title cannot be conveyed.

B. Tenants in common:
If the decedent held the real property as a tenant in common with others then the decedent’s interest is transferable.

i. See sections 1,2,3 for conveyance procedures.

C. The decedent was a joint owner of property leaving a surviving spouse:
When the decedent is a joint owner of property and has died leaving a surviving spouse, two requirements must be satisfied in order to convey marketable title. (1) An "Affidavit of Surviving Spouse" with an attached copy of the death certificate must be filed with the County Recorder. (2) An Ohio Estate Tax Return must be filed in the Probate Court prior to transfer of the real property.

i. Even if the surviving spouse is not listed as a holder of title in the real property he/she needs to consider the surviving spouse’s dower rights in the real estate.

GUARDIANSHIP:

This section provides information regarding how to convey real property owned by an incompetent party or minor. This section is divided into two parts:

1. GUARDIAN APPOINTED:
A Guardian cannot unilaterally convey the real property of his/her ward. In order to convey real property, the Guardian must prepare a Motion for Land Sale with the Probate Court. The Motion must demonstrate that the conveyance is in the best interest of the ward. It must also contain all parties who have an interest in the real estate, including perfected lien holders and all next of kin. The Probate Court must grant an Order authorizing the sale in order for the transaction to be valid. Following the sale, the Court must grant an additional Order confirming the Guardian’s authority to sign the deed. The Guardian cannot sign the deed without first having obtained the confirmation Order.

2. NO GUARDIAN APPOINTED:
If an owner of real property is adjudged incompetent or is a minor an no Guardian has been appointed, the Probate Court must appoint a Guardian. After the Guardian is appointed, follow the steps set forth in paragraph one (1) of this section. If you wish to browse this section press x and then 1.

DIVORCES:

This section provides information regarding how to convey real property when the owner is currently involved in divorce litigation or has in fact been divorced. This section is divided into two sections.

1. PENDING DIVORCE LITIGATION:
When an owner of real property is involved in pending divorce litigation, one must review the file at the Domestic Relations Court. If the Court has placed Restraining Orders on the owner’s ability to convey his/her interest in real property, the owner cannot covey marketable title.

2. VALID DECREE OF DIVORCE:
When an owner of real property has terminated his/her marriage through a valid Decree of Divorce, one must obtain a copy of the Divorce Decree and/or an incorporated Separation Agreement in order to determine its impact on the real property. Although Divorce Decrees are fact specific, some common clauses to look for include:

A. Waiver of Dower Clause

B. Was the real property awarded to one party or both?

i. Was the property awarded pursuant to a Division of Property Clause or as Spousal Support?
1) Decree of Divorce may require proof of compliance.

ii. If the real property awarded to one party the Decree of Divorce will often times require that a percentage of the proceeds be paid to the ex-spouse.

1) Ex-spouse may have mortgage on real property

iii. Which party assumes any liens (mortgages et al.) which have been levied against the property. Liens creates an encumbrance on the real property and must be released if the owner wishes to convey marketable title.

C. Does the Decree of Divorce Order a Sale of the Real Property?

i. Who gets the proceeds?

1) Are there any third party creditors

2) Property Division or Spousal Support

D. Deed

i. Which party is ordered to execute the deed.

ii. Was the deed conveyed via quitclaim, special or general warranty.

 

POWER OF ATTORNEY

This section provides information regarding how to convey real property when the owner has authorized another party, called an attorney in fact, to convey the real property on his/her behalf.

This sections addresses the situation which exists when an owner of real property authorizes an agent, called an Attorney in Fact, to convey real property on his/her behalf. Two requirements must be satisfied in order for any Attorney in Fact to convey marketable title.

1. The Power of Attorney (the document which creates the agency relationship) must specifically authorize the Attorney in Fact/agent to convey or encumber the owner’s interest in the real property.

2. The Power of Attorney must be recorded with the County Recorder prior to the filing of a deed evidencing a conveyance of the real property.

 

TRUSTS

This section provides information regarding how to convey real property when legal title to the property is held in trust for the benefit of a beneficiary or group of beneficiaries.

This section addresses situations which arise when title to real property is held in trust. When real property is held in trust, the trustee holds legal title to the property for the benefit of a beneficiary or group of beneficiaries who hold equitable title to the property. In order to convey marketable title, two requirements must be satisfied.

1. The trustee must provide evidence of the existence of a valid intervivos or testamentary trust.

2. The trustee must provide evidence of his/her authority to convey an interest in real property.

 

BANKRUPTCY

This section provides information regarding how to convey real property when the owner of real property is insolvent and has filed for bankruptcy. This section is divided into two parts.

1. When the owner of real property has filed for bankruptcy pursuant to Chapter 11 of the United States Bankruptcy Code, the owner must file a Motion in the Bankruptcy Court requesting permission to convey the property. An Order granting the Motion must be filed in order to be effective.

2. When the owner of real property has filed for bankruptcy pursuant to Chapter 7 of the United States Bankruptcy Code, the owners interest in the real property is automatically conveyed by operation of law to a Trustee of the Bankruptcy Court. The Trustee, NOT THE OWNER, is authorized in his/her discretion, to convey the owner’s interest in real property. As a general rule, a trustee may, in his/her discretion, place the owner’s interest in the real property for sale if he/she concludes the owner will maintain equity in the property following the sale (the fair market value of the real estate exceeds the value of third parties interests and creditor’s liens on the property)

A. IF TRUSTEE WISHES TO SELL OWNER’S INTEREST IN REAL PROPERTY:
In order to convey marketable title, the Trustee must meet the following four (4) requirements.

i. The Trustee must Petition the Bankruptcy Court for permission to sell the real property;

ii. The Trustee must notify all lien holder’s and parties holding an interest in the property of the sale of the real estate.

1)NOTE: The Court may eliminate certain unperfected lien holders who claim an interest in the real property.

iii. The buyer of the real property must distribute the purchase price amount to the Bankruptcy Court. The Trustee must sign and deliver the deed to the Buyer.

B. IF THE TRUSTEE DOES NOT WISH TO SELL THE OWNER’S INTEREST IN REAL PROPERTY.
When the Trustee does not wish to sell the owner’s interest, he/she may, in his/her discretion, abandon the property. Upon abandonment, title to the property automatically transfers back to the owner. All creditor’s liens on the property, including those which were eliminated by the Bankruptcy Court, remain on the real estate.

C. IF OWNER WISHES TO SELL THE PROPERTY:
In order to convey marketable title, the owner must arrange for the release of the real property in question from the jurisdiction of the Bankruptcy Court.

 

CHURCH / RELIGIOUS DENOMINATION

This section provides information regarding how to convey real property when the owner of real property is a church or religious denomination. This section is divided into two parts.

1. When the owner of real property is a not for profit corporation church or religious denomination, the following requirements must be met in order to convey marketable title.

A. The church or religious denomination must verify that it was incorporated PRIOR to its acquisition of the real property.

B. The church or religious denomination must verify that it is authorized to convey its interest in the real property.

i. This requirement is satisfied through production of the Constitution or By-Laws of the church or religious denomination.

1) Often times conveyances of real property must be approved by a central body or trustees of the church or religious denomination.

C. Roman Catholic Church: Title in real property is owned by the local bishop and NOT the Church.

2. When the owner of real property is an unincorporated church or religious denomination, in order to convey marketable title, the church must Petition a Common Pleas Court and request permission to convey an interest in the real property. (See generally O.R.C. 1715.39)

 

CORPORATIONS

This section provides information regarding how to convey real property when the owner of real property is a corporation.

1. AUTHORITY:
When a corporation is the owner of real property, it is important to determine whether or not the directors of the corporation are authorized to convey the real property. As a general rule, corporate directors can freely convey real property; However, SHAREHOLDER APPROVAL is REQUIRED to convey real property in the following situations:

A. If the purpose of the corporation prevents the conveyance of real property

B. If the conveyance of real property will result in a fundamental change in the corporate structure

C. If the conveyance will result in a sale of all or substantially all of the corporations assets.

 

PARTNERSHIPS

This section provides information regarding how to convey real property when the owner of real property is a partnership.

1. PARTNERSHIP PROPERTY:
When title to real property is held by the partnership, it is presumptively partnership property.

2. AUTHORITY:
As a general rule, every partner is the agent of the partnership for the purpose of its business. The act of selling real property will bind the partnership if the act was done for apparently carrying on in the usual way the business of the partnership.

A. One should obtain evidence of who the partners are, the nature of the partnership's business, and evidence that all the partners have authorized the sale of the real property.

 

NOTE: THE INFORMATION CONTAINED IN THIS DOCUMENT IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT INTENDED TO TAKE THE PLACE OF A LEGAL OPINION. IF YOU HAVE ANY QUESTIONS ON THE INFORMATION CONTAINED IN THIS DOCUMENT, IT IS SUGGESTED THAT YOU CONTACT YOUR ATTORNEY FOR CLARIFICATION.

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