Will, executors, and life estate

[alceryes]

Background - Virginia law. Person A passed away and left 3 children (person B, C, and D). Person A also has a sister and brother-in-law (person E and F). Person A wrote up a will with person E and F's lawyer. Person A's executed will gives co-executorship to person B and C but gives 'life estate rights' to person E and F (named separately). Only recently has person B and C learned that 'life estate rights' basically gives complete ownership of the estate (house and property, in this case) to person E and F. Person B, C, and D know that this is not what person A would have wanted and don't think person A was told this. Person B, C, and D think person A was told that the life estate was just a way to avoid estate probate, which it does. Fortunately, the house and property can’t sell without the executor’s approval.


Current situation – Person B, C, and D are sure person E and F know what the 'life estate rights' really means. Real estate and property are going to sell. Person E and F can, legally, walk away with the profits from the sale of the house without paying any of person A's other debts. The co-executors want to have an amicable end to this mess and persons B, C, D, E, and F, have agreed (at least verbally) to pay off all debts and split any remaining monies (if there is any) between persons B, C, D, and E/F (E and F as one entity for the end split). Person B wants to write up an agreement between person B, person E, and person F, that is legally binding, and supersedes anything in person A’s will. Person C (the other co-executor) fully agrees with person B and person B is not concerned with having person C on the agreement. Below is what person B has written up. Person B just needs a concrete statement that will stand up in court (no obvious holes). Everyone involved is on very friendly/family terms and wants to keep it this way. No one involved can afford a lawyer and would greatly appreciate any help constructing the below statement, as well as ideas on whether or not the agreement will hold up in court if it comes to that. (The terms person A, B, C, etc. will be replaced with the first and last names of those involved.)

Legal statement to be signed by person B, E, and F and notarized.

Person E, person F, and person B hereby agree that any monies gained from the sale of real estate, houses, and property formally owned by person A (the deceased) will be, first and foremost, used to pay off all of person A’s debt. This includes all outstanding debt owed to person B, person C, person E, and person F. Person B and person C (executors of person A’s will), will be the sole decision makers with respect to paying off all of person A’s outstanding debt. All monies involved will be held by person B and person C until person B and person C are satisfied that all of person A’s outstanding debt is paid in full. When and if there is any money left, the remaining money will be split between person B, person C, person D, person E, and person F as follows.

Person B is to receive 25%
Person C is to receive 25%
Person D is to receive 25%
Person D is to receive 12.5%
Person F is to receive 12.5%

This written, signed, and notarized statement is a legally binding agreement between person E, person F, and person B and supersedes all previous written and/or verbal agreements, including but not limited to person A's executed will.

 

[alceryes]

Shoot. Typo in the above. Corrected below.

Person B is to receive 25%
Person C is to receive 25%
Person D is to receive 25%
Person E is to receive 12.5%
Person F is to receive 12.5%

 

[Zigner]

1: Did you have a question?
2: Why do you believe that a "life estate" gives someone the right to sell the property?
3: Who are you in this matter?
4: It sounds to me like you are going to need an attorney to do things right.

 

[LdiJ]

E and F cannot sell the house. They could sell the life estate if they can find someone who wants to buy a life estate, but that person could only have the house until E and F pass away. The house would still belong to B, C, and D when E and F pass away.

However, the parties can certainly come to an agreement about what they want to do with the house now.

 

[alceryes]

1: Did you have a question?
2: Why do you believe that a "life estate" gives someone the right to sell the property?
3: Who are you in this matter?
4: It sounds to me like you are going to need an attorney to do things right.

Hi Zigner.
I would like to know the following -
Is the statement written above (after "Legal statement to be signed by person B, E, and F and notarized") okay from a legal perspective. Are there any wording issues/loopholes that could change the spirit of the goal of the statement or render it invalid or null and void?

If this statement is signed by B, E, and F, in the presence of a notary and then notarized, will it be legal binding and supersede anything in the executed will?

I don't believe the 'life estate holders' have a right to sell the house. I do believe the life estate holders have rights to most profits from the sale of the house, though. All parties want to sell the house and be done with this.

I am person B in this mess. The other co-executor has basically handed me the wheel.

 

[alceryes]

E and F cannot sell the house. They could sell the life estate if they can find someone who wants to buy a life estate, but that person could only have the house until E and F pass away. The house would still belong to B, C, and D when E and F pass away.

However, the parties can certainly come to an agreement about what they want to do with the house now.

Hi LdiJ.
All parties involved want the estate liquidated and everything paid off, ASAP. I am most concerned about the statement I wrote above that I will get myself and person E and F to sign (and get notarized). I want to make sure it's solid writing from a legal perspective and that it CAN supersede anything in the will.

 

[alceryes]

Thank you all for your replies. I am extremely grateful for any advice/guidance you can provide.

 

[Zigner]

Your matter is beyond the scope of this (or any) internet forum. You need to hire an attorney to assist you.

 

[alceryes]

I understand that it may be a complex matter. I'd really just like an idea about my statement from a legalese perspective, if possible.
Thanks.

 

[Zigner]

I understand that it may be a complex matter. I'd really just like an idea about my statement from a legalese perspective, if possible.
Thanks.

That's what I'm trying to tell you - your request is beyond the scope of a legal forum. To tell you how to word the document is a crime known as Unlawful Practice of Law. You need an attorney.

 

[alceryes]

Okay. Got it. Maybe the other part of my request can be answered since it's knowledge about the law and not asking for any type of wording(?)

Does a notarized contract between parties, made after an executed will, supersede the directives of said will?

 

[LdiJ]

Okay. Got it. Maybe the other part of my request can be answered since it's knowledge about the law and not asking for any type of wording(?)

Does a notarized contract between parties, made after an executed will, supersede the directives of said will?

Yes, because it is a contract between the parties. However, you would have had to sell the house anyway to pay off her debts. No matter what the will gives and to whom the will gives it, the debts of the estate must still be paid first. If the house is the only significant estate asset, then the house has to be sold to pay the bills, even if the will had donated it to charity.

 

[Zigner]

Okay. Got it. Maybe the other part of my request can be answered since it's knowledge about the law and not asking for any type of wording(?)

Does a notarized contract between parties, made after an executed will, supersede the directives of said will?

Notarization doesn't affect the validity of a contract.
You can't change the will with a contract, but you can certainly contract with others to transfer the property once you own it. Alternatively, you could simply refuse to accept your portion, at which point the will would still control what happens, but exclude you.

 

[Zigner]

Yes, because it is a contract between the parties. However, you would have had to sell the house anyway to pay off her debts. No matter what the will gives and to whom the will gives it, the debts of the estate must still be paid first. If the house is the only significant estate asset, then the house has to be sold to pay the bills, even if the will had donated it to charity.

Are you suggesting that a contract created between beneficiaries can change the directives in a will?
I don't think that's what you meant, is it? Or, did you mean that the beneficiaries are free to do what they want with whatever property they own and/or that they can refuse the bequest outright?