Bequeathed house dispute, auction or buy out other party.

Discussion in 'Legal Issues' started by Raphael, 10th Mar, 2010.

  1. Perp

    Perp Member

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    I guess I'm now mystified, too. Is this some kind of grand estate on acreage in Toorak or on Sydney Harbour or something? If it's just a regular house in the suburbs, I don't understand why Dad would particularly want somebody in his bloodline to own it.

    If it IS a regular house in the suburbs, I'm thinking that perhaps his intention was that he wanted the benefit of ownership of that house to pass to his blood relatives, rather than to his wife, and this is what he was emphasising. Perhaps he wanted to ensure that his sons were left with something from Dad, rather than his wife getting everything (particularly given that she's not your Mum).

    I really think the best thing to do is to sell it and split the proceeds down the middle.

    You and your brother will then have the benefit of the property, which I would think was his intent. Perhaps what he was trying to make clear, in his statements while he was alive, was not that it was important to him that you retained ownership of it, but perhaps he was emphasising that, in carving out that particular asset for your and your brother, he was ensuring that you knew that you weren't excluded from his will.

    If he really did definitely say that he not only wanted to leave you the house, but that he specifically wanted you to retain ownership of it, well... I can only repeat that I think that was a bit of a silly thing to say. Did he expect you to live in it together? (I imagine not.) Did he expect one of you to live in it and pay half-rent to the other? What possible scenario could he have envisioned which would not lead to conflict between the two of you?

    I think that pragmatism has to win the day. The best way to preserve your relationship with your brother is to sell the house to strangers and split the proceeds.
     
  2. Dazz

    Dazz Banned

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    This is the crux of the in-laws troubles as well.


    The will said one thing....the definitive thing, and yet before his death was running around saying and promising things to some of the children, and ignoring others, that directly contradicted what the will says.


    Of course, when confronted with "well if that's what you want, make sure you change your will to reflect that"....the answer was "no, I'm not changing the will."


    Moral of the story in our case....STFU (please be silent) and let the executed paperwork do the talking for you.
     
  3. Monopoly

    Monopoly Member

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    Chances are that this is basis on which those who decide to "contest a will" argue their case, disgrunted moans of "yeah but he/she told me I could have X, Y and Z, yet the will says he/she just left me X !!!"

    A lesson for us all, promise nothing to no-one and surprise them all when you exit!! ;)
     
  4. kathryn d

    kathryn d Member

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    This is a mess.
    Since you and your brother cannot agree on a valuation, so you can him out, I think it will need to go auction.Do not bid on it, but rather have someone bid on your behalf.Maybe not even attend the auction, but possibly view at a distance.
    If you can purchase the property, and it is important to you, DO IT.
    You can always sell in the future.

    Your relationship with your brother doesn't sound very strong.
    I havent spoken to my older brother for 10 years (except "Hello", when I accidentally meet him somewhere). All families have somne sort of issues.Whether they are voiced or not.
     
  5. pully

    pully Member

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    this is a mess i agree but it is not uncommon.

    we do not have all the facts of course and there are numerous possibilities based on what has been disclosed.

    i wonder who the executer is or perhaps this will be a joint venture?

    are there any other siblings or dependents?

    the 2nd wife could make a claim?

    the brother that is being portrayed as difficult no doubt would have his side to tell. he could be given the option of buying the other brother out, and then deal with it as he wishes?
    the poster says the property is to stay in the family as that was his fathers wish.
    pity it was somehow stated in the will? or in a trust document?

    legal advice will be necessary to resolve this case. it may have been cheaper to have sorted this out prior given the complexity and the emotions involved after the death of a parent.
    maybe a lesson for others.
    o with
     
  6. Terryw

    Terryw Investor

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    This matter has nothing to do with the will. The will is in the past.

    It is a dispute between 2 joint owners. 1 wants to sell the other doesn't.
     
  7. Monopoly

    Monopoly Member

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    Yes, you're right, sorry I need to fast foward...

    Raphael, don't waste money on lawyers, save your money for the bidding war that lies ahead.

    Best of luck! :)
     
  8. natmarie73

    natmarie73 Member

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    I would seriously let it go. Sell the house and split the money both ways, it's only a house now and not worth getting emotionally consumed with.
    No matter what price you give your brother for his share, if you buy him out he will always feel you have ripped him off as the house increases in value over the coming years/decades and whatever relationship you have with him will be destroyed. Sell it, split the money and buy another house with your share that your brother has no vested interest in or even needs to know about.
     
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  9. Perp

    Perp Member

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    I think that any kind of "dummy bidding" at an auction is only going to heighten any tensions. If the OP insists that he *has* to own this property, then he should tell his brother openly, explain why (because he wants to honour what he perceives were his father's wishes), and bid openly.
    I'm assuming that the house was left to the brothers as joint owners, and this was stated in the will. The problem is that the OP feels that he has an obligation beyond receiving ownership of it from his father, to "keep it in the family". One can't, in a will, dictate to people how they will deal with an asset after you've given it to them. You can put a pre-condition on them receiving it - eg only if they're not married, or only if they have living children, or whatever - but you can't give somebody something and put conditions on what they're to do with it AFTER they get it, without some sophisticated and expensive trust vehicles. If it'd been transferred to a bloodline trust or something, it'd be different, but since it sounds as though the property was simply left to the brothers as joint owners, it's now entirely up to them what they do with it, as Terryw pointed out:
    Smart girl, as always.

    Raphael, it's just occurred to me, is it possible when your Dad referred to "keeping the house in the family", that this was his way of saying that at least some of his assets would pass to his sons, and that his wife (who I assume is not your mother) wouldn't get everything? It would be very hard to say "my wife's not getting the house", but saying "I want the house to stay in the family" could simply have been his way of reassuring you that there were going to be assets set aside for you in his will. In which case, I would think he wouldn't give two hoots if you sell the house - particularly if it's causing friction. I'm sure Dad, if he could speak now, would say "for crying out loud, this was meant to be a GIFT creating JOY; sell it, split the proceeds, and LIVE A LITTLE with the cash bonus!"
     
  10. kathryn d

    kathryn d Member

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  11. Monopoly

    Monopoly Member

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    Why would anyone want to put in a dummy bid (or any kind of bid for that matter) on a property that they would rather not be paying for???

    Surely the more Raphael bids, it's 50% more he has to cough up himself!!And we won't even go into the CGT implications (that's too fast forward).

    He just needs to make sure he puts in the FINAL bid, so that he can secure the buy (if he chooses to fight to keep it that is!) :)
     
  12. Rob G.

    Rob G. Member

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    Sorry about your situation.

    Estate planning is a difficult issue.

    If the property passes to beneficiaries under a will, then any CGT could be deferred (although sounds like a main residence anyway) but also stamp duty may be waived.

    This could also be the case if you don't wish to be joint owners where there are other assets in the estate that could be used to satisfy your brother's claims.

    However, if the property is "sold" to you then stamp duty is a problem. Also if the property is not fully CGT exempt then that may be a problem for the executor.

    You are in a bad situation because your brother can use the estate assets to fund any legal action for his claims ... knowing that it is also costing you indirectly.

    Hope you can find some appropriate advice.

    Cheers,

    Rob
     
  13. lizzie

    lizzie when i grow up ...

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    yes - but - if his brother "knows" that he wants to secure the house, what is to stop the brother from having a friend bid on his behalf, and drive up the price so that raphel has to pay more than "fair share of half".

    i totally agree that this property will cause conflict forevermore if not sold to a 3rd party. if brother gets his share than blows it on "whatever", he will always resent seeing the property going up in value (as property does) and believe he was ripped off.

    there is no way to win, or get peace of mind, by holding on to it.

    let us know how it turns out.
     
  14. pully

    pully Member

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    is the property now in the joint names of the 2 brothers?

    or is probate still to be determined?

    if in joint names and one opposes the sale, how will this be resolved?

    how could this situation be avoided in the future?

    if someone really wants to keep a property in the family?

    someone mentioned a bloodline trust or life interest etc?

    i know that some cases of estates can be in the supreme court for years before being resolved, albeit large and more complicated ones.
     
  15. lizzie

    lizzie when i grow up ...

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    why would someone want to do this unless it was a generational farm or historic property?

    i don't understand the "run of the mill" people trying to dictate to future generations what they can and can't do once they are dead.
     
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  16. pully

    pully Member

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    lizzie i think it can happen with things like farms and businesses. in those cases there usually formal estate planning measures put in place and discussions prior.
    it can still be contested of course especially with the complex family structures some have these days.

    sometimes a person may want the family home to pass to grandchildren rather than to their children all sorts of possibilities. in particular when there are 2nd or 3rd marriages etc.

    sometimes a property maybe dealt with by a life interest, after death the surviving partner can live in the property but cannot say sell it for example.

    these situations can be simplified if full discussions occur before death. but nothing is certain and people have their own agendas.

    just some things that come to mind.
     
  17. Bargain Hunter

    Bargain Hunter You start with 1. Dufus.

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    Hi Raphael,

    Sorry to hear about your Dad, and the issues surrounding his wishes. Unfortunately this scenario is all too common regardless of the value of the estate.

    Your desire to hold onto the family home is understandable with all the memories of your chilhood and the time spent with family and friends however as your brother joint owner the decision is not yours alone.

    I assume yu have spokene with your brother regarding the reasons you want to hold onto the property. Have you listened to the reasons why he wants to sell?

    There could be several reasons, for instance;

    1. He wants/needs the money.
    2. He doesn't want the hassle of owning a rental property.
    3. He doesn't wan the hassle of owning a rental property with his brother.
    4. He doesn't want someone renting his family home, seeing the damage they may cause or changes they make (it's OK if they own it he won't know what they do).
    5. As you are an investor he might believe (no matter what the offer) that you are out to rip him off, and the only way to make sure is if the property is auctioned.

    I am sure that he will be able to force a sale through the courts but perhaps there are other options if you can zero in on his reasons.

    If you can find some common ground perhaps you can move forward with a proposal that can work for both of you.

    For instance I had a friend who divorced and the wife wanted to sell the house. They ended up agreeing to each get a valuation and meet part way. The other option is to agree on a valuer then accept whatever valuation they place on the property.

    Of course this will never be the same as auctioning the property, and perhapos as others have suggested you may just have to attend and bid. Don't let you brother know this befroe hand.

    If you can come to an agreement you can probably expect a mention everytime a house in the area sells for more, or perhaps he'll save this for Christmas.

    Good luck and let us know how you go.

    Andrew
     
  18. Monopoly

    Monopoly Member

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    Yes that's very much a possibility as well.

    I agree, that regardless of how this pans out, there will be no "winners" here, even if both brothers get what they want, their relationships stands to be damaged as the result of this (sad and unnecessary) battle!! :(
     
  19. Terryw

    Terryw Investor

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    I think the property has been transferred into the 2 brothers names already and this is the problem - one wants to sell the other doesn't.

    If agreement can't be reached either one can go to the supreme court to seek an order deciding the matter.
     
  20. pully

    pully Member

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    lets hope they can come to an agreement.

    perhaps the deceased should have left the property to the grandchild?

    can property be transferred before probate is granted?

    does probate require a solicitors involvement?