California may go forward with transfer on death deeds

In 2004, Assemblyman Chuck Devore introduced a bill that would allow Californians to transfer real property upon death without resorting to legal services and completely avoiding the probate process.  Assemblyman Devore introduced this bill after meeting with Mary Pat Toups, 79, a pro bono attorney and a grandmother. Toups has spent $30,000 of her own money attending hearings, lobbying officials, and even launching her own website – www.transfer-on-death-deeds.com to support the bill.

In 2004 the California Bar’s Trusts and Estates Section persuaded the Assembly Judiciary Committee to downgrade this bill into a study bill. However in June, the Assembly approved AB 250 after adding explanatory language and consumer warnings on the back of the form.

If the legislation that Toups is pushing for prevails, a standardized, one-page form no longer than a tire-rebate mailer will be available on the Internet or from retail store.  * * *

All owners would have to do would be describe the property, list the beneficiaries and indicate whether they wanted a spouse or someone else to live there as an intermediary owner until their death. * * *

Probate lawyers and others remain unconvinced.

Southwestern Law School professor Ira Shafiroff, who believes the “overwhelming number” of wealthy people handle property disposition with customized living trusts, opposes the bill. He thinks the concept is anti-lawyer oversimplification.

“We’re talking about real estate — for most people, their most significant asset — and to transfer this with a commercial form is asking for trouble,” he said. “It’s a complex area of the law. To [believe] that a TOD deed would take care of it is like trusting a lay person to perform an appendectomy.” * * *

See Chip Jacobs, Crusader pushes for simpler inheritance rules, latimes.com, Nov. 4, 2007.

Note that at least eight states already have special provisions dealing with transfer on death deeds, also called beneficiary deeds (Arizona, Colorado, Kansas, Missouri, Nevada, New Mexico, Ohio, and Wisconsin).

In addition, the National Conference of Commissioners on Uniform State Laws is drafting a Uniform TOD for Real Property Act.