How Grief Made me Financially Vulnerable: Betrayal of Trust

In 1995, my mother made me half owner of her house in northern California. It had always been her intention to leave me this house, and since I am an only child, there were no complications regarding the property. My father died suddenly in 1990, and after his death, she couldn't take care of the house.

We discovered there was a lot of work needed. Work that should have been done while Dad was alive. So I undertook the maintenance and repairs with the help of a contractor. And in 1995, I became a joint tenant in ownership. To register a joint tenancy, the state of California uses a grant deed of joint tenancy, which is notarized and filed with the county recorder -- in this case, Sonoma County.

Many older people are concerned about their property being mishandled or lost to the government when they die, and are attempting to transfer it while they live. A grant deed is a simple, inexpensive way to pass on real property and still retain an interest in it. The filing costs $7, and the deed is then recorded as 'Principal owner et al' being the other people listed on the grant deed -- in this case, me.

No problem until 2000, when my mother died in April. I had been paying her bills for about four years by then, including the house insurance and taxes. I decided to sell the house, a decision, which when made in Northern California, unleashes a maelstrom upon the head of the seller.

Our house was located in a very desirable part of one of the most popular towns in Sonoma County. And Sonoma County is now known as Telecom Valley for good reason. The house was listed on Thursday, April 27th, and my real estate agent and long-time friend Brian Blackwell* opened the house to offers on the following Saturday. We received ten offers, and accepted one for $10,000 over the asking price of $350,000.

I made an offer on a smaller, two-bedroom house in the nearby university town of Cotati -- a house perfect in size and location for one career woman thinking of returning to school to finish her Master's degree.

After my mother's death, I returned to the county recorder's office and changed the deed on the house so it listed me as sole owner. This was even easier than the original grant deed, because it only involved removing an owner. The charge was $10.

The escrow on the house was 30 days, due to close on May 30th. Halfway through the escrow period, North American Title, the company chosen by the buyers, informed Brian they couldn't verify the title on the house. Not because it hadn't been recorded, but because the explanation of the property, taken from the Assessor's Book of Maps for Sonoma County, didn't include as much of the text as the investigator desired. It did include the parcel number and the lot numbers, but because my parcel comprised parts of those lots, the investigator refused to honor my ownership of the house. If we accepted his ruling, it would have meant going into probate, a minimum of 60 days.

The house would have to go back on the market, and I'd lose the cottage I bought. Brian was outraged by the capriciousness of the decision, but the escrow officer, Julie Kidd, told him they always stood by the decision of the investigator, one Terry Gibson.

That night Brian faxed the ownership information to five other title companies in the county. The next morning he had five unanimous decisions -- any one of them would insure the title.

"No reason why we wouldn't insure this title...we did it for the loan that was taken out on it in 1994," said Steve Olsen, manager of the title department for Chicago Title, to Brian.

But the best quote of all came from Paul Taylor of North Bay Title -- "A legal description that includes more than the property owned always includes the property owned."

Brian returned to Julie Kidd, who then decided North American would take the chance of insuring the title. Brian told her that wasn't good enough -- either Terry Gibson admitted I owned the house and land or we went to another title company -- and he would tell all the agents and real estate people he knew how unreliable North American was.

When we went to sign the final escrow papers, Julie Kidd had inserted a clause stating that unless the buyer and seller both signed for the unused rent-back amount and rent deposit within 45 days after I moved, the money would revert to the buyers. That meant if they remained unavailable to sign for 45 days, they got my money by default. This clause is illegal.

The lesson here is clear -- people dealing with grief over the death of a loved one are easy prey for sharks. Don't accept arbitrary judgments or rulings on money or property if you suspect they aren't entirely above-board. Always get second, or in this case, fifth, opinions.

*Name changed.