Expert: Dick Dennis - 10/21/2009

Question
Dick,

My mother's home is in a trust, with me and my 2 brothers as trustees.  My older brother & myself currently are co-executors of the trust, with each of us getting 1/3 of the profits from the sale of the house.  My middle brother now wants to purchase the house from us.  He plans on getting 3 appraisals and a mortgage.  My mother would like my middle brother to purchase the house, and he would like to do so as soon as he can.  He used to be a lawyer in a previous life, and has made a lot of bad decisions with his life.  When the trust was created, he was the executor (because he was a lawyer), and without anyone's approval, put a lien against the house because he needed money.  So we asked him to step down from his executor status, and put ourselves in instead.  

Now my mother wants to make the middle brother executor again of the trust.  My questions are, are there things we should be aware of if the middle brother becomes executor again before he buys the house?  Is there any advantage of making him executor now?  Do we, as the current co-executors, have to agree to this move or can we be usurped without agreeing to this?  Once the house is sold to him, will the trust be dissolved?  My mother believes there is an understanding with him that once he buys the house, she will be allowed to live there until either she dies or she no is longer safely able to.  Can this/should this be noted somewhere legally?  (Quite a few years ago, he firmly believed she should be moved out of the house and into some sort of assisted living facility.)

Thank you for your time, and I look forward to hearing from you.

Anne

Answer
You give me the impressiom you do not trust your middle brother, Anne, and I detect that your mother favors him for one reason or another. If it was me, I would keep politics out of the matter and figure it is not necessary for your middle brother to be an executor if he is buying the house. With him getting (and paying for--make sure of that) three appraisals, the three of you will know how much you are each getting after closing.

I would also diplomatically keep your mother out of the purchase picture. If the middle brother is going to let her live there, then fine, but it is not necessary for him to be one of the executors. To make sure this all goes down the right way, you really should consult with an ESTATE attorney to put everything in proper order PRIOR to your middle brother buying the property. You could also consult with the attorney who put the trust together. He/she is familiar with it and probably could put it all together properly. I do wish you well.

Dick Dennis
dixiedee13@aol.com