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Volume 10 - Opinions of Counsel SBRPS No. 55

Opinions of Counsel index

Assessment roll (designation of owner) (life estate-required format) - Real Property Law, § 240; Real Property Tax Law, § 502:

A life estate may be created or reserved by an unrecorded instrument in writing, but that instrument must satisfy all of the requisites of a conveyance.

Our opinion has been requested concerning eligibility for a partial exemption based upon the claimed life tenant’s ownership interest. The facts are that on October 22, 1994, a father conveyed his property by deed to his daughter. On that same date, the daughter gave a written document to her father, in which she purported to grant a life estate to her father. It has been suggested that the separate writing need not be recorded, that it should be considered as part of the whole transfer from father to daughter, and that the father therefore has a sufficient ownership interest to warrant receipt of the exemption. While we agree that recording is not required, further analysis of the separate writing is necessary in order to respond to the inquiry.

A legal life estate is a sufficient ownership interest to justify the granting of a personal exemption such as that allowed for senior citizens exemptions (e.g., 3 Op.Counsel SBEA No. 45; 9 id. Nos. 41, 49). A life estate may be created by will or by conveyance, in the same manner as any estate in land (see, Real Property Law, §§240, 245). A “conveyance” includes any written instrument (except a will) “by which any estate or interest in real property is created, transferred, assigned or surrendered” (id., §240[2]).

Generally, to be valid as a deed, the instrument must be intended as a muniment of title (document transferring title) and must meet certain requirements, inter alia, as to naming a specific grantor, a specific grantee, a proper designation of the property, a recital of the consideration and operative words of grant, and be in writing. For example, the absence of a valid and legal description of the property in question, in a document claimed by plaintiffs to reconvey the property back to them, precluded its use as an enforceable deed of conveyance (citing Cameron v. Andrukiewicz, 87 A.D.2d 734, 449 N.Y.S.2d 67 (3d Dept., 1982)) (Warren’s Weed New York Real Property, Deeds, §1.02).

Similarly, it has been stated, “[S]o long as a writing discloses the grantor and grantee, the specific property being conveyed, and an intention to convey it, then the writing is effectual as a deed of conveyance” (Rasch, New York Law and Practice of Real Property, §24:9). Also, “A deed must be in writing and in English, or otherwise conforming to the requirements of section 333(2) of the Real Property Law. It must designate a specific grantor and grantee, contain a proper description of the real property being conveyed and show the intent to transfer title” (Pedowitz, Real Estate Titles (2d ed.), Deeds, II.A., citing General Obligations Law, §5-703(1) and Cohen v. Cohen, 188 A.D. 933, 176 N.Y.S. 893 (2d Dept. 1919)).

It is true that the recording of instruments of conveyance in this state is optional (see, Real Property Law, §291). The failure to record the same may, however, result in the conveyance being void as against what the law describes as a “bona-fide purchaser for value.” Since an assessor is to assess property in “the name of the owner, last known owner or reputed owner” (RPTL, §502(2)), “ownership of property as indicated on the assessment roll need not be consistent with the last recorded deed, but it should be consistent with information made available to the assessor” (3 Op.Counsel SBEA No. 25). As we note in the just cited opinion, “Some persons who acquire real property, for certain reasons, may not elect to record the instrument of conveyance.” {1}

The fact that a document purporting to create (or reserve) a life estate is not recorded is therefore not the issue; the issue is whether the document is a “conveyance” within the meaning of the law. Consequently, a life estate may be created or reserved by an unrecorded instrument in writing, but that instrument must satisfy all of the requisites of a conveyance.

Here, the father’s October 22, 1994 deed conveyed all of his interest in the property to his daughter. Whether the separate, unrecorded document is a conveyance, which effectively reconveyed a legal life estate to the father is a matter for local, not State Board, interpretation. Clearly though, if the father is not the “owner” of this property in the sense that he does not hold a legal life estate therein, he cannot receive any exemption.

February 26, 1998


{1}  We have been advised that life estates have value for purposes of estate and gift taxation and for purposes of determining eligibility for Medicaid assistance (see, NYS Department of Social Services Administrative Directive 96 ADM-8). While we do not suggest that the decision to refrain from recording a life estate in this or in any other particular case is intended to subvert any tax or benefit program, we cannot explain why the reservation of the life estate was not simply made a part of the deed conveying “title” from father to daughter, which has long been a common practice in this field.

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