Volume 9 - Opinions of Counsel SBEA No. 59
Veterans exemption (ownership) (life estate) - Real Property Tax Law, § 458:
A life estate which has been properly created is not extinguished if the remaindermen convey their interest in the property, executing a deed which makes no explicit reference to the life estate.
A residence which was receiving the veterans exemption (RPTL, § 458) was conveyed by the veteran to her three sons. In the deed, the veteran expressly reserved a life estate in herself. Some time thereafter, the sons executed their own conveyance of the property, in a deed which made no explicit reference to their mother’s life estate. The question presented is whether the exemption may continue under these circumstances.
A life tenant must be considered the owner of real property for purposes of real property tax administration (1 Op.Counsel SBEA Nos. 34, 59, 88; 9 id. No. 41). Thus, if the veteran’s life estate remains in effect despite the omission of a reference to it in the second deed, the exemption should be continued, assuming all other eligibility requirements continue to be satisfied.
Clearly, the veteran continues to have a life estate in the property, despite the failure of the second deed to explicitly preserve it. First, the second deed contains a standard clause providing that the conveyance is subject to “all . . . reservations . . . of record affecting the premises described herein.” But even if the second deed contained no such language, the life estate would continue in effect. Section 245 of the Real Property Law provides in pertinent part:
A grant of real property passes all the estate or interest of the grantor or testator unless the intent to pass a less [sic] estate or interest appears by the express terms of such grant or by necessary implication therefrom. A greater estate or interest does not pass by any grant or conveyance, than the grantor possessed or could lawfully convey, at the time of the delivery of the deed . . . (emphasis added).
While it might have been preferable from a drafting standpoint to refer to the life estate explicitly in the second deed, as a matter of law, the life estate continues without it. Therefore, the exemption should be continued as well.
July 1, 1992