Decree of Sale of Real Estate by Personal Representative (License to Sell)

There are a couple variations in the types of Licenses to Sell, but the end result for each is that the estate sells free and clear of any liens that would otherwise attach to the estate. Instead, those liens would attach to the proceeds of the sale. These liens include the automatic lien for administrative expenses, any creditor’s claims filed in the probate court (creditors have one year after death to assert claims), and any MassHealth liens filed with the probate court. Keep in mind, any liens that encumbered the real estate prior to death, such as a mortgage, still require a discharge. Also, a license does not eliminate the need to deal with Federal and Massachusetts Estate Taxes. Releases of estate taxes from both the IRS and DOR or an appropriate affidavit must be obtained and recorded at the Registry of Deeds.

The typical license we see is a general license to sell by the Personal Representative (“PR”) in the estate.  A PR would file with the court a Petition for the Sale of Real Estate in order to receive permission to sell.  This is a license under G.L. c. 202, section 19 and the court will only allow the petition if it is filed within one year of the allowance of the PR’s bond.  The license must be used within one year of issuance.   The terms of the license must be scrupulously followed.   Most importantly, the sale price must be for the same amount or more than set forth in the license.    My personal preference, and the best practice, is to have the license recorded along with the deed to make life easier on future title examiners but it is sufficient that the decree is only docketed in the probate case.

Deed from Devisees in a Will or Heirs at Law

Unlike deeds under Licenses to Sell and Power of Sale in a Will, any claims or liens filed in the probate court against the estate will have to be released or satisfied before we can insure a title given by devisees in a Will or heirs at law. One of the first and critical steps in determining whether title can be insured by such a deed, is establishing the identity of the devisees or heirs at law. Prior to the adoption of the MUPC, it wasn’t always easy to identify the devisees of a decedent if the will broadly identified individuals by group, rather than by name; however, with the adoption of the MUPC, the forms that are filed as part of a petition provide detailed information on devisees. In situations where a decedent died testate, and the devisees are clearly established in the probate filing, the devisees can convey the real estate; however, that conveyance is subject to divestment by the PR if the PR seeks to sell the property in order to completely administer the estate. Property conveyed by devisees is also subject to claims for the administration of the estate for a period of six years after the approval of the PR’s bond. To insure the title, we would generally require that the probate be closed with an order of complete settlement. This eliminates the potential for divesture by a PR and eliminates the potential for claims arising out of the administration of the estate.

If the decedent died intestate, unless the probate petition is filed as a formal proceeding, there is no determination of heirs and one cannot immediately rely on the filed forms to establish the heirs at law from a title perspective.  For this reason, deeds from heirs in an informal proceeding may not be immediately insurable.  If an informal probate has been filed for a decedent that died intestate and a PR has been appointed, it will generally be necessary for the PR to file a petition for an order of complete settlement that includes a specific request to determine the heirs.  Once allowed, title conveyed from the heirs will be insurable.   

As you can see, taking title from devisees or heirs at law can be far more complicated than taking title from a PR who has obtained a license or has been permitted to sell by the terms of the Will.  Should you have questions on how to transfer title so that it is insurable when there is a probate involved, don’t hesitate to reach out to any member of our underwriting team.  We will work with you to determine the best and easiest path to insurability.

The probate court provides links to many of the probate related forms, along with instructions for completion.