South-Western Legal Studies in Business

Contract Agreed to by Heirs May Create Life Estate
Description Heirs to property can create, by contract among themselves, a life estate in property they jointly inherited. So long as the agreement can be read as to that effect, the fact that the life-estate was not created in a will or trust does not negate the ability to create one.
Topic Wills, Estates, and Trusts
Key Words Life Estate; Contract
C A S E   S U M M A R Y
Facts Walter Harris died intestate in 1976. He was survived by six children. Each child inherited a one-sixth undivided interest in 160 acres of land with a house on it. One of the children, Clinton, had lived with his father and took care of him until his death. In 1977, the six children agreed that Clinton could continue to live on the property. Noting that they desired not to divide “the estate at this time,” they granted Clinton “the full use and possession of the house and grounds and all cultivatable land.” Clinton agreed to “protect the interests of the remaining heirs in the house and land.” In 2000, one of the brothers sued, demanding his interest in the estate. The chancellor held that the agreement was the equivalent of a life estate that prevented its partition during Clinton’s lifetime. The brother who wanted his share of the estate appealed.
Decision

Affirmed. The agreement granting Clinton a life estate is a contract that is not in the usual, formal form of a life estate that clearly states when the life estate interest will terminate. However, the court may look to the contract signed by the six heirs and determine that the plain meaning was that they intended to give Clinton a life estate. A reading of the contract indicates that was the parties’ intent in 1977, so the contract will be enforced.

Citation Estate of Harris, 840 So.2d 742 (Ct. App., Miss., 2003)

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