Dometri v. Lind – 2/26/2008

February 29, 2008

Arizona Court of Appeals Division One Holds Where Real Property is Transferred by Affidavit of Succession Outside of Formal Probate Pursuant to A.R.S. § 14-3971, a Subsequent Purchaser of the Property Who Relies Upon the Affidavit Takes Title Free and Clear of Any Other Person’s Interest in the Est

In 1983, Warren Parker, Jr. purchased real property “as his sole an separate property” and his wife, Ruth, simultaneously recorded a Disclaimer Deed, disclaiming any right against the real property.  Years later, Mr. Parker created a trust, named his adult children as beneficiaries, and prepared a pour-over will, directing that any property in his estate at the time of his death be placed in the trust.  Mr. Parker then placed the real property into the trust.  In 1995, Mr. Parker transferred title to the real property back to himself as sole and separate property by Quit Claim Deed.  Mr. Parker died in 2004 but his adult children did not act to return the real property to the trust.  Instead, Mrs. Parker recorded and filed an Affidavit for Transfer of Title to Real Property in the Arizona Superior Court, stating that Mr. Parker died without a will and that Mrs. Parker was the sole successor-in-interest to the property.  Mrs. Parker subsequently signed a deed transferring the property to Choice Property Group, LLC (“Choice”) and Choice then deeded the property to Dometri.  After being served with warranty deeds, Ms. Lind, one of Mr. Parker’s adult children, filed a Notice of Objection to Distribution of Estate and a Notice of Lis Pendens, arguing that Mrs. Parker possessed no title to the property and no power to convey it.  Dometri filed a quiet title action.  Both parties later filed cross-motions for summary judgment.  Dometri argued that it was entitled to rely upon Mrs. Parker’s Affidavit and Ms. Lind argued that Dometri could not purchase any rights in the property because Mrs. Parker possessed none.  The Arizona Superior Court agreed with Dometri and granted summary judgment in its favor.  This appeal followed.

The Arizona Appeals Court explained that the probate code provides a procedure whereby real property can be transferred by affidavit, outside of formal probate, when the value of the real property is less than $75,000.  In order to qualify, the affidavit must meet the requirements of A.R.S. § 14-3971(E).  When those requirements are met, the statute protects anyone who later purchases the real property, regardless of the propriety of the sale.  The Court clarified that the statute provides a cause of action against those who fraudulently transfer real property using an affidavit, but it does not provide heirs any recourse against subsequent purchasers. And neither does the statute require subsequent purchasers to inquire into the propriety of the transaction or the authority of the person entering into it.  Thus, because Mrs. Parker’s Affidavit met all the requirements of § 14-3971(E), Dometri and Choice were statutorily protected against Ms. Lind’s claims.

Judge Portley authored the opinion; Judges Hall and Snow concurred.