Legal Question in Real Estate Law in California

Re: Life Estate/Quit Claim Deed

I sure hope you mean that the deeds were recorded in the County Recorder's office! The assessor's job is to determine the correct value of property for purposes of assessing property tax. The County Recorder is charged with responsibility for making and keeping records of the ownership of real property. Failure to record would not invalidate your quitclaim deeds, BUT it leaves the door wide open for misinformation, confusion, uncertainty and downright fraud with respect to property ownership interests. For example, no one but you would know that you are now (presumably) the sole owner of these properties. Your deeds probably were recorded just fine, and it might even be that in some small counties the recorder functions and the assessor functions are combined. In any case, step one for you is to make sure that the County Recorder's records include these two quitclaim deeds, properly indexed, and nothing more recent unless it is something you know about. If anything unexpected shows up on the records, get a lawyer pronto. A clerk in the Recorder's office can show you how to do basic searches for recent records by name or parcel number.

My answer exceeds LawGuru's maximum of 3,000 characters, so I'll post the balance in a second answer.

Re: Life Estate/Quit Claim Deed

Second, and this concern may be more theoretical than practical, the various county offices and officers have nothing to do with transferring title. When the holder of a life estate dies, the life estate ceases to exist and there is nothing to tranfer. The remainderman (you) becomes the sole owner automatically, by operation of law. It's something like a lease expiring--only simpler, because there is obviously no need to worry about an eviction. However, dealings with the county officialdom will be necessary so that their records will reflect current reality.

Once you determine that the county records show you to be the owner but for the life estate, the next step is to prepare and record an affidavit of death, attaching a copy of the death certificate. The technical requirements for such an affidavit are described briefly in the Probate Code at section 210. Due to the importance of getting this step done right, I'm recommending that you have a lawyer specializing in administration of estates or probate practice prepare it for your signature. This lawyer should also be consulted as to whether any other aspects of your father's estate should be handled by an attorney. In particular, you should be sure there are no requirements for formal probate proceedings, or if there are, that they are being or have been handled in accordance with law. Very likely there are none or that they can be handled very easily, but who knows? In any case, your rights to own and possess these two properties are probably not a probate matter.

Finally, here's a possible huge headache. There are at least four kinds of taxes potentially involved here. The first two are at the county level, the documentary transfer tax and the "ad valorem" property tax. The first is zero, per the typed legend on the quitclaims, and the second will not be subject to a reappraisal or reassessment merely due to the termination of the life tenancy. However, you will now be paying the tax. The final tax categories involve state and federal inheritance, gift and capital-gains taxes. You should see a tax advisor at once regarding all these tax issues, including your exposure for future capital-gains taxes if you sell either of the properties.