Legal Question in Real Estate Law in California

In Mid 2000, My Sister Was Appointed Trustee Of My Special Needs Trust, Which Is Irrevocable. My Late Mother's Home Was Put Into This Trust, According To Her Wishes, For My Benefit. A Few Years Ago, Unbeknownst To Me, My Sister Had The Property Deeded Out Of The Trust To Herself, Then Proceeded To Take Out Several Loans (In HER Name) For Her Own Benefit. When She Was Confronted For "Self-Dealing", She Put The House Back Into The Trust, But Passed Away Before She Could Be Held FULLY Liable. I KNOW, That What She Did Was Illegal Under "Trust Law", & Her Actions On The Title Are Clearly Evident On The Property Records For The Home. So My Question Is: Did She Have The Right, Under "Real Estate Law", Specifically Under "Title Issues", To Do The Deed Transfer??? I Am Looking Into Having A "Quiet Title" Action Done On The SNT Property, To Protect It From The Lenders. Thank You.


Asked on 2/17/11, 3:47 pm

1 Answer from Attorneys
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

I would say that she had the POWER to do it, but not the RIGHT. There is a big difference. If someone tries to do something where they lack the power to do it, nothing happens; the act is strictly void. If, however, someone has the power to do an act, but not the right to do it, the act is valid but wrongful, and perhaps also illegal, but nevertheless a done deed.

So, if your question involves whether your sister's acts are void, and could be stricken from the records and the lenders told to go away, I think the answer is no, because she had the power, but not the right, to take the loans.

Having said this, I'm not 100% certain I'm right, and I'm certainly not 100% certain I've answered the right question. You should feel welcome to contact me with details for a further attempt at answering.

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Answered on 2/17/11, 4:08 pm


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