Legal Question in Real Estate Law in California

Re: Real estste contract fraud

Usually I would hesitate to give an opinion without being more certain than I am here. However, this is a very interesting question and I can't resist giving you my offhand, unresearched views.

First, I think the lack of signature by the grantor is unimportant. Promissory notes are usually signed only by the promisor. A note is enforceable against the promisor in accordance with the terms appearing on its face. If the note says $10,000, the holder cannot demand $12,000. Similarly, if the note says nothing is due if X is dead at the time the note is presented for payment, my preliminary opinion is that such a provision is valid and, if X is dead, nothing is due.

I do not know of any case on point, but there almost surely is such a case. I will do some research over the weekend, and you might call next week to see what I've found. (707) 523-4497.

Your facts raise some other issues. As to fraud, the arrangement doesn't seem to be fraudulent as between grantor and grantee; they were both fully aware of what they were doing. It's doubtful whether the arrangement was fraudulent as to other prospective heirs. Heirs don't have real rights in future inheritances; they have a mere expectancy.

The scheme (to avoid probate) might be offensive to the civil authorities or tax collector, if it could be shown that its purpose was tax evasion or impermissible avoidance of probate.

Another aspect is the statute of limitations on the note. Very likely, the older unpaid instalments would be uncollectible due to the passage of time.

Having said all this -- and you're still invited to call -- I recommend (if you have a financial stake in the estate or the transaction) that you consult an attorney who is experienced in probate matters.