Another Inheritance Problem

[avad88]

My nephew recently had an inheritance problem with a resort in North Carolina. My brother and his wife (Virginia residents) were tragically killed last year and did not have wills. They owned a May fixed week in the Outer Banks of North Carolina.
My nephew, as executor, did not want the timeshare and thought he did not have to include it in the estate. His attorney told him to contact the Resort explaining the situation and agree to sign any papers if necessary to abandon it. He did that last Fall, but the resort, Barrier Island Station Duck said they did not have a return program, and in NC, an estate was liable for the ownership. They wanted him to take title in his name, but he refused. They said he had to pay the maintenance fee in January to avoid a judgement against the estate but they would bring it before the Board of Directors in the Spring due to unusual circumstances.
He just heard that many owners wanted a buy back, but his request was the only one approved by the Board. They were doing him a great favor!! He had to pay about $400 in fees to their attorney for paperwork, which he gladly did to get rid of it.
What went wrong here? I know this question has been brought up before and I read on TUG that heirs could refuse to inherit a timeshare. Could the NC laws be different? As an out of state owner, could this be the problem? We own in NC (not this resort) and I would hate for my heirs to have these problems.
I am upset for my nephew. He had enough problems without this one. Thanks for letting me vent!!

 

[Conan]

The Administrator of an intestate estate has the same power to abandon property as does an Executor of a testate estate.
(It's not the heirs who refuse - - it's the administrator/executor who abandons.)

https://codes.findlaw.com/nc/chapte...ecedents-estates/nc-gen-st-sect-28a-13-3.html

§ 28A‑13‑3. Powers of a personal representative or fiduciary.
"(a) Except as qualified by express limitations imposed in a will of the decedent or a court order, ... a personal representative has the power to perform in a reasonable and prudent manner every act which a reasonable and prudent man would perform incident to the collection, preservation, liquidation or distribution of a decedent's estate so as to accomplish the desired result of settling and distributing the decedent's estate in a safe, orderly, accurate and expeditious manner as provided by law, including but not limited to the powers specified in the following subdivisions:
....(7) To abandon or relinquish all rights in any property when, in the opinion of the personal representative acting reasonably and in good faith, it is valueless, or is so encumbered or is otherwise in such condition that it is of no benefit to the estate."

But $400 was a small price to pay to be rid of it....

 

[chalee94]

I am sorry about your brother and sister-in-law.

I am not a lawyer but here are my guesses:

My nephew, as executor, did not want the timeshare and thought he did not have to include it in the estate.

It's a legal contract establishing a debt. I would think it would need to be included in the estate.

His attorney told him to contact the Resort explaining the situation and agree to sign any papers if necessary to abandon it. He did that last Fall, but the resort, Barrier Island Station Duck said they did not have a return program, and in NC, an estate was liable for the ownership. They said he had to pay the maintenance fee in January to avoid a judgement against the estate but they would bring it before the Board of Directors in the Spring due to unusual circumstances.

This sounds reasonable to me. The estate would be liable for maintenance fees.

They wanted him to take title in his name, but he refused.

This sounds like a bad idea that he was smart to avoid.

He just heard that many owners wanted a buy back, but his request was the only one approved by the Board. They were doing him a great favor!! He had to pay about $400 in fees to their attorney for paperwork, which he gladly did to get rid of it.

They weren't doing him a big favor IMO as the estate would not be liable for maintenance fees in perpetuity. From my understanding, the debt to the timeshare would need to be made current, if the estate has assets, and then once all outstanding debts have been satisfied and assets distributed, the estate can be closed and the timeshare would have no choice but to take the deed back.

A lawyer would know better than me how to resolve this more cleanly, but IMO, your nephew handled the situation well and for less money than bringing in a lawyer would have cost...

 

[LannyPC]

A lawyer would know better than me how to resolve this more cleanly, but IMO, your nephew handled the situation well and for less money than bringing in a lawyer would have cost...

...or one of these relief/exit/cancel companies would have cost.

 

[geist1223]

In that that estate got out for only $400 it was probably a good deal for the estate. I am not giving Legal Advice but 2 points which I believe I have mentioned in the past. 1. Do not put your timeshare in a Trust. It will most likely be harder to disclaim. 2. If in addition to MF's there is money still owed on the purchase that the heirs do not want to take on then the Estate should keep payments up to date, go through formal probate (which normally includes publishing in the local newspaper for all creditors of the estate to file claims and it is unlikely that the timeshare will file a claim), the heirs file with the probate court that they are disclaiming the timeshare, close the estate with distribution of all other assets when appropriate, and then drop all contact with the timeshare.

 

[tharris692]

https://disclaimers.uslegal.com/dis...carolina-disclaimer-of-property-interest-law/ try reading this it help us.

 

[klpca]

1. Do not put your timeshare in a Trust.

Since we own timeshares in Arizona, Hawaii, Louisiana, and CA we put them in our trust to avoid out of state probate. I'm good with this although prevailing wisdom on TUG is to avoid doing this. I spoke to our attorney first (but he's no timeshare expert) and he was fine with the timeshares being in a trust. But we also have a will with a pour over provision. It seems to me that it would put the timeshares into the trust anyway. Thoughts?

At any rate, one kid definitely wants the New Orleans timeshare, and another the summer beach week in CA. I doubt that we will have any problem divesting ourselves of the others and expect that we won't still own them when we die, so it shouldn't be an issue. I tend to plan ahead - timeshares will be no exception.

 

[vacationtime1]

Since we own timeshares in Arizona, Hawaii, Louisiana, and CA we put them in our trust to avoid out of state probate. I'm good with this although prevailing wisdom on TUG is to avoid doing this. I spoke to our attorney first (but he's no timeshare expert) and he was fine with the timeshares being in a trust. But we also have a will with a pour over provision. It seems to me that it would put the timeshares into the trust anyway. Thoughts?

I think you are doing it right. The key is to avoid multiple probates -- a needless expense downstream. I am assuming that all of your timeshares have at least some value and/or can be disposed of easily.

Perhaps more important, I have left written instructions for each of our units describing what it is, how we use it, its value, its rental value, the MF's, and a suggested method of disposition (broker's name, deedback, etc.). It took me years to figure this out; my executors shouldn't have to go through the same exercise to maximize estate value.

 

[dioxide45]

I doubt this woudl ever happen, but what if someone decides they don't want to inherit traditional real estate? Does it eventually just go to foreclosure (if there is a mortgage) or tax sale and it ends up going to someone in the end?

 

[VacationForever]

I doubt this woudl ever happen, but what if someone decides they don't want to inherit traditional real estate? Does it eventually just go to foreclosure (if there is a mortgage) or tax sale and it ends up going to someone in the end?

I think the question is can the adminstrator of the estate not put the timeshare through probate before turning it back to the HOA because everyone has disclaim their interest in it? Some of the sites said that unless it is in a trust, it still has to go through probate otherwise the estate cannot be dissolved.