Atty. Eric D. Correira was interviewed by Massachusetts Lawyers Weekly regarding a recent Massachusetts Appeals Court petition for partition case. In Lodigiani, et al. v. Pare, et al., the Court ruled that although a property was subject to a life estate, two remainderman could seek costs from the third remainderman for the expenses they incurred mitigating damages caused by the third remainderman while the life tenant was still living. The decision represents one exception to the general rule that a life tenant is solely responsible for any waste to the property during their lifetime.

From the article: “Boston estate planning and elder law attorney Eric D. Correira said that given the health code issues, the petitioners had little choice but to pay for the cleanup of the property.

Still, he said, the case highlights the risks a co-owner of real estate takes when contributing costs to a property headed toward partition. That is why he tells his own clients to stop paying all expenses other than homeowner’s insurance and necessary repairs.

‘The presumption is that, after partition, the proceeds are split equally, and the less a person has contributed, the less exposure they have to not being paid back,’ Correira said, ‘Plus, by not paying expenses, it often helps put pressure on others to force the partition.’

He also stressed that Lodigiani does not affect the general rule that a life tenant is usually responsible for waste.

‘Here, the important distinction is that the waste was caused by a remainderman as opposed to a third party,’ Correira said. ‘If it had not been another owner that caused the waste, it would have been the life tenant’s responsibility.’

Meanwhile, Correira added, the timing of the partition sale – where the life tenant died the next day – could not have been worse from a tax perspective.

‘If the life tenant had died the day before the sale, there would have been a full step-up in basis and no capital gains,’ Correira explained. ‘Instead, the life tenant died the day after the sale, which means that there was likely some capital gain tax that had to be paid by the children and also the need for a probate.'”

For the full article, click here.