Estate Liability For Purchase

Question:

The husband signed an Agreement to purchase a property, but, he was killed in a car accident before closing. What happens now? Is his Estate liable?

Answer:

This is a very tricky question. Generally, there would be liability upon the Estate of the Husband, which would have a joint obligation with the Wife to complete the purchase. But, the Estate might not have any money. The assets of the Husband may be subject to other claims, in priority to this contract.

Life insurance and insured pension payments and mutual funds etc. in insured accounts are not included. In many cases, while substantial assets are passed on, the Estate itself is bankrupt. That might be helpful here. Additional life insurance should have been sought at contract time. Most often, it is deferred until the deal is done. This is a good example of why it should be done early.

Anticipatory breach might be the right approach. The deposit is at risk. If it’s $1,000.00, leave it on the table. Does the Wife wish to close? Does she have the money? If not, make sure that there is no money in the Husband’s Estate. An Estate lawyer can help here.

Brian Madigan LL.B., Broker

www.OntarioRealEstateSource.com

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