I wasn't sure of the best or most appropriate forum for this situation, but given that it gravitates around real estate, here I am!
My grandmother has two properties in CA. Per her Trust, a specific property is to go to each of her two daughters. And per the terms of Trust, an appraisal is to be performed, and if one property appraises for more than the other, the daughter with the more valuable property is to compensate the other daughter the difference.
I have some questions:
1. Common sense, and preliminary research dictates that one of the properties will command a higher price. The daughter that is to receive the more expensive property has been stating all along that just a "drive-by" appraisal is all that is needed. The daughter of the other property who has never responded to such comments feels that would be an inaccurate way to account for value, especially when the home is nearly 100 years old, and has issues that can only be seen from within. In such a matter, what type of appraisal should be performed, and must it be? The daughter of the more expensive property is the atty-in-fact, if that matters any here, I don't know...
2. The property of lesser value has been allowed to degenerate over the past few years while my grandmother has been incapacitated. The daughter who is the atty-in-fact has refused on many occasions to allocate funds to repair the roof that has leaked into the living area in at least two known areas. These requests have come from the family member living in that home, and the other daughter, the one who will one day receive that property. Just in the last two weeks as my grandmother has reached a critical state, and with her life in jeopardy, the atty-in-fact daughter did a 180, and is now actually requesting the other daughter to find someone, and to find someone fast to replace the roof .
When questioned on the sudden motivation, she says that it's needed... although she denied a request a few weeks earlier. When the other daughter brings that up, the atty-in-fact daughter says that she is doing it to save on potential inheritance tax. When the other daughter makes it clear to her that the whole estate is taxed, not just funds in the bank, the home will then appraise for more, making the true tax benefit marginal. The atty-in-fact daughter gets angry and exclaims that she has power to do it; and demands that the other daughter start getting quotes fast, and if not, than she will find someone herself to get that job done.
As you might guess, the other daughter is just really saddened by all of this... while her/their mom is still alive, and she is being forced to address this matter, when she would least want to do so. That house has been in need of a new roof for at least a couple years, and the other daughter wanted it fixed some time ago. There is now damage to not just the roof, but internally as well. If a new roof would have been pursued when requested, damage would have been avoided, and there would have been time to interview prospective roofers, get detailed quotes, research materials, see previous projects completed, etc... (this a unique home, with a steep roof) not this current pressure to get it done or at least started while she's (my grandma) still alive mentality.
If saving money on possible inheritance tax is truly the reason (the estate is very near the current taxable threshold), it seems very odd that the atty-in-fact daughter refuses to withdraw funds for funeral expenses. Apparently one is allowed to remove funds to cover such costs, and in doing so, they are not scrutinized or seen as part of the estate when ascertaining value for possible taxation. The atty-in-fact daughter gets angry when this is mentioned, saying that she doesn't have time for a trip to the mortuary and bank, most likely less than an hour of time. This is a much more effective means than the immediate roof demand, yet she insists that the roof get done...
The other daughter is left feeling that her sister simply wants the value of that home to increase so it approaches the value of other property, making this a benefit to the atty-in-fact daughter. Given past experiences, this is not surprising though.
I realize that power-of-atty is quite encompassing. But, I also feel that just because one has the power, that doesn't mean that it's right for the person to use it just because they can.
What recourse or options does the other daughter have here? She would love to say that she doesn't want a roof during this time, but fears then that it will get done by someone that she doesn't approve, or with undesirable materials. Or worse yet, anger the atty-in-fact daughter enough to where she decides to just sell the house and kick-out the relative, which she can, as she has the power, she proudly says...
3. Along these lines, the home in question was once a city “Historic Home”, but the atty-in-fact daughter chose not to renew that a year or so ago. Her reasoning is that it costs money, and by it being on that list, it makes it more difficult to make changes to the house. Now, apparently she learned that if a house is a city “Historic Home” it adds value to the house, and there is reason to think that she might put the house back on now.
By virtue of the power-of-atty, she can. Given the self-serving motivation, is this right, and what recourse does the other daughter have? It’s strange how she insists that she doesn’t have time to pursue the funeral option, yet makes time for other things…
I truly appreciate any thoughts, commentary and recommendation you all might have.