Q. What is meant by court confirmation of the sale of real property?
A. The personal representative is required to report the sale and petition the court for confirmation of the sale within 30 days of accepting an offer (Cal. Prob. Code 10308). Should the personal representative fail to perform these acts in this time period, the purchaser may do so on his or her own behalf (Cal. Prob. Code 10308(b)). All estate real property sales must be confirmed by the court except for sales of property under the IAEA. At the confirmation hearing, the original sale may be subject to being overbid by another purchaser (Cal. Prob. Code 10313). The court will confirm the sale to either the original bidder or to an over-bidder and normally approve payment of the brokerage commissions. Title will pass to the successful buyer only after the terms of sale have been met, the court has confirmed the sale and the personal representative has executed a conveyance to that buyer (Cal. Prob. Code 10314).
Selling Real Property
Q. May the personal representative enter into a contract with a licensed real estate broker to sell estate real property?
A. Yes. The personal representative may enter into an exclusive right to sell contract with a broker for an original period of not more than 90 days plus one or more extensions each limited to the same periods (Cal. Prob. Code 10150(c)). This real estate broker may cooperate with other brokers and may advertise the property on the MLS (Cal. Prob. Code 10150(a)). Prior court approval must be obtained for each extension unless the personal representative is acting under IAEA. However, even here, if the personal representative has obtained only “limited” power rather than “full” power to administer the estate, court supervision of the sale of real property is required (Cal. Prob. Code 10501(b)).
Q. May a listing broker obtain an extension of the listing contract if the estate real property does not sell within the original listing ninety day period?
A. Yes. However, any extension of the listing given requires prior court approval unless the personal representative is acting under IAEA. Each extension shall not exceed 90 days (Cal. Prob. Code 10150(a)). Under IAEA authority, the personal representative may give discretionary 90 day extensions to the original period as long as the total time is less than 270 days. Once 270 days are exceeded, the IAEA personal representative must give a Notice of Proposed Action of such further extension (Cal. Prob. Code 10538(c)). (See Section VII below for more information about the IAEA.)
Q. Is there a required form that must be used for listing estate real property?
A. No. However for sales under the IAEA any exclusive authorization and right to sell form is acceptable. The California Association of Realtors (C.A.R.) has forms specifically designed for listing and selling probate properties. In the event court confirmation is required, C.A.R. Standard Form PL is appropriate, it may also be used for probate sales under the IAEA.
Real Estate Disclosure Laws
Q. Is compliance with the California Agency Disclosure laws required in the sale of estate real property?
A. Yes. If the estate real property consists of one to four residential units (including mobile homes) and is to be the subject of a sale, exchange, land contract, or lease exceeding one year, compliance with the agency disclosure laws is required. (Cal. Civ. Code 2079.13(j).)
Q. Must the personal representative transferring estate real property complete a California Real Estate Transfer Disclosure Statement (TDS) or provide other disclosures?
A. Sellers of estate real property (and mobile homes) are exempt from the requirement of providing prospective buyers with a transfer disclosure statement (Cal. Civ. Code 1102.2(b)). This does not, however, relieve the seller from disclosing any known material facts regarding the value or desirability of the property. Furthermore, probate sales must still comply with other disclosure laws. For a complete list of required disclosures for probate residential one-to-four sales transactions, please refer to the following online chart: Real Estate Sales Disclosure Chart.
Q. Is a licensee required to conduct a visual inspection of residential estate real property that is offered for transfer?
A. Yes. A licensee involved in the transfer of residential one-to-four unit estate real property interests (including mobile homes) is required to conduct a reasonably competent and diligent visual inspection of all accessible areas of the property and to disclose to prospective buyers all facts materially affecting the value or desirability of the property that the inspection reveals (Cal. Civ. Code 2079(a)). Although not required by the statute, the disclosure should be made in writing.
Wally Malesh is knowledgeable and experienced with Probate Code, court-directed sales, Trust Sales, mandate disclosure requirements and offers. With over 25 years of experience representing over 12,000 successfully closed real estate transactions, Wally is uniquely qualified to assist you.