He and Francine Yeh bought their condo two decades earlier when a mortgage adviser urged them to drop her from the paperwork to get a better interest rate. Shu promised he’d add her to the title later. She signed a quitclaim, and the place was theirs—paid for from their joint account.
A month after he passed in 2014, Francine discovered the truth: Not only was her name not on the title, her beloved spouse had transferred the deed eight years earlier to a trust he set up for his children from a previous relationship—and they were its sole beneficiaries. Eighteen months later, Francine filed suit, citing Shu’s breach of fiduciary duty. She lost when a court found she’d exceeded the one-year limit for claims against a decedent (California Civil Code Sections 366.2 and 366.3).
But an appeals court recently reversed that decision—and granted a rare and monumental expansion of the statute of limitations when it comes to spousal rights. Its ruling said the Family Code controls in spousal breach of fiduciary duty actions, which meant Francine had three years to file suit from the time she learned of her late husband’s underhanded transaction. It also opened the door to countless other grieving spouses and registered domestic partners who’ve found themselves subjected to spousal financial shenanigans.
It’s another reminder to know your rights—especially the new ones—when it comes to end-of-life decisions made by your loved ones. A good estate lawyer can help you determine exactly where you stand in matters of real-estate, family—and trust. Yeh v Tai (2017) 18 CA5th 953.
About the author:
John O’Grady leads a full-service estate and trust law firm in San Francisco. His practice includes Estate Planning & Administration, Probate and Trust Litigation.