Section 114.102 of the Estates Code

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Effect of Subsequent Conveyance on Transfer on Death Deed.
An otherwise valid transfer on death deed is void as to a subsequent grantee of an interest in real property that is conveyed by the transferor during the transferor's lifetime after the transfer on death deed is executed and recorded if:
(1) a valid instrument conveying the interest or a memorandum sufficient to give notice of the conveyance of the interest is recorded in the deed records in the county clerk's office of the same county in which the transfer on death deed is recorded; and
(2) the recording of the instrument or memorandum occurs before the transferor's death.
Added 84th Leg., R.S., Ch. 841 (S.B. 462);  Amended 86th Leg., R.S., Ch. 1141 (H.B. 2782)

Editor Comments

During the transferor's life, a recorded and unrevoked transfer on death deed remains revocable and is functionally equivalent to a specific devise contained in a will. The prospective beneficiary has no legal or equitable interest in the subject real property and the transferor retains full power to sell, gift, lease, mortgage, or otherwise encumber the property. Cf. The Uniform Real Property Transfer on Death Act: A Summary at 1 ("The transferor may revoke the deed by recording a revocatory instrument such as a direct revocation of the TOD deed, or a subsequent TOD deed that names a different beneficiary. If the transferor sells the property while living, the TOD deed is ineffective.").

The Texas Real Property Transfer on Death Act and the Uniform Real Property Transfer on Death Act both adhere to the following rule: a transfer on death deed, like a will, transfers only real property that the maker owned at death. Cf. Shriner's Hosp. for Crippled Children of Tex. v. Stahl, 610 S.W.2d 147, 150 (Tex. 1980) ("Although there are recognized exceptions to the ademption rule, circumstances warranting an exception do not exist here."); Mattlage v. Mattlage, 243 S.W.3d 763, 768 (Tex.App.—Waco 2007, denied) ("When a specific devise of realty is subject to a contract for sale executed by the testator before his death, the doctrine of equitable conversion applies.").

Section 114.103(a) provides: "Except as otherwise provided in the transfer on death deed, this section, or any other statute or the common law of this state governing a decedent's estate, on the death of the transferor, the following rules apply to an interest in real property that is the subject of a transfer on death deed and owned by the transferor at death: . . . ."

Section 114.104(a) provides: "Subject to Section 13.001, Property Code, a beneficiary takes the real property subject to all conveyances . . . and other interests to which the real property is subject at the transferor's death. For purposes of this subsection and Section 13.001, Property Code, the recording of the transfer on death deed is considered to have occurred at the transferor's death."

The comment to Section 11 of the Uniform Act states: "Revocation means that the instrument is rendered void. Ademption by extinction means that the transfer of the property cannot occur because the property is not owned by the transferor at death. The doctrines are different."

The comment to Section 13 of the Uniform Act states: "Note that the property must be owned by the transferor at death. Property no longer owned by the transferor at death cannot be transferred by a transfer on death deed, just as it cannot be transferred by a will. This is the principle of ademption by extinction, discussed in the Comment to Section 11."

If the real property that is the subject of a transfer on death deed is not owned by the transferor at death, it is not transferred to the beneficiary under the TRPTODA. Cf. Tompkins State Bank v. Niles, 537 N.E.2d 274, 283 (Ill. 1989) ("The official comments to the Uniform Act do not, of course, have the force of statutory language, but are a permissible and typically persuasive aid in determining legislative intent."); Sheils v. Wright, 357 P.3d 294, 296 (Kan.App. 2015) ("Since Richard conveyed all of the property away during Richard's lifetime, there was nothing to transfer on his death via the transfer-on-death deed.").

Consider the following example: T subscribed, acknowledged, and recorded a transfer on death deed for Blackacre identifying X as the designated beneficiary. Later, T conveyed Blackacre to Y. Later, T died. The inter vivos deed conveying Blackacre to Y was not recorded before T's death and therefore it did not invalidate the transfer on death deed under this section. However, at T's death, Blackacre was not owned by T. The attempted transfer of Blackacre under the transfer on death deed was adeemed by extinction. Unless provided otherwise by the Texas recording statute, Y is the owner of Blackacre.

If a transferee fails to occupy the subject real property or record the inter vivos deed before the transferor's death, it is possible but unlikely that the beneficiary will prevail under the Texas recording statute. As explained in the comment to Section 13 of the Uniform Act: "Most beneficiaries of transfer on death deeds are gratuitous, whereas state recording acts typically protect only purchasers for value." Cf. Taylor v. Harrison, 47 Tex. 454, 459 (1877) ("Preference is not given [] because there is any title or interest in the land remaining in the vendor, after he has once sold and conveyed it, but simply because it is a rule of public policy, prescribed by statute, for the protection of innocent parties against fraud.").

This section of the TRPTODA has no corresponding section in the Uniform Act and it was unique when enacted in 2015. Cf. Masterson v. Harris, 174 S.W. 570, 573 (Tex. 1915) ("[T]he diligent research of able counsel has failed to discover the existence in any other jurisdiction of a statute in terms like this; and our own investigation for that purpose has been equally futile in its result.").

However, under Section 11 of the Uniform Act, instruments that may revoke a recorded transfer on death deed include "an inter vivos deed that expressly revokes the transfer on death deed or part of the deed." That language was not included in Section 114.057. The quoted language provides a statutorily recognized method for the transferor to declare his or her intent that the beneficiary of the transfer on death deed not receive a substitute devise from the transferor's probate estate. In Texas, no court has applied the recognized exceptions to the ademption rule to nonprobate transfers. Therefore, it made sense for the quoted language to be omitted from the TRPTODA.

The limited legislative history available for Senate Bill 462 does not contain any information regarding why the quoted language was omitted or what this new section was meant to accomplish. Cf. 2008 Annual Meeting Draft at 12 ("The committee rejected the requirement of California draft §5652(c) that the limitation must be 'of record,' because the beneficiary should merely step into the transferor's shoes . . . .").

When Senate Bill 462 was filed, this section provided: "If a transferor during the transferor's lifetime conveys to any person all of the transferor's interest in real property that is the subject of a transfer on death deed, the transfer on death deed is void as to that interest in real property." During the legislative process, the foregoing language was deleted and different language inserted. Note that, in 2019, the section was further modified by House Bill 2782.

In short, neither the intent nor the effect of this section is clear. Cf. Top 10 Questions: Transfer on Death Deed at 1 ("The statute is so broad, that merely borrowing against the property might be enough to extinguish it."); Transfer on Death Deeds in Texas: High Time for the TODD at 81 ("They may also think that recording a deed is not necessary for it to be valid, but recording a post-TODD transfer by deed is necessary to void the TODD!").

For example, the consequence of a failure to timely record the "valid instrument" or a sufficient memorandum in the proper location is unclear. The "otherwise valid transfer on death deed" is not invalidated under this section but, as a practical matter, what does that change. Unless and until one or more exceptions to the ademption rule are extended to nonprobate transfers, apparently nothing. Cf. Rodgers v. Burchard, 34 Tex. 442, 453 (1871) ("An unrecorded [inter vivos] deed conveys all the title of the grantor, and he has no longer any interest in the estate; nor can any interest descend to his heirs.").

Other commentators read this section differently. For example, Professor Beyer, without extended analysis, interprets the section to invalidate the inter vivos deed of a transferee unless it is recorded before the transferor's death. For details, review the third entry in the Legal Commentaries section below. Also consider the effect, if any, of Section 114.005 ("In applying and construing this chapter, consideration must be given to the need to promote uniformity of the law with respect to the subject matter of this chapter among states that enact a law similar to this chapter.").

Whatever its correct interpretation, this poorly drafted section fails to further the Uniform Act's intent to bring "uniformity and clarity" to this area of the law. Cf. The Uniform Real Property Transfer on Death Act: A Summary at 2 ("At the time of the transferor's death, title to the property is transferred automatically to the beneficiary, subject to any conveyances . . . or other interests in the property. In other words, the beneficiary receives only the interest that the transferor owned at the time of death, and the holders of any security interests in the property are protected.").

Steve Smith

Court Decisions

No appellate court decision has interpreted any section of the TRPTODA.

Legal Commentaries

  • Johanson's Texas Estates Code Annotated at 116 ("A TOD deed does not create any legal or equitable interest in the designated beneficiary, and the owner retains the power to transfer or encumber the property. The owner may revoke the deed, and a subsequent transfer of the property through a recorded conveyance automatically revokes the TOD deed.")
  • New Tool in the Toolbox at 3-4 ("As with most new statutes, there are some unanswered questions and potential pitfalls to avoid. . . . The [inter vivos] deed of the sale is valid as a transfer whether recorded or not, but it must be recorded prior to the transferor's death to void the TODD. What happens if it is not recorded?")
  • Texas Law of Wills (Vol. 10, Texas Practice Series) at 595 ("[T]he property owner may transfer the property to someone other than the beneficiary even if the transferee has actual knowledge of the TOD deed as long as the transferee records his or her deed before the property owner dies.")
  • Texas Transfer on Death Deeds at 1 ("Unlike other deeds that transfer real estate, TOD deeds do not affect an owner's right to use, sell, or convey the property during their lifetime. Tex. Est. Code § 114.101 (West 2017). If the owner sells the property after recording a TOD deed, the TOD deed is automatically revoked.")
  • Transfer on Death Deeds at 1 ("[T]he creation of a TODD does not prohibit the transferor to sell, gift, or otherwise transfer ownership of the property during the transferor’s lifetime. Thus, if a transferor were to make a transfer of the property while living, the TODD would essentially be revoked as the transfer of the property would be immediately effective.")

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Uniform Act Comment