In the first half of 2011, the Appeals Court had two occasions to address the obligations of a life tenant. On each occasion, the Appeals Court sent the same clear message: a life tenant’s primary obligation is to preserve the property.
Comeau v. Coache
In January 2011, the Appeals Court issued a summary decision in Comeau v. Coache, Case No. 09-P-1984, 2011 Mass. App. Unpub. LEXIS 101 (Jan. 24, 2011).
Plaintiff Peter Comeau is the trustee of the Comeau Family Trust. He is also the life tenant of a one-story house in Ipswich that is owned by the trust and where he has resided for the last fifty years. Other family members, including the defendants, are the remainder beneficiaries of the trust.
The relevant provision of the trust instrument allows Mr. Comeau to “continue to occupy the dwelling as his principal residence, provided that he pay all real estate taxes, insurance, maintenance and utilities for the premises.” Accordingly, Mr. Comeau alone must bear financial responsibility for “maintenance” work on the property.
Over the objections of the remaindermen, Mr. Comeau arranged for various work to be done at the property, primarily consisting of the replacement of the original windows. After having the windows replaced, for which he himself paid out of his own pocket, Mr. Comeau sought an order from the probate court to compel the remaindermen to reimburse him for their proportional share of the window replacement, which he claimed to be a capital improvement that was necessary to preserve the property. The remaindermen responded by seeking to terminate Mr. Comeau’s life estate. They argued that the replacement of the windows constituted maintenance work for which he is solely responsible.
The probate court decided in favor of the remaindermen, finding that the window-replacement work constituted “elective and cosmetic” maintenance, and terminated Mr. Comeau’s right to occupy the property.
The Appeals Court reversed the termination of Mr. Comeau’s right of occupancy, holding that regardless of whether the replacement of the windows was maintenance or a capital improvement, Mr. Comeau had in fact paid for the work. The Court also noted that Mr. Comeau’s obligation to pay for maintenance work could be interpreted to be a condition subsequent, and such conditions are not favored in the law: “. . . there is substantial doubt whether the trust document intended that [Mr. Comeau] automatically forfeit his right to occupy the premises if he breached his duty to pay for maintenance.”
Perhaps most importantly, the Court pointed out that Mr. Comeau’s pattern of conduct over the years showed a continuing effort to preserve the integrity and value of the property ultimately benefiting the interests of the remaindermen. Therefore, in the absence of any harm to the property, Mr. Comeau’s pursuit of an arguable claim for reimbursement was not a material breach of the letter or purpose of the condition subsequent of the trust and thus did not warrant the severe sanction of dissolution of his life estate.
Matteson v. Walsh
In May 2011, in its decision in Matteson v. Walsh, 79 Mass. App. Ct. 402 (May 2, 2011), the Appeals Court amplified on the theme that a life tenant has an obligation to preserve the integrity and value of the property.
In her will, Dorothy Walsh devised real property in Chatham consisting of a summer cottage and an unattached garage to her son Robert Walsh as the life tenant, and thereafter, upon his death, to his heirs and her other two children, Elizabeth Gay Matteson and Catherine Baisly, as the remaindermen.
Mr. Walsh resided at the property, but he stopped paying taxes in or about 2004, resulting in the town’s issuance of a notice of tax-taking. Mr. Walsh also stopped paying to maintain the property, causing it to fall into disrepair. Ms. Matteson paid some of the delinquent taxes and hired someone to repair the premises, which were described as being in “considerable distress.” Eventually, however, she filed suit against Mr. Walsh for waste.
The superior court found that Mr. Walsh had committed waste through his non-payment of taxes and by allowing the deterioration of the buildings, ordering him to reimburse Ms. Matteson for the taxes and $53,000 in repair costs she had paid. The superior court also divested Mr. Walsh of his life estate and ordered that he, Ms. Matteson and Ms. Baisly were to hold title to the property as tenants in common.
The Appeals Court affirmed in part, rejecting Mr. Walsh’s argument that his failure to pay taxes did not result in waste because the property was neither seized nor sold. The Court explained that the only reason why the property was not seized and sold was that Ms. Matteson had stepped in to pay the outstanding debt, and that the threat to the remainder interests was sufficient to constitute prejudice to the inheritance. “Permitting the real estate taxes assessed to the property to remain unpaid to the point that the taxing authority records a tax-taking amounts to waste.”
The Court also rejected Mr. Walsh’s argument that his failure to maintain the property amounted to permissive waste for which he, as a life tenant, cannot be liable. The Court reasoned that the notion of permissive waste applies to a tenant at will, and that a life tenant is under a higher duty to preserve the estate for the benefit of the remaindermen.
As for the appropriate relief, the Court held that the superior court had erred in granting Mr. Walsh a fee interest in common after having ordered divestment of his life estate. When Mr. Walsh was divested of his life estate, the remainder interests vested, and he did not hold a remainder interest. If he had any heirs, their remainder interests might have vested, but he had none, and although he theoretically could have still produced an heir, the remainder interests are determined as of the date of recovery under the statute of waste, M.G.L. c. 242, § 1.
With these decisions, the Appeals Court fired an unmistakable warning shot: a life tenant is merely a visitor at the property in which he or she resides, and as such the life tenant must take care to preserve (i.e., not waste) the property for the benefit of the remaindermen. Every life tenant would be well-advised to heed this warning.