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In re Estate of Area

Court of Appeals of Kansas

May 29, 2015

In the Matter of the Estate of BLANCHE A. AREA, Deceased

Page 664

Appeal from Jackson District Court; MICHEAL A. IRELAND, judge.

Reversed and remanded with directions.

SYLLABUS

BY THE COURT

1. Under K.S.A. 59-1401(c), one of the duties of an administrator of an intestate estate is to take possession of all tangible estate property located in this state and all intangible property wherever located to be held, administered, and finally distributed as provided by law. The administrator, alone or with the heirs or devisees, may maintain an action for the possession of the estate real estate or to quiet title to it under K.S.A. 59-1401.

2. When a lien on property has ceased to exist, or when an action to enforce a lien is barred by a statute of limitations, the owner of the property may maintain an action to quiet title under K.S.A. 60-1002(b).

3. An executor or administrator stands in the shoes of the decedent in respect to mortgages given by the decedent.

4. Where a landowner would have standing to challenge the enforceability of a note and mortgage in order to quiet title, the administrator as a fiduciary of the landowner's estate stands in the shoes of the decedent and has the duty to assert the same challenge.2

5. Just as it is with the executor of a testate estate, an administrator of an intestate estate is in a position of trust. The position is fiduciary in character, and its holder is a trustee for the estate and all persons interested in the estate. As the fiduciary of all interested parties, an administrator has a duty to see that their rights are correctly adjudicated and the laws of administration are followed.

6. Under K.S.A. 60-511(1), an action upon any agreement, contract, or promise in writing shall be brought within 5 years.

7. Parties cannot be considered mortgagees in possession of real estate if they take possession of the real estate after the note and lien from a mortgage have expired by their own terms and are barred by the applicable statute of limitations.

8. Kansas is a lien theory jurisdiction. Under Kansas law, a mortgage is not a conveyance of an interest in land. The mortgagee acquires no estate whatever in the property, either before or after any contract condition is broken, but acquires only a lien securing the indebtedness described in the instrument. Parties must take some legal action to protect their lien if they wish to protect their interests in the property subject to their lien.

9. There is no public policy in Kansas stating that different rules apply to notes and mortgage agreements involving familial relationships. The statute of limitations, K.S.A. 60-511, does not exempt contracts between family members.3

10. When classifying demands against a probate estate, K.S.A. 59-1301 provides that any claim for medical assistance paid under K.S.A. 39-709(e), and the amendments thereto, are to be allowed as first-class claims.

11. It is a long-standing principle that equity will not lie when a legal remedy exists.

Clifton B. DeMoss, Jr., of Basehor, and Keith C. Sevedge, of Lenexa, for appellant administrator David P. Mikesic.

Dennis A. White, of White Law Office, of Holton, for appellees children of decedent.

Brian M. Vazquez, of Health Care Finance Legal Group, Kansas Department of Health and Environment, of Topeka, for appellee Estate Recovery Program.

Before HILL, P.J., STANDRIDGE and ATCHESON, JJ.

OPINION

Page 665

[51 Kan.App.2d 550] HILL, J.

This is an appeal of a district court order declaring that an administrator of an intestate estate lacked standing to appeal a magistrate's ruling that the Estate of Blanche A. Area was legally liable for a note. For reasons set out below, we reverse and remand.

Page 666

A lady moves from her home to assisted living.

Blanche A. Area lived in Horton and had seven children. Five of her seven adult children agreed to lend her money to build a home in Horton. On June 27, 1995, Blanche signed a promissory [51 Kan.App.2d 551] note in favor of her five children promising to repay their loan. The note was secured by a mortgage, which was executed and recorded on the same day. At its creation, the note was in the amount of $53,750 with a 10 percent annual interest rate. The note was due in full on July 1, 2005. Blanche never made a payment on this note.

More than 5 years after the note was due, Blanche moved into an assisted living facility in November 2010. At that time, the five children took control of their mother's home; they each contributed to an account, which provided for maintenance, taxes, and insurance on the mortgaged property. On June 28, 2011, Blanche signed a quitclaim deed where she and her son, Jack Area, were ...


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