Conservator’s Sale of Minnesota Real Property.

Any Conservator’s sale of Minnesota Real Property for a Protected Person requires the satisfaction of a number of statutory elements.

Conservator’s Sale of Minnesota Real Property

Any Conservator’s sale of Minnesota Real Property for a Protected Person requires the satisfaction of a number of statutory elements.

Minnesota Conservator – Defined

M.S. Section 524.5-102, Subd. 3 defines the term Conservator in the following manner:

Conservator” means a person who is appointed by a court to manage the estate of a protected person and includes a limited conservator.

Minnesota Protected Person – Defined

M.S. Section 524.5-102, Subd. 14 defines the term Protected Person in the following manner:

Protected person” means a minor or other individual for whom a conservator has been appointed or other protective order has been made.

Minnesota Conservatorships

A Minnesota Conservator is appointed by a Probate Court judge to manage the financial affairs of a Protected Person, and typically will have the power to:

  • enter into, or decline to enter into, contracts for the Protected Person,
  • pay the Protected Person’s bills,
  • invest the assets of the Protected Person,
  • petition the Court for approval of the Conservator’s sale of Minnesota Real Property, and
  • perform other financial functions for the Protected Person.

Minnesota Protected Person – No Power to Transfer Real Property

(i)      M.S. Section 524.5-422(a)

M.S. Section 524.5-422(a) identifies that:

  • after the appointment of a Minnesota Conservator,
  • the Protected Person generally has no right to sell, assign, transfer or convey the interests of the Protected Person in Minnesota real property,

by providing in part as follows:

Except as otherwise provided in paragraphs

(c)     [relating to tangible personal property]

and

(d)     [referencing general property law],

the interest of a protected person in property is not transferable or assignable by the protected person.

An attempted transfer or assignment by the protected person,

although ineffective to affect property rights, may give rise to a claim against the protected person for restitution or damages which, subject to presentation and allowance, may be satisfied as provided in section 524.5-429.

(ii)     M.S. Section 507.04 Subd. 1

M.S. Section 507.04, Subd. 1 identifies that:

  • after the appointment of a Minnesota Conservator,
  • the Protected Person’s right to sell, assign, transfer or convey the Protected Person’s interests in Minnesota real property is generally restricted,

by providing in part as follows:

No Conveyance Except by Court Approval.

Except as otherwise provided by this section, if a protected person’s right to convey an interest in real property is restricted under sections 524.5-401 to 524.5-433, no conveyance of the interest is effective unless ordered by the court pursuant to section 524.5-418.

Minnesota Conservator – Limited Power of Transfer

M.S. Sections 524.5-417(a) and also 524.5-417(c)(3) identify that:

  • after the appointment of a Minnesota Conservator,
  • the Conservator acquires limited rights over the Minnesota real property of the Protected Person,

by providing as follows:

(a)     A conservator shall be subject to the control and direction of the court at all times and in all things. . . .

(c)      The duties and powers of a conservator include, but are not limited to:

(3)     the duty to possess and manage the estate, . . .

Conservator’s Sale of Minnesota Real Property

M.S. Section 524.5-418(a) identifies that after the appointment of a Minnesota Conservator, a Court can direct the Conservator’s sale of Minnesota real property of the Protected Person, by providing as follows:

The court may direct a sale, mortgage, or lease of any real estate of a protected person

  • when the personal property is insufficient to pay debts and other charges against the estate, or

  • to provide for the support, maintenance, and education of the protected person, a spouse, and dependent children, or

  • when it shall determine the sale, mortgage, or lease to be for the best interest of the protected person.

Minnesota Protected Person’s Spouse – Sale of Real Estate

(i)      M.S. Section 524.5-418(a)

M.S. Section 524.5-418(a) identifies that:

  • after the appointment of a Minnesota Conservator,
  • a court can direct the Conservator’s sale of Minnesota real property of the Protected Person,

but any sale of the Protected Person’s homestead by the Protected Person shall not be effective without the written consent of the Protected Person’s spouse, by providing as follows:

The homestead of a protected person shall not be sold, mortgaged, or leased unless the written consent of the spouse has been filed.

(ii)     M.S. Section 507.04, Subd. 6

M.S. Section 507.04, Subd. 6 identifies that any conveyance of a Minnesota homestead is not valid without the proper written consent of each spouse, or such spouse’s legal representative, by providing as follows:

Validity of Homestead Conveyance.

No conveyance of the homestead is valid unless each spouse or the duly authorized legal representative of each spouse joins in the conveyance by joint deed or by separate deeds.

(iii)    M.S. Section 507.04, Subd. 5

M.S. Section 507.04, Subd. 5 identifies that any Conservator’s sale of Minnesota Real Property on behalf of a Protected Person pursuant to the order of the Court shall also release any marital rights of the Protected Person in the real estate, by providing in part as follows:

Inchoate Interest in Real Property

of Protected Person’s Spouse.

In all cases where the court under section 524.5-418 has ordered a conveyance of the interest in real property owned by a protected person . . . the conveyance includes the inchoate interest of the protected person in any share or part of the real property owned by the protected person’s spouse whether or not specifically mentioned in the proceedings or conveyance.

Minnesota Protected Person’s Spouse – Conveyance of Homestead

M.S. Section 507.04, Subd. 1 identifies that any conveyance of a Minnesota homestead by the protected person’s spouse shall not be effective without the written consent of:

  • the protected person’s Conservator, and
  • the Court,

by providing as follows:

A conveyance of an interest in real property owned by the spouse of a protected person remains subject to the marital rights of the protected person unless the protected person’s conservator joins in the conveyance on behalf of the protected person pursuant to a court order under section 524.5-418.

This section does not revive marital rights in real property extinguished as part of a property agreement or settlement between the spouses approved by a court of competent jurisdiction, including but not limited to a valid prenuptial or postnuptial agreement, a legal separation, or any other court approved division of assets between the spouses.

Minnesota Conservator – Release of Marital Rights

M.S. Section 507.04, Subd. 5 identifies that any conveyance of an interest in Minnesota real property by the protected person’s Conservator pursuant to the order of the court relating to a conveyance by the protected person’s spouse shall release any marital rights of the Protected Person in such real property, by providing in part as follows:

Inchoate Interest in Real Property

of Protected Person’s Spouse.

In all cases where the court under section 524.5-418 . . . has ordered a protected person’s joinder in the conveyance of an interest in real property owned by the protected person’s spouse, the conveyance includes the inchoate interest of the protected person in any share or part of the real property owned by the protected person’s spouse whether or not specifically mentioned in the proceedings or conveyance.

Conservator’s Sale of Minnesota Real Property – Petition

M.S. Section 524.5-418(b) identifies that a Minnesota Conservator may petition a Court for the Conservator’s sale of Minnesota real property on behalf of the Protected Person, by providing as follows:

A conservator may file a petition to sell, mortgage, or lease

  • alleging briefly the facts constituting the reasons for the application and
  • describing the real estate involved therein.

The petition may include

  • all the real estate of the protected person or
  • any part or parts thereof.

It may apply for different authority as to separate parcels.

It may apply in the alternative for authority to sell, mortgage, or lease.

Hearing on Petition for Conservator’s Sale of Minnesota Real Property

M.S. Section 524.5-418(b)(1) identifies that a Court shall order a hearing on any petition by a Minnesota Conservator for the Conservator’s sale of Minnesota real property of a Protected Person, by providing as follows:

(1)     Upon the filing of such petition, the court shall fix the time and place for the hearing thereof.

Notice of Hearing on Petition for Conservator’s Sale of Minnesota Real Property

M.S. Section 524.5-418(b)(1) identifies the notice requirements with respect to any hearing on a petition by a Minnesota Conservator for the Conservator’s sale of Minnesota real property, by providing as follows:

Notice of the hearing

  • shall be given to interested persons and
  • shall state briefly the nature of the application made by the petition.

If publication of notice is required by the court, published notice shall be given by publication once a week for two consecutive weeks in a legal newspaper designated by the petitioner in the county wherein the proceedings are pending, or, if no such designation be made, in any legal newspaper in the county, or, if the city of the protected person’s residence is situated in more than one county, in any legal newspaper in the city.

The first publication shall be had within two weeks after the date of the order fixing the time and place for the hearing.

Proof of publication and mailing shall be filed before the hearing.

No defect in any notice or in the publication or service thereof shall invalidate any proceedings.

Conservator’s Sale of Minnesota Real Property – Court Order

M.S. Section 524.5-418(b)(2) identifies that after the hearing on any petition by a Minnesota Conservator for the Conservator’s sale of Minnesota real property on behalf of the Protected Person, a Minnesota court shall have a limited power to direct the sale of such real property – by providing in part as follows:

Upon the hearing, the court shall have full power

  • to direct the sale, mortgage, or lease of all the real estate described in the petition, or
  • to direct the sale, mortgage, or lease of any one or more parcels thereof,

provided that any such direction shall be within the terms of the application made by the petition.

The order shall describe the real estate to be sold, mortgaged, or leased, and may designate the sequence in which the several parcels shall be sold, mortgaged, or leased.

If the order be for a sale, it shall direct whether the real estate shall be sold at

  • private sale or
  • public auction. . . .

An order for sale, mortgage, or lease shall remain in force until terminated by the court, but no private sale shall be made after one year from the date of the order unless the real estate shall have been reappraised under order of the court within six months preceding the sale.

Conservator’s Sale of Minnesota Real Property – Terms

M.S. Section 524.5-418(b)(3) identifies the permissible terms of any Court ordered Conservator’s sale of Minnesota real property on behalf of the Protected Person, by providing in part as follows:

The court may order a sale of real estate for

  • cash,
  • part cash, and a purchase-money mortgage of not more than 50 percent of the purchase price, or
  • on contract for deed.

The initial payment under a sale on contract shall not be less than ten percent of the total purchase price, and

the unpaid purchase price

  • shall bear interest at a rate of not less than four percent per annum

and

  • shall be payable in reasonable monthly, quarterly, semiannual, or annual payments,

and

the final installment shall become due and payable not later than ten years from the date of the contract.

Such contract shall provide for conveyance by conservator’s or quitclaim deed, which deed shall be executed and delivered upon full performance of the contract without further order of the court.

In the event of termination of the interest of the purchaser and assigns in such contract, the real estate may be resold under the original order and a reappraisal within six months preceding the sale.

A sale of the vendor’s interest in real estate sold by the conservator on contract may be made under order of the court, with or without notice, upon an appraisal of such interest within six months preceding the sale;

no such sale shall be made for less than its value as fixed by such appraisal.

Court Order Directing a Private Sale of Real Estate

M.S. Section 524.5-418(b)(5) identifies the manner in which any Court ordered private Conservator’s sale of Minnesota real property on behalf of the Protected Person is to be achieved, by providing in part as follows:

If a private sale be ordered,

  • the real estate shall be reappraised by two or more disinterested persons under order of the court
  • unless a prior appraisal of the real estate has been made by two or more disinterested persons not more than six months before the sale,

which reappraisal shall be filed before the confirmation of the sale.

Court Limitations on Order Directing a Private Real Estate Sale

M.S. Section 524.5-418(b)(5) identifies that the Minnesota real property of the Protected Person cannot be sold for less than its appraised value pursuant to any Court ordered private Conservator’s sale of Minnesota real property on behalf of the Protected Person, by providing in part as follows:

No real estate shall be sold at private sale for less than its value as fixed by such appraisal.

Minnesota Conservator – Reporting the Sale of Real Estate to the Court

M.S. Section 524.5-418(b)(7) imposes an obligation on the Minnesota Conservator to report the Conservator’s sale of Minnesota real property on behalf of the Protected Person to the Court.

Court Confirmation of Private Real Estate Sale

M.S. Section 524.5-418(b)(7) authorizes a court to issue an order confirming the sale by a Minnesota Conservator of the Protected Person’s Minnesota real property by providing in part as follows:

Upon proof of compliance with the terms of the order, the court may confirm the sale or lease and order the conservator to execute and deliver the proper instrument.

Court Confirmation of Pre-existing Obligations to Sell Real Estate

M.S. Section 524.5-418(g) identifies the procedures to be followed by a Minnesota Conservator when the Protected Person has an obligation to sell Minnesota real property which arose prior to the appointment of the Conservator, by providing in part as follows:

When any protected person is legally bound to make a conveyance or lease, the court, without further notice, may direct the conservator to make the conveyance or lease to the person entitled thereto.

The petition may be made

  • by any person claiming to be entitled to the conveyance or lease, or
  • by the conservator, or
  • by any interested person or person claiming an interest in the real estate or contract,

and shall show the description of the land and the facts upon which the claim for conveyance or lease is based.

Upon proof of the petition, the court may order the conservator to execute and deliver an instrument of conveyance or lease upon performance of the contract.

Conclusion – Conservator’s Sale of Minnesota Real Property

Any Conservator’s sale of Minnesota Real Property for a Protected Person:

  • requires the satisfaction of a number of statutory elements,
  • and is not a job for do-it-yourselfers.

Real property which is owned by a Protected Person may not be sold, mortgaged, leased, or encumbered by a Minnesota Conservator without a court order.

Therefore, a Minnesota Conservator should consult with legal counsel before entering into ANY agreement involving real estate.

If you require assistance with respect to any Minnesota Conservator issues, please contact attorney Gary C. Dahle, at 763-780-8390, or gary@dahlelaw.com.

Copyright 2016 – All Rights Reserved

No claim to the text of statutory provisions, or judicial decisions.

 Gary C. Dahle – Attorney at Law

2704 Mounds View Blvd., Mounds View, MN 55112

Licensed in Minnesota and North Dakota

Phone:  763-780-8390   Fax: 763-780-1735

gary@dahlelaw.com

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 Legal Disclaimer

Information provided herein is only for general informational and educational purposes. The laws relating to Minnesota conservators involve many complex legal issues. If you have a specific legal problem about which you are seeking advice, consult with legal counselGary C. Dahle, Attorney at Law, is licensed to practice law only in the State of Minnesota, and in the State of North Dakota, in the United States of America. Therefore, only those persons interested in matters governed by the laws of the State of Minnesota should consult with, or provide information to, Gary C. Dahle, Attorney at Law, or take note of information provided herein.

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Minnesota Guardianship and Conservatorship Links

Minnesota Guardianship and Conservatorship Statutes – Minors: https://www.revisor.mn.gov/statutes/?id=524.5-101

Minnesota Guardianship and Conservatorship Statutes – Adults: https://www.revisor.mn.gov/statutes/?id=524.5-601

Pacer Center: http://www.pacer.org/

National Institute of Mental Health: https://www.nimh.nih.gov/index.shtml

The Alzheimer’s Foundation of America: https://alzfdn.org/