S.C. Statehouse Report
Sunday, Aug. 13, 2006
VIEW: http://www.statehousereport.com/columns/06.0813.prop.htm

Heirs property law provides more protection
By Andy Brack
SC Statehouse Report

AUG. 13, 2006 - - The most unheralded new law from the 2006 legislation affords better protection for people who own so-called "heirs property," - - fractional shares of property in land passed down from generation to generation.

A new law signed by Gov. Mark Sanford in May allows family members to have a right of first refusal to buy the share of a fellow family member' who wants to sell. Under existing state law, land passed on without a will is owned by all of the heirs of the property.

As highlighted in a recent engaging story in The State, freed slaves came into possession of what was thought to be worthless land in the waning days of the War Between the States. But it often was passed on without wills. In the generations since, heirs multiplied into the hundreds for individual parcels of land, a lot which is along the coast and has enormous value as people stream in to take advantage of the state's slower-paced quality of life.

Old property laws have made it relatively easy for unscrupulous developers to cajole just one heir to seek a buyout of his or her share of the property. When that happened, court action often followed to allow the individual to realize his or her share. Unfortunately, other family members were left out in the cold as the land was sold at sheriff's sales for pennies on the dollar. Through the years, millions of acres of heirs property have been lost by families that couldn't intervene.

Under the new South Carolina law pushed by S.C. Sens. Clementa Pinckney (D-Jasper) and Robert Ford (D-Charleston), families have a little more time. The new law says once a court action has been filed to seek a sale, family members who don't want the land sold outside the family have 10 days to let the courts know they want more time.

After the court approves a price, which may be agreed to by the family or set by an appraiser if there is disagreement, family members who want to preserve the historical stake in the property have 45 days to come up with the money to buy out the family member who wants to sell.

In other words, the new law acts as a circuit breaker to give the family more time to come up with money to keep the property in the family.

"It's a positive first step," said Willie Heyward, managing attorney for the Center for Heirs Property Preservation in Charleston, who noted that the new law provides at least some protection - - much better than the lack of protection in the past. "At least now, they have some leverage."


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Still, the new law needs some more work.

First, the time span needs to be lengthened. More than 10 days is needed for families to identify and notify all potential heirs of a possible sale. Through the years, many heirs have moved out of state - - and may not even know they have a fractional share in a piece of now-valuable real estate. There needs to be more time for families to ensure all qualified heirs are part of the process.

Also, families should have a little more time to come up with the money. If a property along the coast is now worth millions, it might be hard for family members to come up with hundreds of thousands to buy out the fractional share of just one member. The statute should be flexible enough to allow courts to extend the time for families to come up with the cash if they're making a good-faith effort to satisfy the member who wants his or her share.

Next, the new law does nothing to shift the burden from the family members who want a buyout to the family members who want to keep the land - - and their family heritage - - intact. One person still can force a sale. If South Carolina really is a state about "family values," then a family's wishes about its land should take precedence over that of one member.

It would be better for the law to be upgraded to require a certain percentage of family members - - say a third - - to agree to a sale before it can move forward. This would allow the family to make a decision based on its wishes as a whole, instead of having to respond to one of 100 potential heirs.

Send your ideas to Andy Brack, publisher of S.C. Statehouse Report, at: brack@statehousereport.com. Brack's book of commentary, Bugging the Palmettos, is available for $15.00. Click here for more.

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