Posted by & filed under Trusts & Estates.

trust attorneyI received yet another call today from the daughter of a client for whom I drafted a trust. The daughter had an all-too-common question: Dad owned a car at his death. His daughter’s question was, “How do I transfer the car to my sister?” I asked if her father had the car titled in his trust. Unfortunately, he didn’t.

When it comes to the children of trust clients, the issue of a vehicle not titled in a trust by a decedent is by far the most common issue in my practice. Here is a short lesson in basic property law.

The owner of an asset is the person whose name is on the title. With respect to motor vehicles, the Ohio Revised Code is clear: The owner of a motor vehicle is the person in whose name the title has been issued, and no person acquires any ownership in a motor vehicle unless and until a certificate of title is issued in that person’s name. (R.C. 4505.03: “[N]or shall any person . . . buy or otherwise acquire a motor vehicle without obtaining a certificate of title for it in the person’s name in accordance with this chapter.”; R.C. 4505.04(A): “No person acquiring a motor vehicle from its owner . . . shall acquire any right, title, claim, or interest in or to the motor vehicle until there is issued to the person a certificate of title to the motor vehicle . . “) Accordingly, when an individual dies and the car title is in that individual’s name, the vehicle is not an asset of that individual’s trust.

In order for an individual to have a vehicle transferred into their trust, an individual would will have to take the title to the clerk of court’s title office with a Certificate of Trust – along with the mileage of the car, and asked the title clerk to issue a new title in the name of the Trustee of the individual’s trust. This transaction will involve fees, a new title and new registration (license plates) for the vehicle. Admittedly, this is a hassle – but not as much hassle family members will encounter after a loved one’s death.

As in the most recent issue the caller had regarding her father’s death, an alternative if for her father to have named his daughter as his transfer-on-death (TOD) beneficiary of the vehicle title. I have discussed the process in a prior blog.

For the daughter, the only thing she can do now is file a probate proceeding and have the vehicle title transferred by order of the Probate Court. This involves court costs, attorney fees, time delay and is an unpleasant experience for all involved. In some cases, the costs of this process are greater than the value of the vehicle.

Do not be this father. If an individual is not willing to transfer their vehicle title into the Trust, at the very least, a single parent/widow/widower should name a TOD beneficiary. Otherwise, family members will be saddled with an unpleasant legal problem in transferring a vehicle.

At The Law Office of John C. Grundy, our Ohio estate planning lawyer provides reliable, solutions-centered representation to people and families. If you have any questions about reviewing or revising your trust, our legal team is here to help. Contact us now for a completely confidential case evaluation. We provide estate planning services throughout all of Northeast Ohio, including in Warren, Lordstown, Howland Center, Girard, Hubbard, Youngtown, and Garrettsville.