§ 32-17-14-28 — Effect of improper distributions

Indiana § 32-17-14-28

• Jurisdiction: Indiana
• Title 32: PROPERTY
• Art. 17: INTERESTS IN PROPERTY
• Ch. 14: Transfer on Death Property Act

Text

(a) The protections provided to a
transferring entity or to a purchaser or lender for value by this chapter
do not affect the rights of beneficiaries or others involved in disputes
that:
(1) are with parties other than a transferring entity or purchaser or
lender for value; and
(2) concern the ownership of property transferred under this
chapter.
(b) Unless the payment or transfer can no longer be challenged
because of adjudication, estoppel, or limitations, a transferee of money
or property under a transfer on death transfer that was improperly
distributed or paid is liable for:
(1) the return of the money or property, including income earned
on the money or property, to the transferring entity; or
(2) the delivery of the money or property, including income
earned on the money or property, to the rightful transferee.
In addition, the transferee is liable for the amount of attorney's fees and
costs incurred by the rightful transferee in bringing the action in court.
(c) If a transferee of money or property under a transfer on death
transfer that was improperly distributed or paid does not have the
property, the transferee is liable for an amount equal to the sum of:
(1) the value of the property as of the date of the disposition;
(2) the income and gain that the transferee received from the
property and its proceeds; and
(3) the amount of attorney's fees and costs incurred by the rightful
transferee in bringing the action in court.
(d) If a transferee of money or property under a transfer on death
transfer that was improperly distributed or paid encumbers the
property, the transferee:
(1) shall satisfy the debt incurred in an amount sufficient to
release any security interest, lien, or other encumbrance on the
property; and
(2) is liable for the amount of attorney's fees and costs incurred by
the rightful transferee in bringing the action in court.
(e) A purchaser for value of property or a lender who acquires a
security interest in the property from a beneficiary of a transfer on
death transfer:
(1) in good faith; or
(2) without actual knowledge that:
(A) the transfer was improper; or
(B) information in an affidavit provided under section 26(b)(20)
of this chapter was not true;
takes the property free of any claims of or liability to the owner's estate,
creditors of the owner's estate, persons claiming rights as beneficiaries
of the transfer on death transfer, or heirs of the owner's estate. A
purchaser or lender for value has no duty to verify sworn information
relating to the transfer on death transfer.
(f) The protection provided by subsection (e) applies to information
that relates to the beneficiary's ownership interest in the property and
the beneficiary's right to sell, encumber, and transfer good title to a
purchaser or lender but does not relieve a purchaser or lender from the
notice provided by instruments of record with respect to the property.
(g) A transfer on death transfer that is improper under section 22,
23, 24, or 25 of this chapter imposes no liability on the transferring
entity if the transfer is made in good faith. The remedy of a rightful
transferee must be obtained in an action against the improper
transferee.

Legislative History

As added by P.L.143-2009, SEC.41. Amended by P.L.6-2010, SEC.35.