Florida Probate Debt

[Michelle Sadler]

Grandfather owns trust, is trustee and beneficiary of trust. Grandfather loan son and daughter-in-law cash June 1994. Security for cash loan was Deed to land. July 1996, son passes. Daughter-in-law had right of survivor ship as we're tenants in common. Fee simple first money mortgage in trust.  Suvived by two half brothers (minor 1996) Deseased first wife placed a claim in estate probate for child support arrears for first born son/heir. Grandfather, (Personal Representatie of son's probate) never listed cash debt for land/non homestead property to protehct security. Probate is still open due to arrears claim, unpaid. August 2011 daughter-in-law passes. Second born heir is living at property. Second grandson is heir to all Grandfather trusts and companies. Sept 2015, both grandsons were served foreclosure summons from grandfather stating amount borrowed in June 1994 through today Sept 2015 plus high interest. Second born defaulted, no responses, as technically heir. First born is defending pro se, specialized lawyer very pricey, but are worth the experience. First born filed Affirmative Defense. Part of content is grandfather mis representing probate debt and assets. 20 yr statute expired, but know he would re-file, different date. Can first born win case evidence of probate proceedings. Plus Deed witness is grandfather and notary. I do not think that is legal as witness signature found a spot to sign. Help, my son wants father custom made home.   Opinions appreciated. Thank you.

[Dion DePaoli]

This is still a little confusing from the OP.  So Grandpa lends money to son and daughter in-law.  The security for the loan is either (a) the interest in the trust as a beneficiary or (b) a mortgage/deed of trust on the land held by the trust benefiting son and family.  

Who owned the land in question at the time of the transaction?  The trust?  The son and family?  

With the foreclosure actions coming forth, I get a sense that a mortgage was signed and not a deed.  So the trust is the Lender and the son and family is the borrower.  This also means the son and family are the property owners and the trust is merely has an interest as a lender in the property.

I am inclined to say if that is the case, a misrepresentation in the trust filings is not grounds to invalidate a security instrument in the property.  Those are two separate issues.  

So if that is the case, does the mortgage held by the trust have valid lien and thus a legal right to enforce that lien?

Sounds like here, the defending grandson is trying to invalidate the transaction for improper notary on instrument.  Certainly an OK place to start but judicially the judge can look to the intent of what was done improperly and still uphold the instrument is enforceable.

I would pause there and look to the intent of the action.  The trust is seeking to enforce its security instrument for default on payment.  I didn't fully understand the 20 year statue comment - was this loan never debt serviced?  Just because the loan is from 1994 doesn't mean it is invalided and unenforceable.  

If the trust is seeking to foreclose, then let's presume that goes forward.  Isn't the grandson and heir to the trust?  

So if the trust forecloses and the property goes to sale and reverts back to the trust as real property, then by proxy the grandson still ends up with the property.  

Is grandpa simply trying to clean up a stale account held by the trust to create a better trust for the future heir?   

That questions sort of begs the question, why fight grandpa then?