In re the Estate of Roloff
2006 Kan. App. LEXIS 981, 143 P.3d 406, 36 Kan. App. 2d 684 (2006)
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Rule of Law:
Under Kansas law, a transfer-on-death (TOD) deed conveys the grantor's entire interest in real estate, including growing crops, to the grantee beneficiary upon the grantor's death, unless the deed explicitly reserves those crops.
Facts:
- In the spring of 2004, Henry M. Roloff planted wheat, corn, and soybeans on his farmland in Atchison County, Kansas.
- On June 26, 2004, Roloff designated Charles A. Schletzbaum, a long-time employee, as a grantee beneficiary under a transfer-on-death (TOD) deed for certain farmland located in Atchison, Kansas.
- Roloff did not include any language in the TOD deed reserving the growing corn and soybeans.
- Roloff recorded the TOD deed with the Atchison County Register of Deeds on June 28, 2004.
- Roloff died intestate on July 24, 2004.
- Schletzbaum subsequently harvested and sold the corn and soybeans, receiving total proceeds of $79,453.05, with net proceeds of $67,424.65 after expenses for harvesting, transporting, and selling the crops.
Procedural Posture:
- Commerce Trust Company, a division of Commerce Bank, N.A., was appointed as administrator of Henry M. Roloff's intestate estate.
- Commerce Trust Company informed Charles A. Schletzbaum that the growing crops on the deeded farmland did not pass to him with the land and demanded an accounting of the proceeds from the sales of the crops.
- The trial court determined that the growing crops should be considered personal property belonging to Roloff's estate and ordered Schletzbaum to pay the net proceeds of $67,424.65 plus interest to Commerce Trust Company.
- Charles A. Schletzbaum appealed the trial court's judgment to the Kansas Court of Appeals (Schletzbaum as appellant, Commerce Trust Company as appellee).
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Issue:
Does a transfer-on-death (TOD) deed, without an express reservation of growing crops, transfer title to those crops to the grantee beneficiary, or do the crops pass as personal property to the grantor's estate under K.S.A. 59-1206?
Opinions:
Majority - Green, J.
Yes, a transfer-on-death (TOD) deed, without an express reservation of growing crops, transfers title to those crops to the grantee beneficiary. The court reversed the trial court's decision, finding that because Henry M. Roloff did not reserve the growing crops in the TOD deed, they passed to Charles A. Schletzbaum with the title to the land. The court reasoned that under Kansas statutory law (K.S.A. 58-2202) and common law (e.g., Jones v. Anderson), a conveyance of land by deed passes the grantor’s entire interest, including growing crops, unless expressly reserved. The legislature, in creating TOD deeds (K.S.A. 59-3501 et seq.), did not abrogate this well-established common law principle, and indeed, TOD deeds are comparable to other deed forms that operate under this rule. The court rejected Commerce Trust Company's argument that K.S.A. 59-1206, which characterizes growing crops as personal property, was applicable, explaining that this statute traditionally governs the distribution of crops to heirs or devisees within a probate estate, not nonprobate transfers via deed. The court further noted that TOD deeds share characteristics with joint tenancy with right of survivorship, where property vests immediately in the survivor outside of probate, and growing crops are similarly treated as passing with the land unless reserved. The inclusion of 'security pledges' in K.S.A. 59-3504(b) further supported the legislative intent that growing crops could be part of the transferred interest, as crops are personal property for security interests.
Analysis:
This case clarifies the treatment of growing crops within the framework of Kansas's relatively new transfer-on-death deeds. It firmly establishes that the long-standing common law rule—that growing crops pass with the land unless explicitly reserved in the deed—applies to TOD deeds, harmonizing them with other forms of real estate conveyance and joint tenancy. The decision provides crucial guidance for grantors and beneficiaries by confirming that the legislature did not intend to silently abrogate established common law with the enactment of TOD deed statutes. This precedent enhances predictability in estate planning and property transfers, ensuring that grantors who wish to separate crops from the land conveyance must include specific, express reservations in their TOD deeds.
