Heirs’ Property Due Process Protections Under Consideration for NC

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Man feeding goatsOften referred to as ‘dead capital’, heirs’ property results when a will is not prepared before a family passes away. This category of land is a subset of tenancy-in-common property results in “undivided ownership,” which means each of the legally defined heirs own a fractional interest in the property (rather than a specific piece or portion of the property). After several generations, ownership of land and other property, including single-family homes, may be fragmented among many heirs, any one of whom can sell their fractional ownership or seek to force a sale of the land, with or without the agreement of all owners. The Department of Agriculture has called heirs’ property “the leading cause of Black involuntary land loss,” and notes that it led to a 90 percent decline in Black-owned farmland nationwide between 1910 and 1997.

In the Southeast USA, this category of land has been estimated to represent ~3.5 million acres with a value of ~$28 billion, with North Carolina share of this estimate being ~350,000 acres and ~$3.8 billion, 13% of the total and ranked 2nd among the 13 Southeastern states assessed. Heirs’ property can also occur in other states and this total of $28 billion is likely a very conservative estimate.

Nationally, many states have adopted the Uniform Partition of Heirs’ Property Act developed under the guidance of Thomas Mitchell, Texas A & M Law Scholar and 2020 Macarthur Fellow. Statues must be adopted by each state and address specific legal aspects of state property law. In general, the UPHPA requires that the co-tenants have the chance to buy out the co-tenant who wants to sell. Courts must also consider non-economic factors, including the cultural significance of the property and potential hardships created by evictions. Only as a last resort can a partition sale proceed, with the price reflecting market value.

North Carolina legal professionals Mavis Gragg of the American Forest Foundation’s Sustainable Forestry and African American Land Retention Program, and Savi Horne of the Land Loss Prevention Project were mentioned in this August 2021 Food Tank article describing the current status of the UPHPA and heirs’ property. The North Carolina legislature is currently reviewing prospective Senate and House UPHPA bills. Gragg points out that “[Lending institutions] in UPHPA states will have an automatic edge over their peers in other states.. Generally speaking, Horne considers the UPHPA a “game-changing” advancement to address legal deficiencies related to heirs’ property.

The 2018 Farm Bill authorizes $10 million annually for heirs’ property owners to pay legal costs related to settling land claims. Through the relending program, owners can apply for up $600,000 in assistance. The 2018 Farm Bill also has a provision to help heirs’ property owners operating farms to get a farm number and access to USDA programs. This process will also be easier in UPHPA states.

Additional heirs’ property resources are available at NC FarmLink, an NC State Extension program seeking to connect farmers, landowners, and service providers across North Carolina, helping to grow the state’s agriculture industry, serving local offices in all 100 counties and with the Eastern Band of Cherokee Indians.

Photo courtesy of USDA.