Legal Question in Wills and Trusts in New Jersey

Is a contract binding after one party dies?

Recently, my father passed away. Before he died he entered into an agreement with my sister: She would help him with his mortgage payment and taxes on the house he owned. For this she was to get 10% of the profit of the house plus all monies she paid out. The agreement was notarized. My father did not have a will.

Is the agreement still binding after my father's death or is it not binding because he died without a will?

Does all of the profit from the sale of the house become part of the estate?


Asked on 4/30/03, 11:31 pm

3 Answers from Attorneys

Walter LeVine Walter D. LeVine, Esq.

Re: Is a contract binding after one party dies?

THE CONTRACT IS BINDING UNLESS YOUR FATHER WAS INCAPACITATED OR ACTING UNDER UNDUE INFLUENCE WHEN HE SIGNED IT. HE DIED INTESTATE (WITHOUT A WILL) AND SOMEONE IN THE FAMILY NEEDS TO BE APPOINTED TO ADMINISTER HIS ESTATE. THE HOUSE AND SALE PROCEEDS ARE PART OF THE ESTATE. HOWEVER, SINCE HE DIED BEFORE IT WAS SOLD, THE ESTATE GETS A NEW COST BASIS FOR CALCULATING GAIN ON THE SALE, NAMELY HIS DATE OF DEATH VALUE. WHEN SOLD, UNLESS THE SALES PRICE EXCEEDS THE DATE OF DEATH VALUE, THERE WOULD BE NO PROFIT. THUS, THE CONTRACT WITH YOUR SISTER MAY HAVE NO MEANING, AS THERE WOULD BE NO PROFIT (SALES PRICE = ESTATE'S COST). MHER RIGHT TO A PORTION OF THE PROFIT WOULD REQUIRE INTERPRETATION OF HER AGREEMENT WITH YOUR FATHER. HER ADVANCEMENT OF FUNDS TO ASSIST HIM WOULD BE A CLAIM AGAINST THE ESTATE AND SHE COULD BE REIMBURSED FROM THE SALE PROCEEDS OR OTHER ASSETS. I MAY NEED MORE INFORMATION OR THE OPPORTUNITY TO REVIEW THE WRITING TO MORE ACCURATELY RESPOND.

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Answered on 5/01/03, 12:36 pm
Jonathan Chester The Law Office of Jonathan S. Chester, Esq., LLC

Re: Is a contract binding after one party dies?

I would need to see the agreement to determine if it is valid. If it is, then the fact that your father died with or without a will may make no difference. The contract can be enforced against his estate in either case.

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Answered on 5/01/03, 9:19 am
Steven Rothberg Law offices of Steven D. Rothberg

Re: Is a contract binding after one party dies?

This question is hard to conclude without seeing the contract; however, an inter vivos contract is certainly binding if the person was competent to sign it. If the contract was signed at a time period close to the time your father passed away, there could be a question of duress, and competency. However, if competency, and duress are not issues that need to be addressed, the contract could certainly be valid and binding.

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Answered on 5/01/03, 9:23 am


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