Our role at Old Republic Title is to focus on educating and informing you of ways to handle situations that would prevent transactions from closing in a timely manner. We often receive questions pertaining to transactions involving properties held in a Trust or an LLC. Below are a few scenarios and suggestions to help navigate each situation accordingly. Artificial entities, common types described below, can also hold title to real property. A title officer will require a copy of the authority documents for the entity as follows: Trust Agreement for a Trust Operating Agreement for a Limited Liability Company (LLC) Articles of Incorporation and Bylaws for a Corporation (Inc or Corp) Partnership Agreement for a Partnership (LP) This documentation is needed to determine who is authorized to “bind” the entity or sign on its behalf. Depending on the terms of this document, title may also require a resolution concerning the specific transaction. As an example, the undersigned Members authorize Jane Doe, as Managing Member, to sign all documentation related to the sale of 123 Main Street. A Power of Attorney should not be used for a Trust, LLC, Corporation, Partnership, or other artificial entity transaction. An available signer should be appointed under the provisions of the documents governing the entity. For example, the trust agreement should contain provisions concerning a substitute trustee. An operating agreement should contain provisions about appointing an authorized signer. Along similar lines, an artificial entity cannot “die.” Even where an entity is dissolved or was never registered with the Secretary of State, it can still be a titleholder. If the entity does not legally exist, all stakeholders (also referred to as members, owners, partners, etc.) will be expected to sign on behalf of the entity. As always, I am here to help and just a phone call away. Sandy 206.660.7938 |