Ground rent dilemma requires a title search

MAILBAG

December 18, 2005|By JONATHAN AZRAEL

In late 2003 we inherited a house from an uncle, which he bought in 1952 with a $90-a-year ground rent. The owner of the ground died last year and his son told us he was the new owner. When I offered to buy the ground for $1,500 last year, I was advised that the previous owner (his late father) had joint ownership with another man whom they have not had contact with in over 20 years. The new owner suggests that I do the research to find the co-owner so we can complete the purchase. I think that should be his responsibility. Meanwhile, the new owner, who lives out of state, insists on biannual ground rent. I feel that we are in a losing position. We want to buy the ground. But how?

Since the ownership of the ground rent ("reversion") is in doubt, you will need a title search to determine who is actually in legal title.

A search of the land records should provide a copy of the original ground lease, and a history of transfers from the original lessor to the current owners of the ground rent.

You may find that the person to whom the ground rent is currently paid is not the true legal owner. You will have to pay for the title search, which can be obtained through a title company or your attorney.

Once legal ownership is determined, you have a right to redeem the ground rent by giving notice by certified mail, return receipt requested, and by first-class mail to the last known address of the landlord (owner).

The redemption price is determined by law. For the typical $90 annual ground rent, the redemption is $1,500. The redemption is completed by the legal owner(s) signing and delivering a deed to the ground, which you will record in the land records.

If the legal owner(s) will not voluntarily complete the redemption, you can obtain ownership through a statutory procedure administered by the Maryland State Department of Assessments and Taxation (SDAT).

The redemption procedure requires you to supply the SDAT with documentation of the ground lease and the notice given to the landlord, together with a $20 fee. The SDAT then posts notice on its Web site that application has been made to redeem the ground rent. The notice remains posted for at least 90 days. Thereafter, you can pay the redemption amount and up to three years' past due ground rent to the SDAT. You will receive a ground rent redemption certificate from the SDAT, which you should record in the land records.

For more information on redeeming a ground rent through the SDAT, visit its Web site at www.dat.state.md.us.

Jonathan Azrael is a lawyer at Azrael, Gann and Franz of Towson.

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