Abstract

Excerpted From: Phyllis C. Taite, Remediating Injustices for Black Land Loss: Taking the Next Step to Protect Heirs' Property, 10 Belmont Law Review 301 (Spring, 2023) (173 Footnotes) (Full Document)

Imagine starting from zero and working your way through hardship and financial difficulty to own real property (“property”). You may be one of the first in your family to own property. The pride of ownership and the opportunity to transfer property to your descendants to enhance wealth for the next generation may be particularly satisfying. Now imagine that property is lost, through no fault of your own, or that ownership is so clouded as to restrict alienation. This is the reality and history of many Black property owners.

Heirs' property is generally known as property passing through generations without clearing probate. In problematic cases, property is concurrently owned by multiple people at multiple generational levels. As owners continue to multiply at each generational level, their property interest becomes more fractionalized. Fractionalization is a commonly cited problem for heirs' property and leads to other problems, such as unclear title and disagreement about disposition, which inhibit alienation.

While issues with heirs' property are not new, scholars and government leaders still struggle to find solutions that will prevent land loss for Black owners. Conventional wisdom suggests consolidation of ownership is the best option because it maximizes each owner's profit potential. Although heirs' property ownership may be problematic, stripping anyone of property rights as a so-called easy solution proves even more problematic. Further, the Black community has experienced many obstacles to land ownership; therefore, no policy that would further contribute to land loss should be supported, even for heirs' property. This article contributes to the scholarly discord by providing solutions for state and local governments and the Uniform Law Commission to strategically address heirs' property, rebuild communities, and facilitate wealth mobility.

Addressing the other major underlying problem, fractionalization, is the next necessary step to rebuilding wealth for Black households. Fractionalization is a serious problem that undermines wealth mobility for heirs' property owners. State, local, and national governments should implement laws and policies to facilitate productive ownership in a meaningful way that promotes family wealth. This article will explore methods that can both address fractionalization and use heirs' property to rebuild wealth for Black households by changing intestacy laws to default into a trust instead of tenancy in common.

Section I analyzes inequalities in land ownership including the seriousness of Black land loss through a brief discussion of eminent domain, neighborhood blight, and gentrification. This section further discusses the lasting impact of redlining, restrictive covenants, and blockbusting. Section II examines problems associated with heirs' property and the limitations of the current law implemented to address heirs' property. Finally, Section III evaluates various proposals to remediate the impact of land losses and proposes new solutions, through new trust laws designed to reduce the impact of fractional ownership, eliminate the partition threat, and the government's responsibility to facilitate.

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With the proposed statutory changes, heirs' property may become an effective tool in rebuilding communities destroyed by prior laws and government action or inaction. Whether land or homeownership was lost 100 years ago or 10 years ago, it is undisputed that bad laws and flawed governments at every level were instrumental in destroying, stealing, and inhibiting Black wealth. The attacks were strategic, systemic, and continuous.

Rebuilding destroyed communities will never make up for all that was lost, but that does not negate the duty to act. The response must be strategic, systemic, and continuous to provide restorative justice. The City of Evanston took the first steps to pay reparation to its residents after acknowledging the discriminatory practices of its government. Even though the planned marijuana tax has not been as lucrative as projected, this is still a good model to use in developing funding plans and highlights the importance of multiple funding sources and multi-facted approaches.

California returned Bruce's Beach to the descendants and provided ownership, income tax relief and property tax relief. This holistic approach provides the model for wealth restoration and preservation. Restorative justice requires multi-level responses and the proposed FLTs provide a direct response to a systemic problem. Most importantly, the family received repair and had the right to decide how they wanted to handle their newly restored property. The Bruce family made the decision to sell the property back to the County for nearly $20 million. While the proceeds represent a fraction of the estimated value, the most important points are family had the right to make that decision and a portion of family wealth was restored.

On a final note, tax policy has subsidized wealth almost since the inception of the Internal Revenue Code. Tax code bias is evident in homeownership which has supported White wealth mobility. The property tax exemptions and proposed FLTs are a small price to pay for the indignities BlackAmericans have suffered for years as a marginalized and economically oppressed community. This article provides solutions for state and local governments to implement small changes that could have a life-changing impact for the affected communities.

Phyllis C. Taite is a Professor of Law at Oklahoma City University School of Law.