Family property disputes often take an unexpected turn when siblings inherit land together. One sibling decides to sell their share to an outside buyer. The remaining family members watch helplessly as a stranger becomes their new co-owner in property that has been in the family for generations.
The situation becomes even more complicated when the sibling making the sale also serves as the executor of the parent’s estate. What happens when the property being sold is not estate property at all but rather the executor’s own interest held as a tenant in common with the estate? Can the executor’s fiduciary duties restrict what they can do with their own property when that property is intertwined with estate assets?
The Court of Appeals addressed these questions in In re Estate of Friend, 2025 WL 2969307 (Tex. App.—San Antonio Oct. 22, 2025, no pet.). This case provides an opportunity to examine how fiduciary duties operate when an executor holds property in co-tenancy with the estate they are administering.
Facts & Procedural History
Joanne had two daughters. Before her death, she executed a will leaving everything to one daughter, Suzanne, while making no provision for her other daughter, Sarah. The mother also conveyed hundreds of acres to Suzanne through gift deeds during her lifetime.
After the mother died, Sarah challenged both the will and several gift deeds. She claimed her sister had isolated their mother as her mental health declined and poisoned the relationship by telling their mother false stories about Sarah. Following a trial, the jury found undue influence. The probate court set aside the will and three of the gift deeds. Because the will was voided, the mother died intestate. Suzanne was eventually removed as executor in December 2023.
The property at the heart of this dispute was a valuable 67-acre riverfront tract in Real County. The three co-owners were Suzanne, Sarah, and the estate itself. Each held an undivided interest as tenants in common. Suzanne owned a 28/67 undivided interest in the tract through a series of transfers from her mother between 2004 and 2007. Sarah had never challenged those earlier transfers.
In December 2021, while Suzanne was still serving as executor of the estate, she sold her 28/67 undivided interest to Wayne and Betty. Sarah later discovered the sale and filed claims under the Texas Uniform Fraudulent Transfer Act (“TUFTA”). She named both her sister as the transferor and the Wayne and Betty as the transferees.
Sarah alleged that her sister sold the property to hide assets from other claims pending against her in the probate proceeding. She further claimed the sale breached fiduciary duties owed to the estate and to Sarah herself. The relief Sarah sought included an injunction preventing further transfer of the property, cancellation of the deed from her sister to the Boyces, and placement of the buyers’ ownership interest into a constructive trust.
Wayne and Betty filed a plea to the jurisdiction. They argued the probate court lacked authority to hear claims against them because the property their sister sold was never an estate asset. The trial court granted the plea and severed Sarah’s claims against the Boyces into a separate proceeding. Sarah appealed.
Fiduciary Duties of Personal Representatives in Texas
Personal representatives in Texas owe fiduciary duties to both the estate and its heirs. These duties include the duty of loyalty and utmost good faith, the duty of candor, the duty to refrain from self-dealing, the duty to act with integrity of the strictest kind, the duty of fair dealing, and the duty of full disclosure.
The duty of loyalty requires the personal representative to act in the best interests of the estate and its beneficiaries. This means the executor cannot engage in transactions that benefit themselves at the expense of the estate. The duty applies even when the executor is also an heir or beneficiary.
The duty to refrain from self-dealing prohibits the executor from entering into transactions with the estate where their personal interests conflict with their duties as fiduciary. Texas courts scrutinize such transactions carefully. Even when an executor believes they are acting fairly, the appearance of impropriety alone can create problems.
The duty of full disclosure requires the executor to keep beneficiaries informed about estate administration. This includes providing information about estate assets, liabilities, and any transactions that might affect the estate’s value. An executor who conceals transactions or fails to disclose material information breaches this duty.
These duties do not automatically end when the executor deals with their own property. The question ls more complex when the executor’s personal property and estate property are intertwined.
Understanding TUFTA Claims in Probate Proceedings
The Texas Uniform Fraudulent Transfer Act provides remedies for creditors when a debtor transfers assets to avoid paying debts. Under TUFTA, a transfer is fraudulent if the debtor makes it with actual intent to hinder, delay, or defraud creditors.
To prove a fraudulent transfer under TUFTA, a claimant must establish three elements. First, the claimant must show they are a creditor with a claim against the debtor. Second, the creditor’s claim must have arisen before the transfer or within a reasonable time after it. Third, the debtor must have made the transfer with actual intent to hinder, delay, or defraud the creditor.
TUFTA provides several factors courts can consider when determining whether actual intent exists. These include whether the debtor retained possession or control of the property after the transfer, whether the transfer was concealed, whether the debtor was sued or threatened with suit before the transfer, and whether the debtor received reasonably equivalent value for the asset transferred.
The determination of liability under TUFTA follows a two-step process. First, a court must find that the debtor made either an actual fraudulent transfer or a constructive fraudulent transfer. Second, the court must determine the appropriate recovery from the transferees.
Recovery under TUFTA can take several forms. A creditor may obtain an injunction against further disposition of the asset. The court can void the transfer or attachment against the asset. The creditor may also be entitled to recover judgment for the value of the asset transferred.
Importantly, TUFTA claims require the transferee to be joined as a necessary party. The transferee has defenses available under the statute. Most notably, a transferee who takes the property in good faith and for reasonably equivalent value can defeat a TUFTA claim even if the transferor had fraudulent intent.
What Did Sarah Allege About Her Sister’s Sale?
Sarah made several specific allegations about why her sister’s sale to Wayne and Betty violated TUFTA. She claimed her sister sold the property to insulate herself from liability on other claims still pending in the probate proceeding. These other claims related to actions her sister took as personal representative of the estate.
Sarah alleged the transaction was not disclosed to her or to the estate. She further claimed her sister and Wayne and Betty concealed the transfer with the intent to hinder, delay, or defraud both the estate and the heirs. The concealment itself served as evidence of fraudulent intent under TUFTA’s factors.
Sarah also alleged her sister did not receive reasonably equivalent value for the property. The lack of equivalent value provided additional evidence that the transfer was designed to remove assets from her sister’s reach rather than accomplish a legitimate business purpose. Under TUFTA, courts consider whether the value received by the debtor was reasonably equivalent to the value of the asset transferred.
Beyond the TUFTA allegations, Sarah claimed her sister breached fiduciary duties when she sold her interest in the tract. As executor, her sister owed duties to both the estate and to Sarah as an heir. By selling to outsiders, she severely devalued the estate’s interest in the same property. The sale also subjected the property to possible partition against their mother’s expressed wishes.
Sarah pointed to testimony from the prior appeal showing their mother did not want anything to happen to the land that might put it in danger of leaving the family. The mother wanted the ranch to remain in the family. By selling to outsiders, Sarah’s sister violated not only her fiduciary duties but also their mother’s intentions for the property.
The sale also included a promise by her sister to convey to the Boyces any property she would later inherit from the estate. This provision meant that even the estate’s undivided interest in the tract could ultimately end up in the hands of the buyers. This term made the connection between her sister’s personal transaction and the estate even more direct.
The Court’s Analysis of the TUFTA Claim’s Components
The Court of Appeals examined what Sarah needed to prove to succeed on her TUFTA claim. She had to show both that her sister made a fraudulent transfer with intent to hinder, delay, or defraud Sarah as an heir to the estate and that the Boyces did not take the property in good faith and for reasonably equivalent value.
The court explained that TUFTA liability involves a two-step process. First comes a finding that a debtor made an actual or constructive fraudulent transfer. Second comes recovery for that fraudulent transfer from the transferees. Both steps matter for determining what relief Sarah could obtain.
The court noted that there was only one TUFTA claim, not two separate claims against her sister and Wayne and Betty. To determine whether the probate court had authority to adjudicate the TUFTA claim as to Wayne and Betty, the court needed to look at whether the entire TUFTA claim fell within the jurisdictional scheme for statutory probate courts.
Sarah’s TUFTA claim alleged her sister sold her undivided interest in the tract to insulate herself from liability on other pending claims relating to actions she took as personal representative. The claim also alleged the transaction was concealed to hinder, delay, or defraud the estate and heirs. These allegations went to the heart of fraudulent intent under TUFTA.
Sarah also alleged her sister did not receive reasonably equivalent value in exchange for the property. This lack of equivalent value supported the inference that the transfer was designed to hide assets rather than accomplish a legitimate transaction. Under TUFTA, the value of consideration received by the debtor is one factor establishing intent to defraud.
The court found that when her sister sold her undivided interest in the land to Wayne and Betty, she altered the character, usage, and value of the estate’s real property interest in the tract. She also promised to convey to Wayne and Betty any property she would later inherit from the estate. By doing so, she placed the settlement, partition, or distribution of the estate squarely within the conditions of the agreement Sarah sought to cancel.
The Takeaway
This case demonstrates that executors who are also co-tenants with the estate they administer face heightened scrutiny for transactions involving the co-owned property. Even though the executor owns their interest independently, their fiduciary duties as personal representative extend to affect what they can do with that property when estate interests are at stake. The sale of an executor’s personal property interest can be challenged as a fraudulent transfer when it impacts the estate’s ability to be properly settled and distributed among heirs. Personal representatives must exercise extreme caution when considering any transaction involving property they hold in common with the estate. The risk of a successful TUFTA challenge exists even when the executor believes they are dealing only with their own assets.
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