Understanding Godoy v. Linzner: What California Families Need to Know About Property Transfer Restrictions in Trust

If you’re a California resident creating or managing a trust that includes real estate—especially a family home—you need to understand how state law protects your heirs’ property rights. A recent California case, Godoy v. Linzner, clarifies an important rule: you cannot place unreasonable restrictions on your beneficiaries’ ability to sell or transfer inherited property.

Who This Affects

This ruling matters if you are:

Creating a trust that includes California real estate

Inheriting property through a trust and facing restrictions on selling your share

Managing family property where multiple siblings or heirs have ownership interests

Concerned about protecting your heirs’ flexibility while still preserving family assets

What the Court Decided

The California court applied Civil Code section 711, which prohibits unreasonable restraints on alienation, to property transferred through trusts and wills. In simpler terms: California law protects your right to sell or transfer property you inherit, even if the person who created the trust tried to limit that right.

In this case, three children each inherited a one-third ownership interest in their family home after their parent died. The trust attempted to restrict what the children could do with their shares, but the court found these restrictions violated California law.

What Does “Unreasonable Restraint on Alienation” Mean?

Alienation simply means transferring or selling property. An unreasonable restraint is any rule that makes it too difficult for an owner to sell, gift, or otherwise transfer their property interest. While some temporary or limited restrictions may be acceptable, California strongly favors property owners’ freedom to control their own assets.

Real-World Implications for Your Estate Plan

If you’re creating a trust:

You cannot indefinitely prevent your beneficiaries from selling inherited real estate

Restrictions that seem protective may actually be unenforceable and create family conflict

Work with an experienced California estate planning attorney to structure provisions that balance your goals with legal requirements

If you’ve inherited property with restrictions:

You may have more rights than you realize to sell or transfer your share

Unreasonable restrictions in the trust document may not be legally binding

Consult with a probate attorney who understands California property law before accepting limitations on your ownership rights

How to Protect Family Property Without Violating California Law

Many families want to keep a cherished home in the family for generations. Rather than imposing rigid restrictions that courts may strike down, consider these alternatives:

Right of first refusal: Give other family members the opportunity to purchase a share before it’s sold to outsiders

Limited liability companies (LLCs): Transfer property into an LLC with operating agreements that provide structure while respecting ownership rights

Life estate arrangements: Allow one person to live in the property during their lifetime while others hold future interests

Clear communication: Discuss your intentions with heirs so they understand your values without legal compulsion

Why California Residents Need Specialized Estate Planning Guidance

California has specific laws governing trusts, probate, and property transfers that differ from other states. What works in another jurisdiction may create legal problems here. The Godoy v. Linzner case demonstrates why generic estate planning documents or online templates may not adequately protect your family’s interests.

At California Probate and Trust, PC, we help California families navigate complex property and trust issues. Our experienced estate planning attorneys understand how to structure trusts that honor your wishes while complying with California law. We’ve assisted thousands of clients in Sacramento, Fair Oaks, and San Francisco with creating comprehensive estate plans that protect both current and future generations.

Take Action to Protect Your Family’s Property Rights

Whether you’re creating an estate plan or dealing with property you’ve inherited, professional guidance ensures your rights are protected and your intentions are legally sound.

Schedule a free consultation with California Probate and Trust, PC today. Our compassionate attorneys will review your situation, explain your options in plain language, and develop a strategy tailored to your family’s needs. We offer transparent pricing and prioritize building lasting relationships with California residents who value clarity and family protection.

Contact us now to discuss your estate planning or property inheritance questions.

Source: California Lawyers Association – Godoy v. Linzner