## Facts

- A lender held a first mortgage on roughly 90 acres of New Hampshire real property formerly operated as a summer camp by Elizabeth H. Boyer.
- Boyer became terminally ill and was hospitalized in mid-1986; her three adult children discussed using a family partnership, Campfire Point Associates (CPA), to own and develop the property.
- On August 14, 1986, one child obtained Boyer’s signature on a warranty deed purporting to convey the property to CPA.
- Boyer died on August 24, 1986; the United States asserted an estate-tax lien that would attach if the property remained in her estate at death.
- After Boyer’s death, the children recorded the deed in CPA’s name and pursued subdivision approvals; for 1986–1987 they treated CPA as a partnership on federal tax filings.
- One child later bought out the other siblings’ interests and, acting for CPA, mortgaged the property to the lender.
- When the lender sought to enforce its mortgage, the children and the United States argued CPA had never been a valid partnership and the deed did not divest Boyer of title.
- The lender sued under 28 U.S.C. § 2410(a)(1) to quiet title against the federal lien; the court conducted the first phase of a bench trial to decide threshold title questions.

## Issues

1. Whether Boyer had sufficient mental capacity on August 14, 1986 to execute a deed conveying real property.
2. Whether CPA existed as a legally cognizable partnership under New Hampshire law and could take title by deed on August 14, 1986.
3. Whether the August 14, 1986 deed was delivered with intent to make a present transfer, thereby divesting Boyer of title before death.

## Decision

- The court found Boyer had sufficient mental capacity on August 14, 1986 to understand the nature and effect of the conveyance.
- The court held CPA was a valid partnership under New Hampshire’s Uniform Partnership Act and was capable of receiving title at the time of the deed.
- The court concluded the deed constituted a valid inter vivos conveyance that divested Boyer of ownership before her death, notwithstanding recording after death.
- These rulings resolved threshold title questions in favor of the lender’s position, leaving remaining quiet-title and lien-priority matters for later proceedings.

## Legal Principles

- In a quiet-title action involving a federal tax lien, state law determines whether the taxpayer/decedent held the relevant property interest; federal law governs whether and how a tax lien attaches to that interest.
- Under New Hampshire law, mental capacity to convey real property requires sufficient ability to comprehend the nature and effect of the act and the business being transacted; serious illness and medication do not invalidate a deed absent proof of incapacity at execution.
- Under the Uniform Partnership Act as applied in New Hampshire, a partnership may be formed by conduct showing an association to carry on as co-owners a business for profit; formal filings are not essential to existence or capacity to hold title.
- A deed’s validity between the parties depends on delivery and intent to make a present transfer; later recording is not necessary to make the conveyance effective.

## Conclusion

The court determined that Boyer competently executed and delivered a deed transferring the property to a valid family partnership before her death, so the property was not part of her estate at death for purposes of the asserted federal estate-tax lien, and the case proceeded with these title determinations in place.


Hilco Prop. Servs., Inc. v. United States, 929 F. Supp. 526 (D.N.H. 1996)