Dear Customer, thank you for choosing Just Answer. I would like to assist you with your legal question today. Your wife is the landlord for her brother, he does not own a life estate, his mother cannot transfer that interest.
Your wife may initiate an unlawful detainer action against your brother in law to get an order for possession of the property and evict him. She can do so simply by giving him 30 days notice to quit the property and then filing the unlawful detainer if he does not leave. She does not need to give a reason for the termination of his leasehold interest, she only needs to give him proper notice. (If you give me the state in which this property is located I may be able to provide you with some helpful links to assist you in this procedure).
Regarding your brother in law's actions in turning off utilities, that is elder abuse (you cannot keep an elderly person from having power and water while controlling her finances, this is something that can be reported to law enforcement and/or civil authorities such as Adult Protective Services (or your jurisdiction's equivalent)).
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