The dispute stems from a $732,000 mortgage loan that Whitney Houston issued to her father for his Fort Lee condominium in 1990. John Houston subsequently named her the sole beneficiary of the insurance policy.
According to the lawsuit, the singer was supposed to subtract $732,000 from the insurance money after his death and provide her stepmother with a clear title to the condominium. Barbara Houston, who still lives in the condominium, claims her stepdaughter was also supposed to send her the balance of the insurance money.
Instead, Barbara Houston alleges that Whitney Houston improperly enriched herself by keeping the mortgage and all of the insurance money.
Lawyers for Whitney Houston and her stepmother declined to comment on the lawsuit, which was filed in federal court in Newark.
The singer's brother, John R. Houston III, served as executor of the estate.