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Hi, this is Stewart Albertson with Albertson & Davidson and I want to talk to you about one of more difficult set of cases we come across and I call these the “Difficult Don’t Miss Undue Influence Cases”.  Let me say that one more time – the Difficult Don’t Miss Undue Influence Case.

What is the difficult don’t miss undue influence case?  That’s where someone has exercised undue influence over your mom or dad while they are still living and mom and dad have not passed away.  And so the question is, what can we do to invalidate the trust or the will that the wrongdoer got created using – exercising undue influence over mom and dad?

These are very difficult cases and the reason they are is because it comes down to California law and capacity and where mom and dad fits in that capacity determination.  So, you can file what we call a conservatorship proceeding where you ask the court to put someone else in charge of mom or dad’s estate.  But, as you can probably imagine, if mom or dad has any capacity whatsoever, they don’t like being told that they don’t have capacity and they certainly aren’t going to like that you’re the one who is asking the court to find that they are not capacitated.  So mom and dad can become upset by this.

The person who’s the wrongdoer who is already unduly influencing your mom or dad, they’re going to take advantage of this situation and they’re going to point out to your mom or dad, that look, your son not only doesn’t love you and doesn’t like you, your son wants to take your capacity away.  You son’s trying to get access to your estate before you’re even gone.  This son of yours is a greedy heir and we see this again time and time in these cases where mom and dad are still living and somebody is exercising undue influence over them.

So what are you to do in these type of difficult cases?  Do you file for conservatorship and that’s why we call these the Difficult Don’t Miss Undue Influence Cases.  Because if you’re going to file for conservatorship, you have to win it.  If you don’t win it and mom and dad is capacitated – are still capacitated and a court finds that they’re capacitated.  Chances are if you were in their trust or will, you’re certainly not going to be in it now by way of an amendment or a codicil to the will.  And then you’re going to have a much higher hill to climb after your mom and dad die when you do bring a trust contest or a will contest.

So, what is a better option, perhaps?  And it’s hard, because, sometimes you have to sit back and do nothing while mom and dad are living.  And what we suggest to many clients is just focus on mom or dad in their sunset years of their live, give them comfort, give them care, give them compassion, spend time with them.  Don’t talk to them about their trust or their will.  Don’t talk to them about their assets – as difficult as that may be.  Because the person who is exercising undue influence over them will turn that against you and make it seem like YOU’RE the one that’s trying to get their assets.  YOU’RE the one that’s the greedy heir.  YOU’RE THE problem, not them.

So if you can, stay disciplined.  Focus on your parents.  Care for them in the sunset years, however many months or years they have left.  Then, once they pass away, there are remedies available to you, such as a trust contest, a hill contest, and financial elder abuse that you can file to remedy the undue influence that took place against your parents during their lifetime.

These are very difficult cases.  It’s very difficult to determine the best route to take.  Our advice is generally to err on the side of caution and that is wait till your mom or dad pass and then you can address the undue influence.

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Hi, this is Stewart Albertson with Albertson & Davidson and I want to talk to you about undue influence cases.  What makes a good undue influence case and what makes a not-so-good undue influence case?  And let me just set this out as we meet with lots of people that come into our office saying, “Hey, I want to contest my mom or dad’s trust or their will because I know that my brother Bob exercised undue influence over my parents and I’ve been written out of the will or the trust and I will receive no inheritance and I’ve got the best evidence you’ve ever seen Mr. Albertson, or Mr. Davidson, and we’re going to come in here and we’re just, this is going to be a slam-dunk.  You’re going to have no problem winning this case!”

The type of evidence you need to have a good undue influence case, it’s a high bar.  The burden of proof that’s required for you is high.  It’s not easy to invalidate a trust or a will.  So that begs the question, “OK, well then what makes a good undue influence cases versus a not-so-good undue influence case?”

Well, let’s talk about some of the elements that you need to meet to prove that undue influence did, in fact, take place.  One of the first things we have to show is we have to show that the decedent, your parent in this case, was a vulnerable individual.  We can show that several ways.  The most easy way to show that is that they’re over the age of 65 or they’re a dependent adult.  So if they’re over 65, chances are, you could show that they have some vulnerable to them.  The State of California has addressed financial elder abuse and said, “Look, we see a lot of financial elder abuse happening in our state, so we want to stop that.  And so what we’ve done is we’ve set out some criteria for people to look at.  This, these are the elements that we look to to prove an undue influence claim.”

The other way you can look to see if a person is vulnerable is what if they have some type of a medical issue?  What if they have some diagnosis for dementia or Alzheimer’s or anything of the like that affects their mental cognition?  That is something that also will support the element of the decedent being vulnerable.

We also want to look to other elements.  What about the actions or the tactics of the wrongdoer?  The wrongdoer is the person that exercised undue influence over the decedent.  And a lot of times this is not something that you see that’s nefarious or evil or somebody yelling or screaming at the decedent, it’s actually done in a very nice manner.  And it happens like this:  The wrongdoer comes to the decedent while they’re still living and says, “How come your son, Johnny, doesn’t come visit you anymore?  Oh, you know, I don’t think Johnny cares about you.  It’s too bad that Johnny’s not here to take care of you like I’m taking care of you.”  And it’s just done over time.  And, of course, this person already – the decedent already is vulnerable, because they’re older, over 65 or older, they may have a health issue, and so now you have this person who is doing deceitful actions and tactics to influence the elder that their son Johnny really doesn’t care about them and we see this element time and again in a good undue influence case.

We also want to look to another element and that is what type of authority did the wrongdoer have over the decedent?  And authority can come in many forms.  Authority can be that this is the person’s agent, under their durable power of attorney, or maybe they’re already the trustee of the trust.  They can also be somebody that the decedent relies on for their necessaries of live, such as daily medication.  Somebody to drive them to doctor’s offices.  Somebody to help change their diaper in bed.  Somebody that makes sure that hospice is taking care of them.  Here we see the decedent, the elder, is being very reliable on this person who has this apparent authority over them.

The last element that you want to flush out in a good undue influence case is there is an inequitable result.  This is most easily shown in cases where the decedent had a preexisting estate plan that gave everything equally to all of their children.  And we see this time and again.  And then just before they die, they make a change to that trust that did give everything equally to all their children, and they give everything to one person, either one of their children or the wrongdoer who has come into their life and has now exercised undue influence over them.

So in order to have a good undue influence case, where you can meet the burden of proof which is a high bar in the State of California, you’re going to have to show that the victim was vulnerable, that the wrongdoer used actions or tactics that were deceitful, that the wrongdoer had apparent authority over the decedent, and the results that the wrongdoer got was inequitable.  If you can pull all of those elements together through a totality of the circumstances and showing the evidence, you probably have a good undue influence case.

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Hi, this is Keith Davidson at Albertson & Davidson.  And in this video, I want to discuss step-parents.  And I don’t mean to disparage step-parents, there’s a lot of very good step-parent and step-child relationships out there.  But, there’s also some bad ones.  And a lot of times we’re asked, “Can my step-mom or step-dad, can they change the estate plan after my parent dies?”  So, typically, in this scenario, maybe you have a father who married somebody new and that’s your step-mom.  And then your father passes away and you always thought you had a good relationship with your step-mom, but after your dad passes, things start to get a little strained and awkward and you start to wonder can she actually change the estate?

In some cases, it might actually get downright hostile and maybe the step-mom actually tells you, “I’m changing the estate and I’m leaving it all to my kids and I’m not going to leave your father’s share to you after all.”  And you wonder, can she do that?  And the answer is maybe.  And that’s a typical lawyer answer, right?  But it depends; it depends on what your father did when he planned out his estate.  Or, if he didn’t have any planning at all, that could be a real problem.

So the best case scenario would be if your father had created a trust prior to his death, he has the right to leave assets to step-mom and that’s fine.  But, typically, what you’d want to see is that he left money to step-mom in a trust.  So she can use that money for her care and support during her lifetime, but she can’t change the ultimate distribution of it.  Whatever’s leftover after step-mom passes, has to go to you.  But that only works if your dad created a trust and if he had a trust created that had those type of terms in it that allowed the step-mom to use the assets but not control them.  That required that the assets go to you after death.

If your father didn’t do that, then you probably are not going to be entitled to his share of the estate.  And so what happens a lot of times is, either your father leaves everything to the step-mom, in which case she can do whatever she wants after your father dies, and she can cut you out.  Or, he just doesn’t plan at all and things just pass to the step-mom because it’s in joint tenancy or she’s the beneficiary on life insurance, or whatever the case may be.

So when these things are not planned out and if the assets actually pass to step-mom after your father passes away, then you’re really in trouble, because the step-mom can do whatever she likes.  She becomes the owner of those assets and she can do whatever she wants with them as the owner.

The fact that your father may have had a family home that you grew up in and lived in and has been in the family for decades, the law doesn’t care about that – if your father didn’t plan it out property.  And so that’s really the big question.

So anytime somebody approaches us and says, “Can step-mom change the estate after my father passes away?”  The first question we’re going to have is, “Well, what did your dad have in place?  Did he have a trust?  Did he have a will?  Did he have something that we can look at to see if you, as a child, have any rights to any of those assets?” And if you were to tell us that no, he didn’t have any of those things, then chances are, you’re out of luck.  And that’s a little something about the downfalls of step-parent and step-children relationships when it comes to passing assets.

 

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This is Stewart Albertson with Albertson and Davidson, and I want to talk to you about an issue that we do see from time to time called advances on inheritance. Advances on inheritance are essentially a loan that mom or dad makes to one child. They don’t want to be unfair in giving that loan to one of their children when they have several other children. So they basically tell the person they made the loan to, well that is an advance on your inheritance so that when I die, you’re going to have to take that into account based upon whatever your share of my estate is.

There’s a real problem with advances on inheritance though because the probate code has some technical requirements that must be met to qualify as an advance on inheritance. Otherwise, that payment of money from a parent to a child will be looked at as a gift.  If it’s a gift that makes a big difference because when the estate is distributed after mom and dad have passed away it’ll be distributed equally between all of the children without taking into account the “loan” that was made to one of the children during lifetime.

So how can you tell the difference between an advance on inheritance and a gift? The advance on inheritance can be proven in three primary ways. There’s actually a fourth way, but that gets a little complicated. If you really want to look into this, you can go to Probate Code section 21135, and you can read how you establish an advance on inheritance there.

Generally, the way you prove an advance on inheritance is:

  1. The trust or will terms themselves have in there saying, I’m giving $100,000 loan to my son Johnny, and when I die, this counts as part of his inheritance at the time he receives his ultimate distribution. That’s the first way that an advance on inheritance can be included and be supported by the evidence.
  2. The next way you can establish an advance on inheritance is did your mom or dad have a writing outside the trust or will that simply says: I hereby am making a loan to Johnny and after I die, that should be considered as part of his inheritance for distribution purposes. That would be the second way that you can establish an advance on inheritance.
  3. The third way is you have Johnny acknowledged in a writing that he’s already receiving some of his inheritance by way of a loan prior to mom and dad passing.

If you have any of those three, chances are you can establish an advance on inheritance.

As you can see, this is not always easy to do. If there is money that is given to one child, a lot of money, say several hundreds of thousands of dollars to one child and not to the other, and there’s nothing to establish an advance on inheritance, what is the argument the child makes who received the money during the parents’ lifetime? And that is, it was a gift. If it’s a gift, it won’t be chargeable against their share of the estate. It won’t be an advance on inheritance.

 

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This is Keith A. Davidson from Albertson and Davidson. In this video, I want to talk to you about the differences between Wills and Trusts. A lot of times people think that Wills and Trusts are the same thing, that they’re the same type of documents, and they really aren’t. Wills and Trusts are very different, and so let’s start with a discussion of Wills, and then we’ll talk about Trusts and you can see the differences between the two documents.

Wills are testamentary documents, and what that means is they only come into effect, they only actually are created, upon somebody’s death. Now you go ahead and create the Will and write it down and sign it prior to death, but it doesn’t operate until after death. For Wills, there’s a lot of what we call formalities that you have to follow.

To have a valid Will, you have to have it in writing. It has to be signed by the person who’s creating the Will, and a typewritten Will has to be witnessed by two witnesses, or it has to be in the testator’s own handwriting. That’s what we call a holographic Will. If you don’t meet those formalities when you create a Will, then the Will simply isn’t going to be valid. That’s something that is unique to Will’s. You’re not going to have that with Trust.

After somebody passes away, a Will cannot operate over their assets until you take that Will to court and you have the court admit the Will to probate. That’s where the court decides whether the Will is valid or not, and until the Will is admitted to probate, nothing can happen with that Will. You can’t administer it. You can’t manage the decedents assets. It has to go through this court process in order to operate and then the Will ultimately will dictate how the assets pass out of probate and to the beneficiaries who are intended to receive them. And that’s generally how a Will works.

A Trust is very different because most people create what we call a living Trust. In legal terms, we would call that an inter-vivos Trust, meaning that it’s created during your lifetime and it actually operates during your lifetime. So the Trustee of your living Trust can manage your assets, can make management decisions over those assets, and it operates even if you lose capacity. That’s different from a Will because the Will never helps you if you lose capacity, but a Trust does. And then after you passed the Trustee can administer that Trust without having to go to court.

Trust don’t require any court oversight in order to be administered. And in order to create a Trust, all you have to do is have something in writing and signed. You don’t technically even need to have it notarized, although most Trusts are notarized and they probably should be, but that’s not a legal requirement that they be notarized.

Trusts tend to be a lot more flexible because you can leave your assets to your children or your beneficiaries, and you can have all sorts of flexibility in how you leave your assets to them. So, you can leave something in a child’s Trust that holds their assets until a certain age, or you can leave something to your grandchild and also hold that until they reach a certain age. There’s all sorts of flexibility that you can build into your Trust that is much harder to do under a Will because the Will has to go to court and through the probate process in order to be administered.

So that is some differences between a Will and a Trust, and I think you’ll see that they’re very different documents.

Trust and will disputes are confusing because the way you see your family and their assets can be very different from how the law sees it.  You may see your family as one group of people related by blood.  If one of your siblings is taking advantage of your parents, then you should be able to step in and help protect them.  Or if your parents pass away and their assets are not being distributed according to your parents’ desires, then you should be able to place all the assets in a big pile and force a proper distribution among your family members.Asset Puzzle.jpg

Well not so fast.  The law makes things complicated because it does not see these issues as a “family” problem.  Instead, the law sees individual people, each with their own set of rights—some rights being enforceable now and some being enforceable later (if at all). 

For example, if a parent is being controlled by one sibling and that sibling has taken control of the parents’ trust, you cannot simply demand a Trust accounting from the bad brother or sister.  Why not?  Because you do not have a current right to do that.  When a parent creates a revocable Trust the Trustee only owes a duty to the Trust creator (called a Settlor—i.e., the parent).  Therefore, only a parent can demand an accounting from the Trustee—no one else has that right and no one else can enforce the parents’ rights.  The exception is if a conservator is appointed on behalf of the parent, then the conservator can exercise the parent’s right and force an accounting from the Trustee.  Once the parent dies and the children become vested beneficiaries of the Trust, then the children can demand an accounting (including an accounting for the period while the parent was still alive). 

It may seem like a family matter to you when a sibling is wreaking havoc with a parent, but the law sees individual people with individual rights—not a family matter.

The same is true for disputes over a parents’ assets after they die.  You may see a pile of assets your parents owned while they were alive, all of which they controlled and benefitted from.  Things like their home, joint bank accounts, life insurance, retirement accounts, brokerage accounts, bank accounts, CD’s, etc.  If your parents owed all of these assets then you should be able to deal with them in a single action, just pile them on the table and let the dispute begin. (See our previous discussion on how assets pass at death.)

But after death, the law sees assets very differently.  The law places each asset in its own box that is governed by its own set of rules.  The assets titled in the name of a Trust pass under Trust law, but they have nothing to do with assets passing by beneficiary designation—like life insurance and retirement accounts.  And joint assets pass under their own law, which is different from assets held in an individual’s sole name, which passes under a Will as part of the probate estate. 

Filing a Trust contest will help to undue assets passing under a Trust, but it does nothing for assets passing by joint tenancy or beneficiary designations.  So all those life insurance proceeds and retirement accounts have to be contested in different legal actions.  It is not uncommon to have a Trust contest petition, a Will contest petition, and a third type of probate petition all in a single matter. 

Why is this all so confusing?  Thanks to a few centuries of legal evolution where people came up with new and exciting ways to side-step Wills and the probate process.  Things like Trusts, joint tenancy, and beneficiary designations were meant to make passing assets easier.  That may be true when a parent plans out their assets ahead of time.  But when things go astray and assets have been wrongly distributed, this maze of laws governing different types of assets can be a difficult obstacle to overcome.

So beware, family issue involving Trusts and Wills are far more complicated than they appear.  

I get calls every week from California Trust, Last Will, and Estate beneficiaries complaining that they can’t get their brother or sister, who is the Trustee and Executor of their parents’ estate plan, to provide copies of the parents’ estate plan after the parents have died.

I usually suggest the following. First, send a letter to the Trustee and Executor politely requesting the entire Trust, including amendments, and Last Will for both parents. Include the following language in the letter: 

A.         Please Provide True Copy of California Will

Under California Probate Code Section 8200, you, as Executor of Mom’s and Dad’s estates, are required to deliver mom’s and dad’s Last Wills to the County Superior Court where mom and dad died within 30 days of mom’s and dad’s respective deaths. Please note, if I am damaged by your failure to deliver moms’ and dad’s Last Wills to the Superior Court you will be liable for my damages. (See Probate Code section 8200(b).)

As you are required to deliver the Wills to the Superior Court, you should have no objection in providing me with true copies at this time. If you do not provide me with a true copy of the Wills I will have no choice but to file a petition in the Probate Court requesting the Court to order you to provide me with true copies of the Wills. Please note, if I’m forced to file a petition, I will request that the Court order you to pay for the attorneys’ fees and costs associated with my petition. I hope I am not required to file a petition and you will simply provide me with true copies of the Wills on or before DATE. 

B.         Please Provide True Copy of California Trust

Under California Probate Code Section 16061.7, you, as Trustee of Mom’s and Dad’s Trust, are required to provide all beneficiaries of the Trust and all of Mom’s and Dad’s heirs with a true copy of the Trust documents, including any amendments, 60 days after Mom’s and Dad’s respective deaths.

As you are required to provide Mom’s and Dad’s Trust after 60 days of their respective deaths you should have no objection in providing me with true copies of the Trust, and any amendments, at this time. If you do not provide me with a true copy of Mom’s and Dad’s Trust, and any amendments, I will have no choice but to file a petition in the Probate Court requesting the Court to order you to provide me with a true copy. Please note, if I’m forced to file a petition, I will request that the Court order you to pay for the attorneys’ fees and costs associated with my petition. I hope I am not required to file a petition and you will simply provide me, as an heir and/or beneficiary of the Trust, a true copy of the Trust, and any amendments, on or before DATE.

If you include the above-referenced language in your letter to the Trustee, more times than not you will be successful in getting the Trustee to turn over the Trust and Will documents.

If the Trustee still refuses to provide the Will and Trust, then you must seek help from the Probate Court to force the Trustee and Executor to hand over these documents. I will explain in a future post how you get the Court’s help for obtaining these documents. 

California Trust and Will litigation is like building a puzzle.  There are a lot of moving parts in most cases and trying to figure out how and when to put the parts together can be confusing.

The Fourth District Court of Appeals recently set Trust litigators straight on how and when a Trustee can be sued by Trust beneficiaries, in a case titled “Estate of William A. Giraldin” (2011, No. G041811).  Associate Justice William W. Bedsworth authored the opinion that holds beneficiaries have no standing to sue a Trustee for alleged breaches of fiduciary duty that occurred while the Settlor (which is the Trust creator) is still alive and had the power to revoke the Trust.  My first reaction: What???

In Estate of Giraldin, the decedent, William Giraldin had created a revocable, living trust.  Although he was the “Settlor”, because he created the Trust, he appointed one of his five sons, Tim, as the successor Trustee.  The Trust was revocable by William Giraldin during his lifetime and, therefore, under Probate Code Section 15800, the Trustee, while acting as Trustee during William’s lifetime, only owed duties to William—not the named Trust beneficiaries (Williams’ other four sons)..  In other words, the Probate Code specifically states that the Trustee does not owe any fiduciary duties to the children of William (who are “contingent” beneficiaries so long as William is alive) until after William’s death.

The problem in Estate of Giraldin revolved around a large investment William made, over $4 million, into a start-up company owned, in part, by his son Tim.  After William created the Trust, and made his investment in Tim’s company, William stepped down as Trustee and allowed Tim to act as Trustee of his Trust.  But Tim was acting at William’s direction.

As might be expected, the start-up company William invested $4 million in did not survive, and William’s wealth plummeted as a result.  After William’s death, the other siblings were not happy that William invested so much of his money into Tim’s company only to have it disappear (I would imagine that had Tim’s company been successful, the other siblings would have been quite happy).  So Tim’s siblings sued Tim for breach of Trust claiming, among other things, that Tim never should have allowed William to invest in the company and lose his $4 million.

The Trial court agreed with Tim’s siblings and awarded a surcharge against Tim in excess of $4 million (yikes!).  Tim naturally chose to appeal that ruling and Justice Bedsworth gives us new law with a ground-breaking result for Trust litigation issues—he reversed the surcharge.  Tim owes nothing!

Before Estate of Giraldin, it was generally assumed that while beneficiaries could not sue a Trustee while the Settlor was alive, they could do so after the Settlor’s death.  The beneficiary could receive both an accounting of actions that took place before the Settlor’s death and even ask for a surcharge for any breach of Trust that occurred during that time.  This was based on Evangelho vs. Presoto (1998) 67 Cal. Appl. 4th 615.  Not so fast, says Justice Bedsworth.  He overrules the concepts set down in Evangelho.

Instead, the Court states that when a Trust is revocable by a Settlor, the only duty a Trustee owes is to that Settlor.  Therefore, there is no basis, and even no standing(!), for beneficiaries to seek an accounting of Trust actions or assert a breach of Trust for actions taken during that time.  What about breaches that the Trustee incurs, but the Settlor could not assert due to the ill-health or lack of capacity of the Settlor?  The Court says that can be taken up by the Settlor’ successor’s-in-interest, which usually means his Executor or surviving heirs.  But that type of action must assert wrongs against the Settlor, which did not occur in this case.

In fact, in the Estate of Giraldin matter, the only wrongs asserted by the beneficiaries is that they should have had an extra $4 million to split among themselves.  Everyone agreed that the Settlor wanted to invest in Tim’s company and had the capacity to do so.  They merely asserted that Tim should have stopped William from investing how he liked.  The Court disagreed, saying that during the Settlor’s lifetime, since the Settlor has the power to revoke the trust, the Trustee must do as the Settlor directs.  This is true even if the investing decisions are foolish. 

Had the beneficiaries been asserting wrongs committed as against William, then it may have been a different story.  Or if the investing had occurred after William died, when the Trustee owned a duty to his siblings as vested trust beneficiaries, there would have been a different outcome.  But under these facts, the Trustee gets a free-pass because he based his actions on the directions of the Settlor.

Giraldin is a well-reasoned and well-written opinion and makes sense on the facts of that case.  But the downside of a case like this is that the new argument for every Trustee acting while the Settlor is alive is going to be “the Settlor made me do it”—no matter whether that is true or not.  It will then be up to the beneficiaries to show whether that is true. 

 

I have posted many articles on the wrongful acts of bad trustees and I am just getting started on that subject. There is always more to write about.

I can’t help but notice that there is a general lack of understanding about the burden of beneficiaries as well.  Legally speaking, beneficiaries of California Wills and Trusts do not have any legal obligations or duties to the Will or Trust estate. However, beneficiaries do have a duty that they must undertake to enforce their rights–the duty to take action.

A beneficiary of a California Trust or Will has rights.  And an heir of a decedent who is disinherited may have rights, depending on the circumstances.  But those rights lie dormant until you choose to make the effort to enforce them.  Therefore, every beneficiary has a duty to take action to enforce their rights.  No one is going to step in and make your life easy by enforcing your rights for you.  You can take the Trust or Will matter to court, but the court’s role is supposed to be as a neutral trier of fact and law, it’s not there to help you assert your rights–that’s your job.

Of course, undertaking to enforce your rights is not easy.  It takes time, money and an emotional toll as well.  But when you’re dealing with a bad trustee or a bad situation, you have little choice but to stand up for yourself.

Many times I hear beneficiaries complain how having this burden to enforce their rights is hard, unfair, and it simply should not be this way.  Trustees should do the right thing in the first place or siblings should be fair with trust distributions.  Of courses all of those complaints are true and well founded, I agree.  But complaining gets you nowhere.  You alone have the burden to stand up and enforce your rights.  The sooner you as a beneficiary accept this fact, the sooner you can move on and try to get something done.

Love and marriage may go together (like a horse and carriage…), but marriage and estate planning may be another story.

If a person creates a Will or a Trust in California and then subsequently marries, that person’s new spouse automatically becomes a beneficiary of the Will and Trust by operation of law.  Many times people mistakenly believe that if their spouse is not mentioned in their existing estate plan, s/he will not receive anything after death.  And this may be exactly what the parties intended.  Especially with second marriages where each spouse may already have their own assets and they would rather leave those assets to their children rather than to their spouse at death.

But California law says otherwise.  The law is referred to as “omitted spouse” and it assumes that if a Trust or Will is made before marriage, and never changed to reflect the new marriage, then the new spouse gets his or her share of the estate.

This result can easily be avoided, however, by simply updating your estate plan to reflect the new marriage.  If the Trust and Will documents reflect an intent to disinherit the new spouse, then that overrides the law of omitted spouse. 

If avoiding the omitted spouse law is so easy, then why are attorneys called upon to litigate so many omitted spouse cases?  Primarily it’s because the law of omitted spouse is not widely known or even understood.  In fact, it’s usually a huge surprise to the children after a parent dies.  The children believe that since the spouse is not mentioned in the estate plan, he or she should receive nothing from the estate.  The children are outright stunned when they find out how omitted spouse automatically opens the door for the new spouse into the estate as a beneficiary.

The lesson is to remember that marriage raises many issues and rules that can have a significant effect on a person’s property rights (especially in California because we are a community property State).  Taking the time to review and update an estate plan either shortly before, or immediately after, marriage can help avoid future litigation.