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1216424_supreme_court_new_yorkDuring the course of estate administration, the beneficiaries of an estate may need to wait many months or even years before their beneficial interests are paid.  In many instances a lengthy delay may cause a hardship to a beneficiary, especially when the beneficiary was dependent upon the decedent for support or the decedent’s death impacted the financial stability of the beneficiary.

In many cases of estate administration, the executor or administrator or preliminary appointee may voluntarily make an advance distribution to a person who is in need.  This tends to be a common occurrence when all of the interested parties are cooperative and there is no contentious estate litigation occurring.  However, when a fiduciary refuses to help a beneficiary who is in need, the Surrogate’s Court Procedure Act provides a procedure whereby an application can be made to the Court for an advance distribution.

SCPA 2102 entitled “Proceedings for relief against a fiduciary” contains a paragraph 5 which allows the commencement of a proceeding to force the payment in advance of an estate share when the estate “exceeds by at least one-third” the sum needed to pay other claims, debts and legacies.  The applicant must demonstrate that such payment is required for his education or support for him or his family.  This statute gives parties interested in an estate an important right to maintain financial stability during a long period of estate settlement.

The executors and administrators of a New York estate have a fiduciary responsibility to collect and protect estate assets.  In the event these fiduciaries fail to act in a responsible manner, the administrator or executor’s malfeasance would constitute a breach of fiduciary duty.

When a situation arises where it appears a third party is withholding assets that belong to a decedent’s estate, it is the responsibility of the fiduciary to pursue the recovery of the property or the value thereof.  Fortunately, the Surrogate’s Court Procedure Act provides a statutory procedure to obtain recovery of the property of an estate.  The rules and procedures are contained in SCPA Section 2103 entitled “Proceeding by fiduciary to discover property withheld or obtain information.”  This section of the law, along with SCPA Section 2104, entitled “Inquiry; trial and decree,” give the estate representatives broad discovery to ferret out information about possible estate assets and to prosecute a hearing or trial for return of the property.  The New York Probate Lawyer Blog has discussed these discovery and turnover proceedings in many posts over the years.

The Surrogate’s Court routinely has these matters appear on the Court calendars.  I have represented many clients in such proceedings.  A recent Albany estate case provides yet another insight into such matters.  In Matter of Mahoney, decided on August 8, 2018 by Albany Surrogate Stacy Petit, the executors of an estate sought to recover claimed estate assets including bank funds which the decedent had transferred to her long-time friend while she was still alive.  An interesting part of the case was that the bank transfer occurred with telephone authorization by the decedent.  While the executors argued that it was not common for the decedent to transfer funds by telephone authorization, the Court found that the overall evidence did not show such transaction would not have taken place.  Particularly, it seems the friend needed the funds sent quickly to complete a purchase.  After reviewing all of the facts, the Court rejected the executor’s claims and found that the bank funds were not assets of the decedent since they were properly transferred prior to her death.

Probate-2-300x200It is an important role of estate planning to prepare a Last Will and Testament.  This document allows a testator to set forth in various provisions his desires as to the disposition of his estate.  Once a Will is admitted to probate, the terms become validated and the testator’s estate plan is effectuated.  It is then subject to being finalized by the executor settling the estate.

As has been discussed in a number of articles in the New York Probate Lawyer Blog, that the Surrogate’s Court requires that the original Will be filed as part of the petition for probate.  The Court needs to see the original signatures of the testator and the attesting witnesses, as well as the Will provisions.  Unfortunately, it is a common occurrence that after a testator dies, the original Will cannot be located.  Instead, usually a copy of a Will is found.  In these circumstances, Surrogate’s Court Procedure Act Section 1407 entitled “Proof of lost or destroyed will” must be referred to in order to resolve the issue regarding the probate of the copy.

A recent decision in a Manhattan estate case provides a good example of the issues presented in these types of cases.  Estate of Rothberg was decided by Manhattan Surrogate Rita Mella on September 25, 2020.  In Rothberg, the decedent’s son petitioned to probate a lost Will.  He was the sole residuary beneficiary and the named executor.  The proceeding was uncontested.  Apparently, after the decedent’s death, the petitioner-son received the original Will from the decedent’s attorney.  However, prior to filing it with the Court, the son lost the original.  There is a presumption that a Will that cannot be located after death was destroyed by a decedent with an intention to revoke it.  However, the Court in Rothberg noted that such presumption does not exist if the attorney had possession of the Will.

20200522-Estate-Planning-300x200Estate planning in New York involves the preparation of different documents.  These include a Last Will and Testament, Living Will, Living Trust, Power of Attorney and Health Care Proxy.  All of these papers have terms and language which should be clear and specific so that the writer’s intentions are precisely spelled out.

In particular, a Will can have numerous provisions that involve descriptions of property being disposed of and identification of beneficiaries who are to receive benefits pursuant to the document.  The New York Probate Lawyer Blog has published many posts regarding Wills and estate planning and the need for proper drafting.

Some of the considerations that need to be taken into account include the recognition that a Will may describe property that is being disposed of.  Such property may be tangible items like pieces of jewelry or furniture.  Other types of assets may include real estate or business interests.  In all these situations it is important to take extra care to describe the gift with precision.  The last thing a testator should want is for beneficiaries to engage in post-death Surrogate’s Court litigation as to which item owned by the testator was given to them.  For example, a bequest of my “gold watch” is not helpful if the testator owned multiple gold watches.

There are a number of different types of fiduciaries.  These include Executors, Administrators, Trustees and Guardians.  Even an agent under a Power of Attorney stands in a fiduciary relationship to his principal.  One common aspect relating to all fiduciaries is that they are required to provide a complete accounting of their conduct and activities to beneficiaries.

In most cases, accountings in estates and trusts are done voluntarily.  These are informal procedures.  After a beneficiary has had an opportunity to review the accounting, they can provide an acceptance and release to the fiduciary acknowledging that there are no objections or concerns as to the acts of the fiduciary.  Sometimes the parties cannot engage in this procedure either because the Executor or Trustee refuses to provide a full account or the objections by the beneficiaries cannot be informally resolved.  When this occurs, a formal accounting proceeding must be filed in the Surrogate’s Court or other Court that has jurisdiction over the case.

A recent Queens trust case was the subject of a judicial settlement of a final account by the trustee.  The case is entitled In Re Baron and was decided by Queens Surrogate Peter Kelly on July 7, 2020.  The Court was asked to consider an application by the trustee to dismiss various objections to the account that had been filed by the trust beneficiaries.  The objections encompassed various assertions of breach of fiduciary duty and wrongdoing by the trustee.  These centered around insurance policies held by the trust which had been allowed to lapse.  Thus, there was no value in the trust at the time of the grantor’s or insured’s death.

stock-vector-blue-kinship-distress-rubber-stamp-1662322042-281x300All proceedings regarding an inheritance from a decedent require that interested parties receive proper notice to protect their interests.  Whether an estate involves the probate of a Last Will and Testament or administration where there is intestacy, it is essential to determine the identity of a decedent’s heirs or distributees.  The New York Probate Lawyer Blog has published many articles regarding proof of kinship.

In both probate and intestate cases, estate lawyers may need to present evidence establishing that an individual is a distributee of a decedent or eliminating the possibility that any unknown heirs exist.  This evidence may need to be presented in an Affidavit of Due Diligence or at a formal Kinship Hearing in the Surrogate’s Court.  The manner by which kinship can be provided is through documents such as birth, death, and marriage records.  Also, testimony from disinterested parties who knew a decedent can establish such facts as marriages and the existence of children and other relatives.  The use of professional genealogical search firms can prove to be invaluable in difficult cases.

One area in estate settlement that is important in establishing potential kinship is where a claimant’s father was not married to the claimant’s mother.  Proof of kinship in these non-marital child cases is provided by Estates, Powers and Trusts Law Section 4-1.2 entitled “Inheritance by non-marital children.”  The statute provides that potential non-marital kinship can be demonstrated by various means including where there is an order of filiation showing paternity; a signed acknowledgement regarding paternity; proof that the father “openly and notoriously acknowledged the child as his own”; or through blood genetic marker testing.  Proof of paternal kinship in a New York estate case can be difficult.  An interesting example of the issues that can arise in such matters was recently shown in a Pennsylvania estate case entitled In Re Estate of David W. Ackley, Sr.  As reported by Max Mitchell in the Legal Intelligencer on August 12, 2020, an administrator of an estate sought to compel an alleged heir to take a DNA test.  The Court recognized that the alleged heir had the burden to prove kinship.  However, it refused to grant the Administrator’s request to force the claimant to take a DNA test.

rendered-300x107A person who is planning the disposition of estate assets needs to make a number of decisions.  Among these is the identity of intended beneficiaries and the value or amount of the interest to be provided.  These determinations can occur in different forms.  Where someone prepares a Last Will and Testament the document is going to include various dispositions.  Additionally, with regard to assets that pass outside of the administration estate, such as joint accounts or assets that have designated beneficiaries, the name of the intended payee must be provided.

A spouse of a decedent stands in a preferred position regarding the disposition of a decedent’s assets.  This is because a spouse, unlike any other family member including children, cannot be entirely disinherited.  Estates, Powers and Trusts Law Section 5-1.1.A entitled “Right of election by surviving spouse,” provides that the spouse is entitled to receive the greater of $50,000.00 or one-third of the decedent’s net estate.

The interesting and complicating aspect of EPTL 5-1.1.A is that it includes as part of the value of asset calculation items identified as “testamentary substitutes.”  These items include assets that pass to third parties upon death such as bank accounts that are payable upon death either in a joint account or as a pay on death account or retirement or death benefit funds.  The intention of the statute is to prevent a decedent from diverting assets for which a surviving spouse would have a right to receive a share of.  The New York Probate Lawyer Blog has posted numerous articles regarding estate settlement and spousal rights.

shutterstock_96626983-300x300It is not uncommon for a person who is domiciled in New York to have the persons who are interested in his estate residing outside of New York.  This situation can occur in a number of contexts.

In the event a decedent created a Last Will and Testament, the document may have designated an out-of-state individual to serve as Executor.  Contrary to some misinformation, there is no prohibition for a person who resides in another state or even another country to serve as a New York estate executor.  Reference should be made to Surrogate’s Court Procedure Act (SCPA) Section 707, entitled “Eligibility to receive letters.”  The statute provides that a non-domiciliary alien is not eligible to serve as a fiduciary.  Thus, if a person resides in New York and is a qualified resident, or is a U.S. citizen and lives anywhere in the world, he would qualify to serve as an executor.  The statute also allows a non-domiciliary alien to serve as a fiduciary as long as they serve with a New York resident co-fiduciary.

The above rules apply equally in the case where a decedent dies intestate.  An out-of-state distributee (next of kin) can qualify as the administrator.  SCPA Section 1001 entitled “Order of priority for granting letters of administration” identifies the persons who can become administrators based upon their relation to the decedent.

In order for a Last Will and Testament to be valid, it must be admitted to probate.  Probating a Will in New York requires following all the procedures in the Surrogate’s Court.  Many times a person who is disinherited or does not receive what he expects in the Will provisions feels that the Will must be invalid.  The conclusion reached is that the document must have been procured through fraud, undue influence or other wrongdoing.

The reality of these cases is that most Wills that are prepared by an attorney and executed under an attorney’s supervision are found to be valid.  When the statutory formalities provided by Estates, Powers and Trusts law section 3-2.1 entitled “Execution and attestation of wills; formal requirements” are followed, a contest of a Will is usually dismissed.  While undue influence and other grounds may result in a denial of probate, such an outcome is difficult to achieve.  The Courts typically prefer to see that a testator’s intentions are carried out through the terms of a Will rather than left to the uncertainly of intestate distribution.  The New York Probate Lawyer Blog has posted many articles regarding probate.

A Manhattan estate case entitled Estate of Menchini demonstrates that the Courts tend to favor admitting a Will to probate.  Menchini was decided on March 18, 2019 by Manhattan Surrogate Rita Mella.  The decedent had left most of his estate to a friend who was also named as an alternate executor.  The decedent’s brother challenged the Will based upon lack of due execution and fraud.  It appears that the Will was not prepared by an attorney, nor did an attorney supervise the execution ceremony.  The Will was signed in the office of a Reverend of a local church.  There were two witnesses, although one witness predeceased the decedent and was not available to testify.  Also, a notary was present to notarize the witness affidavits.

shutterstock_330039464-300x200A person who dies without a Last Will and Testament is said to have died intestate.  According to Estates, Powers and Trusts Law (EPTL) Section 4-1.1, entitled “Descent and distribution of a decedent’s estate,” there is a statutory priority as to the identity of the individuals who are entitled to inherit a decedent’s estate.  The statute provides, for example, that a surviving spouse is to receive $50,000.00 and one-half of the rest of the estate with the balance to be shared by the decedent’s issue (i.e., children and descendants).

In most cases, determining the identity and location of the next of kin or distributees, as referred to in the statutes, is not a problem.  Not only do these individuals receive a share of the estate, they may be entitled to serve as the estate Administrator.

In addition, since such persons must be given notice of the Surrogate’s Court proceedings, the Court requires that they be fully identified in the Court filings.  There are many circumstances that may be present when identifying a decedent’s next of kin which can delay and complicate estate settlement.  Here are a few of the more common problems.

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