A very common issue that arises during the course of estate administration concerns assets that a decedent transfers close to the time of death. These transfers can be in the form of outright gifts or the creation of ownership rights such as a joint tenancy or through a beneficiary designation. For example, a situation may exist where a decedent transfers to another person as an outright gift funds from a bank account. Likewise, the decedent may add a person’s name to a bank account or change a beneficiary designation on an insurance policy or retirement account.
All of these events appear on their surface to be improper especially when the transfer occurs right before a person dies and, in particular, when the transferor is aged and/or suffering from a medical or psychological condition which may impair their judgment.When an estate Executor or Administrator is confronted with these transfers, the fiduciary must determine whether or not to seek to recover these assets on behalf of the estate. Due to the fact that the pre-death transfer resulted in the assets passing outside of the administration estate, the estate beneficiaries are deprived of the asset values. In many instances the executor or administrator has a fiduciary duty to attempt to recover these assets for the estate. In order to do so, the fiduciary must engage in estate litigation in the Surrogate’s Court. The New York Probate Lawyer Blog has provided many posts discussing issues involved in locating and recovering assets of an estate.
In a recent case decided on June 17, 2015 by Manhattan Surrogate Nora Anderson, entitled “Estate of Lewis S. Wechsler, Deceased”, the Court had before it a turnover proceeding that was filed by a Preliminary Executor of an estate. As noted by the Court, there were a number of asset transactions made by the decedent within a 6 month period prior to death which essentially turned the decedent’s probate estate into one that passed outside of his Will at death. These transactions included the changing of a brokerage account frm the decedent’s name alone into a joint account with his wife and the transfer of assets into joint ownership through the use of a power of attorney.
In its decision, the Court refused to dismiss the turnover proceeding before trial. The Court found primarily that material issues of fact existed as to whether the transfers were the result of undue influence. Among other factors the Court found the decedent had a certain cognitive impairment and it was troubled by the fact that the wife had participated in and facilitated the transfers. Therefore, the Court felt that these issues needed to be decided after a trial.
Estate litigation in Surrogate’s Court, particularly involving matters of undue influence and capacity are very complex since the Court must assess the circumstances regarding the decedent and the events that occurred around the time of the transfers that are being reviewed. I have represented many clients in cases involving the issues of undue influence an incapacity. These matters also arise in Will Contests. If you have any questions regarding any of these problems, call me for a free review at (212) 355-2575.
New York City probate lawyer, Jules Martin Haas has helped many clients over the past 30 years throughout Nassau and Bronx Counties resolve issues relating to estate litigation and settlement in New York Probate proceedings. If you or someone you know has any questions regarding these matters, please contact me at (212) 355-2575 for an initial consultation.
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