Posted by: Pierson W. Backes | Posted on: February 4th, 2013 | 0 Comments
When representing a personal representative in my probate practice, it not unusual for my client to scoff at the idea of making a formal notice of probate.
Take a common situation in which the two children of the decedent are the sole heirs, and one of the children is the executor. If the sibling heirs are personally close, a formal notice of probate might seem silly. Sending the formal notice described in the court rule might even be irritating to the brother or sister; if they’ve read the Will and know that it was probated, the notice of probate they’ll receive will contain less information than they already know.
Now, within the context of my representation, the issue is easy enough to resolve. Notice of probate is simply part of the administration, and when it’s handled by the law firm it’s rarely questioned by the recipient.
A more interesting circumstance is where we get involved late in an administration where no formal notice of probate was delivered, or where we represent an heir who has not received a formal notice of probate. The question then is whether whatever notice the heir or next-of-kin received was sufficient.
Rule 4:80-6 describes what must be in a notice of probate. All beneficiaries and next-of-kin (in general terms) are to receive “a notice in writing that the will has been probated, the place and date of probate, the name and address of the personal representative and a statement that a copy of the will shall be furnished upon request.”
It is clear that mere knowledge of the existence of a Will and the identity of the executor named in the Will is not enough to constitute notice of probate. In re Estate of Green, 421 A.2d 600 (App.Div. 1980). It’s likewise clear that a technical defect separate from the contents of the notice itself – such as failure to file proof of notice with Surrogate – does not make the notice insufficient.
There is some authority to support the position that actual knowledge of the facts that should be contained in the notice is like sufficient, even where there is noncompliance with the literal requirement of written notice. See, e.g., In re Will of Landow 199 A.2d 43 (App.Div. 1964).
But far better to actually comply with the rule, even when all of the facts contained in the notice are already known to the recipient.
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Posted by: Pierson W. Backes | Posted on: January 27th, 2013 | 0 Comments
I was speaking recently with an excellent estate planning attorney, discussing the matter of joint bank accounts. From the point of view of the estate planning lawyer, joint bank accounts looked like a viable tool in the estate planning toolkit. From my point of view, as an estate litigator, joint bank accounts are an invitation for trouble.
I’m speaking here of bank accounts that are joint in name alone, where one person has contributed all of the money and simply named another person as joint owner. This happens for a variety of reasons; sometimes it is a “convenience” account, set up to let another person pay bills or the like, and sometimes it is a round-about way of estate planning, made with the intention that the money in the account will pass to the survivor upon the death of the person funding the account.
There are a host of problems with joint bank accounts of this kind. For one, these accounts are among the most common means an unscrupulous person can steer money out of the Estate and into their pockets. For reasons I don’t pretend to understand, it’s apparently easier to convince an aging relative to add you as a “joint owner” of a bank account than it is to have them make a more clearly intentional gift.
In every Estate involving a joint bank account where the decedent paid in all of the money, it’s reasonable to ask whether the account is an asset of the Estate or if it should pass directly to the surviving “joint owner.”
At first blush, the law in New Jersey seems clear enough. The Multiple-party Deposit Account Act (NJSA 17:16I-1 et seq.) says that the money in a joint bank account will pass to the surviving owner and not to the Estate of the decedent “unless there is clear and convincing evidence of a different intention at the time the account is created.” The standard of “clear and convincing evidence” is a high one, nearly the civil law equivalent of the more familiar “beyond a reasonable doubt.”
The question gets a lot more complicated when the question of undue influence is raised. A presumption of undue influence can be created quite innocently under New Jersey law. I’ll write more about that elsewhere, but I think it’s enough to say that, in many instances, the decedent leaving a joint bank account named as joint owner someone they relied on, trusted, and were close enough to that the specter of undue influence isn’t far away.
If the relationship between the decedent and the survivor was of a nature that creates a presumption of undue influence, the burden of proving that the decedent intended a joint bank account to pass to the survivor and not to the estate is completely inverted. Now, the survivor must show that the creation of the joint account was not the product of undue influence.
And undue influence is not the sole grounds for directing a joint bank account back to the Estate. Our Appellate Division directs that “[e]ven if no undue influence is found, a trial judge should still be free to look at all the direct and circumstantial evidence available to determine whether the depositor intended to create survivorship rights.” That is, even without a finding of undue influence, the court should broadly examine all of the evidence — direct and indirect — to look for donative intent.
While the presumption the under Multiple-party Deposit Account Act might seem to make gifts by joint account almost unassailable, the full context of the law governing such gifts suggests that joint bank accounts should always be reviewed as a potential asset of the Estate. I think that joint bank accounts in nearly all cases have no role in prudent estate planning, and that in the administration of an estate, from a litigator’s perspective, these accounts should always be viewed with suspicion.
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