Just” is not justice.
People often think that if they die without a will, everything will just get taken care of.
“Oh, I don’t need a will. Everything will just go to my spouse.” Or, “I don’t need a power of attorney. Worst comes to worst, they’ll just get a guardianship.”
Often, these statements are driven by the speaker’s desire to avoid paying legal fees, making it easier to resort to his vision of focusing on what he thinks is the ultimate result — rather than the process required in order to get there.
When someone dies without a Last Will and Testament, the rules of descent and distribution of property under the laws of intestacy — that is, dying without a will — apply. These rules also apply when someone leaves a will that is invalid and does not comply with the formalities of the statute, for example, when someone pulls something off the internet and just has it notarized, or has it witnessed by one of the beneficiaries named in the will.
There are rules about the order of priority about who stands to inherit from an intestate estate and who has “standing” — the right to petition to be the fiduciary of the person’s estate. The fiduciary is called an “Administrator” and not an “Executor,” a term which applies to probate estates where a decedent died with a will. (By the way, in New York State, female fiduciaries are no longer called “Executrix” or “Administratrix” since the diminutive suffix was abolished by court rule in 1997, yet many people continue to incorrectly use these terms.)
The application of the laws of intestacy may have unintended consequences. For example, the spouse does not take all. Instead, the spouse takes the first $50,000, and then half of the remainder, with the other half going to any surviving children. And, there are many people who hold themselves out to be husband and wife (or spouses) but in fact are not legally married. New York State does not have common-law marriage.
Often people lose sight of what is involved to administrate an estate, and the fact that it can be less organized and require additional paperwork than in a probate estate. For example, for unmarried persons, you can try to go to court to have a judicial declaration of a marriage, but it is a high burden of proof and an uphill battle, one that encounters legal costs. Those costs are always considered in determining the cost-benefit analysis of whether to proceed in a certain direction. Estate taxes can also be higher in those cases, where a decedent was not actually married to his partner, who now will not receive the assets of the decedent because he or she has no legal standing as a non-spouse.
Also, if there are minor children, those minor children are not legally competent to own property. Therefore, the parent must seek appointment as a Guardian of the property in order to receive the assets, at which point those funds must be held jointly with the Clerk of the Court, and the Court’s permission is required for a withdrawal of those assets.
This puts the Court in control of the assets, and not the child’s parent. The parent is then required to seek the Surrogate’s Court approval every time she or he wants to access some of the child’s money for childcare expenses. In New York County, the Guardianship department has an unspecified rule (not codified anywhere) that there should be enough money left for the child to go to college. There are no guidelines for what this means. College tuition at a state school or a private university?
Although the child is legally entitled to whatever is left in the account once he or she reaches the age of 18, many would agree that no child should have access to large sums of money at 18, particularly when that child has experienced a tragedy like losing a parent.
In addition, there are certain factors that render a person ineligible to serve as a fiduciary, such as a felony conviction. Although a will does not necessarily overcome that statutory barrier, at least you would be able to state why you want that person to serve notwithstanding the defect or barrier to serving.
In other situations, the decedent might not have gotten along with his or her siblings, or parents, from whom he or she was estranged, or distant cousins whom he or she never met. Often, people in same-sex relationships, particularly those who hail from the South or “fly over” states, had a falling out with their conservative family members and don’t speak with them once arriving in the Big Apple. Nonetheless, in this case, blood really is thicker than water, and they will stand to inherit if there is no will to stand in the way of that situation.
Without a will, you lose the option of choosing the person who will administer an estate, or serve as trustee. Often in an intestacy situation, in cases where there is no one suitable to serve, or even where there is no family, the Public Administrator will serve as fiduciary. This is a person appointed by the Court to administer those estates that are without someone to serve.
In certain circumstances, even those people who are otherwise entitled to take under the statute can be barred from that entitlement. For example, a parent or spouse who abandoned the decedent cannot inherit, nor can a person who murdered the decedent or was culpable in their death (known as the “Son of Sam” rule).
A Surrogate Court recently took that logic one step further: A husband who murdered his wife’s mother (his mother-in-law). The wife — the heir of the murdered woman’s estate — post-deceased her mother, also intestate, leaving her husband as the sole heir of her estate. Even though he was not culpable in his wife’s death, the Court barred him from taking in intestacy.
Children who are “adopted out” may also not inherit from the biological parent. Stepchildren are not included in the intestacy list, no matter how emotionally close the relationship.
You need to look no further than estates of celebrities to visualize what happens. Prince died unexpectedly this year without a will. Now his estimated $300-million estate will be distributed among six siblings. This is complicated because of the nature of his assets. Unsurprisingly, other potential heirs have surfaced claiming to be Prince’s out-of-wedlock child, including a federal prison inmate.
There are serious consequences to not leaving a valid will, yet nearly two-thirds of American adults fail to do so. Don’t be one of them. And remember that this is not a “do-it-yourself” project.
Alison Arden Besunder is the founding attorney of the law firm of Arden Besunder P.C., where she assists new and not-so-new parents with their estate planning needs. Her firm assists clients in Manhattan, Brooklyn, Queens, Nassau, and Suffolk Counties. You can find Alison Besunder on Twitter @estatetrustplan and on her website at www.besun