San Diego Estate Planning Lawyer Blog
One scenario you need to consider as part of your estate planning is the possibility of you and your heirs dying at the same time. A common example of this would be a husband and wife killed in a car accident. If each spouse signed a will leaving their estate to the other, this could create a conundrum. This is why it is generally a good idea to include a survivorship clause in your will. Such a clause specifies a time period a person must survive you in order to inherit under your will. Any person who dies within the specified time period will be treated as if they died before you.
Twin Sisters Die Within Days, Litigation Ensues
A recent San Diego case illustrates how survivorship clauses work. This case is only an illustration and not a complete statement of California law on this subject. This case involves a pair of sisters—twin sisters, actually—who sadly died within five days of each other.
The first sister died on December 26, 2011. Six years earlier, the first sister established a living trust and transferred her home into it. Her will also left any probate assets to the trust. The trust left everything to the second sister, but if she failed to survive the first sister, the trust named two contingent beneficiaries. The trust contained a survivorship clause specifying a beneficiary must survive the first sister by at least 30 days.
Shortly before her death, the second sister took over as successor trustee of the trust. Acting as trustee, the second sister sold the house and deposited the sale proceeds—about $250,000—into a bank account jointly owned by the two sisters. The second sister subsequently died on December 31, 2011.
One of the contingent beneficiaries took over the trust as successor trustee. He claimed the second sister’s decision to deposit the proceeds of the sale in the joint account violated the terms of the trust. Since the second sister died within the term specified by the survivorship clause, the contingent beneficiaries were entitled to inherit all of the trust assets. Unfortunately, the courts held the contingent beneficiary’s claim was barred because he waited too long to file his objections with the probate court.
Get Advice From an Estate Planning Lawyer
The second sister’s estate argued before the probate court the early sale of the house was consistent with their overall estate planning intentions—that is, they always wanted to make sure the surviving sister was provided for. Of course, from a legal standpoint, neither sister survived the other. While the legality of the sale may have been muddled, there was no question the survivorship clause applied in this situation.
A survivorship clause is just one of many issues you need to consider when making a will or a trust. An experienced San Diego estate planning attorney can advise you these subjects. Contact the Law Office of Scott C. Soady if you would like to speak with an attorney today.