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Procrastination Is Not Discrimination

An older woman adopted her younger girlfriend/partner in the 1970’s so the girlfriend could inherit the trust fund created by the older woman’s father.  When the older woman died in 1997, the girlfriend inherited a substantial sum from the trust.  The younger woman died in 2009 without a will.   Her brother staked a claim to her $25 million estate as her closest living relative.  However, NY law (and Ohio law) provides that once someone is adopted, they lose all relationships with their prior family, including the ability to inherit from them, and the ability to leave them assets without a will.  The woman’s estate will escheat to the State of NY because she has no relatives.

Several points:

1.  Lawyers in this case are arguing that the older woman adopted her girlfriend because same sex couples did not have the same rights as traditional couples in the 1970s.  However, that argument is a red herring because the funds were in a trust which could only be left to a descendant which caused the woman to adopt her girlfriend.  Funds not in trust could be left to anyone she pleased – girlfriend, charity, or relatives.

2.  I draft trusts to prevent this type of adoption chicanery by including only children who were adopted prior to the age of 18.

3.  In an era of Obergefell and Kaitlyn Jenner’s reality show, it is easy to create a legal smokescreen by arguing discrimination from 40 years ago, when the real culprit is simple neglect by a wealthy person to create a will.  

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“What is Per Stirpes?”

After I ask clients if they have reviewed drafts of their wills, the question they most often ask me is “what does per stirpes mean?”  It helps that the term is underlined. In short, it means by representation.  If a beneficiary dies before the decedent, that beneficiary’s heirs will divide his or her share.A recent Nebraska case, Estate of Evans, recently interpreted per stirpes in the context of an individual who died without a will and was survived by a nephew from a pre-deceased brother and 2 nieces from another pre-deceased brother. The court held that the 3 individuals would share equally because the division into shares began at the generation with living heirs.

Several points:

1.  In Ohio, the division would be made at the level of the pre-deceased brothers so the nephew would receive half and the nieces would each receive one quarter.

2.  A common fallacy among non-attorneys is that if an individual does not have a will, the assets will escheat to the state.  States have statutes that provide who will inherit assets if there is no will.  Only if there is no one somewhat directly related to the decedent will the assets escheat to the estate.
3.  It is always better to prepare a will to determine who inherits assets rather than leave the distribution to a state statute.

4.  It is rare to be able to use the term escheat twice in the same post.

There Is Gold in the Walls! Part 2

Following up on an earlier post. A woman will officially inherit her reclusive first cousin’s $7.4 million estate after a court ruled that she is his only heir. After the man died, the estate auctioneer found $7.4 million of gold coins in his house.

Several points:

1. When someone dies without a will, the estate does not escheat to the state. Statutes set forth how the estate will be distributed which is generally along the lines of closest living relative.

2. Only one first cousin? That is a narrow family tree.

3. Gold was a great investment for him (actually for his cousin). Apple stock would have been better.

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All Posts By Jay Brinker

I am an attorney located in Cincinnati, Ohio who practices in the areas of estate planning, probate, asset protection, and small business advice. I make a difficult and bewildering process as simple as possible. Most importantly, I provide "more for less" for my clients.