Many spouses complain they are unappreciated. But when they are omitted from a deceased partner's estate plan, their complaints don't just echo in the kitchen. They are also heard at the courthouse.
Consider the case of Ted Will, a divorced father of five who executed an estate plan that included a will and trust to protect his estate for his children.
Years later, at the ripe old age of 81, Ted became reacquainted with his high school sweetheart, 80-year-old Gertrude Fochs, who was also divorced with five children. They fell in love and decided to get married. But Gertrude suffered from lung cancer, and they expected she would never survive Ted.
Shortly before the wedding, the couple met with Ted's attorney to discuss a prenuptial agreement stating that each spouse waived the right to inherit from the other. Gertrude, who knew Ted's estate was substantial, later described the agreement as "he keeps his assets, I keep mine." Ted's attorney explained the agreement to Gertrude and offered to obtain independent counsel for her at Ted's expense, but she declined the offer. Ted and Gertrude signed the agreement and were married the following day.
Two years later Ted died unexpectedly, leaving Gertrude as the surprise survivor of their marriage. He never amended his existing will and trust, nor did he execute a new will after marrying Gertrude. Instead, he relied on the prenuptial agreement.
What Ted didn't count on was Gertrude's change of heart. Despite her purported waiver of rights, she petitioned for a share of her husband's estate (Estate of Will,
170 Cal. App. 4th 902 (2009)). This raised two issues: whether Gertrude was indeed an "omitted spouse" under the Probate Code (see Cal. Prob. Code § 21610),
and whether the waiver contained in the prenuptial agreement would stand up against a Family Code provision that crimps enforceability of such agreements (see Cal. Fam. Code § 1615).
Shares for Forgotten Spouses
Section 21610 of the California Probate Code protects a spouse who is not mentioned in estate planning documents executed prior to the marriage. The statute gives the omitted spouse a statutory share of the estate, but not if (1) the decedent's estate plan specifically disinherits the spouse, (2) the spouse receives assets outside the estate, or (3) the spouse executes a valid waiver.
Gertrude contended that her waiver did not comply with Family Code section 1615, which nullifies prenuptial waivers that do not follow certain strict procedures. Among other things, the section requires a seven-day waiting period, and the person waiving rights must have the opportunity to be represented by counsel. Furthermore, an unrepresented person must receive a separate document explaining the rights being waived. (See
Cal. Fam. Code § 1615.)
Gertrude's waiver did not meet the Family Code requirements, but that fact did not stop the court of appeal from upholding Ted's clear intention, to which Gertrude had acceded prior to their marriage. The court relied on a series of Probate Code sections that allow for a written waiver of inheritance rights if, at the time of signing, the waiver makes a fair and reasonable disposition of the surviving spouse's rights. Alternatively, the code allows a written waiver if the surviving spouse had adequate knowledge of the decedent's property and there was no violation of a fiduciary duty owed to the affected spouse. (See Cal. Prob. Code §§ 140?147.)
In Estate of Will,
the specific Probate Code waiver rules trumped the prenuptial requirements of the Family Code.
Justice Arthur Gilbert wrote that "[i]n probate matters, justice can be illusive, if not absent. ... But in the case we decide here, the Probate Code itself gives the probate judge discretion to reach a fair result." With respect to Ted Will's love for Gertrude during her dying days, followed by Gertrude's change of heart on her waiver, he continued, "A good deed finds its reward, not its punishment." (170 Cal. App. 4th at 904.)
The court simply refused to let Gertrude go back on her word. Yet the essential lesson to be gleaned from Estate of Will
is not that justice prevailed. Rather, it is that life-cycle events?such as marriage, childbirth, divorce, or death of a loved one?should trigger a reexamination of a person's estate plan, if not an amendment of key documents. Had Ted amended his will and trust to disinherit Gertrude, she would have had no case.
Sadly for Ted's family, where there was a will (that was not amended) there was a way to stir up litigation. A few dollars spent with an experienced estate planner at the time of the marriage would have saved Ted's family the money it spent on protracted probate litigation after his death.
Michelle Lerman is a partner at Lerman Law Partners in San Rafael, where she is a certified specialist in estate planning, trust, and probate law.