Most complications that arise in estate administration are the result of unanticipated events. Divorce is one of the least planned for events in any estate plan; it can also cause some of the most devastating complications. The recent case of Carroll v. Israelson illustrates this point.
Thomas and Wendy were married for 18 years, but had no children. During their marriage, Thomas executed a Will that left his estate to Wendy, if she survived him. In the event Wendy died before Thomas, he left his estate to the Wendy Family Trust. This Trust benefited Wendy while she was alive and then, upon her death, her niece and nephew. In 2012, Thomas and Wendy divorced. Only a month later, before he could redraft his Will, Thomas died.
Florida law seeks to protect divorced persons from their inattention to estate planning details. Unless the estate plan provides otherwise, any provisions in a person’s estate plan that “affect” his or her spouse become void upon their divorce. Additionally, the estate plan is administered as if the spouse had died at the time of divorce.
If Wendy had died at the time of divorce (before Thomas), Thomas’s estate would pass to the Trust and benefit Wendy’s niece and nephew; Wendy would not be affected. However, Wendy was alive and the current beneficiary of the Trust. If Thomas’s estate were to pass to the Trust, Wendy actually would be affected.
Wendy’s niece and nephew contended that the terms of the Will were not void because the terms should be read as if Wendy had died before Thomas and they should inherit the estate in a separate trust share. Thomas’s mother contended that the terms of the Will were void because, in fact, the terms do affect Wendy, so instead she should inherit the estate by intestacy. At trial, the court ruled in favor of Wendy’s niece and nephew. On appeal, the court agreed with Thomas’s mother and reversed the ruling. The bitter legal dispute lasted more than three years (costing the estate substantial legal fees), and even the judges disagreed on the outcome.
The entire dispute could have been avoided if Thomas had executed a comprehensive estate plan that included a provision to “provide otherwise.” Comprehensive estate planning anticipates potential complications and provides alternative provisions to avoid their potentially devastating effects.
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