Estate Litigation

October 15, 2014

New York Administration Proceedings Can Be Complicate by Family Disputes

The New York Probate Blog contains numerous articles discussing the differences between Surrogate’s Court probate proceedings and administration proceedings. When a decedent leaves a Last Will, the process is to probate the Will and then to distribute the estate assets according to the Will provisions. The appointed Executor will receive Letters Testamentary from the Court. If a person dies intestate (without a Will), the next of kin or distributees need to file a petition to obtain Letters of Administration. New York Estate Litigation Lawyers are aware that there can be many complications and controversies in Administration cases.

A recent decision by Suffolk County Surrogate John Czygier decided on September 16, 2014 and entitled Estate of Lambert, provides an example of many of the potential problems. In Lambert the decedent died as the result of a vehicular accident. He was survived by eight children all of whom were non-marital. Continue reading

October 1, 2014

New York Estate Litigation Often Concerns Real Property

by Jules M. Haas

The settlement of a New York estate involves dealing with many different estate assets. These assets may include bank accounts, stocks and bonds and retirement funds. In many instances the most valuable item comprising a decedent’s estate is real property. Such property may be in the nature of the decedent’s residence or investment or commercial real estate.

It is not uncommon that when a person dies their home had been owned by them for many years or even decades. Very often the decedent lived in their home with other family members such as a spouse or children or other relatives like nieces and nephews. Problems tend to arise where the decedent was not survived by a spouse and other family members had been living with the decedent in the home. Typically, the real property residence is either given in a Last Will to persons other than, or in addition to, those who had been living there with the testator. When there is no Last Will and a person dies intestate, the interest in the real estate may pass to a group of individuals who are the decedent’s next of kin or distributees. Such persons may or may not include the residents of the property. Continue reading

September 10, 2014

New York Undue Influence Can Be Difficult to Prove

by Jules M. Haas

A New York Estate Attorney is familiar with cases where a family member claims that a lifetime transfer of assets or a disposition in a Last Will is the subject of undue influence. Such claims when they arise during the life of a person who is alleged to have been taken advantage of are often the focus of litigation in Article 81 Guardianship Proceedings. These cases are usually filed in the New York State Supreme Court. It is interesting to note that if the Guardianship judge finds that a property transfer was the result of undue influence, pursuant to Mental Hygiene Law 81.29, the Court can void or revoke such transfer. Also, once a Guardian of the Property is appointed for an incapacitated person, the Guardian can commence Court proceedings to recover property that was wrongfully transferred.

After a person has died, a claim of undue influence may be asserted in a Will Contest. Undue influence is one of the grounds upon which a Will can be contested in Surrogate’s Court estate litigation. Continue reading

September 3, 2014

New York Will Consents Can Delay Estate Settlement

by Jules M. Haas

Following a person’s death, a petition may be filed with the Surrogate’s Court for the probate of the decedent’s Last Will. Usually, the person nominated as the Executor in the Will engages a New York Estate Lawyer for representation in the probate proceeding. As discussed in prior posts in this blog, a decedent’s next of kin or distributees must receive notice regarding the probate process. Such distributees may sign a Waiver and Consent which provides that they do not object to the Will. If such consent is not forthcoming, then a Citation needs to be issued by the Court and served upon these potential objectants.

Will Contests and other estate litigation can take a long time to resolve. During the delay in obtaining a resolution of the probate issue, there are many matters concerning an estate that need to be attended to. For example, assets such as bank and stock accounts need to be collected, the decedent’s debts and estate obligations such as estate and income taxes must be paid and other assets such as real estate have to be secured and maintained. Continue reading

August 1, 2014

A New York No Contest Clause In a Will May Be Difficult to Interpret

by Jules M. Haas

A New York Estate Lawyer is familiar with the various provisions of the Estates, Powers and Trusts Law (“EPTL”) and the Surrogate’s Court Procedure Act (“SCPA”) that impact estate planning. One of the provisions of the law that has caused much controversy over the years concerns the commonly known “no contest clause”. Section 3-3.5 of the EPTL contains the authority and rules regarding these clauses. While the statute allows the use of this limiting language in a Will, the statute also provides some limitations. For example, EPTL 3-3.5 states that the contest provision is not breached when an infant or incompetent opposes probate. Thus, such individuals do not forfeit their inheritance under the Will. The statute also allows pre-objection discovery under SCPA 1404 as to the witnesses to the Will, the Will’s preparer, the nominated executor and the proponent without resulting in any loss of beneficiary status under the Will.

In many instances the language of a no-contest clause in a Will may be unclear as to the extent of the conduct resulting in a forfeiture. An interesting example requiring interpretation of such a clause was presented in Matter of Prevratil decided by the Appellate Division 3rd Dept. on July 24, 2014. In Prevratil, a disinherited son filed objections to the probate of a 2011 Will that had made no provision for him. The son had been the sole beneficiary to an earlier 2006 Will. The 2011 Will contained a no contest clause. Since the named executor of the 2011 Will initially refused to petition for its probate, the beneficiaries filed a petition for probate seeking letters of administration. The disinherited son asserted that the actions by the beneficiaries to have an administrator appointed circumvented the 2011 Will’s named executors and, therefore, amounted to a contest of the Will resulting in their forfeiture of their Will bequests. Continue reading

May 28, 2014

New York Estate Litigation Can Complicate Estate Settlement

by Jules M. Haas

Controversies are not uncommon during the course of administering an estate. New York estate lawyers are familiar with the Surrogate’s Court procedures involved with such matters. Executors and Administrators have the fiduciary obligation to protect the interests of the estate in connection with all disputes regarding the decedent. A few recent cases highlight the different types of lawsuits that an estate may be involved with.

Matter of Elena Duke Benedict involved the determination of the validity of a claim against an estate. In this matter, trustees of certain trusts created by the decedent asserted that the decedent’s estate owed the trusts monies that were borrowed from the trusts by the decedent during her lifetime. The claim was based upon promissory notes that were signed by the decedent. Although the executor opposed the claim, in a decision dated May 8, 2014 Westchester Surrogate Anthony Scarpino found that the claim was valid and enforceable against the estate. Continue reading

March 12, 2014

New York Estate Litigation Frequently Involves Real Estate

by Jules M. Haas

Real estate is typically one of the most valuable assets comprising a decedent’s estate. Typically, a person’s residential house is a major asset. Many individuals also own commercial properties that may be used as a part of a business or may contain tenants. In view of the large worth of real estate assets it is common that the property is at the center of many estate battles.

A common occurrence appears to involve a pre-death transfer of the real estate interest to one person to the exclusion of others who would otherwise receive the property pursuant to a Last Will or through their rights of intestacy as a distributee of a decedent. Moreover, these lifetime transfers often occur when the decedent is elderly and suffers from physical or psychological conditions. Also, the deeds may be executed by persons acting as an attorney-in-fact under a power of attorney. Since these changes in property ownership appear to be improper and deprive potential beneficiaries of valuable inheritance rights, lawsuits in the Surrogate’s Court and Supreme Court frequently occur concerning ownership rights and the validity of the deeds reflecting the transfers.

A recent case decided by Kings County Justice Francois A. Rivera on February 20, 2014 provides a good example of a controversy created by real estate owned by a decedent. In Juliano v. Juliano, the decedent (“Beatrice”) had owned a home in Brooklyn where she lived with some of her adult children. Beatrice had made a Last Will in which she left her entire estate, which included the house, to her four children in equal shares. Approximately 6 years prior to her death it appears that Beatrice signed a deed transferring her entire interest in the house to her son to the exclusion of the other 3 children. However, it seems that the son receiving the property (“Frank”) did not accept or record the deed at the time it was signed by Beatrice but waited about 6 years to record it.

Interestingly, the Court voided the deed because it found that the gift was not effective due to the lack of proper acceptance by Frank at the time the deed was made. Additionally, although the Court found that there was a confidential relationship between Beatrice and Frank that would have provided a basis for a finding of undue influence, the Court declined to void the transaction on that ground since it had determined the deed was invalid due to the lack of acceptance.

As an estate litigation attorney, I have represented numerous individuals in situations where issues have arisen concerning the alleged improper transfer of real estate and other assets from a decedent to a family member or to a third party. These cases are typically presented in Surrogate’s Court proceedings and Supreme Court proceedings. Sometimes the issue is raised before a person dies and is litigated in a Guardianship case. The Guardianship Court has the power to void deeds and other transactions it finds to be improper due to the abuse of a power of attorney or the incapacity of persons making the transfer.

February 26, 2014

New York Will Dispositions Can Adeem When Not Owned by the Decedent at Death

by Jules M. Haas

New York Will Attorneys are aware that there are many aspects of a decedent’s estate that can result in controversy and estate litigation. A recent case decided by Queens Surrogate Peter J. Kelly on January 22, 2014 entitled “The Matter of Hill” and reported in the New York Law Journal, contains many issues that are common to estate disputes. In Hill, the decedent had executed a Last Will that provided for a residuary clause leaving the balance of the estate equally to the decedent’s two daughters, Brenda and Marcia. The Will also contained a pre-residuary provision which specifically devised real property equally to the two daughters subject to a life estate in favor of Brenda.

Brenda lived at the real property premises with the decedent and became her attorney- in-fact in a power of attorney. Shortly before the decedent’s death Brenda used the power of attorney to transfer the real property from the decedent into Brenda’s sole name.

The transfer of the deed by Brenda as attorney-in-fact to herself is not an uncommon occurrence. Litigation by New York estate attorneys as well as Queens Guardianship Lawyers concerning such circumstances is often commenced to void the deeds in these transfers. Under both the estate laws and the New York Guardianship laws improper transfers of a person’s assets can be invalidated and the property or the proceeds thereof recovered. Moreover, an attorney-in-fact under a power of attorney has an obligation to account for his actions especially where there appears to be self-dealing by having transfers made for one’s own account. The Courts are more likely to find impropriety where a person abuses a confidential relationship by benefiting from his position of trust or authority.

In Hill the Court had previously found that the deed transfer by Marcia was voidable and the estate was able to recover title to the property. However, the dispute in Hill did not end. Since the real property had been transferred before the decedent’s death it was not part of the decedent’s estate when she died. As a result Marcia claimed that the property was subject to the rules of Ademption which effectively provide that when property that is specifically given under a Will does not exist when the decedent dies, the gift is essentially ignored. If the Court in Hill had applied the Ademption rule, then the real estate, once recovered, would have been disposed of under the residuary clause to the two daughters and not by the specific pre-residuary provision. This result would have eliminated Brenda’s life estate.

Notwithstanding Brenda’s improper and voidable transfer of the deed, the Court held that the recovery of the title to the property by the estate although occurring after the decedent’s death, prevented the application of the Ademption rule. The Court also stated that Maria had a fiduciary obligation to the estate to recover the deed and that she should not personally profit by not following the terms of the Will.

I have represented many clients in New York Guardianship cases and estates where it was necessary to recover property that was improperly transferred. As can be learned from Hill, the Courts are receptive to proceedings to rectify a breach of fiduciary duty by a fiduciary and to enforce the disposition of assets in the manner a decedent expresses in his Last Will.

January 2, 2014

New York Disqualifies a Person from Inheriting Where the Person’s Conduct Causes Death

by Jules M. Haas

The New York Probate Lawyer Blog has previously discussed cases involving the disqualification of a person from inheriting from a decedent’s estate. Where a person murders another the New York Courts do not permit the murderer to profit from his wrongdoing. The wrongdoer is deemed to lose any inheritance he might receive from the decedent. This basic principal was recently affirmed by Nassau Surrogate Edward McCarty III in the case of Matter of Innocent Demesyeux decided on December 23, 2013 and reported in the New York Law Journal on January 6, 2014. In Demesyeux the Court was faced with the issue of determining whether a mother who killed her children would be disqualified from receiving a share of the wrongful death proceeds resulting from their death. The Court found that the basic principals of equity should prevent the mother from profiting where she apparently had the ability to know that her acts were morally wrong.

Disqualification of a person’s inheritance interests appears in other aspects of New York estate law. Estates, Powers and Trusts Law (“EPTL”) Section 4-1.6 provides that a joint tenant of a bank account forfeits rights of inheritance as to the joint account if convicted of murder in the first or second degree. Also, EPTL Section 4-1.4 provides a number of situations where a parent is disqualified from receiving a distributive share of a child’s estate. For example, under 4-1.4(a)(1) a parent is disqualified if he or she fails or refuses to provide for the child or if the child is abandoned. Similarly, EPTL Section 5-1.2(a)(5) provides that a spouse may lose inheritance rights if he or she abandons the other spouse. Under EPTL 5-1.2(a)(6) such rights may be forfeited if a spouse fails to support the other spouse. There are also instances where in the event a Last Will contains a “no contest” clause a person may forfeit any bequests under the Will if the clause is violated.

New York estate attorneys are aware that estate settlement and distribution often involve many unique and complex issues. The resolution of matters regarding the interests of potential beneficiaries and heirs at law requires the investigation of all facts regarding the decedent and the estate and determining whether and to what extent a Last Will or appropriate estate statutes apply. I have represented many clients including Executors, Administrators and beneficiaries of estates with regard to their responsibilities and entitlements.

December 11, 2013

New York Executors and Administrators May Be Removed for a Breach of Fiduciary Duty

by Jules M. Haas

Fiduciaries in New York such as Executors and Administrators are responsible for carrying out their tasks in settling an estate. As discussed in previous posts in the New York Probate Lawyer Blog, the job of a fiduciary includes identifying and collecting a decedent’s assets and paying a decedent’s debts as well as estate administration expenses and income and estate taxes.

While these tasks may be uncomplicated in many instances, each estate presents its own problems and challenges that must be confronted and resolved by the Executor or Administrator. For example, prior to death the decedent may have been a party to a lawsuit as a plaintiff or defendant. Following death, the estate representative must take the place of the decedent as a party to the court action and process the litigation to finality in the best interests of the estate. It may not always be easy for the fiduciary to decide if a settlement of such litigation is more advantageous than a final determination by a court or a jury. A fiduciary needs to be concerned as to whether the estate beneficiaries will find fault as to the course of action taken and attempt to have the fiduciary found liable for any loss or expense incurred.

Also, a fiduciary is responsible for protecting estate property and if he fails to do so this may be found to be a breach of fiduciary duty resulting in a revocation of his court appointment. New York Surrogate’s Court Procedure Act (“SCPA”) Section 711 entitled “Suspension, modification or revocation of letters or removal for disqualification or misconduct”, provides various grounds upon which a fiduciary may be removed from office. For instance, paragraph 2 provides that a fiduciary can be removed if he has “wasted or improperly applied assets of the estate. . . .” In a recent decision by Manhattan Surrogate Nora Anderson dated November 26, 2013 and reported in the New York Law Journal on December 6, 2013 entitled Estate of Katherine E. Freeman, an estate administrator was removed. The Court found that the administrator engaged in serious misconduct that was harmful to the estate including the failure to pay maintenance on the decedent’s cooperative apartment which resulted in the apartment being sold in foreclosure.

Clearly, it is the responsibility of the estate representative to find and protect all of the estate assets. When a fiduciary acts improperly, the Court may surcharge him for the damage that is caused to the estate. I have represented many executors and administrators in Surrogate’s Court proceedings and estate litigation. It is important that the fiduciaries understand and are diligent in performing their fiduciary duties. I have worked closely with my clients in the estate settlement process to help them carry out their fiduciary responsibilities so that the interests of the estate and its beneficiaries are protected.