Recent New York Fiduciary Cases

January 21, 2010

In re Singer, 2009 NY Slip Op 9265 (Dec. 15, 2009)

The court was asked to determine whether a beneficiary’s conduct in investigating the decedent’s will rose to a level that would violate the in terrorem clauses within the will, or whether the acts were protected by New York law.

In short, the first in terrorem clause in the will states that any beneficiary who directly or indirectly contests, objects to, or opposes the probate of the will or administration of the trust shall forfeit any benefit conferred on the beneficiary. The second in terrorem clause specifically states that if the decedent’s son contests or objects to the will or trust, either in court, in a religious court, or in any other manner, that he will lose any benefit conferred by them.

New York has statutory safe harbors that allow beneficiaries to perform preliminary examinations of the will’s witnesses, the attorney who prepared the will, and the nominated executors without resulting in forfeiture under an in terrorem clause unless otherwise specifically disallowed within the in terrorem clause. The son chose to depose the drafting attorney to determine whether the decedent had capacity and whether he was under any undue influence. After the deposition, the son determined he would not contest the will. However, the executor argued that the son’s acts violated the in terrorem clauses, and that the son was no longer entitled to any benefit from the will or trust.

The court found for the decedent’s son specifically stating that the in terrorem clauses must be strictly construed, and that they did not contain language that trumped the statutory safe harbors.

Matter of Atiram, 2009 NY Slip Op 52534U (Dec. 16, 2009)

Decedent’s disinherited “spouse” filed for an elective share in decedent’s estate. The executor of the estate argued, under theories of divorce, abandonment and legal separation, that the decedent and “spouse” were not legally married at the time of the decedent’s death.

Although the executor provided documentation from Israel that they were legally divorced pursuant to Israeli law, as well as other evidence of abandonment, none of the facts brought to the court rose to the level of a legal divorce under New York law. The court found that the disinherited spouse was entitled to an elective share in the estate.

Matter of Postma, 2009 NY Slip Op 29512 (Dec. 16, 2009)

Decedent prepared a will that was witnessed by only one party. The attorney who represented the named executor in the will filed a petition for probate that was denied because the will did not meet the statutory execution requirement of two witnesses. The attorney later filed for fees incurred to assist with the administration of the estate in the amount of $2,500.

The court denied these fees specially stating that costs payable out of the estate may be awarded in a contested probate proceeding to an “unsuccessful proponent named in the will when propounded by him… in good faith as the last will of the decedent.” The court found that the work done by the attorney and named executor was not done in good faith, as there was no reasonable argument that the filed will could be admitted as the last will of the decedent.

Matter of Jones, 2009 NY Slip Op 52533U (Dec. 16, 2009)

The daughter and brother of a decedent were initially appointed as the administrators of decedent’s estate (administrators). In the petition for administration, the administrators fraudulently represented that the daughter was the decedent’s sole heir, while knowing the decedent had a son who was also entitled to take under the estate.

After their appointment, the administrators transferred an apartment building owned by the decedent to both of the administrators. The court found for the guardian for the son, revoked the letters of appointment, and cancelled the deed that transferred the property to the administrators.

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