Also known as: non-probate · non probate
Written by attorneys — see sources below.
Property or a transfer that passes at death outside the probate process by operation of law or beneficiary designation rather than by will or intestacy. Such assets include joint tenancies with right of survivorship, payable-on-death accounts, life insurance proceeds, and revocable trusts. A will has no effect on these assets absent severance or other lifetime action.
Nigel Nelson and Nora Nash owned their farmhouse as tenants by the entirety. While divorce proceedings were pending, Nigel executed a will leaving the farm to his nephew. Nigel died before any decree severed the tenancy. Title passed directly to Nora by survivorship, and the will had no effect on the property.
Nikhil Narayan held a joint bank account with his spouse. The spouse died first. The account balance is valued immediately before the spouse's death for purposes of determining the surviving spouse's fractional interest in the augmented estate.
Nia Nkosi designated her spouse as beneficiary on an ERISA-governed life insurance policy and pension plan. After divorce the state statute would have revoked the designation, but federal law controls. The proceeds pass to the former spouse according to the plan documents.
Donna Rae Egelhoff was married to David A. Egelhoff. Mr. Egelhoff was employed by the Boeing Company, which provided him with a life insurance policy and a pension plan. Both plans were governed by ERISA, and Mr. Egelhoff designated his wife as the beneficiary under both. In April 1994, the Egelhoffs divorced. Just over two months later, Mr. Egelhoff died intestate following an automobile accident. At that time, Mrs. Egelhoff remained the listed beneficiary under both the life insurance policy and the pension plan. The life insurance proceeds, totaling $46,000, were paid to her. Respondents Samantha and David Egelhoff, Mr. Egelhoff's children by a previous marriage, are his statutory heirs under state law. They sued petitioner in Washington state court to recover the life insurance proceeds. In a separate action, respondents also sued to recover the pension plan benefits. The trial courts, concluding that both the insurance policy and the pension plan "should be administered in accordance" with ERISA, granted summary judgment to petitioner in both cases. The Washington Court of Appeals consolidated the cases and reversed. Applying the statute, it held that respondents were entitled to the proceeds of both the insurance policy and the pension plan. The Supreme Court of Washington affirmed. Courts have disagreed about whether statutes like that of Washington are pre-empted by ERISA. The Supreme Court granted certiorari to resolve the conflict.
View caseAssets that pass at death by beneficiary designation or survivorship rights, such as joint tenancies, payable-on-death accounts, life insurance, and revocable trusts, qualify as nonprobate transfers. A will cannot dispose of them.
No. Title passes by survivorship to the surviving spouse if the tenancy remains intact at death, even if divorce proceedings are underway and a will attempts to devise the property to a third party.
Values are determined at the decedent's death, with fractional interests in joint property fixed immediately before death. Certain insurance proceeds are excluded from valuation as if the spouse were deceased.
Generally no. Will substitutes require compliance with their own contractual or statutory procedures for change. Courts are divided when a will attempts revocation without following those procedures.
Yes, specified nonprobate transfers to others are included in the augmented estate for elective-share calculations, subject to timely election and notice requirements.
…asset will pass at A’s death “as if” A’s “former spouse” had died first— unless the “instrument governing disposition of the non-probate asset expressly provides otherwise.” Wash. Rev. Code § 11.07.010(2)(b)(i) (1994) (emphasis added). This state-law rule is a rule of interpretation, and it is designed to carry out, not to…