Rules of Revocation and Ex-spousal Inheritance

Divorce is a complex legal matter. The revocation of a former spouse’s rights to valuable estate assets can lead to litigation. Estate law provisions guiding rules for revocation, affect the entitlement of ex-spouses also subject to judicial separation, annulment, or final divorce decree by due process. The revocation of automatic spousal rights to estate transfers at the end of those proceedings may also lead to probate litigation after the ex-spouse owner dies. Amendment or restatement of an estate’s trust is the legal process for modifying distribution of assets to named beneficiaries. Professional estate planners experienced in probate litigation services can assist parties to a divorce-related estate matter with trust or Will modification. Planned giving specialists will benefit from knowledge about issues relating to estate transfers impacting nonprofit charitable giving plans.

The Doctrine of Revocation

The transformation of estate law to encompass all concerns related to trust ownership transfer between ex-spouses, has led to a range of statutory rules guiding estate planning in the past several decades. For example, in New York the reform of the state’s Existing Estates, Powers and Trusts Law, EPTL 5-1.4 provisions in 2008, created the legal conditions for revocation of divorced or annulled parties’ rights to inheritance. New York estate rules now apply a “doctrine of revocation” to the disposition or appointment of property between former spouses. Revocable disposition refers to “testamentary substitutes”, including joint tenancies of bank and retirement investment accounts, as well as lifetime revocable trusts, and life insurance policies (IN RE: The Estate of Joseph SUGG, Deceased. No. 2013–5055/B, Decided: June 29, 2015).

Estate Rules of Revocation

Recently reformed estate laws, including New York state legislation (EPTL 5-1.4), now permit revocation of any nomination of ex-spouses as appointed trust agent, executor, fiduciary, guardian, representative, trustee, or attorney-in-fact. Estate laws denying legal termination of automatic power-of-attorney at time of divorce, once protected ex-spouses from probate review of deceased spousal estate transfers. Will or trust designation of a spouse as beneficiary stands in lieu of estate intestate rules of automatic estate transfer to surviving, still married spouses. The enforceability of revocation may also be affected by individual state rules depending where an ex-spouse or their children reside.

Trust or Will Restatement Post-Divorce?

The opportunity to amend or restate an estate’s trust or Will documentation occurs when a couple divorces or dissolves a common law union. If it is determined changes must be effectuated within a trust, an estate’s executor or living owner to redraft or modify a Will. If the estate has already gone to probate, it is the court that determines the future control of trust assets. The decision to amend, restate, or execute a Will attached to the estate of a joint tenancy estate, is typically required by law depending on the state jurisdiction where the trust or will was enacted. Drafting of new estate documentation during a divorce is generally performed by a licensed estate lawyer, experienced in matters of trust and probate litigation.

Ex-spousal Entitlements

If an estate’s trust or will documentation has been changed to reflect the rights of ex-spouses, a surviving spouse may retain the right to Elective Share. “No will” contestation of an estate subjects the distribution of assets to rules of intestacy, as defined under state laws. For ex-spouses, this may or may not lead to automatic revocation of rights to proportional distribution of estate assets. Prior to divorce, surviving spouses have full rights to a decedent spouse’s assets and real property under rules of intestacy. Intestate succession laws in some states revoke the rights accorded former spouses in estate matters, immediately after a divorce is finalized. Pre-nuptial and joint tenancy agreements still held with an ex-spouse also affects revocation of entitlements.

In the 21st century, divorce or annulment of a marriage does not automatically revoke the disposition or appointment of trust property from an ex-spouse at time of a decedent’s death.

Planned Giving Wiki

This is the definitive resource for professional gift planners. It covers all of the relevant information you’ll ever need as far as technical details go.