[WSBAPT] Probate Reality Check

Thu Aug 25 11:54:05 PDT 2016

One big issue however is whether sister is on Medicaid.  If so, and son signs disclaimer, he will screw up her benefits royally as this will be treated as a gift.  He could also be reported to APS for financial abuse of a vulnerable adult, in addition to incurring penalties for taking sister’s share.  In addition, there may be problems with title insurance if he uses his DPOA to sign disclaimer which then results in all property passing to him. If APS report on son, then APS might also file petition for guardianship for sister stating that son acted in his own interests at her expense.  I absolutely would not do this – your client has too much exposure and there will be a strong argument that he is taking advantage of a vulnerable adult.

Karen Marie Thompson
THOMPSON HOWLE VAUGHN
4115 Roosevelt Way NE, Ste. B
Seattle, WA 98105
(206)545-7777
Fax: (206)545-0777

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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Paul Neumiller
Sent: Thursday, August 25, 2016 11:12 AM
To: 'WSBA Probate & Trust Listserv'
Subject: Re: [WSBAPT] Probate Reality Check

Yeah, I’m been thinking about that but I’m not sure it passes the “smell test.”  Sister is mentally disabled but Son, her brother, has her POA.  Mom’s Will says Son gets everything if Sister predeceases Mom and Sister’s Will gives everything to Son.  So, on one hand, Son is signing, as a fiduciary, a disclaimer which benefits him and creates a conflict of interest.  On the other hand, who cares because he gets everything anyway and there is no one around to complain/object because Sister never married and has no children.  Under Sister’s POA, Son has already started to pay her debts and bills.  Son plans on paying for all of Sister’s medical debts so I don’t think we will have any abandoned creditors.

I wasn’t able to find any cases discussing IRS disclaimers and a POA’s conflict of interest.  In the past, I got a self-serving disclaimer by a guardian approved by the court but that was in the context of an existing probate and a separate guardianship.  I could open this probate and petition the court for approval of the disclaimer but that would entail getting a guardian ad litum for Sister, and that’s an expense we are trying to avoid.

Any thoughts out there regarding Son’s exposure for signing the self-interested disclaimer when he is to receive everything anyway and there isn’t anyone out there to complain or object???

(Apparently there is interest in this topic because I have received multiple emails off-list from attorneys in similar situations asking for the results of my research.)

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From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of David Faber
Sent: Thursday, August 25, 2016 10:32 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Probate Reality Check

Can sister disclaim her interest in mom's estate?

Best,
David J. Faber
Faber Feinson PLLC
210 Polk Street, Suite 1
Port Townsend, WA 98368
(360) 379-4110

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On Tue, Aug 23, 2016 at 3:39 PM, Paul Neumiller <pneumiller at hotmail.com<mailto:pneumiller at hotmail.com>> wrote:
I represent Son.  Mom dies.  Sister, who gets 50% of Mom’s estate (Son get the other 50%), is dying (in hospice care) and incapacitated.  No one knows when she will pass and family thought Sister would have died before Mom died.  Sister is insolvent (and has no heirs) except for inheritance and her Will gives everything to Son, her brother.  Son wants to open Mom’s probate in order to sell Mom’s house quickly.  But, if we open probate, then need to appoint a guardian-ad litem for incapacitated Sister.  Any creative solutions out there?  To complicate the issue, there may be Medicaid collections issues out there for Sister when she passes.

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