[WSBAPT] question on right of retainer

[John J. Sullivan]

Sharon: 

I like Rebecca's language. But I always characterize the debt as an advance against the beneficiary's share instead of a debt. The reason is that if the beneficiary has obtained a discharge in bankruptcy the debt is no longer worth anything as an asset of the estate and its distribution is a nullify - it does not reduce the recipient's share of the residue. 

John J. Sullivan

Sent from my iPhone

> On Sep 11, 2017, at 1:17 PM, Rebecca King <rebecca at nwelg.com> wrote:
> 
> Sharon, this is the language we often use in such situations:
> NAME1 is currently indebted to me in the principal sum of $_____ resulting from loans made by me. This loan amount is non-interest bearing.  I direct that no action to collect such debt be taken at my death. However, NAME1’s share of my estate shall be offset by any remaining unpaid loan balance.  The burden of proof shall be on NAME1 to substantiate that the loan has been partially or fully repaid.
>  
> Some of the language may not be applicable to your situation, but I hope it will serve as a starting point.
>  
> Regards,
> Rebecca King
> Attorney
>  
> PLEASE NOTE: Our new address is 2150 N. 107th Street, Suite 501, Seattle, WA 98133
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>  
> Northwest Elder Law Group
> 2150 N. 107th Street, Suite 501
> Seattle, WA 98133
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> From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Sharon Rutberg
> Sent: Monday, September 11, 2017 1:01 PM
> To: wsbapt at lists.wsbarppt.com
> Subject: [WSBAPT] question on right of retainer
>  
> Happy Monday, list mates --
>  
> I am writing wills for clients who are concerned that if their estate were divided among their three children at the death of the second spouse to die, one child might have an outstanding debt to the parents that should be offset from her distributive share. As I read the law of Washington, the doctrine of retainer says that the debt should indeed be set off or "retained" before the shares are distributed.  Does anyone include language in their wills to account for this circumstance - that is, to refer to the loan and express the intent of the testator that the offset should occur?
>  
> Thanks,
> Sharon
>  
> Sharon C. Rutberg, Attorney at Law
> Salmon Bay Law Group, PLLC
> 1734 NW Market St.
> Seattle, WA 98107
> 206-735-3177, ext. 2
> sharon at salmonbaylaw.com
> Website: www.salmonbaylaw.com
> Washington State Bar #47055
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