[WSBAPT] Will/CPA

Wed Jul 14 09:10:11 PDT 2021

FWIW – Briefing on this issue from early in my practice (in other words, a really long time ago). I haven’t researched it recently, but am unaware of any substantive changes to case law.

3.1 A community property agreement is a contract authorized and controlled by R.C.W. §26.16.120, and remains in effect until rescinded by a valid agreement of the parties.  See In Re Estate of Catto, 88 Wn App.  522, 944 P.2d 1052 (1997); In re Estate of Lyman, 7 Wn.  App 945, 503 P.2d 1127 (1972).   In Catto, the wife executed a inconsistent will and filed for divorce, but because the community property agreement did not include a clause terminating it on divorce.  The beneficiaries of Mrs. Catto’s will contended that the community property agreement should be nullified because the marriage was defunct at the time of her death.  The court specifically found that the marriage was defunct, but held that because the agreement had no clause indicating termination in the event of a defunct marriage, it would not imply such a provision.  Catto, supra, 88 Wn App at 529, 944 P.2d at 1056.    Similarly, the status of the marriage between Mr. and Mrs.  Stamper should have no bearing on the validity of the community property agreement.

3.2 The courts have long since determined that a “meeting of the minds”, or at least knowledge of and acquiescence to or reliance on the repudiation by one party is necessary to revoke or rescind a contract such as a community property agreement.  “Uncommunicated subjective mutual intention to abandon is not enough.”  In re Estate of Lyman, 7 Wash. App. at 949, 503 P.3d at 1131 (quoting Restatement of Contracts §§20,21&22(1934)).  One party’s unilateral act cannot by itself serve to rescind the agreement.   See, In re Estate of Lyman, supra; In re Estate of Catto, supra; In re Estate of Wittman, 58 Wn.2d 841, 365 P.2d 17 (1961).  Further, to constitute intention to abandon, both foresight of the consequences to follow and a desire to do the thing foreseen is required.  Lyman, supra.  If there was no mutuality of intent, the agreement is still valid because there is no valid recission
3.3. Often spouses will execute wills contemporaneously with executing a community property agreement.  This is to cover any property excluded from the agreement, or the eventuality of simultaneous deaths.  In this case, no property was excluded from the terms of the community property agreement.   If there were any assets not covered by the community property agreement, Olivia’s will could have dispositive control over those assets, but as no such assets exist, Olivia’s will should not have any force or effect.  See, Lyman, supra.  In fact, the events in the case at hand are similar to those of Wittman, in which the wife made a will purporting to dispose of only her one-half interest in their community property subject to a community property agreement.  The husband made a will giving certain legacies to certain individuals and devising and bequeathing the residue to his wife.  In fact Olivia Stamper’s will went one step further and specifically attempted to divest her husband of his one-half of the community assets.  Such attempt should fail, as it did in Wittman where the court confirmed ownership of all assets on the surviving spouse.
3.4 A community property agreement such as the one at issue in this case is clear on its face and terms that it shall have the effect of vesting all property owned by the couple, or by the first spouse to die in the survivor.  In re Estate of Wittman, supra.
There is no case law regarding waiver of contractual rights under a community property agreement.  The similar but distinct principle of election has been examined by the courts.  The only case where a spouse was estopped from having the probate court enforce a community property agreement instead of the will of the predeceased spouse was Norris v. Norris 95 Wash.2d 124, 622 P.2d 816 (1980).

ALSO FWIW – I use CPAs in my practice all the time and include a provision for unilateral revocation in the event of incapacity of one spouse and need for Medicaid.

Heather

Heather S. de Vrieze
Attorney-at-Law
[cid:image001.jpg at 01D7788F.0993DA20]
3909 California Avenue SW
Seattle, WA 98116-3705
(206)938-5500
heatherd at westseattlelaw.com<mailto:heatherd at westseattlelaw.com>
www.westseattlelaw.com<http://www.westseattlelaw.com/>
Click here to connect with de Vrieze | Carney on Facebook:   [FB Logo] <https://www.facebook.com/DeVriezeCarney>

For the months of July and August 2021, our firm will be open Monday through Thursday 8:30am to 5pm. We will be closed Fridays.

CONFIDENTIAL & PRIVILEGED. This e-mail message may contain legally privileged and/or confidential information.  If you have received this e-mail in error, please notify the sender immediately and delete all copies of this e-mail message and any attachment.

From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Karen E. Boxx
Sent: Wednesday, July 14, 2021 7:34 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] Will/CPA

See Norris v. Norris, 25 Wn.App. 290 (1980). On W’s death, H opted to probate wife’s will even though there was a CPA in effect, and court held he had disclaimed his interest under the CPA.  Some agreements provide that  a surviving spouse can disclaim their interest at death of first spouse, so the terms of the agreement should be considered.  But Diane is right - there are numerous cases where a CPA trumps terms of a will and other nonprobate transfers - see Lyon v. Lyon, 100 Wn.App. 409, where a CPA controlled over a joint tenancy with the deceased H’s brother (“ Which “instantaneous” event takes place first might muddle metaphysicians for millenia. There is a need to resolve the issue, however, and we hold that when the agreement simply conveys all community property to the surviving spouse, the agreement controls. It is the policy of law to favor community property and disfavor joint tenancies. ”)

Karen
Sent from my iPad

On Jul 14, 2021, at 7:22 AM, Diane J. Kiepe <DJKiepe at depdslaw.com<mailto:DJKiepe at depdslaw.com>> wrote:

Sarah,

I agree with the contract conclusion and that it isn’t a take it or leave it tool.  That was said much better than my post stating that the CPA trumps the Will.  Trump may have been a bad word.  Because it’s a contract that takes effect on a death of one person there is nothing in the probate estate unless it is a CPA that only goes to character of property (not how it vests).  I rarely see these.

I have been using CPAs for certain plans (all goes to first spouse on death) and where Medicaid qualification is unlikely (due to pension/ss or whatever) or where the parties acknowledge they want to use all their funds as they  have for their best care and Medicaid only if absolutely necessary.  With that being said, the some comments here certainly have given me food for thought.

Diane J. Kiepe

Diane J. Kiepe
Douglas Eden
717 W. Sprague Ave.
Suite 1500
Spokane, WA  99201
djkiepe at depdslaw.com<mailto:djkiepe at depdslaw.com>
509-455-5300

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Sarah McCarthy
Sent: Tuesday, July 13, 2021 7:54 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Will/CPA

Here are 2 cents from a less seasoned player in this field than most of you:

A CPA is a contractual commitment as to how assets will vest after the first spouse’s death. I don’t view it as something a surviving spouse can simply discard if it winds up not being the best method of handling things after the first spouse’s death. For this reason it’s a tool that I don’t employ unless it’s clear that absolute vesting to surviving spouse on death is the only desired outcome. I do see it as trumping the will.

Though I am aware that some attorneys prepare these as an optional tool, and advise surviving spouses to choose whether or not to take under a CPA, depending on the circumstances after the first spouse’s death. I personally don’t agree with this approach. Either the spouses make a contractual commitment, or they don’t.

The CPA can however be drafted to permit revocation by a single spouse after one spouse’s incapacity (as may be needed for Medicaid or tax planning purposes), as well as an option for disclaimer by surviving spouse, which affords additional flexibility.

Sarah

Sent by dictation from my iPhone. Please excuse typos and missing punctuation!

On Jul 13, 2021, at 4:15 PM, Roger Hawkes <Roger at law-hawks.com<mailto:Roger at law-hawks.com>> wrote:

One of the main reasons not to do a cpa is the inability to do any sort of complex planning, like trusts etc.

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Diane J. Kiepe
Sent: Tuesday, July 13, 2021 3:34 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Will/CPA

Ken,

If the SNT in the Will is for the surviving spouse, the CPA will be problematic.  The CPA, if not revoked in any way, will trump the Will.  I sense I may either be reading your note below wrong or missing a fact.

Happy to send you a direct e-mail with some additional information.

Diane J. Kiepe

Diane J. Kiepe
Douglas Eden
717 W. Sprague Ave.
Suite 1500
Spokane, WA  99201
djkiepe at depdslaw.com<mailto:djkiepe at depdslaw.com>
509-455-5300

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Ken Luce
Sent: Tuesday, July 13, 2021 3:17 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Will/CPA

Concern is with CPA it eliminates provisions in their will for SNT

kl

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Jeff at bellanddavispllc.com<mailto:Jeff at bellanddavispllc.com>
Sent: Tuesday, July 13, 2021 2:47 PM
To: 'WSBA Probate & Trust Listserv' <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Will/CPA

[EXTERNAL MAIL] DO NOT CLICK links or open attachments unless you recognize the sender and know the content is safe.
Ken,

I would use what is most beneficial for the situation.  Is there a surviving spouse?  If so, wouldn’t the cpa be easier and avoid probate?  What is the issue probating the Will(s).

Jeff

W. Jeff Davis
BELL & DAVIS PLLC
P.O. Box 510
720 E. Washington Street, Suite 105
Sequim WA 98382
Phone: (360) 683.1129
Fax: (360) 683.1258
email: jeff at bellanddavispllc.com<mailto:jeff at bellanddavispllc.com>
www.bellanddavispllc.com<http://www.bellanddavispllc.com/>

The information contained in this e-mail message may be privileged, confidential, and protected from disclosure. If you are not the intended recipient, any dissemination, distribution, or copying is strictly prohibited. If you think that you have received this e-mail message in error, please e-mail the sender at info at bellanddavispllc.com<mailto:info at bellanddavispllc.com>  or call 360.683.1129.

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Ken Luce
Sent: Tuesday, July 13, 2021 2:33 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: [WSBAPT] Will/CPA

At time of death with will and cpa is it mandatory the cpa be used? Both wills are identical.

Ken Luce
Luce & Associates, P.S.
4505 Pacific Hwy. E., Suite A
Tacoma, WA 98424
T: (253) 922-8724
F: (253) 922-2802
www.LuceLawFirm.com<http://www.lucelawfirm.com/>
<image001.gif><https://www.facebook.com/pages/Luce-Kenney-Associates-PS/200703820101348>

IMPORTANT NOTICE TO EMAIL RECIPIENTS
1. The information contained in this e-mail and accompanying attachments constitute confidential information which may be legally privileged and is intended for the sole use of the addressee.  If you are not the intended recipient of this information, any disclosure, copying, distribution or the taking of any action in reliance on this information is strictly prohibited and may be unlawful. This information is the property of Luce & Associates, P.S.  If you received this e-mail in error, please notify us immediately by return e-mail or by calling (253) 922-8724.
2.  This e-mail transmission may not be secure and may be illegally intercepted.  Clients of Luce & Associates, P.S. are asked to use their best judgment in determining whether the topic of an e-mail response is such that it would be better saved for a more secure means of communication.
3.  The sender believes that this e-mail and any attachments are free of any virus.  However, by reading this message and opening any attachments, the recipient accepts full responsibility for taking remedial action regarding any viruses or other defects.
4.  All Luce & Associates’ attorneys are licensed to practice law in Washington and do not intend to give legal advice to anyone with legal matters not involving Washington law or federal law or to those who are not clients of this firm.

***Disclaimer: Please note that RPPT listserv participation is not restricted to practicing attorneys and may include non-practicing attorneys, law students, professionals working in related fields, and others.***
_______________________________________________
WSBAPT mailing list
WSBAPT at lists.wsbarppt.com<mailto:WSBAPT at lists.wsbarppt.com>
http://mailman.fsr.com/mailman/listinfo/wsbapt
***Disclaimer: Please note that RPPT listserv participation is not restricted to practicing attorneys and may include non-practicing attorneys, law students, professionals working in related fields, and others.***
_______________________________________________
WSBAPT mailing list
WSBAPT at lists.wsbarppt.com<mailto:WSBAPT at lists.wsbarppt.com>
http://mailman.fsr.com/mailman/listinfo/wsbapt
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20210714/d499febd/attachment.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image001.jpg
Type: image/jpeg
Size: 17884 bytes
Desc: image001.jpg
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20210714/d499febd/image001.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image002.png
Type: image/png
Size: 18009 bytes
Desc: image002.png
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20210714/d499febd/image002.png>