[WSBAPT] Will/CPA
Ryan P. Coon
cole-gilday at stanwoodlaw.net
Wed Jul 14 09:32:45 PDT 2021
Also see RCW 11.86 regarding disclaimers of interests. Under
11.86.011(6)(n) the statute specifically contemplates disclaimers of
interests under community property agreements.
Thus, I don't see any problem with executing a will and community
property agreement concurrently and then choosing which to use at the
time of the death of the first spouse. When the first spouse passes the
survivor can simply choose whether to (1) use the CPA to dispose of
property or (2) disclaim interest under the CPA and probate the will
instead.
However, it would probably be best practice to include in the CPA a
provision contemplating disclaimer and/or to have a the survivor sign a
disclaimer of interest at the time of such disclaimer (in Norris v.
Norris disclaimer was implied by the fact that the survivor discussed
whether to use the will or the CPA and ultimately decided to probate the
will).
Very Truly Yours,
Ryan P. Coon
Law Office of Cole & Gilday, P.C.
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On 7/14/2021 9:10 AM, Heather de Vrieze wrote:
>
> 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 controlled by R.C.W. §26.16.120, and remains in effect until rescinded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/
>
> ////
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> *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
>
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>
> 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*
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> *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.*
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