[WSBAPT] Claiming small estate by affidavit as custodian for minor grandchild as sole heir and successor to decedent

Thu Dec 1 13:27:22 PST 2022

Very helpful, thanks!

Joshua D. McKarcher

McKarcher Law PLLC

537 6th Street

Clarkston, WA 99403

(509) 758-3345

(509) 758-3314 (fax)

josh at mckarcherlaw.com<mailto:josh at mckarcherlaw.com>

www.mckarcherlaw.com<http://www.mckarcherlaw.com/>

________________________________
From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> on behalf of Dalynne Singleton <dalynne at glgmail.com>
Sent: Thursday, December 1, 2022 7:21:52 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] Claiming small estate by affidavit as custodian for minor grandchild as sole heir and successor to decedent

I have opened a Testate (with Will) Estate and the court has appointed a custodian for assets.  See attached Petition and Order with handwritten custodian language.

This one there was a Will providing for a minor but it was not in a Trust in the Will to the minor.  This worked for me but is not directly on point for you.  Might assist in what direction to take.

Dalynne Singleton

Gourley Law Group

Snohomish Escrow

The Exchange Connection

1002 10th Street / PO Box 1091

Snohomish, WA 98291

360.568.5065

360.568.1717  fax

dalynne at glgmail.com<mailto:dalynne at glgmail.com>

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From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Joshua McKarcher
Sent: Wednesday, November 30, 2022 1:33 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] Claiming small estate by affidavit as custodian for minor grandchild as sole heir and successor to decedent

Fellow Listmates,

The most excellent and generous Eric Nelsen and I have emailed separately the past week trying to connect the dots in the statutes to permit the person with priority of appointment as PR for a decedent who leaves a single minor child as sole heir to sign a small estate affidavit to collect the small estate’s assets as custodian.

No luck.

We also cannot find a way for the person, even if appointed ex parte as Administrator, to appoint himself or herself as custodian without court approval. (Please note that I am carefully not using the words guardian or conservator. I’m focused on two or three distinct assets, not all assets the minor may have, as I “think” a conservatorship would be aimed at.)

If you’re even still reading this, and if you’ve encountered the need for a custodian appointment where one was not named by the grantor/owner of the asset, I would be so grateful if you know whether there is any reason a petition for appointment of an administrator in intestacy could not ALSO cite the relevant statutes in RCW 11.114 to request court approval of the custodian simultaneously with appointment of the Administrator. (I’m assuming it may require notice, but I am hoping a judge could make the appointment without the requirement of a GAL appointment and multiple hearings and all of that if the facts appeared straightforward. What the heck else is UTMA for, right?)

Alternatively, if you have sought court approval for appointment of a custodian under UTMA – vs. what I will call a “full blown” conservatorship or guardianship – I would be super grateful for a model or template or whatever experience you have and can share briefly.

Unless my colleague and I are missing it, we don’t see anything in the WSBA Probate Handbook (or whatever it’s properly called in long form). ??

Thanks everyone! Best, Josh

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 Eric Nelsen
Sent: Wednesday, November 23, 2022 3:10 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Claiming small estate by affidavit as custodian for minor grandchild as sole heir and successor to decedent

Josh—I just spent 45 minutes reading and re-reading the statutes, and I think I ended up recapitulating some of the research you must have already done. I don’t think that the small estate affidavit can be signed by a grandparent. The minor is the only person who qualifies as a “successor” under RCW 11.62.005(2)<https://nam04.safelinks.protection.outlook.com/?url=https%3A%2F%2Fapp.leg.wa.gov%2FRCW%2Fdefault.aspx%3Fcite%3D11.62%26full%3Dtrue%2311.62.005&data=05%7C01%7Cdalynne%40glgmail.com%7C0e9dfaf6014e49cbfe0908dad31b09ae%7Cebbf337fee3b4dd681791c2ed72652b1%7C0%7C0%7C638054410347265933%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=6%2F5WGrbp%2B22pH7voae0TmqWrWet7PBFHdSZuLEK5xJY%3D&reserved=0>, and the definition can’t be stretched to include anyone else, except a person with already-legally-confirmed authority to receive the minor’s property. I think.

I don’t think you can bootstrap a UTMA custodian by having an obligor say “I’m designating this grandparent as UTMA custodian of the property I owe to the minor” and at the same time “I as obligor can accept this small-estate affidavit from the grandparent because they’re a UTMA custodian for the property I owe to the minor.” The logic is circular: each act is the precedent for the other, so neither of them can logically occur first without the other having occurred before it.

In any event, even if it worked in theory, I bet the life insurance company will want a court order of some kind. Even if the heir’s mother applied to them for the funds—she is the natural guardian—in my experience life insurance companies require commencement of a minor guardianship. I’ve never had an insurance company accept a UTMA designation, even for a $25,000 policy split between two minors.

Hypothetically I think that an insurance company could designate a UTMA custodian under RCW 11.114.070(3)<https://nam04.safelinks.protection.outlook.com/?url=https%3A%2F%2Fapp.leg.wa.gov%2FRCW%2Fdefault.aspx%3Fcite%3D11.114%26full%3Dtrue%2311.114.060&data=05%7C01%7Cdalynne%40glgmail.com%7C0e9dfaf6014e49cbfe0908dad31b09ae%7Cebbf337fee3b4dd681791c2ed72652b1%7C0%7C0%7C638054410347265933%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=VTkpCzp3df0aYlxvRXsN%2FGHTrTfGN7urL1QwP9YDwew%3D&reserved=0> if the amount going to the minor is less than $30,000. But I doubt the company would take on the risk designating a UTMA custodian themselves, even if the statute allows it. Easier and less risky for them to force the family to pay the expense of a guardianship.

As for the car and the cash, I think it’s the same issue for whomever has possession of those assets. How do they obtain the protection from liability under the small estate affidavit process? Only by having the successor sign the affidavit—but the only proper successor is the minor or a legally designated representative. Does the mother’s natural guardian status include that authority? I don’t think it does, though I haven’t researched it.

I think you are correct, that this one of those things that “works if the obligor allows it to work and hands over the asset” but “doesn’t work and you have zero leverage if the obligor declines.” A bare-bones minor guardianship might be simplest. I think that’s more streamlined now under the new statutes?

Sincerely,

Eric

Eric C. Nelsen

Sayre Law Offices, PLLC

1417 31st Ave South

Seattle WA 98144-3909

206-625-0092

eric at sayrelawoffices.com<mailto:eric at sayrelawoffices.com>

Covid-19 Update - All attorneys are working remotely during regular business hours and are available via email and by phone. Videoconferencing also is available. Signing of estate planning documents can be completed and will be handled on a case-by-case basis. Please direct mail and deliveries to the Seattle office.

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 Joshua McKarcher
Sent: Wednesday, November 23, 2022 12:52 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: [WSBAPT] Claiming small estate by affidavit as custodian for minor grandchild as sole heir and successor to decedent

I would be grateful for your knowledge if you know whether a qualified custodian under our state’s UTMA can permissibly collect a decedent’s personal property by a small estate affidavit as “successor” on behalf of the decedent’s sole heir, a minor child.

My clients’ adult son died, leaving no surviving spouse, one 11-year-old son, and individual items of personal property. Each item is worth less than $30,000, and all items together are worth less than $100,000 collectively.

Clients get along very well with minor grandchild and his surviving mother (who was never married to the decedent, to be clear).

I have very little experience with small estate affidavits and custodianships, but I believed (hoped?) these grandparents (or one of them) could sign a small estate affidavit as the decedent’s parents (having priority of appointment as PR) and as qualified custodians for their grandchild under Washington’s UTMA. I intended to have them open a custodial bank account at the same bank holding decedent’s funds (where they bank as well), and to deposit the proceeds of life insurance, a car, and a small amount of cash into the custodial account. Voila! (Rather, voila?)

If I am reading UTMA correctly, I “think” each obligor can, without court appointment of the grandparent, turn over each individual asset to the grandparents as custodians so long as each is under $30,000 in value . . . if they can also sign a small estate affidavit on behalf of the minor child “successor.”

So, I “think” the relevant issue is: is it permissible to modify the small estate affidavit so that the grandparent is signing it as custodian for the minor child as sole heir and successor to decedent and only with respect to individual assets not exceeding $30,000 in value?

Or is this one of those things that “works if the obligor allows it to work and hands over the asset” but “doesn’t work and you have zero leverage if the obligor declines”?

Have I happened upon a fact pattern that requires court appointment of the grandparent as Administrator of the decedent’s intestate estate, despite the seeming necessity or justification for incurring that cost?

Happy Thanksgiving? ?? (No, really: Happy Thanksgiving!!)

Thanks, Josh

Joshua D. McKarcher

McKarcher Law PLLC

537 6th Street

Clarkston, WA 99403

(509) 758-3345

(509) 758-3314 (fax)

josh at mckarcherlaw.com<mailto:josh at mckarcherlaw.com>

www.mckarcherlaw.com<https://nam04.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.mckarcherlaw.com%2F&data=05%7C01%7Cdalynne%40glgmail.com%7C0e9dfaf6014e49cbfe0908dad31b09ae%7Cebbf337fee3b4dd681791c2ed72652b1%7C0%7C0%7C638054410347265933%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=UFXx5iyMEPVrvtLQASrhm%2F48yUrHzEPo1Sh9I6AqP%2Fc%3D&reserved=0>

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