[WSBAPT] TOD Beneficiary Designation Signed but not Mailed

Fri Sep 9 08:34:40 PDT 2022

I think Joshua’s analysis is spot on.  With that said, I feel like I am recalling some case law where life insurance (which is not code driven like Qualified Plans) was paid to the named beneficiary without delivery.  Any chance they’d go for the King Solomon approach and save time and fees?

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 <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Joshua McKarcher
Sent: Thursday, September 8, 2022 7:28 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] TOD Beneficiary Designation Signed but not Mailed

I have encountered something similar, without the fact of a medallion guaranty (which strikes me as odd if it wasn’t a current asset transfer request but a mere death designation, but so be it). The phrasing "Transfer Request for a TOD beneficiary designation of a stock" strikes me as odd, but I'll assume you mean it was some form NOT intended to transfer ownership contemporaneously but indeed only at death.

In my case, without delivery of the IRA beneficiary designation form to the financial institution, there was nothing to be done. Admittedly, California law technically applied, not Washington, but I’m not sure there is a 50-state survey out there on this particular issue that would modify the analysis by state.

(If it was intended as a lifetime transfer of stock, not a death designation, then a different contractual provision or set of laws would apply. But I'd be surprised if the outcome was any different without delivery.)

Now, if the institution was the same as the one that provided the medallion stamp guaranty, maybe you’d have some kind of delivery argument, but even then I seriously doubt it. Because the whole point is that one must follow the institution’s reasonable requirements in order for the contractual right (to designate a death beneficiary, or to effectuate a lifetime ownership transfer) to have any force. (Also, I’ve never heard of a medallion stamp guaranty by an institution for its own forms, but who knows? I've probably posited an absurdity anyhow.)

The paper is irrelevant, I would think. He was entitled to change his mind until he placed it in the mail (or faxed or emailed it, or whatever) to achieve delivery.

I think the law assumes (or, more precisely, does not disallow the institution to conclude) that he did not complete the steps required to make a valid beneficiary designation (or lifetime transfer).

It’s hard to fathom a probate court ordering payment to the purported beneficiary, short of some bizarre interference or fraud on someone’s part to prevent the decedent from delivering the designation. But even then the proceeds would be payable to the estate and recovery would be on a legal theory other than “the designation is valid.”

But that is all worth nothing much if I'm ignorant of some Washington rule of law that changes the outcome. If someone knows of some such rule, I will be as excited as the designated beneficiary (but for different reasons 😉) to read of it.

All the best, 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<http://www.mckarcherlaw.com>
________________________________
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 Neli Espe, J.D. - Olympic Legal <neli at olympiclegal.com<mailto:neli at olympiclegal.com>>
Sent: Thursday, September 8, 2022 5:50:09 PM
To: wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com> <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: [WSBAPT] TOD Beneficiary Designation Signed but not Mailed

Dear List-mates,

Prior to his passing, PNC signs a Transfer Request for a TOD beneficiary designation of a stock with all formalities of Medallion guaranty and family members watch him do this.
PNC is fully competent, but elderly, so the  beneficiary designation form does not get mailed.

In the current probate, if the TOD beneficiary designation is valid, the asset goes to A, but if not, asset will be distributed to B under a clause in the Will. A TEDRA agreement is unlikely as both A and B wish to receive the asset. The PR (with non-intervention powers) plans to seek direction from the court.

Has anyone dealt with this type of situation? If so, would you be willing to help with a few pointers or cases?

Kind regards,

Neli

___________________________________
   Neli Espe, J.D., Olympic Legal
                360.630.3635
2114 Commercial Ave., Anacortes
            olympiclegal.com<http://olympiclegal.com/>
     Estate & Business Planning
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/wsbapt/attachments/20220909/87b14033/attachment.html>