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<font face="Times New Roman, Times, serif">I think we're missing
something -- "the asset involved in an investment account."
Assume, as is likely, that the account is with an out-of-state
online brokerage or mutual fund sponsor. The terms of the
investment entity's contractual account agreement with the account
owner provide that the entity will recognize the owner's
designated beneficiary as the new owner of the account upon proof
of death of the original owner--the decedent here. Or it may be an
IRA or an account in an employee benefit plan with comparable
beneficiary terms in the governing plan document. I fail to see
that there is a "res" in the state of Washington over which the
local court has jurisdiction. The decedent's intangible rights
under his contract with the account provider terminated upon his
death.<br>
<br>
And in this specific case, the investment entity, pursuant to its
contractual obligation, has given the beneficiary "possession and
control of the asset," either by selling the investment(s) and
distributing the proceeds to the beneficiary or by allowing the
beneficiary to open an new account with the investments
transferred to it. There is no "res" in Washington state, and the
beneficiary took no action relating to Washington state that would
support application of the long-arm statute giving a Washington
court personal jurisdiction over the beneficiary. So any suit
against the beneficiary would need to be in his/her home state,
and its courts might not agree that Washington law applies to the
beneficiary's receipt of the investment account proceeds.<br>
<br>
I note that RCW 11.02.005(13) defines "nonprobate asset" as NOT
including "</font><font face="Times New Roman, Times, serif">A
payable-on-death provision of a life insurance policy, annuity, or
other similar contract, or of an employee benefit plan." Arguably,
the legislature recognized that it lacked authority to override
the contractual terms of insurance policies, annuities and similar
contracts, and employee benefit plans. The US Contstitution
provides, at Article I, Section 10, Clause 1: "No state shall ...
pass any ... Law impairing the Obligation of Contracts". That
would seem equally applicable to a contract specifying the
pay-upon-death terms of an investment account. So I don't believe
the estate, in this case, can successfully sue the investment
entity (e.g., brokerage or mutual fund sponsor) for honoring its
contract.<br>
<br>
It's also possible that the decedent's investment was a variable
life insurance policy, or variable annuity contract, that is based
on a portfolio of stocks, bonds, and mutual funds, or was an IRA
sponsored by an insurance company and documented as an insurance
product.
(<a class="moz-txt-link-freetext" href="https://www.statefarm.com/finances/retirement-plans-iras/individual-retirement-accounts">https://www.statefarm.com/finances/retirement-plans-iras/individual-retirement-accounts</a>).<br>
<br>
Doug Schafer, in Tacoma.<br>
<br>
<br>
</font>
<div class="moz-cite-prefix">On 6/1/2023 17:05, Eric Nelsen wrote:<br>
</div>
<blockquote type="cite"
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<p class="MsoNormal">Other thoughts:<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">First: If you have an in rem judgment as to
ownership, that should be given full faith and credit in
beneficiary’s state, even if the part ordering the defendant
to disgorge the money lacked personal jurisdiction. So, how to
enforce?<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">One option, maybe a relatively easy route?
Domesticate the court’s judgment as to ownership in the
beneficiary’s state, and pursue execution of the judgment with
local counsel. No more long-arm problem; the judgment in rem
is certainly valid and entitled to full faith and credit.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">But maybe the in rem judgment by itself
isn’t directly enforceable against the individual? More
complicated but maybe necessary:<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">If the beneficiary got notice by mail of
the proceeding under .110, then they should be collaterally
estopped from contesting the court’s ruling. Just because it’s
in rem doesn’t mean they aren’t required to appear and defend
their interest.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I haven’t done this before, but I think the
Estate (or maybe the surviving spouse?) possibly could file a
separate civil action against the beneficiary, on a tort of
conversion or money had & received or something like that,
asserting ownership based on the in rem judgment, and the
beneficiary would be estopped from asserting an ownership
contrary to the judgment. A money judgment against the
beneficiary in that action would essentially duplicate the
judgment against them from the TEDRA.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I think long-arm jurisdiction is still
tricky though, under <a
href="https://app.leg.wa.gov/RCW/default.aspx?cite=4.28.185"
moz-do-not-send="true">
RCW 4.28.185</a>. If I brought the suit here, I think I’d
argue that the account was “situated” in Washington under 1(c)
and the beneficiary’s interference with it was improper. But
it could fail; filing the suit in the defendant’s state is
probably safer.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<div>
<p class="MsoNormal"><span style="mso-ligatures:none">Sincerely,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Eric<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Eric C.
Nelsen<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Sayre
Law Offices, PLLC<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">1417
31st Ave South<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Seattle
WA 98144-3909<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">206-625-0092<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none"><a
href="mailto:eric@sayrelawoffices.com"
moz-do-not-send="true"><span style="color:#0563C1">eric@sayrelawoffices.com</span></a><o:p></o:p></span></p>
</div>
<p class="MsoNormal"><o:p> </o:p></p>
<div>
<div style="border:none;border-top:solid #E1E1E1
1.0pt;padding:3.0pt 0in 0in 0in">
<p class="MsoNormal"><b><span style="mso-ligatures:none">From:</span></b><span
style="mso-ligatures:none"> Eric Nelsen
<br>
<b>Sent:</b> Thursday, June 1, 2023 4:45 PM<br>
<b>To:</b> WSBA Probate & Trust Listserv
<a class="moz-txt-link-rfc2396E" href="mailto:wsbapt@lists.wsbarppt.com"><wsbapt@lists.wsbarppt.com></a><br>
<b>Subject:</b> RE: in personum jurisdiction under TEDRA<o:p></o:p></span></p>
</div>
</div>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Arg. I don’t think this issue has been
addressed in a reported case yet, but I know I’ve had
discussions with other attorneys about it being a potential
problem in TEDRA proceedings. This might be an appealable
issue.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I think the TEDRA statutes, and especially
the notice-by-mail rules in
<a
href="https://app.leg.wa.gov/RCW/default.aspx?cite=11.96A.110"
moz-do-not-send="true">RCW 11.96A.110</a>, impliedly assume
that no more than in rem jurisdiction is necessary to resolve
a TEDRA matter. I think it
<i>could</i> be argued that .110 does not establish personal
jurisdiction over <i>
any</i> party so served, even those residing in-state, much
less out of state.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I think it’s a stretch to think that our
appellate courts would interpret .110 as a combined in-state
and long-arm statute that establishes personal jurisdiction.
Even CR 4(d)(4) allowing service by mail to create personal
jurisdiction is constrained to the circumstances where a
person could otherwise be served by publication under
<a
href="https://app.leg.wa.gov/RCW/default.aspx?cite=4.28.100"
moz-do-not-send="true">RCW 4.28.100</a>. Those are pretty
limited circumstances and the typical TEDRA matter doesn’t fit
well within them.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">But in rem jurisdiction would mean that the
Court can only redirect or reallocate assets, and can’t enter
a judgment directly against a party (other than the PR). So if
the party is entitled to a share of an estate, the court could
impose an offset against their share, but couldn’t impose a
judgment in excess of the amount they otherwise would receive
from the estate.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">That in turn implies more broadly that any
TEDRA judgment purporting to place a personal obligation on a
party lacks the necessary jurisdiction. That probably includes
attorney fees under RCW 11.96A.150.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">For this reason, when initiating a TEDRA it
might be prudent to selectively serve some parties with
service of process under
<a href="https://app.leg.wa.gov/RCW/default.aspx?cite=4.28"
moz-do-not-send="true">Ch. 4.28 RCW</a> rather than by mail
under .110.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">However—personal jurisdiction is also a
waivable defense, and I don’t see many TEDRA parties raise
jurisdictional issues in their initial filings. From
Washington Civil Procedure Deskbook (WSBA) (3d ed. 2014)
Chapter 12.6:<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal" style="margin-left:.5in">Prior to the
adoption of the civil rules, if a defendant entered a general
notice of appearance, it waived its right to assert the
defense that the court lacked jurisdiction over it.
<u>DiBernardo-Wallace v. Gullo</u>, 34 Wn.App. 362, 364, 661
P.2d 991 (1983). That is no longer the case. Defendants who
enter a general notice of appearance retain the ability to
argue that the court does not have jurisdiction over them.
<u>Id</u>. However, CR 12(h)(1) requires that this affirmative
defense be made by motion or in the answer or else it is
waived.
<u>In re Schneider</u>, 173 Wn.2d 353, 362, 268 P.2d 215
(2011). Engaging in discovery that relates to the defense will
not result in waiver.
<u>Crouch v. Friedman</u>, 51 Wn.App. 731, 735, 754 P.2d 1299
(1988). Whether engaging in discovery that does not relate to
the defense will waive the defense, even if properly asserted,
is not definitively answered by the reported cases.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<div>
<p class="MsoNormal"><span style="mso-ligatures:none">Sincerely,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Eric<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Eric C.
Nelsen<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Sayre
Law Offices, PLLC<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">1417
31st Ave South<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">Seattle
WA 98144-3909<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none">206-625-0092<o:p></o:p></span></p>
<p class="MsoNormal"><span style="mso-ligatures:none"><a
href="mailto:eric@sayrelawoffices.com"
moz-do-not-send="true" class="moz-txt-link-freetext">eric@sayrelawoffices.com</a><o:p></o:p></span></p>
</div>
<p class="MsoNormal"><o:p> </o:p></p>
<div>
<div style="border:none;border-top:solid #E1E1E1
1.0pt;padding:3.0pt 0in 0in 0in">
<p class="MsoNormal"><b><span style="mso-ligatures:none">From:</span></b><span
style="mso-ligatures:none">
<a href="mailto:wsbapt-bounces@lists.wsbarppt.com"
moz-do-not-send="true" class="moz-txt-link-freetext">wsbapt-bounces@lists.wsbarppt.com</a>
<<a href="mailto:wsbapt-bounces@lists.wsbarppt.com"
moz-do-not-send="true" class="moz-txt-link-freetext">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Shannon Jones<br>
<b>Sent:</b> Thursday, June 1, 2023 4:02 PM<br>
<b>To:</b> WSBA Probate & Trust Listserv <<a
href="mailto:wsbapt@lists.wsbarppt.com"
moz-do-not-send="true" class="moz-txt-link-freetext">wsbapt@lists.wsbarppt.com</a>><br>
<b>Subject:</b> [WSBAPT] in personum jurisdiction under
TEDRA<o:p></o:p></span></p>
</div>
</div>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Listmates, Is there no authority for in
personam jurisdiction under TEDRA of an out-of-state “party”
as defined under TEDRA but WA’s long arm statute? The asset
involved is an investment account. The deceased lived in WA.
The asset was claimed by the surviving spouse as part of the
mandated family support award with notice to a potential
beneficiary who resides outside WA. The asset was unclaimed
when the beneficiary was served with the TEDRA petition, it
was still in decedent’s name. Before the hearing, the
beneficiary took control and possession of the asset. The
court granted the family support award based on the proceeding
being “in rem,” and ordered beneficiary to return the asset to
the surviving spouse. Beneficiary continues to claim the court
had no “in personam” jurisdiction, appealing the court order.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<table class="MsoNormalTable" style="border-collapse:collapse"
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<p class="MsoNormal"><b><span
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New
Roman",serif;color:#323E4F;mso-ligatures:none">Shannon
R. Jones | Attorney
</span></b><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:#323E4F;mso-ligatures:none"><o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;color:#323E4F;mso-ligatures:none">Campbell
Barnett PLLC<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:10.0pt;font-family:"Times New
Roman",serif;color:black;mso-ligatures:none">Direct:
253.848.3515<o:p></o:p></span></p>
<p class="MsoNormal"><span
style="font-size:10.0pt;font-family:"Times New
Roman",serif;color:black;mso-ligatures:none">Office:
253.848.3513| Fax: 253.845.4941</span><span
style="font-size:12.0pt;font-family:"Times New
Roman",serif;mso-ligatures:none"><o:p></o:p></span></p>
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<p class="MsoNormal"><span
style="font-size:10.0pt;font-family:"Times New
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