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Tuesday, September 13, 2016

The Extreme Importance of Proper Estate Plan Maintenance

Summary: Estate planning is not a one-time task; it requires upkeep, just like your home, your yard or your vehicle. Even after you've made an estate plan, you should consider getting a plan "check-up" routinely, especially after major life events like divorce, marriage or a death in the family. Also, it is very important to take great care in storing your documents and making sure the right people have access to them in the event of your death. Experienced estate planning professionals can help you deal with these and other issues as you undertake the ongoing maintenance that is necessary to allow your plan to function as it should.   

When you undertake to deal with your "yard work," you understand that this task may entail many things, including mowing, weeding, or fertilizing, just to name a few. What's more, you also fundamentally know that you cannot just mow or weed your yard once and profess that your yard work is "finished." You'll need to revisit this chore periodically over time. Estate planning is a lot like that. Failing to recognize that your estate plan needs occasional care and maintenance can have disastrous consequences. A court case from New York provides a real-life example of just what can go wrong if you don't dot your I's and cross your T's when it comes to estate plan maintenance.

Based upon the facts reported by the New York courts, the story of the deceased person in the case, Robyn Lewis, had many tragic elements to it. She died in Syracuse, NY at the young age of 43. Unfortunately, her death marked only the beginning of a long legal process regarding her estate. 14 years before she died, Lewis was married and living in Texas. She and her then-husband made the wise decision to get estate plans. In her will, she left everything to her husband and, as an alternate beneficiary, she named her father-in-law.

In 2007, the couple divorced. Lewis and her ex-husband agreed between themselves that the husband would keep the property in Texas and Lewis would keep the upstate New York property she'd bought during the marriage, which had been in her family for many generations.

Divorce is one of those life events that should definitely make you consider the benefits of getting an estate plan "check-up". Lewis's estate planning goals were clearly different after the divorce than they were before. Getting either a new document or amending her existing one would have allowed her to enshrine these changes onto paper.

Lewis may have done just that. Her neighbor testified in court that Lewis made a new will in 2007 naming her brothers as her beneficiaries. However, when Lewis died in 2010, no one could find the will. Once you've gone to the effort not only to create a plan, but to update your plan after a major life event, it is essential to make sure that you store your documents in a safe place and let the appropriate person (or people) know how to access them after you die.

Based on the inability to locate the 2007 will, two New York courts decided that the 1996 will was still valid. Because Lewis and her husband had divorced after the will was made, New York law prevented him from inheriting under that will. However, the law had no prohibition against other ex-in-laws inheriting. This meant that, under the will, Lewis's New York property, the one that had been in her family for multiple generations, belonged to... her ex-father-in-law!

In 2015, New York's highest court sent the case back to the trial court for reconsideration. The ex-father-in-law could still prevail and receive the property. Even if he loses, Lewis's relatives will have spent many years and (presumably) much money on legal costs just to keep the property in the family. A properly updated and stored estate plan likely could have prevented much or all of these problems and this litigation. 

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com

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