The following is a link to an article by Gary Altman titled “Don’t Forget to Audit Your Beneficiary Designations,” Click Here For The Article. I’m going to change the title – it should be “Update,” and it should apply not only for beneficiary designations but also how title to property including real property is held. Mr. Altman hits on an important and relevant issue. I am seeing this issue arise more often in litigation with how financial accounts are held, insurance beneficiary designations, and title to real property (such as joint tenancy or right of survivorship) and certain personal property.
The general rule is that (1) on death the account assets, or the insurance proceeds, or the title to the property passes or transfers to the person or persons who are designated, if the surviving person or persons take the appropriate steps to complete the asset or title transfer, and (2) the general rule applies regardless of what the decedent’s will or trust provides because asset or title transfer passes by way of the designation or how title is held not by way of what the will or trust states.
As you can imagine, very significant problems can and do occur. People forget about the account, insurance, or property designations or how title is held, or they are confused or mistaken about the legal ramifications, or they intend differently, or in some situations there might have been undue influence, fraud, duress, abuse, or other wrongdoing. This is still a developing area of law.
The good news is that depending on the facts and circumstances of the case, and with sufficient evidence of the true facts and intent, in some situations it can be possible to fix these situations and the unintended consequences. But the best course of action obviously is to update these designations and how property is held while the person is still alive and to not have to try to do so post-death through the courts and litigation or agreement of all of the parties involved.
Dave Tate, Esq., San Francisco and throughout California, civil, trust, estate, conservatorship and elder and dependent adult litigation, and contentious administrations, http://californiaestatetrust.com and http://directorofficernews.com