Estate Drama | Intestacy & Stepchildren

Estate Drama | Intestacy & Stepchildren

• April 11, 2022 - Estate Litigation, Trust Litigation,

I’m Mike Hackard with Hackard Law. We litigate California estate, trust, and elder financial abuse cases.

Our cases enfold classic human dramas. Dislocation from families.  Lives changed. Secrets revealed. Chaos.

Stepfamilies present particular dramas. Intestacy and stepchildren issues are one of them.

The characters and events depicted in this story are entirely fictional. The referenced law is real.

Ron and Sandy met in 2005. Ron had never been married. Sandy had been married. She and her first husband had three children. The first marriage ended soon after the third child was born.

Ron and Sandy married in 2006. They had little in the way of separate property. They worked hard and secured high paying Silicon Valley jobs. They bought their first house in Palo Alto in 2008.

Their marriage thrived and their community property grew. They never did any estate planning. Unfortunately, Sandy died in 2014. They owned their house in Palo Alto at the time she died.

It was community property.

Ron hired an attorney to have the property put into his name alone. This is entirely consistent with community property laws.

Ron and Sandy also had a joint account at Wells Fargo at Sandy’s death. The account had $1,000,000 in it. It, like the house, went into Ron’s name alone.

Ron never remarried. He continued to work, live in the house, and kept the Wells Fargo account intact. He did not have an estate plan prepared.

When Ron died of COVID in late 2021, he died without a will or trust. It’s said that when you don’t have an estate plan, the government has one for you. This is true in Ron’s case.

Ron’s only living relative, his sister Robin, opened an estate and was appointed as the administrator of the estate. Ron’s three stepchildren, Sam, Tom, and Elaine contacted Robin and asked for half of Ron’s estate assets.

The house and bank account that Ron inherited in 2014 had been Ron and Sandy’s community property. The house and bank account are still intact. The house is now worth $4,000,000.

Robin, administrator of Ron’s estate, denies the stepchildren’s claim. The stepchildren contact Hackard Law. They ask if we’ll take this case on a contingency fee basis. They indicate that they do not have the resources to hire a lawyer by the hour. Hackard Law agrees to represent them.

Contingency fee contracts are only payable if is a sum is recovered from the client from someone else. California law has other requirements that must be met. They are met.

We file a lawsuit on the stepchildren’s behalf against Robin, the estate administrator. The lawsuit is based on the California statutory framework that identifies the circumstances where stepchildren may inherit assets from a stepparent through intestacy. The law provides, under certain circumstances, where a decedent had a predeceased spouse and the decedent passed away with no issue of his own or a surviving spouse at the time of his death, the children of that predeceased spouse may have priority to inherit a portion of the decedent’s estate to which they would not otherwise have been entitled.

The law differentiates between rights to real property and personal property. Ron’s estate is made up of the Palo Alto real property and the Wells Fargo Bank personal property.

Sam, Tom, and Elaine, Ron’s stepchildren, are entitled to “the portion of the decedent’s estate attributable to the decedent’s predeceased spouse (Sam, Tom, and Elaine’s mom, Sandy). This is so because Ron passed away 7 years (the law says “not more than 15 years”) after Sandy (the predeceased spouse) passed away.

Ron’s stepchildren are entitled to one-half ownership of the Palo Alto house, which is attributable to their mother, Sandy’s community property interest. Ron’s sister, Robin, is entitled to the other one-half community property interest.

Ron’s estate’s $1,000,000 personal property is treated differently. Stepchildren do receive intestate priority in the distribution of a decedent’s personal property (including cash assets), but only when the decedent and predeceased spouse died not more than five years apart. Sandy and Ron died seven years apart.

Sandy’s biological children (Ron’s stepchildren) are not entitled to any interest in the cash. Robin, Ron’s sister, inherits the $1,000,000 cash.

I stated earlier that the characters and events depicted here are entirely fictional. They are. The circumstances described are common enough. They do happen. And when they do – California law has a way to address them.

If you have an estate or trust case that you’d like to discuss with us, call us at Hackard Law: 916- 313-3030. We’ll be happy to talk with you.

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