Married Fortunes & Beneficiary Litigation | The California Experience

Married Fortunes & Beneficiary Litigation | The California Experience

• January 27, 2022 - Estate Litigation, Trust Litigation,

I’m Mike Hackard. I’m an estate and trust beneficiary rights litigator with Hackard Law.

I became an attorney when Gerald Ford was President. Now, eight Presidents later, I’m still practicing law, and I still like it.

We represent clients in both Northern and Southern California’s largest trial courts. Our case load reflects real-world issues that Californians face.

It’s estimated that about 17% of people remarry after the first marriage ends. Stepmoms and stepdads’ relationships with their biological children and stepchildren are different. It can be challenging for a biological child to accept a second marriage. Difficulties can persist despite the good faith best efforts of all.

Some aspects of these difficulties are seen after the death of a second-marriage spouse, particularly the distribution of a decedent’s assets to children of a previous marriage. Second-marriage spouses may wish to pass on assets to their own biological children. Unfulfilled wishes, if not incorporated into estate planning, may result in disinheritance of biological children.

By most estimates, 50% to 60% of Americans don’t have a will. It’s said that if you don’t have a will, the state has one for you. California certainly does.

The assets of a deceased married person without a will are distributed according to probate law. Community property assets, assets acquired during marriage belonging to the marital estate, are distributed to the surviving spouse. Separate property estate assets are distributed one-half to the surviving spouse if the decedent died with one child, with the child entitled to the other half.

The surviving spouse only receives one-third of the decedent’s separate property assets if the decedent died with two or more children, with the children entitled to the other two-thirds. Stepchildren have no entitlement to the estate assets of a deceased stepparent.

Properties held in a trust, joint tenancy, or with a beneficiary designation are outside of a probated estate. It’s common that second-marriage couples set up revocable living trusts that fail to fully address foreseeable issues among step and biological children. The trust may become wholly or partially irrevocable at the first death.

Problems arise when parts of the trust designed to benefit the decedent’s biological children are not funded. If this happens, the biological children may be surprised to see asset distributions going solely to the stepparent’s biological children. Empowering the surviving settlor with the unfettered right to amend or revoke the couple’s trust creates predictable problems.

Trust amendments or revocations by the surviving spouse often benefit the survivor’s biological children and disinherit the survivor’s stepchildren. These circumstances raise the risk of an estate fight.

If you’re facing this situation and you want to talk with a lawyer, call us at Hackard Law: 916-313-3030. Whether you’re in LA, Sacramento, or the Bay Area, we’ll be happy to speak with you.

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