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Pretermitted Spouse in California

INTRODUCTION

The #1 reason why you should review your estate plan when you get re-married is to avoid the pretermitted spouse problem.

GENERALLY

California law, at probate code section 21610-21612, (which I will paste below for easy reference) presumes that a person wants to provide for later born children and/or later married spouses. It’s just fundamental black letter law in California and most states.  This is because the majority of people do not prepare an estate plan.  So, the California legislature jumped in with this law.  Today we will focus on the pretermitted spouses.  In a former blog post I spoke about thepretermitted child issue.

HOW IT WORKS

If a person prepares his or her last will or trust AND THEN MARRIES these laws kick in.  If this happens the new spouse is a “pretermitted spouse” and is entitled to a set percentage of the estate BY LAW. If the decedent has no kids then the spouse gets 100% of the assets. If one child the spouse gets 50%. If two or more children the spouse gets 33.3%. Basically, it works in conjunction with the laws of intestacy (i.e. a person dying with no will or trust).

IN REAL LIFE

Let’s look at a real life hypothetical.  Let’s say the decedent creates a trust in 2008. At that time he is single with two kids. Let’s say he has $145k in assets in the name of the trust. Then in 2009 he gets remarried. Let’s assume he does not amend his trust after marriage.  At the decedent’s death his wife is entitled to a statutory share of this trust.  In this case the spouse would be entitled to 1/3 and the other 2/3 would be given away by the trust.

The above assumes the trust can be found. What if the trust can not be found?  Obviously this creates a huge other issue from the standard pretermitted spouse case. First question is if the trust language can be established?  Can the drafting attorney be found? If so, even if he doesn’t have a copy of the trust he can testify from his file notes and/or recollection. That is, to help establish the terms of the trust and how the 2/3rd to the family should be distributed and who should be the trustee.

However, if the drafting attorney can not be found then the 2/3rd would be distributed by the laws of intestacy.  In this case each of the two children would receive 1/3 of the total.  So, in conclusion the spouse and each kid would each receive approximately $50,000.

CONCLUSION

If you get re-married go meet with your attorney immediately to review your estate plan!

 

 

CALIFORNIA PROBATE CODE SECTION 21610-21612

21610. Except as provided in Section 21611, if a decedent fails to
provide in a testamentary instrument for the decedent’s surviving
spouse who married the decedent after the execution of all of the
decedent’s testamentary instruments, the omitted spouse shall receive
a share in the decedent’s estate, consisting of the following
property in said estate:
(a) The one-half of the community property that belongs to the
decedent under Section 100.
(b) The one-half of the quasi-community property that belongs to
the decedent under Section 101.
(c) A share of the separate property of the decedent equal in
value to that which the spouse would have received if the decedent
had died without having executed a testamentary instrument, but in no
event is the share to be more than one-half the value of the
separate property in the estate.

 

21611. The spouse shall not receive a share of the estate under
Section 21610 if any of the following is established:
(a) The decedent’s failure to provide for the spouse in the
decedent’s testamentary instruments was intentional and that
intention appears from the testamentary instruments.
(b) The decedent provided for the spouse by transfer outside of
the estate passing by the decedent’s testamentary instruments and the
intention that the transfer be in lieu of a provision in said
instruments is shown by statements of the decedent or from the amount
of the transfer or by other evidence.
(c) The spouse made a valid agreement waiving the right to share
in the decedent’s estate.
21612. (a) Except as provided in subdivision (b), in satisfying a
share provided by this chapter:
(1) The share will first be taken from the decedent’s estate not
disposed of by will or trust, if any.
(2) If that is not sufficient, so much as may be necessary to
satisfy the share shall be taken from all beneficiaries of decedent’s
testamentary instruments in proportion to the value they may
respectively receive. The proportion of each beneficiary’s share that
may be taken pursuant to this subdivision shall be determined based
on values as of the date of the decedent’s death.
(b) If the obvious intention of the decedent in relation to some
specific gift or devise or other provision of a testamentary
instrument would be defeated by the application of subdivision (a),
the specific devise or gift or provision may be exempted from the
apportionment under subdivision (a), and a different apportionment,
consistent with the intention of the decedent, may be adopted.

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