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Expressions of Intent: Admissible but Insufficient

Dad holds family meeting before he dies, and says he wants everything to go equally to his six children. He specifically indicates that this includes all assets controlled by beneficiary designation.  His will likewise provides for equal division.  But when he dies, the beneficiary on one IRA is to one of his children, individually.

The other children go to great lengths to show that there were defects in the way the financial institution tracked the paperwork associated with the beneficiary designation on this IRA, which defects, they claim, opens to the door to extrinsic evidence and ambiguity. But their case falls short, particularly because the financial advisor who managed the accounts testified that he had a conversation with the decedent when the account needed to be updated, and the decedent reaffirmed that he wanted to retain the single child as beneficiary.

The case, In re Estate of William Patrick McNeight (click on the name to read the case), offers a good discussion of admissible evidence of intent [hearsay exception 803(3)]; as well as the difference between a contest over a joint account (in which there is merely a presumption of ownership in the survivor) versus a beneficiary designation (which is conclusive subject to being set aside by evidence sufficient to invoke a legal or equitable theory for relief). The case is unpublished.

The trial court decided the case on summary disposition, which was affirmed by a majority of the COA panel. The dissenting COA judge writes that, in light of the amount of paperwork, the number of accounts held by the institution, and the institution’s seemingly imperfect ability to track their own forms, the case should not have been disposed of on summary disposition.  To read the dissent, click here.

A lot of potential litigation matters start with the proposition that: “Our parents always said everything would be divided equally.”  The Appellants in this case did a good job trying to make something of these statements.  But in the end, as with most such matters, that expression simply isn’t enough to overcome a written testamentary document that indicates otherwise.