Parents of Illegitimate Children in Probate (To Receive or Not to Receive Part II)

In a previous post, we discussed how illegitimacy affects the share of a child in probate. However, in some instances it’s the death of a child that raises a different issue . . . who benefits from the estate of a child? Who is entitled to serve as Personal Representative? Who can bring legal action on behalf of the child’s estate?

Determining the heirs of a young child can be a complex issue in a society of single parent homes, children being raised in foster care and blended families. First, remember that parents of a child will only inherit from the child if the child was not old enough to have a spouse or children of their own. For further information on the basics of when the parents are heirs, see our series on “Am I an Heir?” Part 1 and Part 2. In this post, we’re generally referring to the estate of a young child who has neither spouse nor children and therefore the parents are presumed to be the heirs. Many people may wonder how a young child can even have an estate (especially if they weren’t old enough to own assets) but this usually occurs when a child dies as a result of an accident and the assets in question stem from a lawsuit or insurance that pays to the estate.

South Carolina Code § 62-2-109 governs when a parent-child relationship exists for inheritance purposes. A child born out of wedlock is always the child of the mother. Absent a termination of the mother’s parental rights, the surviving mother of a deceased child is presumed to be an heir of the estate. Fathers; however, can prove more difficult.

The common law in South Carolina for many years provided that the father had no obligation to provide support of an illegitimate child. See McGlohon v. Harlan, 254 S.C. 207, 211, 174 S.E.2d 753, 755 (1970). A child is also the child of the father if: (1) the natural parents participated in a marriage ceremony, even if the attempted marriage is void; or (ii) paternity is established by adjudication. However, S.C. Code Ann. § 62-2-109(2)(ii) contains a wrinkle to paternity by adjudication. In order for the putative father to inherit from or through the child, he must have openly treated the child as his and not refused to support the child.  Further, if either or both of the parents’ parental rights have been terminated, they are not eligible to inherit from or through the child.

Often in the case of children, adjudication of paternity occurs in connection with child support or child custody proceedings in family court. A birth certificate containing the signatures of the mother and putative father creates a rebuttable presumption of paternity. S.C. Code Ann.  § 63-17-60(A)(6).

However, where the adjudication of paternity is occurring after the death of the child, a finding of paternity will require that the father did not refuse to support the child (this would include the payment of child support), as well as acknowledgement of paternity by the father during the child’s lifetime.

As a note for our legal readers, the burden of proof for these matters, whether the decedent is the putative father or the illegitimate child, is clear and convincing evidence. This can be a difficult standard to meet in the absence of DNA evidence. Frank discussion with clients is important before appearing at your hearing.

In conclusion, if you’re dealing with the death of a child (as a parent or legal counsel), it’s wise to understand the complex issues that can arise if there is a question of paternity, a termination of parental rights, an adoption or a failure to support the child. It’s wise to get a probate attorney involved early that can guide you through these issues.

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What is an “Information to Heirs and Devisees?”

In a previous post, we discussed the Personal Representative’s duty to inform by issuing the Information to Heirs and Devisees. This is a state prescribed form, 305ES. Today, we will look at this form from the recipient’s perspective.

This form is sent to both the heirs and the devisees of the decedent’s estate. The heirs are the decedent’s heirs under the intestacy statute. We discussed South Carolina’s intestacy scheme in previous posts. Devisees are those individuals named in the decedent’s Will. If you have received one of these forms, you fall into one of these groups. Receipt of this form does not guarantee you will inherit from the estate.

In some cases, the heirs and devisees overlap significantly. For example, the deceased may have a surviving spouse and children. Their Will divides the estate between the spouse and children. In this case, all the heirs are also the devisees. If the decedent died intestate, or without a Will, then there will be no devisees, and only the heirs at law will receive the form.

Again, this doesn’t necessarily mean that you will receive anything from the estate. The function of this form is to notify these groups of potential recipients that an estate has been opened and where it has been opened. It also lists the name and contact information for the appointed Personal Representative. Once you receive the form you should consider yourself on notice and take any steps necessary to protect your interest in the estate. This is not the time to “sit and wait” as many actions must be filed within six (6) months from the date the Personal Representative was appointed.

Ultimately, whether you receive anything from the estate depends not only on the terms of the Will, whether or not you are an heir or devisee, the outcome of any litigation and any creditor’s claims. If you’ve received one of these notices, it’s wise to schedule a consult with an attorney who handles these issues so you can be aware of your rights.

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Common Probate Terms | A Helpful Glossary

GLOSSARY OF COMMON TERMS IN PROBATE

 

Beneficiary– a person who has any present or future interest, vested or contingent in a trust. Also includes any person entitled to enforce a charitable trust.

 

Ceremonial marriage– also known as statutory marriages; those marriages entered in compliance with S.C. Code Ann. § 20-1-10 et seq. Ceremonial marriage requires an application for a license, a 24 hour waiting period between the application and issuance of the license, performance of a marriage ceremony by an authorized official, a lack of impediments, and consummation by cohabitation.

 

Child– any individual entitled to take as a child by intestate succession from a parent but excludes individuals who are only stepchildren, foster children, grandchildren or any other more remote descendant

 

Common-law marriage– a form of marriage where the parties did not engage in a ceremonial (or statutory) marriage, but which meets certain requirements. The existence of a common law marriage must be determined by either the Family Court or Probate Court. A common law marriage has the same rights and obligations as a ceremonial or statutory marriage. The requirements for a common law marriage are an intention evidencing an actual and mutual agreement to live publicly together as husband and wife, consummation by cohabitation, and a lack of impediments.

 

Conservator– a person appointed by a court to manage the estate of a protected person. A conservator is appointed after a formal proceeding to determine if a person is an incapacitated person, or to secure the administration of the estates of an incapacitated person or minor.

 

Devise– noun- a testamentary disposition of real or personal property; verb- to dispose of real or personal property by will

 

Devisee– any person designated to receive property in a will.

 

Elective share– the right of a surviving spouse to elect to take one third of the decedent’s probate estate, to be satisfied from all benefits provided to the spouse whether under or outside the will.

 

Executor– also known as Personal Representative.

 

Guardian ad litem– literally, “guardian for litigation”; an attorney appointed to represent the alleged incapacitated in a proceeding for appointment of incapacity and be the eyes and ears of the court.

 

Guardian– a person who has qualified as a guardian of an incapacitated person pursuant to a testamentary or court appointment. A guardian is appointed after a formal proceeding to determine if a person is an incapacitated person.

 

Heir– a person entitled under the laws of intestate succession to receive the property of the decedent.

 

Incapacitated person– a person who is impaired by reason of mental illness, mental deficiency, physical illness or disability, advanced age, chronic use of drugs, chronic intoxication, or other cause (except minority) to the extent that he lacks sufficient understanding or capacity to make or communicate responsible decisions concerning his person or property.

 

Intestate– someone who died without a valid will.

 

Issue– all of a person’s lineal descendants whether natural or adopted where a parent child relationship is determined at each generation.

 

Parent– any person who is entitled to take or would be entitled to take as a parent under the laws of intestate succession.

 

Per stirpes– a different word for the term “by representation”. By representation is a way of counting heads to find heirs. Under South Carolina’s version of by representation shares are determined at the first degree of kinship where a living person is found. One share is set aside for each living person, and one for each predeceased person who was survived by issue.

 

Personal representative- includes executor, administrator, successor personal representative, special administrator, and persons who perform substantially the same function under the law governing their status.

 

Power of attorney– a writing by a principal designating another person to act as his attorney in fact to act on their behalf. The authority of the attorney in fact to act on behalf of the principal must be set forth in the power and may relate to any act, power, duty, right or obligation which the principal has or may acquire relating to the principal or any matter, transaction, or property. The attorney in fact has a fiduciary relationship with the principal and is accountable and responsible as a fiduciary.

 

Special administrator– a personal representative appointed by the court when necessary:

  • to protect the estate prior to the appointment of a general personal representative or successor personal representative after a prior personal representative’s appointment has been terminated;
  • or a creditor of the estate to institute a proceeding regarding a claim against the estate under certain circumstances as provided in 62-3-803;
  • in a formal action, to preserve the estate prior to the appointment of a personal administrator; or
  • in a formal action, to secure proper administration of the estate (or act on behalf of the estate) where the general personal representative cannot or should not act (such as in the case of a conflict of interest).

 

Spouse– the surviving spouse under a valid ceremonial or common-law marriage.

 

Testate– dying with a valid Will.

 

Trust– a form of property ownership where legal and equitable title is split. In a trust, a trustee holds the legal title to the property for the use and enjoyment of the trust beneficiaries. A trust under the South Carolina Probate Code refers to an express trust, but not a constructive trust, resulting trust or other special types of trust specifically excluded by statute.

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Joint Bank Accounts In Probate Court

Well-intentioned family members often add a loved one to their bank accounts. There are a variety of reasons this may occur: shared expenses, planning for final expenses, long-term care concerns, or a potential for future incapacity. In many of these instances, one individual contributes most or all of the funds to the account. After death, the question then arises among family members and heirs as to whether these funds are part of the decedent’s estate or pass directly to the other person named on the account.

Here’s the typical scenario we see: Dad passed several years ago. Mom has three children but only one of them lives nearby. Mom adds the local child (Child A) on her checking and savings account so that Child A can help make sure the bills get paid, handle the account during her absence or illness and then “do the right thing” when she dies. Child B and C are aware of the arrangement but have been told by mom and Child A that this is just for convenience. At Mom’s death, Child A goes to the bank and personally claims all of the funds and declares they are hers as joint owner of the account. The funds comprise the bulk of mom’s estate which was to be divided equally. An argument and threats of litigation begin . . .

In this scenario, it is important to remember that bank accounts are ultimately governed by the account agreement with the financial institution. They should always be your first stop when trying to determine the true ownership of your accounts (when setting up this type of arrangement) or the first stop for a Personal Representative trying to determine whether or not these funds belong to the estate.

The account agreements at many financial institutions now provide that multiple owner accounts are owned as joint tenants with rights of survivorship. You may recall we previously discussed the two types of joint property ownership in South Carolina. As a quick recap, owning property as joint tenants with right of survivorship (a mouthful but a useful tool in estate planning) gives each joint owner an equal interest in the property. At the death of the first joint owner (mom in our scenario), their share belongs equally to the surviving joint owner(s) automatically (Child A). Therefore, Child B and C would not have access to these funds nor would the Probate Court have jurisdiction over them as they are a non-probate asset.

In researching this post, we reviewed the consumer account agreements at several major banks. All provided for ownership of joint accounts as joint tenants with right of survivorship as the default (or sometimes only) option. Again, this means that these assets pass directly to the other person whose name appears on the account, and are NOT an asset of the estate. The result is that accounts are opened with rights of survivorship even when that may not be the intent of the original account holder.

In addition to the account agreement, recent amendments to the South Carolina Probate Code provide a general set of rules to apply in these situations. The Probate Code’s default rule for accounts with multiple owners is also to consider them joint ownership with right of survivorship.

So what does this mean for the estate? Unfortunately, the answer is: it depends. Most likely, the account belongs to the surviving joint owner unless the designation on the account agreement indicates a different result.

If a dispute has arisen as to ownership of a decedent’s account, consultation with an experienced probate attorney may be helpful. Despite these rules, sufficient evidence of a different intent by the Decedent may be able to reverse this outcome. More importantly, we suggest our estate planning clients be aware of these rules when deciding whether or not to create joint accounts or how much funds to place in them.

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Understanding Summary Administration

Similar to a small estate, summary administration is another abbreviated process available in the probate court under certain limited situations.

For a variety of reasons, the same person wears may be both the Personal Representative as well as the only heir at law or devisee under the Will. Often this arises when a person dies with little family remaining (think only child), or, more commonly, when the first spouse dies giving the survivor everything in their Will.  After a point in the probate process, this individual may be the person both sending and receiving all notices regarding the estate.  That seems a little silly—sending a notice to yourself.

Fortunately, the Probate Code allows for a shortcut: summary administration. In summary administration, after certain requirements are met (generally notice to creditors), the Personal Representative files a document with the Court called a “closing statement” instead of the traditional closing documents. The court then waits one year and, if no claims or proceedings are pending, the Personal Representative’s appointment will terminate. This streamlined process reduces paperwork and expedites the process for sole heirs who also serve as the Personal Representative.

To qualify for summary administration, certain requirements must be met.  An experienced probate attorney can help determine if this is an option for your loved one’s estate. Please contact us with any questions or to schedule a consultation!

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Can I Sell The Property?

Personal Representatives or heirs are often anxious to sell the real property due to the expense of holding the property if it’s vacant. Here’s what you need to know before signing a listing agreement or liquidating that real estate.

If the Will gives the Personal Representative the power to sell property of the estate, the P.R. can simply market and sell the property on behalf of the estate. This is a standard power granted in most documents and should be easy to identify.  When selling the property, the P.R. should simply make sure they are entering in to an arm length’s transaction and acting in the best interest of the estate. For example, if the P.R. wished to purchase the property, it would be prudent to contact an attorney so as not to be accused of self-dealing. The P.R. should also take caution to make sure they are getting the fair market value for the property through the use of a CMA (cost market analysis) or appraisal or the employment of a qualified real estate agent.

If the decedent died without a Will (intestate) or the Will does not give the P.R. the power to sell property, then the Court’s permission must be obtained prior to seeing the property. Seeking Court permission to sell real estate involves filing a Petition which will inform the Court about the property the P.R. is seeking to sell, provide its estimated value, and explain the reason the P.R. desires to sell the property. The Personal Representative will also need to provide the Court with a copy of the deed and documentation to support the estimated value. A hearing will be set and all parties interested in the estate will be required to be given notice to attend. After a hearing, the Court will decide whether or not the P.R has permission to market the property.

If granted, the Probate Court will authorize the property to be marketed for sale on the terms set by the Court. An Order detailing the terms will be issued which should be provided to any professionals involved in the process (agents, closing attorneys, etc.) The P.R. can then accept an offer on the property for at least the minimum sale price approved by the Court.

If you are unsure if you have the power to sell, wish to sell to a party (including yourself) who has an interest in the estate, or need to file a Petition to approve a sale it’s wise to contact an attorney to handle these issues for you. Many of them will hold their expenses and can be paid from the proceeds of the sale in estates where there is no cash to cover these expenses.

Lastly, please remember that this post does not apply to property held jointly with rights of survivorship as explained in our previous posts as upon death that property belongs to the remaining owners and is no longer an asset of the estate.

 

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We Found The Will – Now What?

Many times people contact our office because a Will has been found among their deceased loved one’s belongings. A common question is what the next step is. The movie depiction of the family attorney reading the Will seldom occurs these days. Instead, the process of administering and distributing the Estate occurs through the process of probate.

Probate of a Will in South Carolina may be either an informal or a formal proceeding. Formal proceedings are subject to more court scrutiny and may be useful in certain circumstances. However, in this post, we will look at the more common informal probate process.

Probate begins by filing the Will along with an Application and certified copy of the Death Certificate with the Probate Court. The Application is a state-approved form, the 300ES. This filing is done in the county where the decedent resided prior to their death (if you are unsure, see our earlier post on this topic).  In some cases, the decedent may have property in more than one county or state. In those instances, probate still begins in the county of residence, but may also be conducted where the other property is located.

The Application provides the Probate Court information regarding the decedent, the Will, and the Personal Representative. Once the application is received and processed by the Court, the probate process has officially begun and a Personal Representative is appointed to administer the Estate.  We have discussed some of the duties of the Personal Representative in prior posts here and here.

If you have been nominated as Personal Representative in a loved one’s Will, an experienced probate attorney can help you navigate the process and ensure you perform your duties properly.

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South Carolina Senior Citizens’ Handbook

Seniors Seniors HandbookSeniorsThe South Carolina Bar Association has a wonderful publication that we use regularly for our clients called the South Carolina Senior Citizens Handbook. This free publication is a great resource for anyone 55+. It addresses topics ranging from Medicare to Reverse Mortgages to Age Discrimination. Parts III and IV of the publication specifically address our practice areas and include valuable information on Guardianships and Conservatorships as well as Estate Planning. We encourage our clients to review this publication to learn about valuable rights, benefits and issues that may effect them as seniors. Should you have any questions about these issues, we would love to provide you more information.  Seniors HandbookSeniors Handbook

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Uniform Simultaneous Death Act: Part II

In our first post on this topic, we discussed how to determine whether or not an heir or devisee survived the decedent. This post will explain how survival alters the administration and distribution in an estate. Effective January 1, 2014, the Uniform Simultaneous Death Act includes both intestate (without a will) and testate (with a will) estates. It can also now alter non-probate transfers as explained below.

In intestate estates, if the party is determined to have survived the required 120 hours after the decedent, then they will take as an heir under the intestate statute. If they have not, they loose the right to take as well as the right to file a claim for exempt property. Application in a testate estate can be a little more complicated as it can cause the spouse’s estate to loose the ability to claim both exempt property and elective share claims. However, in testate estates, the governing instrument (will, trust, etc.) can override the act such that survival by 120 hours is not required when:

  • The governing instrument contains language dealing explicitly with simultaneous deaths or deaths in a common disaster and that language is operable under the facts of the case;
  • The governing instrument expressly indicates that an individual is not required to survive an event, including the death of another individual, by any specified period or expressly requires the individual to survive the event for a specified period; but survival of the event or the specified period must be established by clear and convincing evidence;
  • The imposition of a one hundred twenty hour requirement of survival would cause a nonvested property interest or a power of appointment to be invalid under other provisions of the Code. In this situation, survival (although not by 120 hours) must be established by clear and convincing evidence;
  • The application of the 120 hour requirement to multiple governing instruments would result in an unintended failure or duplication of a disposition; Similar to above, survival of any period must be established by clear and convincing evidence;
  • The application of the 120 hour requirement would deprive an individual or the estate of an individual of an otherwise available tax exemption, deduction, exclusion, or credit, expressly including the marital deduction, resulting in the imposition of a tax upon a donor or a decedent’s estate, other person, or their estate, as the transferor of any property;
  • The application of a one hundred twenty hour requirement of survival would result in an escheat.

In addition to the application of the 120 hour rule to testate estates, it now also alters how real property held jointly with rights of survivorship passes. If it is not established by clear and convincing evidence that one of two co-owners with right of survivorship survived the other co-owner by the 120 hours, one-half of the property passes as if one had survived by at least one hundred twenty hours and one-half as if the other had survived by at least one hundred twenty hours. In other words, the right of survivorship is essentially changed to a joint tenancy where each parties ownership interest passes through their respective estate.

While the Uniform Simultaneous Death Act has new amendments, they aren’t complicated to an experienced probate attorney. If you have any questions about its application, seek out an attorney for a consultation on its application.

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Proof of Life: Understanding the Uniform Simultaneous Death Act

It’s more common than most people realize to have spouses, relatives or other beneficiaries die at the same time or in close proximity to the decedent. Sometimes this occurs due to a common accident (car, plane, etc.) while other times we see spouses simply loose the will to live upon the death of their husband or wife. In these circumstances, Personal Representatives and attorneys must refer to the Uniform Simultaneous Death Act to determine whether or not party passing after the decedent will qualify as a survivor.

January 2014 brought about substantial changes to the S. C. Probate Code. Included in these changes were significant amendments to the Uniform Simultaneous Death Act as found in §62-1-500 through §62-1-508. In order to be qualified as a survivor after January 2014, you must be able to show that the individual outlived the decedent by at least one hundred twenty (120) hours.

A certified copy of a death certificate is considered proof of the fact, place, date and time of death, and the identity of the decedent. If a death certificate has not been issued because the party is missing or presumed dead, a certified or authenticated copy of any record or report of a governmental agency is considered evidence of the status and of the dates, circumstances, and places disclosed by the record or report. If neither of these is available, the fact of death may be established by clear and convincing evidence, including circumstantial evidence. For example, a person who is absent for a continuous period of five years, during which he or she has not been heard from, and whose absence is not satisfactorily explained after diligent search or inquiry, is presumed to be dead. The death is presumed to have occurred at the end of the period unless there is sufficient evidence for determining that death occurred earlier.

The time of death can become a highly contested matter when it might substantially change the beneficiaries of the estate. A party litigating this issue should understand that although a death certificate may be considered proof of death, another party may contest its accuracy. In order to successfully do so, they too would have to meet the clear and convincing evidence standard to dispute the document.

Now that you’re armed with a better understanding of how to establish time of death, our next post will explain how the January 2014 changes have expanded its relevance to include both intestate (no last will exists) and testate (the decedent left a will) estates.

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