On January 27, 2011, a new state law began which addresses the affect of a pending divorce on Wills, intestate estates (i.e., where a person dies without a Will), and life insurance and retirement plan beneficiary designations.
Prior to this new law, in divorce proceedings, unless a party changed their Will or the court issued a divorce decree, sometimes years later, the divorcing parties could still inherit property under the other's Will. Now, under the new law, when a divorce is filed and grounds for divorce are established, but before the decree in divorce is issued by the court, a spouse is not entitled to receive any property from the estate of the other spouse. A life insurance or retirement account - IRA or 401(k) - beneficiary designation is automatically changed so that the surviving, but divorcing, spouse cannot receive the benefit. The new law provides similar protections to spousal property during divorce proceedings, even in the absence of a Will (i.e., intestate estates).
The new law also provides additional protection for people who have someone else acting on their behalf through a power of attorney. While the existing law did not allow an agent under a power of attorney to name themselves as the beneficiary of life insurance, the new law extends this prohibition to beneficiaries of retirement accounts as well. As under the existing law, there is an exception for certain family relationships. The new law, though, provides for civil liability on the part of the agent who names themselves as the beneficiary.
In addition to assisting you with estate planning documents (i.e., Wills, powers of attorney, living Wills, etc.), our estate lawyers can help you with cases where Will provisions are in dispute. We represent families in court on Will challenge cases, such as where one party claims they were wrongfully cut out of the Will, often due to fraud. Contact us today for help.
