Wednesday, October 16, 2013
Lifetime transfers to a spouse do not satisfy the elective share. A husband spent down his and his wife’s joint resources paying for her nursing home care until she was eligible for Medicaid. The husband then executed a will disinheriting his wife. At the same time, the wife’s agent under a durable power of attorney disclaimed her elective share. After the husband’s death, a guardian ad litem was appointed for the wife who filed a motion to revoke the disclaimer. The trial court denied the motion, holding that the lifetime transfers had satisfied the elective share. The state Department of Social Services filed an application to intervene moved for reconsideration, which was denied and then appealed.
In re Estate of Shipman, 832 N.W.2d 335 (S.D. 2013), the Supreme Court of South Dakota reversed, holding that the elective share is determined by formula under state law and under that formula, lifetime transfers are not taken into account. In addition, the transfers could not satisfy the elective share because they were made to fulfill the mutual obligation of spousal support. The disclaimer was deemed revoked because if it stood, the wife was likely to be disqualified from receiving Medicaid.
Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.