Wednesday, August 13, 2014
A revocable trust was created in fraud of the surviving spouse’s rights included in calculation of elective share. A year before his death, the husband executed a revocable trust, which on his death gave his wife a cash gift of $100,000. Previous wills and trusts had been much more generous to wife. The final trust was executed after the spouses separated. After the husband’s death, his wife filed with the court to take her elective share and sought to include the property in the trust in the husband’s estate solely for purposes of calculating the elective share. The trial court found in the wife’s favor and on appeal by the trustee, a divided Arkansas Supreme Court affirmed, finding that the evidence supported the lower court’s finding that the trust was created to deprive the wife of her marital property rights, that the trust property should therefore be included in calculating the elective share, and that the trust was valid in all other respects. In re Estate of Thompson, 2014 Ark. 237 (2014).
Special thanks to William LaPiana (Professor of Law, New York Law School) for bringing this case to my attention.