Probate

Probate attorneys considering challenging or defending nonprobate transfers in probate litigation may want to consider the following opinion:

Gary Lewis v. Alvis Wynn, Case No.10A01-0804-CV-157

This case involved a tragic set of circumstances where a husband separated from his wife shot and killed his wife’s daughter (his step-daughter) and then himself.  Several investment accounts, either in the husband’s name or held jointly with the wife, passed to the wife outside the husband’s estate.  The personal representative of the step-daughter’s estate argued that these accounts should be used to satisfy any judgment against the husband, to the extent his estate is insufficient to do so. The trial court held that the wife’s liability would be limited to the extent the husband contributed to the accounts which were transferred to her on the husband’s death.

On appeal, the personal representative of the step-daughter’s estate argued that the trial court should have distinguished between joint accounts and P.O.D. accounts and that P.O.D. accounts should be subject to claims on the husband’s estate. This argument was based on the provisions of Indiana Code § 32-17-11-17 which identifies that a P.O.D. account belongs to the original payee during the payee’s lifetime and therefore “because the funds in P.O.D. accounts did not belong to [wife] prior to [husband]’s death, those accounts should not fall within the protection of Ind. Code § 32-17-13-2(c).”  The Court of Appeals rejected this argument.

The Court held that:  “Chapter 32-17-11 is titled 'Multiple Party Accounts,' and chapter 32-17-13 is titled 'Liability of Nonprobate Transferees for Creditor Claims and Statutory Allowances.' These two chapters are harmonized by Ind. Code § 32-17-11-21.1, which provides, 'The liability of a surviving party, P.O.D. payee, or beneficiary for creditor claims and statutory allowances is determined under IC 32-17-13.'”   Thus,“[a]lthough joint accounts and P.O.D. accounts are governed by different rules during the parties’ lifetimes, the liability of both surviving parties and P.O.D. parties is determined by chapter 32-17-13, and that chapter makes no distinction between the two.”

The opinion also addressed the issue of negligence in both the context of negligently procuring a gun for another person and negligently storing and monitoring a gun. The opinion was handed down on January 30, 2009 and a full text copy of the opinion can be found here for those that may be interested in reading this decision.