Does Undue Influence Apply to Payable on Death Beneficiary Designations?

Many banks and credit unions give account holders the option to add a payable on death (POD) beneficiary to their checking and savings accounts. If you do this, then the account becomes a non-probate asset. This means that the beneficiary does not have to wait until the estate of the original owner of the account settles before the beneficiary gets the money. When the original owner dies, the POD beneficiary can bring the original owner’s death certificate to the bank, and the bank will officially make the beneficiary the new owner of the account. It can take a long time for an estate to settle, especially if one of the heirs, such as a disinherited family member, challenges the will and alleges that the testator signed it through undue influence from the personal representative of the estate or one of the beneficiaries of the will. Even though POD beneficiaries can gain possession of an account or its funds without the involvement of the probate court, the probate court has jurisdiction to hear claims that a deceased person listed a POD beneficiary under undue influence. For help listing POD beneficiaries on your bank accounts in ways that will not cause drama during the probate of your estate, contact a Dade City estate planning lawyer.

Probate Court Orders Eleventh Hour POD Beneficiary to Return Money to Decedent’s Estate

Aiko and her husband did not have children, so they wrote a version of an “I love you” will with their church as a beneficiary. The wills stated that, when the first spouse died, the surviving spouse would inherit the entire estate, and when the second spouse died, the church of which they were members would inherit the estate. Aiko’s husband died in 2009, and she did not modify her will, leaving the church as the sole beneficiary.

Aiko’s neighbor Pennie was Aiko’s primary caregiver after her husband’s death, and as Aiko’s health worsened and she needed more care, several of Pennie’s relatives also helped with caregiving. When Aiko was 87 years old and suffering from her final illness, she added POD beneficiaries to her credit union account, which had a balance of more than $300,000; Pennie would receive 75 percent of the money in the account, her son and daughter would receive ten percent each, and her former daughter-in-law would receive five percent. Several days later, Aiko was admitted to the hospital, and she died shortly thereafter.

The church, which had inherited all of Aiko’s other property, challenged the POD designation, alleging undue influence by Pennie. The court ordered Pennie and her relatives to return the money to Aiko’s estate. Pennie appealed the court order, claiming that probate courts could not invalidate POD beneficiary designations because POD accounts are non-probate assets. The appeals court affirmed the trial court’s ruling and Pennie’s obligation to return the money.

Contact a Florida Estate Planning Attorney About Undue Influence Outside of Probate

An estate planning attorney can help you keep your property out of probate and away from undue influencers.  Contact The Law Office of Laurie R. Chane in Dade City, Florida to discuss your case.

Source:

scholar.google.com/scholar_case?case=11243746023092901967&q=undue+influence&hl=en&as_sdt=4,10&as_ylo=2015&as_yhi=2025