Case Law Update: Non-Probate Assets

Under statute providing that a will provision trumps a beneficiary designation, a devisee named in a will becomes the owner of real property the testator had previously transferred to a trust.

The decedent’s will made a specific devise of his interest in a home which he had already transferred to himself as the trustee of the revocable trust he and his predeceased spouse created. The successor trustee and the devisee under the will litigated the question of title to the house and the trial court quieted title in the successor trustee. The devisee appealed.

In Manary v. Anderson, 265 P.3d 163 (Wash. Ct. App. 2011), the intermediate appellate court reversed, holding that under Washington State’s Testamentary Disposition of Non-probate Assets Act which provides that the “owner’s interest” in any non-probate asset specifically referred in a the owner’s will belongs to the will beneficiary, the interest in the house passed under the will. The statute defines “owner” as someone who has beneficial ownership of the asset during life and a non-probate asset includes property in a trust that becomes irrevocable on the death of the settlor.

Special thanks to William P. LaPiana (Rita and Joseph Solomon Professor of Wills, Trusts,and Estates, New York Law School) for bringing this case law update to my attention.