In re the Estate of Reynolds

Appellate Division of the Supreme Court of New York

In re the Estate of Reynolds

214 A.D.2d 944, 626 N.Y.S.2d 603, 1995 N.Y. App. Div. LEXIS 6678

CourtAppellate Division of the Supreme Court of the State of New York

DecidedApril 28, 1995

StatusPublished

This text of 214 A.D.2d 944 (In re the Estate of Reynolds) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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In re the Estate of Reynolds, 214 A.D.2d 944, 626 N.Y.S.2d 603, 1995 N.Y. App. Div. LEXIS 6678 (N.Y. Ct. App. 1995).

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Decree modified on the law and as modified affirmed without costs in accordance with the following Memorandum: The Surrogate [945]*945properly concluded that decedent, in transferring assets into an irrevocable trust and in changing the beneficiary designation on her Keough plan, did not make gifts causa mortis (see, EPTL 5-1.1 [b] [1] [A]). Objectant failed to demonstrate by clear and convincing evidence that decedent made those transfers in apprehension of impending death from a present illness (see, Matter of Kelsey, 29 AD2d 450, 456, affd 26 NY2d 792; see also, 62 NY Jur 2d, Gifts, §§ 58-62).

The Surrogate erred in concluding that the irrevocable trust was a testamentary substitute pursuant to EPTL 5-1.1 (b) (1) (E). The Surrogate held that, by retaining the right to substitute beneficiaries, decedent retained the right to dispose of the principal within the meaning of that statute. We disagree. By the terms of the trust agreement, the transfer of assets was irrevocable and only the trustees had the power, in their sole discretion, to invade the principal. Although decedent retained the right to change the beneficiary designation, she irrevocably relinquished the right to appoint either herself or her estate as a beneficiary. That distinguishes this case from Matter of DeVita (141 AD2d 46), relied upon by the Surrogate.

In any event, decedent’s right to change beneficiaries extended only until the termination of the trust, which, by the terms of the trust agreement, occurred one day prior to decedent’s death. Thus, decedent did not retain the power to change beneficiaries "at the date of [her] death”, as required by EPTL 5-1.1 (b) (1) (E) (see, Matter of Kohut, 133 AD2d 687, 688-689). Finally, we affirm the award by the Surrogate of fees to the attorneys for the estate.

All concur except Lawton, J., who dissents in part in the following Memorandum.

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Decree modified on the law and as modified affirmed without costs in accordance with the following Memorandum: The Surrogate [945]*945properly concluded that decedent, in transferring assets into an irrevocable trust and in changing the beneficiary designation on her Keough plan, did not make gifts causa mortis (see, EPTL 5-1.1 [b] [1] [A]). Objectant failed to demonstrate by clear and convincing evidence that decedent made those transfers in apprehension of impending death from a present illness (see, Matter of Kelsey, 29 AD2d 450, 456, affd 26 NY2d 792; see also, 62 NY Jur 2d, Gifts, §§ 58-62).

The Surrogate erred in concluding that the irrevocable trust was a testamentary substitute pursuant to EPTL 5-1.1 (b) (1) (E). The Surrogate held that, by retaining the right to substitute beneficiaries, decedent retained the right to dispose of the principal within the meaning of that statute. We disagree. By the terms of the trust agreement, the transfer of assets was irrevocable and only the trustees had the power, in their sole discretion, to invade the principal. Although decedent retained the right to change the beneficiary designation, she irrevocably relinquished the right to appoint either herself or her estate as a beneficiary. That distinguishes this case from Matter of DeVita (141 AD2d 46), relied upon by the Surrogate.

In any event, decedent’s right to change beneficiaries extended only until the termination of the trust, which, by the terms of the trust agreement, occurred one day prior to decedent’s death. Thus, decedent did not retain the power to change beneficiaries "at the date of [her] death”, as required by EPTL 5-1.1 (b) (1) (E) (see, Matter of Kohut, 133 AD2d 687, 688-689). Finally, we affirm the award by the Surrogate of fees to the attorneys for the estate.

All concur except Lawton, J., who dissents in part in the following Memorandum.

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214 A.D.2d 944, 626 N.Y.S.2d 603, 1995 N.Y. App. Div. LEXIS 6678, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-the-estate-of-reynolds-nyappdiv-1995.

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