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Altering the Distribution of Assets in a Probate by Private Agreement : “But I Know That’s What He Would Have Wanted”

You are the Chosen One: the nominated Personal Representative in a close friend or family member’s Will (or perhaps you are a grieving spouse or adult child whose spouse or parent passed away without a Will). Over the weeks and months following that person’s death (the Decedent), you arrive at the conclusion that there are assets titled solely in the Decedent’s name with no named beneficiaries, and in order to transfer those assets to the persons entitled to receive them (the Heirs), you have to open up a probate proceeding in the Minnesota Courts. Additionally, you find out through extensive Googling or interviewing potential probate attorneys that whatever you or the Heirs think that the Decedent “would have wanted” may not align with what their Will or Minnesota Intestacy laws require.

This article does not provide an overview of how the probate process works; I assume that if you are reading this article, you are already there. Instead, I want to highlight a provision of the Minnesota Probate Code, Minn. Stat. § 524.3-912 (Private Agreements Among Successors to Decedent Binding on Personal Representatives). Consider this a ‘quick tip’ to those Personal Representatives out there trying to understand how and whether they can change the asset distribution plan in the probate.

Examples:

  • Decedent passed away without making a Will and left two adult children surviving. He spent the last 20 years living with a partner, but they never married. Under Minnesota Intestacy laws, the two children inherit all of their father’s assets. But you as the Personal Representative know that he would have wanted his Partner to receive some of his estate and the two children agree. What do you do?
  • A beloved aunt passed away with a Will and Personal Property list. Although her Will named five adult nieces and nephews to inherit her assets in equal shares, all of those family members knew that the Aunt wanted two of those nieces to “get her house”. You, the Personal Representative, and all of the nieces and nephews want to honor the Aunt’s wishes. What do you do?
  • A man passes away without a Will. He never had any children of his own and although he ended up divorcing their mother, he loved his stepchildren dearly and continued to have a strong relationship with them and their children (who called him grandpa!) until his death. You, the Personal Representative and brother to Decedent, talked it over with your surviving five siblings and all agree that the stepchildren should inherit all of the assets of their stepfather’s estate. How do you do it? Can you do it?

Minn. Stat. § 524.3-912 provides an opportunity for Heirs to privately agree to alter the distribution plan of a Decedent and could be used to solve the distribution issues in the above examples. To successfully use this tool, the following requirements must be met:

  • The Decedent’s estate must be solvent (e.g., there are enough assets after the payment of debts and expenses to complete distributions);
  • All of the Heirs that will sign the agreement must be “competent” (e.g., adults with the capacity and understanding to sign binding legal documents);
  • All of the Heirs entitled to the asset(s) in question must agree to alter the distribution plan; and
  • The Personal Representative must be able to carry out the responsibilities with respect to any Heirs who are not parties to the agreement.

This has proven to be a very flexible tool to help Personal Representatives work together with Heirs and “Wannabe” Heirs to come to an agreement over how assets will be distributed among the Decedent’s loved ones. I have found it to effectively reduce disagreement and support family harmony, and perhaps most importantly, carry out the decedent’s wishes.

If you have questions about this tool or need legal representation to administer a probate or trust estate, please contact the author Jennifer Rutz at 952-746-2171 or [email protected].

ABOUT THE AUTHOR

Jennifer A. Rutz
Phone: 952-746-2171
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