Also known as: will substitute · will-substitute · will-substitutes · nonprobate transfers · will-substitute devices
Written by attorneys · grounded in primary & secondary sources — see below
Arrangements respecting property or contract rights established during the donor's life under which the right to possession or enjoyment of the property or to a contractual payment shifts outside of probate to the donee at the donor's death. The donor retains substantial lifetime rights of dominion, control, possession, or enjoyment. Common examples include revocable inter vivos trusts, life insurance beneficiary designations, payable-on-death accounts, and joint tenancies with right of survivorship.
Wesley Wells and his spouse Winston Ward held a brokerage account as joint tenants with right of survivorship. Wesley died first. The surviving spouse's interest in the account is valued immediately before Wesley's death for purposes of calculating the augmented estate in an elective-share proceeding brought by Wesley's children from a prior marriage.
After Willow West's death, her surviving spouse Warren Wu received only a small probate bequest. Warren's elective-share amount remains unsatisfied after applying the marital-property portion of the augmented estate. The personal representative therefore applies amounts in Willow's net probate estate and certain nonprobate transfers to others under Section 2-205 to satisfy the remaining balance.
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Winston Wong's elective-share claim is still unsatisfied after applying the probate estate and the first category of nonprobate transfers. The remaining nonprobate transfers, consisting of a life-insurance policy and a payable-on-death account, are therefore applied so that liability for the unsatisfied balance is apportioned among the policy beneficiary and the account payee in proportion to the value of their respective interests.
No. A will substitute need not be executed in compliance with the statutory formalities required for a will because it is established during the donor's life and shifts rights outside probate.
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Yes. Many will substitutes are included in the augmented estate for purposes of calculating the elective-share amount, and unsatisfied balances may be satisfied from nonprobate transfers to others.
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Revocable inter vivos trusts, life insurance with beneficiary designations, pension and employee-benefit accounts, payable-on-death and transfer-on-death accounts, joint tenancies with right of survivorship, and Totten trusts are recognized will substitutes.
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Yes. To the extent appropriate, will substitutes are subject to substantive restrictions on testation and to rules of construction and other rules applicable to testamentary dispositions.
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…light of settlor’s contemporaneous execution of interrelated will). As one law review commentator has noted, “[t]ransferors use will substitutes to avoid probate, not to avoid the subsidiary law of wills. The subsidiary rules are the product of centuries of legal experience in attempting to discern transferors’ wishes and suppress…