Many people have heard the phrase “taking against the will” or “electing against the will.” Generally, this refers to protections in the form of an “elective share” of an “augmented estate,” created for a surviving spouse who has been disinherited. In Virginia, the concept of an “augmented estate” reflects a legislative public policy determination: disinheriting a surviving spouse is easier said than actually done, even when a predeceasing spouse makes certain transfers before death. Moreover, the augmented estate can be affected not only by the assets owned or transferred by a decedent, but also by liabilities incurred.
If a deceased spouse leaves no children from a prior marriage, a surviving spouse generally may elect to claim half of a predeceased spouse’s “augmented estate”—a statutory concept that involves a “lookback” to include certain pre-death transfers. This election overrides the predeceased spouse’s will or estate plan to the contrary. The applicable fraction is reduced to a third of the predeceased spouse’s augmented estate if there are children from a prior marriage. Sounds straightforward in the abstract, but is it in application?
In a recent case, the Virginia Supreme Court had occasion to deal with subtle distinctions in the law governing the composition of the augmented estate. The decedent disinherited her husband and their two adopted children, leaving her entire estate to her son from a prior marriage. In computing the augmented estate, two issues arose: (1) whether the husband had consented to the wife's transfer, during her lifetime, of half of certain jointly owned funds to her son from a prior marriage; and (2) whether her surviving husband was entitled to contribution for half of a joint debt. The trial court had held against the surviving husband on both counts.
The Virginia Supreme Court reversed, holding that the surviving husband had not consented to permit his wife to transfer her half of the jointly owned funds to her son. He had only consented to permit his wife to transfer these funds into her sole name, which did not “decrease the value of the decedent’s estate”—the linchpin of whether his consent did, or did not, exclude these funds from the computation of the wife’s augmented estate. The Court also held that where the husband and wife were co-makers of a promissory note, they were subject to this liability equally, and the husband was entitled to contribution from the wife’s estate for the full half of the joint obligation. The case is Tuttle v. Webb (2012).