It’s Not Just Documents

It’s Not Just Documents

THOMAS D. BEGLEY, III, LLC

Attorney at Law

Frank Casagrande set up an irrevocable trust in which he was to transfer his life insurance policies.  At the time, he was married to Roberta, who was named as the beneficiary of one of his policies.  Although he established the irrevocable trust, the beneficiary designation for that policy was never changed. Subsequently, Frank divorced Roberta and married Rosemary.

After Frank died, Rosemary filed an action to have the policy reformed to conform with the property settlement agreement that Frank entered with Roberta, as well as his will and his trust.  One of Frank’s children contested this action.  Although the court enforced the agreement, the matter was brought to the Appellate Division before its final resolution, which meant lots of time and legal fees.

This case demonstrates the need to stop looking at estate planning as merely documents.  For many, substantial assets pass outside of a will, such as life insurance, annuities, retirement plans, and jointly held accounts.  One can argue that Frank should have made sure that this beneficiary designation was changed.  However, the Casagrande case is played out far too often in the administration of estates.  Professionals need to ensure that plans are properly implemented.  Clients need to ensure that they hire attorneys and advisors to do so.