Does my dad's will override POD designation?

September 10, 2009 12:11 PM

My dad's accounts are designated POD (payable on death) to me. Is that overriden by his listing of those accounts in his total assets, which his will divides among me and others, and which will is going to take some time to execute?

My dad's estate is going to be complicated and take some time -- there's several apartments which will have to be liquidated in order to execute the will, which is set up 3/12ths of total assets to me, 1/12th to 9 other people IIRC.

He did name me as POD (payable on death) on his bank accounts. My understanding is that this bypasses the probate process -- I just show up with ID and death certificate and the bank turns over the accounts.

These are checking accounts whose balance fluctuated, but are small (<1%) compared to the total estate. I could use some cash right now to keep me in cellphone service and cigarettes.

However, he included those accounts in the listing of assets attached to his will. Specifically, he had a spreadsheet printout with those accounts' balances at the time, the appraised values of apartments, IRA and money market account balances, etc. I'm not sure if he filed updated versions with his lawyers each year or whatever, but there have been different versions.

So my question is, does his listing of those accounts among his assets override the POD designation? If it does, is the asset the account itself, or whatever balance was listed with the "official" balance sheet? Would I be able to get some money now?

posted by anonymous to law & government (6 comments total)

Where are you? (Country, state or province?) It's impossible to answer this question without knowing what body of law applies.

(Perhaps you could get one of the mods to post that information for you.)
posted by Chocolate Pickle at 12:24 PM on September 10

IANYL, and this is not legal advice.

It obviously depends on the jurisdiction, and you should consult a probate lawyer in the relevant locality. But yes, it is entirely possible that a POD account can be overridden by probate law. In particular, I believe it is often the case that a surviving spouse that elects to have an "elective share" will be entitled to claim any value in the decedent's estate (which would generally include a POD account, because he had power over the funds). If you had preemptively withdrawn that money, you may have to pay it over to the electing spouse to satisfy her claim. There may be other rules in your jurisdiction of similar effect.

In some cases you can avoid this by making an inter vivos gift, but in certain jurisdictions I believe there are clawback provisions that will include in the decedent's estate certain gifts made within, say, three months prior to death.

Again, not legal advice. Consult a probate lawyer in your jurisdiction--estate/probate law is some of the most kooky and antiquated law out there and always requires experts to avoid unexpected results.
posted by Admiral Haddock at 12:42 PM on September 10

I am a retail banker, but not your retail banker. I'm not a lawyer. (Whatever I say is Maryland-centric.) The will can't override the POD by itself, but the others can contest it, which could result in a levy being put on the account. The POD can be overridden by probate law.

However, the bank has to follow the POD- it's a contract between the account owner and the bank- until they hear different from a higher authority- a judge. If the executor doesn't want you to get the money, it will be a rush to the bank. If you get the funds distrubuted to you, it's yours until they win in court, which is iffy but certainly possible.

The problem is that every bank I've ever of is going to require you to have an official copy of the death certificate to distribute the funds, but you're probably not going to get one except from the exectuor. The state generally won't just give it away, but that's not my field.

Beyond that, what Admiral Haddock.
posted by spaltavian at 1:00 PM on September 10

Also, sorry about your dad.
posted by spaltavian at 1:04 PM on September 10

IANAL.

Haddock has it - probate law is absurdly non-obvious. However, I can say that there is a significant possibility that if you use any money from these accounts on yourself, you have the possibility of being sued for it and losing. Is that a guarantee? Only a lawyer can even guess.
posted by Citrus at 1:08 PM on September 10

Yes, this can vary by state. But in most states, the POD designation prevails over the will - the will governs only property not otherwise disposed of.
posted by megatherium at 4:51 PM on September 10