Problems With Intestacy

by Jackie Bedard on March 31, 2009

in Estate Planning,Intestacy

In the previous post, What Happens If I Die Without A Will?, I discussed North Carolina intestacy law and who would receive your property if you were to die without a will.  The following are some of the many reasons why the intestacy distribution scheme may not fit your needs:

1.If you have minor children, the intestacy laws do not provide a means of appointing a guardian to care for your children.

When it comes to your children, I’m sure you take precautions as to who cares for them.  You ask around for recommendations of a reputable babysitter.  You research their school districts, teachers, coaches, etc.  So why would you want to leave it to the courts to decide who cares for your children after your death?

2.  If you have minor children, it is not recommended that you leave property to your children outright.

Under North Carolina law, children are not allowed to own property.  As such, if property passes to a child directly, either under a will or under the intestacy laws, the courts will appoint someone to manage the property on behalf of your child.  This process can be time consuming, frustrating and costly.  The person appointed must file an annual accounting each year reporting (to the penny) all money into and out of the children’s accounts.  While this might seem like a reasonable protection, the result is that it often binds the hands of a surviving spouse or guardian that is caring for the children, for example, making it difficult to handle such day to day responsibilities such as paying mortgage, utilities, educational expenses, etc.  It is instead recommended that you include a trust for minors in your will or have a separate trust agreement to provide for the management of the children’s property.  Such a document can be drafted to protect your children while still allowing flexibility to the surviving spouse or guardian.

3. Problems can arise in blended families.

In families with step-parents or step-children, certain family members that you do or do not want to be included may not receive the treatment you would like.  For example, if you are a step-parent that would like some of your property to pass to your step-children but you have not legally adopted the step-children, the step-children will not receive anything via intestacy.

4. Couples without children typically want their spouse to receive everything.

In my experience, most married clients without children want to leave everything to their spouse.  However, under the intestacy laws, their parents would actually receive a substantial share of their possessions.

5.  Unmarried persons may not want to leave everything to their parents.

Again, in many instances, unmarried persons would instead prefer to leave assets to their siblings, nieces and nephews, or a charity.

6.  The intestacy distribution scheme does not include charitable gifts.

Many clients, even if it is only a small amount, like to leave a gift to charity.  The intestacy distribution scheme does not allow for such.

7.  Heirlooms and sentimental possessions may be sold.

Often people have special family heirlooms, family vacation homes or other sentimental possessions, that they want to ensure remain in the family and are not sold upon their death.  If the property passes through intestacy, there is a greater likelihood that such property may be sold.  Having a valid will can ensure property treatment of such sentimental property.

8.  Equal may not be “fair.”

The intestacy statutes lean towards equal division of property to those within the same generation.   For example, equal division among parents if you property passes to your parents, or equal division among children if your property passes to your children.  The reality, for many, is that an equal distribution may not be a “fair” distribution.  For example, parents with adult children often use wills to leave unequal amounts to their children due to particular circumstances.  The parents may choose an unequal distribution because during lifetime they spent disproportionally more money putting one child through graduate school.  Another common reason is that one child may have stayed close to home and taken on the caretaker role as the parents aged.

9.  Special circumstances will not be factored in.

There are many, many reasons why intestacy will not fit most people’s wishes.  Intestacy statutes are drafted with a “one size fits all” mindset, and just like one size fits all T-shirts, the intestacy laws often end up fitting very few people properly.  The laws cannot take into account each person’s particular circumstances, so special situations will not be adequately resolved under the intestacy laws.  Such special circumstances might include the need to provide for a special needs child, a pet, a business ownership interest, a close friend, charity, and so on.

{ 4 comments… read them below or add one }

Angela Deck March 9, 2011 at 5:38 pm

I reside in Lee Co. We recently lost our uncle. He has three daughters that he leaves behind. My question is that he was an heir to an estate that has not yet been settled. My grandfather died without a will as many people of his generation did. My grandmother is now fearful that the girls may try to force settlement of the estate. My grandmother understands that she is entitled to a portion of the estate and land. This is her home where she has lived for 60+ years and she does not want people living on the 100+ acre farm with her that she does not know and does not want to give up anything that she and my grandfather worked hard to accumulate. She understands that when she passes it will be divided and she is okay with that. She just doesnt want it to happen before she passes. How does this work? What is necessary to make the family settle this estate?

Jackie Bedard March 10, 2011 at 9:32 am

Angela, I’m afraid there are a lot of moving parts to your question. The rights of heirs depend upon various factors such as whether property was owned individually or as joint owners with rights of survivorship. If your uncle has a claim for part of your grandfather’s estate, then they may not be able to complete the probate of your uncle’s estate until your grandfather’s probate is complete. I would strongly recommend that your family consult with a probate attorney in your area to obtain more specific advice.

Mary February 29, 2012 at 12:55 pm

My counsin recently died intestate. She is divorced, has no children, and her parents are deceased. There is one surviving uncle related by blood (her mother’s brother). There are two aunts related by marriage. There are many counsins who are descendants of her aunts and uncles? We’re trying to decide who is most appropriate to “step up” to handle probate. In degrees of kinship, would the blood related uncle be the correct person?

Jackie Bedard March 1, 2012 at 4:34 pm

Mary, my sympathies to you and your family. Based on the situation that you described, it sounds as if the uncle is probably the best person to step forward. The order of priority for selecting the personal representative (i.e., the person that will step up to handle probate), is set out in NCGS Section 28A, Article 4: http://www.ncga.state.nc.us/EnactedLegislation/Statutes/PDF/ByArticle/Chapter_28A/Article_4.pdf

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