Pre-Marital Will Statute Misapplied Where Factual Record Deemed Incomplete

In re Estate of Mark A. Rayner, Docket No. A-2619-20 (N.J. Super. App. Div. Nov. 9, 2023)

This matter concerns a will contest between Carol Petty, the decedent’s sister, and Colleen Kelly-Rayner, the decedent’s widow.  Carol appealed three orders entered by the trial court: (1) granting summary judgment in favor of Colleen that awarded her the intestate estate, under the Pre-Marital Will Statute (N.J.S.A. § 3B:5-15), and appointed Colleen as administrator of her late husband’s estate; (2) finding the Omitted Children Statute (N.J.S.A. § 3B:5-16) applicable to the decedent’s two after-adopted children if Colleen were not the surviving spouse under Pre-Marital Statute; and (3) denying Carol her application for counsel fees and costs.

Notably, the first two rulings barred Carol from recovering from her late brother’s estate under either statute.  Instead, Colleen was awarded the decedent’s entire intestate estate and appointed administrator of the estate.

The appellate court reversed the three orders and remanded with instruction that the trial court hold a plenary hearing.  In particular, the Appellate Division reversed the summary judgment, finding that genuine issues of material fact existed which precluded the entry of summary judgment as a matter of law under R. 4:46-2(c).

The facts of the case were complex. On January 31, 1989, the decedent executed the subject will (“1989 Will”).  Carol was named as the executor and sole heir of her brother’s estate.  She was the decedent’s only living relative at the time.

In 2004, Carol and her brother had relationship problems which lasted to around 2014. Their disagreement concerned distribution of monies from a relative’s estate.  Litigation was threatened by the decedent against Carol but was ultimately avoided when Carol conveyed a rental property to the decedent. While the two reconciled on the inheritance issue, difficulties arose between them later stemming from the decedent’s alcoholism.

In 2007, the decedent married Colleen.  They had met in 2003. Colleen and the decedent lived together at the decedent’s Farmingdale home, which was purchased by the decedent prior to the marriage and was titled solely in his name.

In September 2009, Colleen and the decedent adopted a set of twins with special needs.

The decedent never updated his 1989 Will.

Between 2014 and 2019, the decedent sent a series of messages regarding his estate plan, many of which were contradictory. Some examples including the following:

  • In 2014, in at least one message, he indicated that it was his intention to divide his estate between his sister and wife.
  • In or about February 2015, after serious marital issues arose and Colleen had moved out of the Farmingdale home, the decedent wrote to Carol: “I think [Colleen] is still pissed because she is not in my will, no[ne] of them are. I believe the Rayner money stays with the Rayners.”
  • In June 2015, the decedent named Colleen and his two children as beneficiaries on his employer provided life insurance policy and Colleen was named as the sole beneficiary of his 401(k) plan.
  • In 2017, after Colleen and the decedent reconciled their marital differences and dismissed a pending divorce complaint, the decedent emailed Colleen: “I love you Colleen and our wonderful children . . . . They will be [heirs] to my estate. My kids will always be protected.”
  • In 2019, the decedent emailed his sister, stating, “If anything happens to me you must come home and handle the Ranyer estate. [One] million dollars at your fingertips.”
  • In May 2019, one month before the decedent’s death, he entered into a written agreement with Colleen, which memorialized that they were living separate and apart.

The decedent died on June 3, 2019.

Colleen filed a caveat objecting to the probate of the decedent’s 1989 Will and for relief under the Pre-Marital Will Statute.

In response, Carol filed a verified complaint seeking to vacate Colleen’s caveat, declare the Pre-Marital Will Statute and elective share under N.J.S.A. § 3B:8-1 inapplicable, appoint Carol as executor.  Carol also sought counsel fees.  Colleen, in turn, filed a verified answer and counterclaim seeking, among other relief, her intestate share under the Pre-Marital Will Statute.

As to the assets at stake, following the decedent’s death Carol received approximately $175,314.00 in non-probate assets from the decedent’s life insurance policy and 401(k) plan. The total estimated value of the estate was disputed.  Carol maintained the estate was worth $850,000, and Colleen contended that it was worth only $350,000.  The estate was primarily comprised of real property for which the parties did not obtain any appraisals.

The appeals court agreed with Carol and found that the trial court made factual findings on critical issues on a disputed record.

The Appellate Division first analyzed the doctrine of probable intent and, ultimately, turned its attention to the third subsection of the Pre-Marital Will Statute, which provides (emphasis added): “(3) the testator provided for the spouse or domestic partner by transfer outside the will and the intent that the transfer will be in lieu of a testamentary provision is shown by the testator’s statements or is reasonably inferred from the amount of the transfer or other evidence.”  N.J.S.A. § 3B:5-15(a).

The court focused on the underlined portion of the statute quoted above and determined that the trial court did not analyze whether the terms of the decedent’s 1989 Will remained his testamentary intent throughout the remainder of his life and instead “impos[ed] a personal sense of fairness on the situation as it came to pass. It seemed unfair to the court that defendant be left without sufficient financial means to support the children.” Rayner at 27.

Therefore, the appellate court reversed and remanded the three orders of the trial court, including as to attorneys’ fees costs, with instructions to the trial court. Specifically, after analyzing the doctrine of probable intent, the Pre-Marital Will Statute, and the Omitted Children Statute, the trial judge must then determine the value of the decedent’s estate net of liabilities. After this calculation, the court was advised to compare the net value of the estate with the total amount of non-probate assets Colleen received; this calculation and analysis is a prerequisite to determining the contested issues of fact presented in this will contest.

Carol did not challenge the trial court’s finding that the Omitted Children Statute would have applied if the Pre-Marital Statute did not. The appellate court directed the trial court “to address whether the Omitted Children Statute applies under the circumstances of the case following the plenary hearing and proofs adduced at the hearing.” Id. at 30.

In sum, the Appellate Division determined the trial court “improvidently granted” summary judgment by resolving “critical factual questions on a disputed and incomplete record.” Id. at 28.