Under Doctrine of Probable Intent, Court Decides Beneficiary Designation
In re Estate of DeConca, A-1876-18T1, 2020 WL 1492556 (N.J. Super. Ct. App. Div. Mar. 27, 2020).
This case highlights the need to ensure that charitable entities are correctly identified in estate planning documents.
The co-executors of the estate filed a complaint seeking direction as to which charitable organization was the intended beneficiary of the decedent’s revocable trust – the National Alzheimer’s Association (“AA”) headquartered in Chicago, Illinois or the Alzheimer’s New Jersey, Inc. (“ANJ”). After a bench trial, the trial court found that the ANJ was the intended beneficiary of trust assets.
In upholding the trial court’s decision, the Appellate Court looked to N.J.S.A. §3B:3-33.1, which delineates the doctrine of probable intent. In instances where intent of the will or trust is unclear or ambiguous, the doctrine permits the reformation in light of a decedent’s probable intent, by searching out the probable meaning intended by the words and phrases in the will. Id. at *5.
The Appellate Division held that the trial court had properly focused on the decedent’s probable intent and relied on extrinsic evidence, including evidence the decedent had named AA at a Chicago address in earlier versions of the trust, but later changed the recipient to the an Alzheimer’s organization with a Denville, New Jersey address. “In light of the documents and the settlor’s contact with the national organization, the record supports the conclusion that ambiguity existed as to which beneficiary should benefit. The judge’s decision that the designated beneficiary was probably intended to be ANJ is well supported by the evidence of the record . . . The judge took into account [the decedent’s] use of the Denville address in the trust document and for gift-giving during her life. [The decedent] was aware of the address of the headquarters of the national association in Chicago, but did not use it for either purpose after 2009.” Id. at *7-8.