In a rare venture into the world of trusts and estates and its most significant recent ruling regarding in terrorem clauses, the Court of Appeals in Matter of Singer, 2009 NY Slip Op 09265, reversed both the Surrogate’s Court and the Appellate Division, holding that a beneficiary’s conduct in deposing the testator’s former attorney regarding drafts of prior wills did not violate the in terrorem clauses in the propounded will. Specifically, the Court held that the safe harbor provisions of SCPA 1404 and EPTL 3-3.5 are not exclusive, and must be applied on a case-by-case basis. The decision has essentially set forth a two-prong analysis to determine whether a beneficiary’s conduct triggers an in terrorem clause, consisting of the following inquiries: (1) whether the conduct falls within the statutory safe harbor provisions, and if not (2) whether it violated the testator’s intent.
In Singer, the decedent had executed a last will and testament approximately one year prior to his death, in which he appointed his daughter, Vivien, as executor. He also created a corresponding revocable trust through which he bequeathed to Vivien his home, most of his tangible personal property, and the sum of $200,000. In the trust instrument, the decedent stated that Vivien’s inheritance was in recognition and gratitude for her extreme dedication and constant care. The decedent’s son, Alexander, received one-half of the remainder of the estate, to be split with Vivien, and each of Alexander’s sons was given a $15,000 bequest.
The will contained a typical, broad in terrorem clause, which stated, “if any beneficiary, shall, in any manner, directly or indirectly, contest, object to or oppose, or attempt to contest, object to or oppose the probate or validity of [the] will or revocable trust created by [the decedent], or any part of [his] estate plan, or any gifts made by [him], . . .” that beneficiary’s share of the estate would be forfeited (id. at *2). The decedent also included a second in terrorem clause that was explicitly directed at Alexander. That clause directed that Alexander “not take [decedent’s] daughter . . . to a . . . (religious court) or to any other court for any reason whatsoever . . . ,” and stated that if he did, the result would be the forfeiture of his and his sons’ inheritance (id.).
Immediately after Viven submitted the will for probate, Alexander served a notice for discovery and inspection pursuant to SCPA 1404 and Article 31 of the CPLR. He sought documents and the deposition of certain individuals, including the decedent’s previous attorney, Mr. Katz. Alexander pursued this particular deposition despite a warning from Vivien’s attorney that this examination was outside of the scope of SCPA 1404 exams and would result in a violation of the in terrorem clause.
At his examination, Mr. Katz testified that he had drafted seven prior wills for the decedent, and stated that he did not believe the decedent lacked testamentary capacity or was unduly influenced by Vivien. In light of this information, Alexander decided not to contest his father’s testamentary plan. The will was subsequently admitted to probate by a decree that explicitly stated that it had not been contested. Notwithstanding this fact, Vivien commenced a construction proceeding seeking a determination that Alexander’s deposition of Mr. Katz resulted in a violation of the in terrorem clauses, as he was the decedent’s prior attorney, not the attorney-draftsman of the propounded instrument. The Surrogate agreed, holding that the deposition of anyone aside from those specified in SCPA 1404 triggered the clauses. The Appellate Division affirmed, and further opined that the deposition of Mr. Katz was not protected by any of the safe harbor provisions in EPTL 3-3.5 or SCPA 1404.
EPTL 3-3.5 enumerates specific conduct of a beneficiary that will not trigger an in terrorem clause. Relevant to Singer is the statute’s provision that protects a beneficiary from forfeiting his or her bequest as a result of examining the following individuals (see EPTL 3-3.5[b][D]):
· The nominated executor(s) and proponent of the will
· Witnesses to the will
· The attorney-draftsman or other individual who prepared the propounded instrument
Although the statutory safe harbor provisions limit permissible depositions to the above-listed individuals, the Court of Appeals recognized that there might be circumstances that render it permissible to examine individuals outside of the foregoing parameters without an in terrorem clause violation. In so concluding, it was held that the safe harbors of EPTL 3-3.5 are not exclusive, and that if a beneficiary exceeds these parameters, a court must then inquire as to whether there has been a violation of the testator’s intent. This is an analysis that must occur on a case-by-case basis, looking to the language of the clause in issue. As always, such language must be strictly construed.
Applying this rule to the facts in Singer, the Court of Appeals noted that the language of the subject in terrorem clauses demonstrated that the decedent sought to prevent Alexander from commencing any type of court proceeding against, or attempting to contest, the estate plan. Construing the clauses narrowly, the Court held that the deposition of Mr. Katz, an attorney who had a long history of representing the decedent in connection with his testamentary plans, was simply a method of information gathering, not disputing the estate plan.
Indeed, because Alexander decided not to object to the instrument, the Court explained that the purpose of the in terrorem clauses, as well as the general public policy in favor of permitting broad investigation to allow a beneficiary to weigh the risk involved in contesting a will, was actually satisfied by the additional deposition. According to the Court, “[a] broader construction of these clauses as manifesting testator’s intent to preclude the examination of this witness would essentially cut off all other persons from being asked for information, no matter the potential value or relevance . . .” (Singer at *5).
In a concurring opinion, Judge Graffeo noted that the decision has implied that a testator may draft his will to explicitly limit the scope of permissible inquiries to the statutory safe harbor provisions. Thus, he interpreted this decision as granting further latitude to the testator to determine exactly how strict he really intends his in terrorem clause to be (id. at *5-*6).
While this case permits more relevant inquiries into an estate plan when the language of an in terrorem clause allows, it is also likely to result in many more construction proceedings at the Surrogate’s Court level. Notwithstanding this potentially inconvenient consequence, Singer is a landmark decision that implements and emphasizes the concept that testamentary intent must be the paramount consideration in any will construction proceeding.