Chapter 12.9 Abatement of Assets

• Jurisdiction: Washington

§12.9 ABATEMENT OF ASSETS

Abatement determines what portion of an estate will bear the estate's liabilities; that is, from which gifts the estate will pay costs of administration, taxes, claims against the estate, enforced payments to an omitted spouse or child, and the like. Allocation of those burdens that are anticipated (the decedent's debts, costs of administration, and taxes) is usually provided for in the will, and the abatement scheme found in the statutes is always subject to revision by the terms (perhaps even the implied terms) of the will or other governing instrument. RCW 11.10.010 and .040 set forth the abatement priorities for probate and nonprobate assets, respectively, with the priorities for both being essentially identical.

(1) Probate assets

The general rule of RCW 11.10.010 requires that property abate in the following order: (1) intestate property, (2) residuary gifts, (3) general gifts, and (4) specific gifts. Within a category, property abates pro rata among the beneficiaries of the class of gift based on the value of the property the beneficiaries would have received but for the abatement. A general gift charged against any specific property or fund (e.g., "$5,000 from my checking account at First Bank") is a demonstrative gift. For abatement purposes, a demonstrative gift is treated as a specific gift to the extent of the value of the specific property or fund on which it is

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charged, and it is considered to be a general gift to the extent of any insufficiency of that property or fund.

The primacy of any abatement scheme set forth in the will is established by RCW 11.10.040(2), which further provides that if the testamentary plan or the express or implied purpose of a devise would be defeated by the order of abatement stated in the statute, then a gift may be abated in a different way so as to give effect to the testator's intent. If the subject of a gift having priority is sold or in some other fashion exhausted as part of the administration of the estate, the statutory scheme of abatement must be achieved by making adjustments, or requiring contributions, from other interests in the remaining assets.

RCW 11.10.020 and .030 deal with allocations between separate and community property. The former addressed express bequests and may not technically be an abatement provision. RCW 11.10.020 and .030 apply to marriages and registered domestic partnerships.

If a gift is to be satisfied out of a source...