Chapter K. Other Will Substitutes

• Jurisdiction: Washington

K.OTHER WILL SUBSTITUTES

K.1. In General

A number of miscellaneous types of transaction have characteristics of a will substitute and at one time or another have been questioned or rejected because of their testamentary or quasi-testamentary nature. Some of these have been the subject of Washington case or statutory law, and some have not. Virtually all are now deemed nontestamentary by RCW 11.02.091, which covers in blanket fashion all otherwise-effective instruments that have certain testamentary aspects. Of course, the law that preceded the statutory amnesty for will substitutes is still applicable to any instrument that for any reason might not fall under the statute's broad sweep.

In In re Verbeek's Estate,⁴³⁹ the Court of Appeals stated at length the distinction between a testamentary and a nontestamentary instrument. It first listed the three essential characteristics of a testamentary instrument: (1) testamentary intent; (2) revocability during the maker's lifetime; and (3) effectiveness only at the

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maker's death, operating on property in existence at that time.⁴⁴⁰ In an inter vivos transfer, the transferor surrenders some interest or control and gives some interest to another party at the time of the transaction.⁴⁴¹ Postponement of enjoyment until the transferor's death, as by retention of a life estate in the transferor, does not prevent a transfer of a present interest,⁴⁴² as has already been observed in the case of deeds.⁴⁴³

K.2.Particular Transactions

K.2.a. Real Estate and Other Contracts

The instrument in Verbeek was a real estate contract that provided for, inter alia, continuation of the payments until, and cancellation of payments upon, the seller's death. The court determined that the instrument was nontestamentary It listed several "indicia of intent" that together could help to determine whether the transferor's intent was testamentary or nontestamentary: the instrument's name, form, manner of execution, acknowledgment, or recording; how the instrument is treated by the parties; whether it can be revoked or modified or is conditional on the transferee surviving the transferor; any prohibitions on recording before the transferor's death; and whether the transferor retains possession of the instrument until death.⁴⁴⁴ This checklist could serve as well for other such instruments, as similar factors are generally taken into account, and no one factor usually is controlling. The ultimate question is still whether a present interest is intended to be passed.⁴⁴⁵

Other contracts with some testamentary effect would be valid also if they pass a present, enforceable interest and are irrevocable without the consent of both parties.⁴⁴⁶ Thus a provision in a promissory note that it shall be discharged by the death of the obligee is not testamentary, but it is a valid and enforceable part of the contract.⁴⁴⁷ But the contract cannot control when it would be contrary to a spouse's community property rights. For example,

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a conflict between the beneficiary designation in a pension fund agreement and a community property agreement will be resolved in favor of the latter.⁴⁴⁸

K.2.b.Partnerships

The surviving member of a partnership can take the assets held in that relationship without satisfying the "express agreement" requirement of a contract to devise⁴⁴⁹ or the "high probability" standard of proof of such a contract.⁴⁵⁰ Moreover, the partnership agreement can be implied from the circumstances and conduct of the parties without the need for any direct evidence of that agreement.⁴⁵¹

K.2.c.United States Savings Bonds

United States savings bonds fall into a special category of will substitute because their survivorship provisions are largely controlled by federal law under the Supremacy Clause.⁴⁵² Therefore, state law cannot deny the right of survivorship under provisions of the bonds except for fraud or breach of trust.⁴⁵³ Whether there was fraud is decided under federal law, including the allocation of the burden of proof,⁴⁵⁴ but state law determines the nature of the property interest of the co-owners.⁴⁵⁵

The survivorship feature of savings bonds is further protected by state law, which deems the survivor of a bond co-owned with the decedent or the beneficiary of a bond payable to the beneficiary on the owner's death to be "the sole and absolute owner of the bond."⁴⁵⁶

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K.3.RCW 11.02.091

RCW 11.02.091, first enacted in 1974 (as RCW 11.02.090) and based on the Uniform Probate Code,⁴⁵⁷ attempts to eliminate the need to determine whether certain commonly used written instruments are testamentary or nontestamentary by declaring them to be nontestamentary despite provisions...