Your estate plan exists to make sure that your wishes are known and fulfilled. In particular, you have a will to make sure that your family is provided for and that your assets go to the people you want to care for and believe are deserving. However, failure to keep your will up to date or not managing your assets while keeping your will in mind can cause major problems with ademption.
Ademption and Your Will
Ademption occurs when the property that the Will leaves to someone is not present in the Testator’s estate when the Testator dies. Ademption only applies to specific bequests which are particular pieces of personal or real property.
There are two types of ademption: by satisfaction or extinction. In general, only ademption by extinction is a big issue in estate planning. Ademption by satisfaction means that the property is not in the Testator’s estate because it was already intentionally transferred by the Testator to the beneficiary. It is not a problem because the Testator’s intent has already been satisfied: the beneficiary received the bequest.
Ademption by extinction means the property that the Testator wished to be transferred is not in the Testator’s estate at the time of death. This happens for many reasons. It may have been sold, transferred, substantially changed or even destroyed before the Testator’s death. If you have already sold your house but specify that it is to be left to your children, they will receive nothing under your will. An ademption by extinction represents a failure in a Testator’s estate plan. If a person cares enough to include an item or a person to be taken care of in their will, it is important that their wishes are fulfilled.
New York Anti-Ademption Statutes
There is no comprehensive New York legislation that governs ademption. However, bequests in certain situations may be protected. New York Estates, Powers and Trusts Law Section 3-4.2 provides that in a situation where the Testator has agreed to sale or disposition of specifically bequeathed property, the bequest does not adeem but the beneficiary takes subject to whatever rights were created by such agreement.
Section 3-4.3 provides for partial ademption. Partial ademption occurs when part or some of a bequeathed asset is not a part of the estate, such as if a collection has been broken up or sold. In this case, the beneficiary would still receive whatever part of the collection is in the estate.
Do Not Rely On Statute To Prevent Ademption
New York law is very scant on the subject of ademption. The best way to avoid ademption occurring in your estate is to make sure that your will is always up to date to accurately reflect the assets and property that you currently possess. You cannot leave property to a beneficiary if you do not have that property in your estate. Failure to properly plan means that your loved ones will not be taken care of as you had wished and that is something that no one wants to have happen.
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