Disabled Man Being Defrauded in Estate Matter

[arkitekton]

What is the name of your state (only U.S. law)? New York

Hi All,

I am a disabled man living in New York State. Disabled but well able to care for myself. I live alone. I have received SSI disability from 1996 through today.

My mom died in 2009, my dad died in 2010.

They left their estate in the form of a Revocable Trust with my sister (my only sibling) as sole Trustee. Unfortunately, they also named her the sole beneficiary. They were very clear to both of us their intent was to have her divide the estate evenly and give me my half as quickly as possible. They left close to $500,000 in various financial instruments (something it has taken me a year and a half to learn about--my sister first tried to tell me there might be only $35,000 in the estate), and a house worth roughly $220,000.

My parents were very dear people, but they were very gullible, and trusted my sister completely to divide the estate evenly. To date, 19 months after our dad died, she's given me very little. I've jumped through all the hoops she's set up, and it has become sadly clear she's going to give me as little as she can. She's also recently started saying it's likely she'll also give me only $13,000 a year from now on.

My parents named her sole Trustee and benificiary because they were misinformed by an incompetent attorney, who was unaware of things such as Special Needs Trusts. I do have a debt of $200,000 that I incurred after I became disabled, thanks to an unscrupulous attorney who took advantage of my illness. (I'm sorry if it sounds as though I'm damning all attorneys--I'm certainly not, it's just that it's necessary to note the actions of two bad ones in order to clearly tell my story.) The debt is under dispute, but my parents fear was that whatever they left me would be taken by my creditor, hence their naming my sister as sole Trustee and benificiary.

I don't intend to spend the remainder of my life at my sister's whims. She's a drinker, has abused both her children, forced the sale of many small items my parents wanted me to have and that were very precious to me, and for which she received all of a few hundred dollars; I'm willing to lose whatever pittance she might be willing to dole out to me in order to try and get my half of the estate and go and live my life. I know that's what my folks wanted.

My first question then, is, what is the standard of proof I need to meet in order to receive half of my parents' estate, particularly in the form of a payment by my sister into a Special Needs Trust immune to my creditor?

There are all kinds of supporting questions I'd like to ask, but my best guess is that the answer to the above paragraph is the best way to get started, and that it will help direct my next steps.

Thanks so much for any help anyone can give me in this matter. I'm frankly somewhat desperate, and the emotional pain of realizing my sister is not only attempting to cheat me, but that she may well have been lying to our parents even as they were dying, is difficult to cope with. It's important to me to being to take real action, and I welcome any advice. What is the name of your state (only U.S. law)?What is the name of your state (only U.S. law)?

New York

 

[anteater]

I'm sorry, but this is not fraud. And I don't see that you have any cause for action against your sister.

Your parents may have been badly advised and misinformed, but they did what they did.

The mention of $13,000 per year likely means that your sister is thinking of gift tax reporting. $13,000 per year is the amount that can be gifted to any one person without having to file a gift tax return. You could mention to her that, while she would need to report a gift in excess of that amount to the IRS, gift tax is only due when one exceeds the lifetime exclusion for reportable gifts - currently $5 million.

Of course, you are free to consult with a few attorneys to review your situation.

 

[tranquility]

They left their estate in the form of a Revocable Trust with my sister (my only sibling) as sole Trustee. Unfortunately, they also named her the sole beneficiary. They were very clear to both of us their intent was to have her divide the estate evenly and give me my half as quickly as possible. They left close to $500,000 in various financial instruments (something it has taken me a year and a half to learn about--my sister first tried to tell me there might be only $35,000 in the estate), and a house worth roughly $220,000.

With sister as sole beneficiary, the now irrevocable trust is entirely hers. She has no legal duty to divide anything.

My first question then, is, what is the standard of proof I need to meet in order to receive half of my parents' estate, particularly in the form of a payment by my sister into a Special Needs Trust immune to my creditor?

None. Only if sister agrees to disclaim 1/2 of the estate (And, that is still possible.) or gift 1/2 of the estate to the OP. "Proof" has nothing to do with it. Even if there were a videotape with the parents saying exactly what they want and why they did things they way they did and the tape was recorded by a conclave of former presidents, popes, ambassadors and quasi-celebrities who are famous because they are famous, it would not help.

I'm frankly somewhat desperate, and the emotional pain of realizing my sister is not only attempting to cheat me, but that she may well have been lying to our parents even as they were dying, is difficult to cope with.

Undue influence is the only potential cause of action I see. Even then, it would have to be attorney driven. Sister has all the money and the OP cannot present a claim without an attorney who will take it on contingency. Unless there is more than what is said here regarding undue influence, I don't see an attorney taking this.

 

[arkitekton]

Anteater, tranquility:

Thanks very much for your replies. I have some follow-up questions I hope you'll be willing to answer.

1. What would you say in the case that I did have on tape my sister, in 2009, at an hourlong meeting with our father, agreeing to administer the estate on my behalf, such that I receive half. Could I not then argue that she was named trustee on the condition that she divide the estate in half, and has failed to do so? Does that qualify as "undue influence", and "fraud", which a freeadvice.com article (quoted below) mentions as grounds to possibly overturn the estate? In other words, she committed fraud in order to obtain the trusteeship. By the way, and in case it's useful information, the backup trustee in the event anything happened to my sister is a family friend who is a State Supreme Court justice.

2. What if I also had my sister on tape, in 2010, despite our having numerous conversations in the months previous to a deposition about to be given by a creditor, instructing me to lie at that same deposition, and state that she and I had had no conversations whatever regarding the estate? I realize now she meant to protect my half of the estate from my creditor in order to steal it. Nonetheless, it seems like a clear case of suborning perjury, no?

As to another of your points, I've contacted a number of attorneys and, unfortunately, no one is interested in taking the case on a contingency.

Here is the article from freeadvice.com I mentioned, above, specifically enumerating many grounds for overturning an estate, at Trusts Contest - When Can I Contest a Trust? I'm quoting the salient paragraphs below, and bold-facing what I'm guessing are broader grounds than you described for challenging a trust:

"The usual reasons for challenging a trust are lack of mental capacity, fraud, mistake, undue influence, and duress. {The article gives the example of] Your father would have to show that your grandfather was incompetent when he made the trust, that he made a mistake, or that someone else was defrauding, influencing, or forcing him. The trust might also be overturned if it was not created properly under the laws of the state where your grandfather set it up.

"It isn’t easy to successfully challenge a trust, but because such challenges are very expensive and can eat up all the assets of a trust in legal expenses, the other beneficiaries are sometimes willing to settle the dispute to preserve the estate. A no-contest clause doesn’t stop someone from challenging a trust. It only means that if the person does challenge it and fails, he or she will receive nothing under the trust. If your father wasn’t going to receive anything under the trust anyway, a no-contest clause wouldn’t affect him at all."

Tranquility--you mention the irrelevance of "proof", though in the context of other people. Would my sister's repeated admissions over time that half the estate is mine, and that's what our parents wanted, help me by constituting a more usable form of proof?

I didn't mention it in my first post simply to try to start out with some brevity, but over the last year and a half I have taped my sister any number of times agreeing that half the estate is mine, in several cases in front of witnesses, including our family's accountant.

Also, you mention "undue influence" as the only grounds for contesting. If you care to, please let me know why you believe fraud is not also grounds to contest an estate?

While I understand that having an attorney would be a great help to me, I have caused subpoenas to be served, have written briefs in various cases, and worked with an attorney (albeit 20 years ago when I spent a semester in law school)--I'd rather not do this pro se, but are you noting that handling this without an attorney is simply impossible? I've been able to get some guidance from an attorney who works with disabled folks when I thought this was a matter of establishing a Special Needs Trust, and expect that I can continue to get occasional help on that level. Obviously not as useful as having a full-time attorney on my side, but that seems to be out of the question.

Thanks again,
ark

By the way, I have been advised to note that anything I write in this forum is strictly the proposing of hypotheticals.

 

[curb1]

What is the nature of the "debt of $200,000 that I incurred after I became disabled"? Are you suggesting that you will never have to pay that debt?

She could be doling out the $13,000/year for your own good.

 

[tranquility]

1. What would you say in the case that I did have on tape my sister, in 2009, at an hourlong meeting with our father, agreeing to administer the estate on my behalf, such that I receive half.

Wills matter. Intestate succession matters. Trusts matter. What the deceased said during his life does not. The living must follow the formalities or we have chaos in death. This is well settled law.

2. What if I also had my sister on tape, in 2010, despite our having numerous conversations in the months previous to a deposition about to be given by a creditor, instructing me to lie at that same deposition, and state that she and I had had no conversations whatever regarding the estate? I realize now she meant to protect my half of the estate from my creditor in order to steal it. Nonetheless, it seems like a clear case of suborning perjury, no?

Give it to the police. How did you testify? It doesn't seem material to me, but, who knows? It won't help you get money though.

As to another of your points, I've contacted a number of attorneys and, unfortunately, no one is interested in taking the case on a contingency.

Then, you're done. You don't have enough money to pay for an attorney and do not have the skills or ability to prove up what is, at best (And, THAT is very, very generous.), a hard case to prove. The tape is not going to be useful and, if you are not smart, will not get in at all. If you don't know why, you will never overcome the objection.

Tranquility--you mention the irrelevance of "proof", though in the context of other people. Would my sister's repeated admissions over time that half the estate is mine, and that's what our parents wanted, help me by constituting a more usable form of proof?

Proof of what? Prove the intent all you want, prove sister's "admissions" all you want; but, what is your goal?

The money passed according to the trust when the events (Probably dad's death.) enumerated in the trust occurred. The only way to fight that is to claim the trust was changed due to undue influence or that dad was not competent to make the trust.

Nothing you want to prove addresses either of those two things.

Also, you mention "undue influence" as the only grounds for contesting. If you care to, please let me know why you believe fraud is not also grounds to contest an estate?

Yes. You don't have fraud here. Period. Get it out of your mind. Any moment you think of it, reduces the chance you might have a valid argument. Fraud is more rare than you can imagine and has nothing to with your facts.

While I understand that having an attorney would be a great help to me, I have caused subpoenas to be served, have written briefs in various cases, and worked with an attorney (albeit 20 years ago when I spent a semester in law school)--I'd rather not do this pro se, but are you noting that handling this without an attorney is simply impossible?

Yes. Contesting a trust is hard. You can't seem to prove there was something untoward which should cause the trust to fail. While you make some allegations, all you have is some taped conversations. While the parol evidence rule is not strictly applicable to non-contracts, the concept is the same here. The dead can't speak for themselves. We set up the laws to speak for them, but made the process so that they have to jump through a few hoops before the law speaks for them. If the hoops are not jumped through, the law will not help.

 

[arkitekton]

What is the nature of the "debt of $200,000 that I incurred after I became disabled"? Are you suggesting that you will never have to pay that debt?

She could be doling out the $13,000/year for your own good.

It's a debt that was reduced to judgment in 2005. A business partner took the occasion of my being in hospital for six months to loot the business and leave me with the debt.

While I appreciate your charitable assumption, if my sister was behaving honorably she could, a year ago, for example, have put my half of the estate into a third-party funded Special Needs Trust. Sad to say, she's simply doing whatever she can do in order to give me as little as possible. If you need an indication, my sister forced the sale of eight boxes of trinkets, vases, and items special to my family over my objections, knowing that half of them were mine, and that I wanted to keep my half.