When someone dies, their legally expressed wishes take precedence over state intestacy laws. Heirs are those people who would inherit under the intestacy law, typically spouses, children, siblings, grandparents, aunts, uncles and cousins. Learn more information understanding Beneficiary and Heir Rights.
Beneficiaries are those named in the decedent’s will, trust, life insurance policy and/or financial account who are legally entitled to receive assets. They can be anyone, including long-term partners, close friends or even a charity.
Fiduciary Duty
A fiduciary is a person or entity with a legal responsibility to advocate for another party’s interests, with a high standard of care and good faith. Fiduciaries can include personal representatives (executors), trustees, and guardians.
Fiduciaries must carefully manage trust assets and estate matters with a high degree of skill, caution, and critical awareness of risk. They must also disclose all relevant information that could affect the beneficiaries’ interests.
They must act without favoring one beneficiary over another, despite the fact that they may know the parties involved or be related to them. This is why it is important for heirs and beneficiaries to seek legal counsel as soon as they suspect misconduct.
If the evidence is sufficient, an heir or beneficiary can petition to have a personal representative or trustee removed and replaced, surcharged, or even held personally liable for breach of fiduciary duty. However, it is important to understand that this type of action is only one option among many possible remedies.
Rights Under a Will
A will usually gives specific pieces of property or sums of money to family members and friends, or to institutions. The people who are given these gifts are called beneficiaries. If someone dies without a will, their assets will pass to their heirs via a process known as intestate succession.
Beneficiaries are owed many rights by their executors and trustees, including prompt distribution of their inheritance. They are also owed information about their inheritance and the progress of estate administration.
If they feel that an executor or trustee is violating their rights, they have the right to petition the court for relief. They can ask the court to remove the personal representative and assign a new one, or they can take legal action to hold the original executor or trustee accountable.
For example, if a surviving spouse or domestic partner is deprived of their separate property by the will, they can file something called a will contest to invalidate that portion of the will.
Rights Under a Trust
Being named as a beneficiary of an estate or trust is often a life changing event. It can also be complicated and, if handled improperly, it can have unfortunate consequences. Beneficiaries have the right to be kept informed about trustee business and have a duty to be provided with an accounting that includes profit, loss and distributions. They are also owed timely distributions in accordance with the trust terms and, in some instances, may be entitled to an extended or special accounting.
If beneficiaries suspect that a trustee is not performing their fiduciary duties or is in violation of the law they can take legal action to resolve the matter. Such actions are normally handled through a petition filed in probate court. Our team can help determine what kind of trust best suits your needs, draft trust deeds, amend or wind up existing trusts, advise trustees on their obligations and duties, and assist beneficiaries in exercising their rights.
Rights Under an Insurance Policy
The law governing insurance rights often plays an important role in estate-related transactions. The laws governing such transactions usually prohibit the transfer of a policy or its rights without insurer consent. Such transfers may be considered illegal, and the parties who have transferred the property or liabilities may be responsible for defending claims brought by other people and entities.
If the decedent’s property includes homestead allowance, family allowance or exempt property in addition to the assets that would pass under intestate succession, those rights have priority over all other claims against the estate. However, the requirement that a person survive the decedent for 120 hours applies only to the share of an heir who does not have a co-ownership interest such as a joint tenancy with right of survivorship or a payable-on-death account.
Estate beneficiaries also have a right to receive accountings from executors and administrators, as well as to inspect and challenge those accountings. If any party – whether another beneficiary, heir, personal representative or third party – violates an estate beneficiary’s rights, the estate beneficiary can bring a lawsuit to enforce those rights.
