Estate of Baird, Matter of
| Decision Date | 18 June 1997 |
| Docket Number | No. 63985-0,63985-0 |
| Citation | 933 P.2d 1031,131 Wn.2d 514 |
| Parties | In the Matter of the ESTATE OF Phyllis Lee BAIRD. |
| Court | Washington Supreme Court |
Keithly, Weed & Graafstra, Thom Graafstra, Cynthia First, Snohomish, Law Offices of Philip Rosellini, Philip Rosellini, Daniel Parsons, Bellingham, Chmelik & Johnson, Frank Chmelik, Richard Davis, Bellingham, Karen Boxx, Kathleen Coghan, Seattle, for Respondent.
The question presented is whether an anticipatory disclaimer of an expectancy interest in an intestate estate is valid and effective under RCW 11.86. We hold the plain language of the statute does not authorize an anticipatory disclaimer of an expectancy interest created by intestacy, and affirm the order of the probate court declaring this disclaimer invalid.
Phyllis Baird died intestate on December 29, 1994. She was survived by two children, James Thomas Baird and Julie A. Breckenridge. James Baird has two children, Jayme Baird and Hunter Baird, from his first marriage to Cheryl Kern.
During the later stages of her life, Phyllis Baird suffered from Alzheimer's disease and, as a result, was mentally incapacitated. Susan K. (Saulsbury) Baird was appointed guardian for Phyllis Baird on November 29, 1988, in a guardianship proceeding in Whatcom County.
James Baird married Susan (Saulsbury) Baird on November 10, 1992.
On February 9, 1993, James Baird brutally assaulted Susan Baird. 1 As a result of this attack, Susan Baird was permanently disfigured and suffered permanent cognitive defects preventing meaningful employment. Susan Baird filed a personal injury action against James Baird in Whatcom County Superior Court on February 26, 1993, for the injuries suffered in the assault.
James Baird was convicted of first degree assault on March 8, 1994. He received an exceptional sentence of 20 years on June 3, 1994. 2 On March 8, 1994, the same day as his conviction, James Baird executed an instrument purporting to disclaim "any and all interest" he "may have" in his mother's estate. This instrument was filed in his mother's guardianship proceeding that same day.
On October 19, 1994, Susan Baird was awarded a judgment of $2.75 million in her personal injury action against James Baird. One week later, on October 26, 1994, James Baird filed a petition for Chapter 7 bankruptcy. Susan Baird's judgment constitutes approximately 95 percent of the outstanding creditor claims in the bankruptcy proceeding.
As previously stated, Phyllis Baird died intestate on December 29, 1994. Her estate is valued in excess of $500,000. James Baird's share of his mother's estate represents approximately 60 percent of his potential assets available in the bankruptcy proceeding.
On January 26, 1996, Jayme Baird and James Degel, guardian ad litem for Hunter Baird, petitioned the probate court for an order declaring James Baird's disclaimer valid. The bankruptcy trustee opposed the petition. At the same time, Susan Baird filed a motion to intervene in the On March 25, 1996, the probate court entered orders granting Susan Baird's motion to intervene, and denying the petition to declare the disclaimer valid. Rather, the court declared the instrument invalid without explanation. Jayme and Hunter Baird appealed directly to this court.
probate proceeding. On February 14, 1996, the bankruptcy court entered an order abstaining from determining the issue of the validity of the disclaimer pending the resolution of this same issue in the probate proceeding.
We hold anticipatory disclaimers of expectancy interests created by intestacy are not contemplated or authorized by RCW 11.86, and affirm the probate court's order declaring James Baird's disclaimer invalid. 3
The issue in this case involves statutory construction; issues concerning statutory construction are questions of law reviewed de novo. Rettkowski v. Department of Ecology, 128 Wash.2d 508, 515, 910 P.2d 462 (1996).
Disclaimers 4 are defined in RCW 11.86 as "any writing which declines, refuses, renounces, or disclaims any interest that would otherwise be taken by a beneficiary." RCW 11.86.011(4). Statutory disclaimers have their roots in the common law principle that a beneficiary under a will has the right to disclaim or renounce a testamentary In Washington and other jurisdictions, this particular distinction was abrogated when the law of disclaimer was codified. See, e.g., Laws of 1973, ch. 148. Washington's disclaimer statute, RCW 11.86, was originally enacted in 1973, and almost completely rewritten in 1989. Laws of 1989, ch. 34. The current version of RCW 11.86 substantially conforms with the Uniform Probate Code's section on disclaimers. Compare RCW 11.86 with Unif. Probate Code § 2-801 (Supp.1995). 5
gift. Mark Reutlinger & William C. Oltman, Washington Law of Wills and Intestate Succession 163-67 (1985). This rule was based on the theory that no one could be forced to accept a gift. Reutlinger & Oltman, supra, at 163. However, at common law an interest passing via intestacy could not be disclaimed. [933 P.2d 1034] See S. Alan Medlin, An Examination of Disclaimers Under UPC Section 2-801, 55 Albany L.Rev. 1233, 1235 (1992)
At common law and under our current statute, a properly executed and delivered disclaimer passes the disclaimed interest as if the disclaimant "died immediately prior to the date of the transfer of the interest." RCW 11.86.041(1); see Reutlinger & Oltman, supra, at 164-65. So long as a disclaimer is properly executed and timely delivered, the legal fiction of "relation back" treats the interest as having never passed to the intended beneficiary or heir at law.
In this case, Jayme and Hunter Baird argue that this We disagree. The result of adopting the children's argument in this case would be to extend the legal fiction of "relation back" at the potential expense of the bankruptcy estate and Susan Baird. That we will not do. In re Estate of Graley, 183 Wash. 268, 274, 48 P.2d 634 (1935) (quoting United States Fidelity & Guar. Co. v. Wooldridge, 268 U.S. 234, 238, 45 S.Ct. 489, 489, 69 L.Ed. 932, 40 A.L.R. 1094 (1925)).
legal fiction applies and prevents James Baird's interest in his mother's estate from becoming an asset of his bankruptcy estate. 6 They argue the instrument executed on March 8, 1994 by James Baird met all of RCW 11.86.031(1)'s content requirements and was properly delivered according to RCW 11.86.031(2) by being filed in Phyllis Baird's ongoing guardianship proceeding or, alternatively, in the probate proceeding following Phyllis Baird's death. Thus, Jayme and Hunter Baird assert the disclaimer was valid and effective as of the date their father executed the instrument
Our disclaimer statute provides: "A beneficiary may disclaim an interest in whole or in part ... in the manner provided in RCW 11.86.031." RCW 11.86.021(1). "Interests" that may be disclaimed include:
the whole of any property, real or personal, legal or equitable, or any fractional part ... thereof, any vested or contingent interest in any such property.... 'Interest' RCW 11.86.011(2)(a). An intestate interest is created only upon the death of the creator of the interest, i.e., the death of the intestate. See In re Estate of Wiltermood, 78 Wash.2d 238, 240, 472 P.2d 536 (1970); RCW 11.04.250 and RCW 11.04.290 (). Thus, at the time James Baird executed the instrument at issue, he did not yet have an "interest" in his mother's estate to disclaim.
includes, but is not limited to, an interest created ... [b]y intestate succession.
This definition of "interest" is further supported by the delivery requirements of RCW 11.86. The statute requires that a disclaimer "shall be delivered ... at any time after the creation of the interest, but in all events by nine months after the ... date of the transfer." RCW 11.86.031(2)(b) (emphasis added). As stated above, an intestate interest is not created until the death of the creator/transferor. Thus, James Baird could not have met the statutory delivery requirement on the date the instrument was executed, or, for that matter, at any time prior to his mother's death, because the "interest" had yet to be created. See In re Will of Heffner, 132 Misc.2d 361, 362, 503 N.Y.S.2d 669 (1986) ().
Additionally, James Baird was not a "beneficiary" under RCW 11.86 when he executed the disclaimer. The statute defines a "beneficiary" as "the person entitled, but for the person's disclaimer, to take an interest." RCW 11.86.011(1). James Baird was not entitled to take any interest in his mother's estate prior to her death. See generally Estate of Wiltermood, 78 Wash.2d at 240, 472 P.2d 536 (); Rawsthorn v. Rawsthorn, 198 Wash. 471, 481, 88 P.2d 847 (1939) (no one can have an interest at law or in equity, contingent or otherwise, in the property We hold that as a matter of law the instrument executed by James Baird on March 8, 1994 is invalid under RCW 11.86 because at that time he did not have an "interest," nor was he a "beneficiary." In sum, RCW 11.86 does not authorize anticipatory disclaimers of expectancy interests.
of a living person to which one hopes to succeed as heir at law); In re Marriage of Leland, 69...
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