Estate of Melton v. Palm

• Decision Date: 16 February 2012
• Docket Number: No. 55634.,55634.
• Citation: 272 P.3d 668,128 Nev. Adv. Op. 4
• Parties: In the Matter of the ESTATE OF William MELTON, Deceased.The State of Nevada; Linda Melton Orte; and Sherry L. Melton Briner, Appellants, v. Vicki Palm; Elizabeth Stessel; Robert Melton; Bryan Melton; and John Cahill, Public Administrator, Respondents.
• Court: Nevada Supreme Court

128 Nev. Adv. Op. 4

272 P.3d 668

In the Matter of the ESTATE OF William MELTON, Deceased.The State of Nevada; Linda Melton Orte; and Sherry L. Melton Briner, Appellants,

v.Vicki Palm; Elizabeth Stessel; Robert Melton; Bryan Melton; and John Cahill, Public Administrator, Respondents.

No. 55634.

Supreme Court of Nevada.

Feb. 16, 2012.

Catherine Cortez Masto, Attorney General, and K. Kevin Benson, Deputy Attorney General, Carson City, for Appellant the State of Nevada.

Kehoe & Associates and Ty E. Kehoe, Henderson, for Appellants Linda Melton Orte and Sherry L. Melton Briner.

Albright Stoddard Warnick & Albright and Whitney B. Warnick, Las Vegas, for Respondents Vicki Palm and Elizabeth Stessel.Bowler Smith & Twitchell LLP and Russell K. Bowler and Jonathan W. Barlow, Las Vegas, for Respondent John Cahill.Solomon Dwiggins & Freer and Mark A. Solomon, Las Vegas, for Respondents Robert Melton and Bryan Melton.BEFORE SAITTA, C.J., DOUGLAS, CHERRY, GIBBONS, PICKERING, HARDESTY and PARRAGUIRRE, JJ.

OPINION

PER CURIAM:

This is a dispute between the State and a testator's daughter and half sisters over his $3 million estate. At issue is the proper distribution of the estate of the testator, who, by way of a handwritten will, attempted to disinherit all of his heirs but was unsuccessful in otherwise affirmatively devising his estate. Under the common law, a disinheritance clause was unenforceable in these circumstances. In the proceedings below, after determining that the testator's handwritten will was a valid testamentary instrument that revoked his earlier will, the district court applied the prevailing common law rule, and thereby deemed the testator's disinheritance clause unenforceable. The court therefore distributed the testator's entire estate to his disinherited daughter, pursuant to the law of intestate succession, and rejected the claim that because he disinherited all of his heirs, his estate must escheat to the State to be used for educational purposes.

Crucially, however, the Nevada Legislature has enacted a statute providing, in pertinent part, that a will includes “a testamentary instrument that merely ... excludes or limits the right of an individual or class to succeed to property of the decedent passing by intestate succession.” NRS 132.370. We conclude that by its plain and unambiguous language, NRS 132.370 abolishes the common law rules that would otherwise render a testator's disinheritance clause unenforceable when the testator is unsuccessful at affirmatively devising his or her estate. Here, although the district court correctly determined that the testator executed a valid handwritten will that revoked his earlier will, the court erred in deeming the disinheritance clause contained therein unenforceable.

Next, we consider whether to adopt the doctrine of dependent relative revocation, which, broadly stated, provides that a revocation made in connection with a failed dispositive objective or false assumption of law or fact should be considered ineffective when doing so is necessary to ensure that an estate is distributed in a manner that most closely matches the testator's probable intent. In this, we consider whether the district court erred in determining that the doctrine is precluded by NRS 133.130, which provides, in relevant part, that where a testator executes two wills, the revocation of the second will does not operate to “revive the first will,” absent terms in the revocation expressing an intention to revive the first will or the reexecution of the first will. We conclude that NRS 133.130 restricts revival, a concept that is fundamentally distinct from the doctrine of dependent relative revocation. Furthermore, because we believe that the general policy underlying the doctrine of dependent relative revocation is sound, we take this opportunity to expressly adopt the doctrine. Here, while the district court erred in determining that NRS 133.130 precludes the doctrine of dependent relative revocation, it did not err in alternatively determining that if the doctrine exists in Nevada, it is inapplicable under the particular facts of this case.

Finally, we consider whether an escheat is triggered when, as here, a testator disinherits all of his or her heirs. We conclude that an escheat is triggered in such a circumstance because, when all heirs have been disinherited, the testator “leaves no surviving spouse or kindred” under NRS 134.120 pursuant to the plain and commonly understood meaning of that phrase. Accordingly, the district court erred in determining that the testator's estate does not escheat.

Because the disinheritance clause contained in the testator's will is enforceable, we reverse the judgment of the district court. As the testator disinherited all of his heirs, his estate must escheat.

FACTS AND PROCEDURAL HISTORY

The 1975 will

In 1975, William Melton executed a formal will. The will was comprised of two forms, which Melton and three witnesses signed. Melton devised most of his estate to his parents and devised small portions to his brother and two of his cousins, Terry Melton and Jerry Melton. He also indicated that his daughter was to receive nothing. In 1979, Melton executed a handwritten codicil on the back of one of the 1975 will forms that provided his friend, Alberta (Susie) Kelleher, should receive a small portion of his estate (both will forms and the codicil are hereinafter referred to as “the 1975 will”).

The 1995 letter

In 1995, Melton sent a handwritten letter to Kelleher. It reads:

5–15–95

5:00 AM

Dear Susie

I am on the way home from Mom's funeral. Mom died from an auto accident so I thought I had better leave something in writing so that you Alberta Kelleher will receive my entire estate. I do not want my brother Larry J. Melton or Vicki Palm or any of my other relatives to have one penny of my estate. I plan on making a revocable trust at a later date. I think it is the 15 of [M]ay, no calendar, I think it[']s 5:00 AM could be 7:AM in the City of Clinton Oklahoma

Lots of Love

Bill

/s/ William E. Melton

AKA Bill Melton

[Social security number]

Discovery of the 1975 will and the 1995 letter

Kelleher died in 2002, thus predeceasing Melton, who died in 2008.¹ Shortly after Melton's death, respondent John Cahill, Clark County Public Administrator,² initiated a special administration of Melton's estate. During this administration, it was discovered that Melton had a daughter, respondent Vicki Palm. The 1995 letter was also discovered. Initially, Palm and respondent Elizabeth Stessel ³ were appointed co-administrators of Melton's estate. But the district court suspended their powers after determining that a disinterested party should administer the estate because a dispute over the proper distribution of the estate had arisen between Melton's half sisters, appellants Linda Melton Orte and Sherry L. Melton Briner, appellant State of Nevada, respondents Bryan Melton and Robert Melton,⁴ and Palm. The district court therefore appointed Cahill to be the special administrator of Melton's estate. Thereafter, Cahill obtained access to Melton's safe deposit box and discovered the 1975 will. The appraised net value of Melton's estate is approximately $3 million.

The parties and their respective positionsMelton's daughter

Palm, Melton's only known child, initially argued that the 1995 letter is not a valid will, and that Melton's estate therefore should pass to her under the statutes governing intestate succession. Following the discovery of the 1975 will, however, she argued that the 1995 letter is a valid will and that it revoked the 1975 will. Palm argued that although the 1995 letter is a valid will, it is ineffective because the only named devisee, Kelleher, predeceased Melton. Thus, she maintained that Melton's estate should pass through intestacy, under which she has priority pursuant to NRS 134.100. ⁵

Melton's half sisters

In the proceedings below, Melton's half sisters contended that the 1995 letter is not a valid will, and therefore, the 1975 will is still effective. In addition, they argued that if the 1995 letter is a valid will, it does not effectively revoke the 1975 will. They further argued that, even assuming that the 1995 letter is a valid will that revoked the 1975 will, the revocation should be disregarded under the doctrine of dependent relative revocation. Although Melton's half sisters were not named as devisees in the 1975 will, they asserted that under Nevada's antilapse statute, NRS 133.200,⁶ they could take their parent's share of Melton's estate.

The State

The State asserted that the 1995 letter is a valid will that revoked the 1975 will. It argued that the Legislature's revisions to the Nevada Probate Code in 1999 provide for the enforcement of disinheritance clauses, even when an estate passes by intestate succession. Thus, the State contended that because Melton expressly disinherited all of his relatives in the 1995 letter, his estate must escheat.

The district court order

After extensive briefing by the parties, the district court determined as follows: (1) the 1995 letter is a valid will; (2) although the 1995 letter is a valid will, the disinheritance clause contained therein is unenforceable; (3) the 1995 letter revoked the 1975 will; (4) the revocation of the 1975 will cannot be disregarded under the doctrine of dependent relative revocation because NRS 133.130 precludes the doctrine in Nevada; and (5) even if the doctrine of dependent relative revocation applies in Nevada, the doctrine is not applicable under the particular facts presented in this case. Accordingly, the district court distributed Melton's estate to Palm pursuant to the intestate succession scheme. Melton's half sisters and the State each appealed.

DISCUSSION

On appeal, the parties largely maintain the positions that they asserted during the proceedings below. Thus, in their appeal, Melton's half sisters' primary contention is that the district court erred...