The Workings of Anti-Lapse

With the help of New York’s anti-lapse statute (EPTL § 3-3.3(a)(1)), my firm was able to successfully exclude a very harmful piece of evidence in a heavily contested Will probate proceeding.

Petitioner sought to probate a 33-year old Will of which she was a beneficiary. Leading up to trial, Petitioner found an audio recording of a telephone call between Petitioner’s mother (“Mother”), also a legatee under the purported Will, and the decedent, her father. Petitioner sought to offer the recording into evidence on the testimony of Mother. We successfully argued that, as a legatee under the purported Will, Mother is interested in the probate of such instrument and is therefore barred from testifying under New York’s Dead Man Statute. CPLR § 4519[1]. Petitioner cleverly counter argued that Mother renounced her legacies and thereby avoids that proscription of the Dead Man Statute.

It is important to note here that in the case of a renunciation,the renouncing person is treated as having predeceased the testator. EPTL § 2-1.11(e). Further, the relevant part of the anti-lapse statute reads, “whenever a testamentary disposition is made to the issue…of the testator, and such beneficiary dies during the lifetime of the testator leaving issue surviving such testator, such disposition does not lapse but vests in such surviving issue, by representation.” EPTL § 3-3.3(a)(1) (amended 9/27/2013).

Anti-lapse told us that Mother’s renounced interest does not lapse to the residuary, but vests in her issue (Petitioner), outright.  With that, we argued that even if Mother renounced her legacy, she is still barred under the Dead Man’s Statute and may not testify in support of the Will offered for probate because such testimony is offered in behalf of “a party or interested person succeeding to [Mother’s] interest.” CPLR § 4519.

And the judge agreed.

While we were lucky to see anti-lapse at work in a litigious matter, it is the drafting attorney that must remain sharp on the workings of New York’s anti-lapse statute. Many attorneys, and their clients, operate under the false assumption that a failed bequest to issue will lapse to the residuary.  This may be the desired result when, for example, the residuary funds a GST Trust for minor grandchildren. Under New York law, however, that GST Trust will never be funded unless the drafting attorney considers the effects of anti-lapse and drafts the Will to achieve the desired result.

Bottom line: Estate planning attorneys must pay attention to the anti-lapse statute when advising clients and drafting Wills. Importantly, EPTL § 3-3.3(a)(1) not only applies to predeceased issue of the testator, but predeceased siblings of the testator as well[2].

[1] The Dead Man’s Statute provides, in part, that: “a party or a person interested in the event, or a person from, through or under whom such a party or interested person derives his interest or title by assignment or otherwise, shall not be examined as a witness in his own behalf or interest, or in behalf of the party succeeding to his title or interest…concerning a personal transaction or communication between the witness and the deceased person.” (emphasis added).

[2] For more information on the recent changes to EPTL § 3-3.3, please see: http://www2.nycbar.org/pdf/report/uploads/20072277-A.9478amendingdiscrepancyinanti-lapsestatute.pdf