What Happens to inheritance if a parent remarries late in life?

While there are no official reports that Hugh Hefner has dementia, he provides a great example of an elderly parent remarrying later in life. For those of you out of the popular news loop – Hugh Hefner married 29 year old Crystal Harris in late 2012. While Hefner reportedly had Crystal sign an “iron clad prenup,” and there are no reports of his mental decline (at least public ones), this is not the case for many seniors who choose to marry later in life.  

The Alzheimer’s Association reports that nearly 1 in 3 seniors dies with some form of Alzheimer’s or other kind of dementia. Once someone turns seventy, there is a 1 in 7 chance they already have dementia. As they continue to age, the likelihood only increases. For seniors that have been diagnosed with some form of dementia – or worse yet, fall in the grey area that does not lead to a conclusive diagnosis – romantic relationships can be potentially hazardous.

What’s the Risk of a Late in Life Marriage?

Certainly, no child would want to deprive their parent of finding love later in life, but what is the risk to the family’s estate if that parent should remarry? Well, potentially huge. The children could lose their entire inheritance, as in the case of New Orleans Saints owner Tom Benson. In this lengthy trust litigation case, the children  tried to prove their stepmother had exercised undue influence over Benson. His children had been previously slated to inherit the majority of his fortune until he signed a new will leaving everything to his new, and much younger wife. Benson’s kids alleged that the new wife had essentially coerced him into signing everything over to her. The attorney for the children attempted to prove financial elder abuse, but in the end was unsuccessful. The children were cut out, and the new wife left everything.

Much more common in the SF East Bay is the situation where a parent remarries later in life, and simply does nothing in regard to Estate Planning. The parent neither amends their current will or trust to include the new spouse, or alternatively, fails to create an Estate Plan all together. In either scenario, the new wife would be entitled to a significant portion of the Estate under California probate law. If the parent was mentally competent at the time of the marriage, there is little the children can do to recover lost inheritance. However, if the parent is believed to have been suffering from some form of dementia, the children have a potential case of Financial Elder Abuse against the spouse of the deceased. Let’s look at an example:

Dad marries his younger caretaker with a will leaving everything to his 2 adult children. He makes no amendments to his will before his death.

In this scenario, the former caretaker will inherit all community property, and one third of all his separate property, upon his death. This is because of California’s Omitted Spouse statute, which states: 

“if a decedent fails to provide in a testamentary instrument for the decedent’s surviving spouse who married the decedent after the execution of all of the decedent’s testamentary instruments, the omitted spouse shall receive a share in the decedent’s estate.”

As is the case with all California Probate code, there are multiple exceptions for this rule, such as a spouse being explicitly provided for through another means, intended to take the place of any inheritance. Nevertheless, for the purposes of our example, let’s assume that is not the case. So, the caretaker in our scenario could potentially inherit the majority of dad’s assets. This would depend upon how much of the estate is community property at the time of his death, and how much is separate property. 

Separate property in California is defined as any assets that dad entered the marriage with. Community property is defined as any assets obtained after the marriage has occurred. An example of separate property could be a home or an investment account. An example of community property would be a house,a car, jewels, or other valuables acquired after the marriage. For simplicity, let’s assume the new wife did not have the dad add her name to a deed or investment account (that opens up a new can of worms.)

Now, if  dad was of sound mind when the marriage occurred, the children would not have a legal footing on which to stand. The caretaker would inherit her share, and the children would get a nice lesson in the value of detachment. BUT, if the children can prove in probate court that their father lacked mental capacity at the time of the marriage, they have a valid case of elder abuse. If financial elder abuse can be proven, California Probate Code 259 will essentially deem the spouse dead. In a legal sense, the spouse will be treated as if they had “predeceased the decedent” and the benefit they receive from the state will be limited.

Financial elder abuse is the most common kind of elder abuse I see in my practice as an Elder Law attorney in the SF East Bay. Nevertheless, it can be difficult to prove in many situations. In Contra Costa County, I often see financial elder abuse taking place in the form of undue influence. California probate code defines undue influence as “excessive influence” that essentially “overcomes a person’s free will.” But, unless a doctor gave dad a diagnosis of Alzheimer’s or dementia prior to his marriage to the caretaker, proving undue influence and/or financial abuse can be tricky.

As an Elder Law attorney in Walnut Creek, many cases I litigate in the SF East Bay involve a parent who falls in the “grey area” of dementia, meaning one doctor may have diagnosed them with mild dementia, but there are questions around when it began, and how severe it really is. If this were the case with dad, his children could make a case against the caretaker for financial elder abuse. It is unlikely they would be able to disinherit the surviving spouse completely, but could potentially recover some of the assets. When families work with experienced Elder Law attorneys, most cases of this nature can be settled in mediation without significant funds going to lawyers.

How Can Children help an Elderly Parent protect against Financial Elder Abuse?

There are many steps children can take to ensure an elderly parent does not fall prey to financial elder abuse. In the scenario outlined above, the children could have encouraged their father to update his estate plan. For example, dad could have amended his trust to include a provision on how property placed in the trust will be treated. For example, that it “retain the character it had when it entered the trust.” This means that prior to his marriage, all assets in the trust would be considered separate property. Similarly, they might encourage their father to check that the trust does not say that everything placed in the trust is community property. 

Another estate planning point children can bring up with an aging parent is their financial power of attorney and Advance Health Care Directive. For example, should they become incapacitated, who has the authority to manage their financial and medical affairs? In the current celebrity drama of Lamar Odom, estranged wife Khloe Kardashian had both medical and financial power of attorney, despite the fact that they were weeks from having their divorce finalized. Had Lamar done a power of attorney or health care directive, the duties would not have gone to his legal wife by default.

If the parent has been given a diagnosis of dementia, and does not already have a valid power of attorney, a child can establish a conservatorship to manage their affairs. For example, Britney Spear’s father Jamie has a conservatorship over her, meaning that if Britney ever wanted to remarry, he would legally have the authority to allow or disallow the marriage. This is the rare instance of a parent having a conservatorship over a non special needs child. 

Legal actions aside, perhaps the most powerful tool children have to help their aging parents is communication. Communicating with an elderly parent on a regular basis can alert one to suspicious activities, and allow the child to provide assistance before harm has been done. In my own family there is an elderly relative who was giving away large sums of money to certain individuals, unbeknownst to anyone. Her children were living their own lives, and seldom checked in on their mother. Left alone, she began to develop dementia, and was easily preyed upon by others. 

In summary, if you have an elderly parent who wants to remarry, encourage them to:

A. Plan Ahead: Consult an Estate Planning & Elder Law Attorney

B. Communicate, Communicate, Communicate

And of course, if you believe a parent is exhibiting signs of dementia, consult a doctor immediately. 

For questions about Estate Planning or Elder Abuse, call my SF East Bay Elder Law and Estate Planning Law Firm at 925-322-1795 for a consultation.