Many of our couples who seek estate planning execute “sweetheart wills.” That is, each executes a will stating that upon the death of the first spouse, one spouse gets the other spouse’s property, and upon the death of both spouses, the children get the property. Your will is your own document, and you can change the document at will (no pun intended). But in some situations, couples may want to additionally execute a contract agreeing to each other that they won’t change, or will eventually execute, reciprocal wills. It could be for a variety of reasons. Perhaps there is a lack of trust between the couple, or concern that the kids may challenge the wills arguing they were supposed to have gotten a distribution from the estate. These arrangements, while very rare, are the subject of statutes and litigation to make enforceable.
N.J.S.A. 3B:1-4 provides three ways to prove a reciprocal will contract is valid and enforceable. “(1) provisions of a will stating material provisions of the contract; (2) an express reference in a will to a contract and extrinsic evidence proving the terms of the contract; or (3) a writing signed by the decedent evidencing the contract.” Should one of the spouses die, and the other spouse takes ownership of the other’s property as required by the reciprocal will agreement, it is said that sufficient consideration has been given to enforce the reciprocal will arrangement, and that the surviving spouse is bound to its terms, and he/she cannot revoke the contract. Woll v. Dugas, 104 N.J. Super. 586 (Ch.1969), aff’d, 112 N.J. Super. 366. Furthermore, a reciprocal will agreement where two wills are executed naming the other spouse as the beneficiary, with the couple’s children as residuary legatees, allows for the surviving spouse to use the funds passed on to him or her as he or she wishes, and the children cannot challenge the contract, and will inherit the remainder of the estate of the first spouse once the second spouse dies. Matter of Estate of Resnick, 284 N.J. Super. 47, 49 (App. Div. 1995.)
So as long as there was a valid contract to enforce reciprocal wills and the survivor took the benefits of the other’s will, the reciprocal arrangement is valid.
To discuss your NJ estate planning or wills matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at firstname.lastname@example.org. Please ask us about our video conferencing or telephone consultations if you are unable to come to our office.
Written by Stephen W. Kornas, Esq. of Hanlon Niemann & Wright