At the time of her death, the decedent (“Marianne”) had been divorced for more than forty years. She remained living in the former marital home, and did not remarry. Her Last Will and Testament expressly disinherited her children, and left her entire estate to charity. She appointed her attorney as executor.
At the time of her divorce, Marianne had entered into a property settlement agreement (“PSA”) that conveyed ownership of the marital home to her, but provided:
in the event that [Marianne] intends to remarry, she shall, prior to said remarriage, sell and convey the aforesaid premises. The net proceeds shall be distributed one-half to Marianne and the other one-half to be placed in a trust fund for the two children of the parties. In the event that the property is sold at any time, the net proceeds shall be also so distributed.
Two years before her death, Marianne executed the will disinheriting her children; she died two years later.
The decedent’s son filed a complaint seeking to reform his mother’s will to comply with the property settlement agreement (“PSA”).
While the action was pending, the executor sold Marianne’s home, but placed a portion of the proceeds in escrow pending resolution of the litigation.
The trial court granted summary judgment to the son. The judge concluded that the PSA terms were unambiguous, and called for one-half of the home sale proceeds to be distributed to Marianne’s children. The judge then concluded that Marianne’s intent regarding her will was not relevant, because:
The question in this case is really whether the testator had the ability to convey 100% of that real property. The answer to that question is that she did not… The agreement says if the property is sold at any time, and that literally means anytime, and that’s what happened here, the property was sold after the decedent’s death. The children are entitled to their one-half interest.
Marianne’s estate and the Attorney General filed an appeal, and the Appellate Division reversed the trial court. It concluded that there was no ambiguity in Marianne’s will: it was “crystal clear” that she wished to disinherit her children. As to the PSA, the appellate court disagreed with the trial court’s conclusion that the PSA limited Marianne to a 50% ownership in the home even after her death. Instead, the Appellate Division concluded that the two conditions for 50% distribution of the sales proceeds of the PSA (Marianne’s remarriage or the sale of her home) did not occur prior to her death and, upon her death, the entire interest in the home passed to her estate and was controlled by her will:
Because the will is unambiguous and the conditions for distribution [under the PSA] did not occur during Marianne’s lifetime,… the trial court had no grounds on which to reform the will to conform to the PSA.
A copy of the Superior Court Appellate Division decision in In re Canova. can be found here.