TITLE 15

UNIFORM PROBATE CODE

CHAPTER 6

NONPROBATE TRANSFERS

PART 1.

MULTIPLE-PARTY ACCOUNTS

15-6-107.  Liability of nonprobate transferees for creditor claims and statutory allowances. (1) In this section, "nonprobate transfer" means a valid transfer effective at death, other than of a survivorship interest in a joint tenancy of real estate, by a transferor whose last domicile was in this state to the extent that the transferor immediately before death had power, acting alone, to prevent the transfer by revocation or withdrawal and instead to use the property for the benefit of the transferor to apply it to discharge claims against the transferor’s probate estate.

(2)  Except as otherwise provided by statute, a transferee of a nonprobate transfer is subject to liability to the decedent’s probate estate for allowed claims against the decedent’s probate estate and statutory allowances to the decedent’s surviving spouse, minor children and dependent children to the extent the decedent’s probate estate is insufficient to satisfy those claims and allowances. The liability of a nonprobate transferee may not exceed the value of nonprobate transfers received or controlled by that transferee.

(3)  Nonprobate transferees are liable for the insufficiency described in subsection (2) of this section in the following order:

(a)  As provided in the decedent’s will or any other governing instrument;

(b)  To the extent of the value of the nonprobate transfer received or controlled by the trustee of a trust serving as the principal nonprobate instrument in the decedent’s estate plan as shown by its designation as devisee of the decedent’s residuary estate or by other facts or circumstances;

(c)  Other nonprobate transferees, in proportion to the values received.

(4)  Unless otherwise provided by the trust instrument, interests of beneficiaries in all trusts incurring liabilities under this section shall abate as necessary to satisfy the liability as if all of the trust instruments were a single will and the interests were devises under it.

(5)  A provision made in one (1) instrument may direct the apportionment of the liability among the nonprobate transferees taking under that or any other governing instrument. If a provision in one (1) instrument conflicts with a provision in another, the later one prevails.

(6)  Upon due notice to a nonprobate transferee, the liability imposed by this section is enforceable in proceedings in this state, wherever the transferee is located.

(7)  A proceeding under this section may not be commenced unless the personal representative of the decedent’s estate has received from the surviving spouse or one acting for a minor or dependent child, to the extent that statutory allowances are affected, or a creditor, a written demand for the proceeding. If the personal representative declines or fails to commence a proceeding after demand, a person making demand may commence the proceeding in the name of the decedent’s estate, at the expense of the person making the demand and not of the estate. A personal representative who declines in good faith to commence a requested proceeding incurs no personal liability for declining.

(8)  A proceeding under this section must be commenced within two (2) years after the decedent’s death, but a proceeding on behalf of a creditor whose claim was allowed after proceedings challenging disallowance of the claim may be commenced within sixty (60) days after final allowance of the claim.

(9)  Unless a written notice asserting that a decedent’s probate estate is insufficient to pay allowed claims and statutory allowances has been received from the decedent’s personal representative the following rules apply:

(a)  Payment or delivery of assets by a financial institution, registrar or other obligor to a nonprobate transferee in accordance with the terms of the governing instrument controlling the transfer releases the obligor from all claims for amounts paid or assets delivered.

(b)  A trustee receiving or controlling a nonprobate transfer is released from liability under this section on any assets distributed to the trust’s beneficiaries. Each beneficiary to the extent of the distribution received becomes liable for the amount of the trustee’s liability attributable to that asset imposed by subsections (2) and (3) of this section.

History:

[15-6-107, added 2003, ch. 61, sec. 2, p. 207.]