The Appellant Court In The Matter of the Estate of Stites, 2020 OK CIV APP 51 held that when a testator makes a transfer-on-death deed and a will together on the same day, they must be construed together to prove the intent of the will maker. Here the son who was left the real property by transfer-on-death deed failed to file his affidavit accepting ownership within nine months of death. The transfer-on-death deed became void and the property is now to be distributed under his will. Fortunately the attorney drafting the will did a very good job. The attorney left the same property to the same son in his will and left everything else to another son. The Appellant Court held that taken together the will and transfer-on-death deed proved that the will maker intended his son to have these properties, one way or another. It pays to use an experienced will attorney. Brent Coldiron is experienced. Let Brent help you with your will, trust, transfer-on-death deed or other estate planning needs. You can reach Brent at 405 478-5655. Here is what the Appellant Court had to say:
¶1 Tythe Hill Stites (Ty) appeals from an order for the partial distribution of the estate of Clarence Fred Stites, Jr. (Decedent). The trial court determined that a transfer-on-death deed for particular real estate (the Property) to Jeffry Tapp Stites (Jef), which Jef failed to accept by filing an affidavit according to statute, reverted to Decedent’s estate for distribution according to Decedent’s will (the Will). The trial court held the reverted Property should be distributed according to the specific devise in the Will and ordered the Property be distributed to Jef. On appeal, Ty argues that the Property should have been distributed according to the Will’s residuary clause, such that the Property should have been divided evenly amongst Decedent’s three sons–Ty, Jef, and Chad.1 We hold that the trial court’s determination that Decedent intended the reverted Property be distributed according to the Will’s specific bequests was not against the weight of the evidence and affirm.
¶2 Decedent passed away August 17, 2016. On June 27, 2017, Jef filed a petition for letters of administration of Decedent’s estate (the Estate). Jef attached a copy of the Will to his petition. Jef also alleged Ty–who was named executor in Decedent’s Will–had failed to petition for the probate of the Will within the statutory period, so that Jef should be named administrator of the Estate. On July 20, 2017, Ty objected to Jef’s petition and petitioned for the admittance of the Will to probate. Ty also sought appointment as personal representative of the Estate, pursuant to the terms of the Will. Jef dismissed his petition for letters of administration July 25, 2017. The Will was admitted to probate August 30, 2017. Ty was appointed personal representative and letters testamentary were issued. Notice of probate of the Estate was sent to creditors October 23, 2017, and inventory and appraisement of the Estate was completed October 30, 2017.
¶3 Jef petitioned for partial distribution of the Estate March 16, 2018. Specifically, Jef sought the distribution of three real estate properties specifically devised to him in the Will. In his petition, Jef acknowledged that two of the properties devised to him had also been the subject of a transfer-on-death deed (TODD) executed by Decedent naming Jef as the transferee. Jef admitted he had failed to accept the two properties transferred via the TODD by failing to file an affidavit accepting the property within the statutory period. Still, Jef argued the Decedent’s Will and TODD evinced an intent that all of the Property devised to him in the Will should be distributed to him according to the Will’s specific provisions, despite his failure to accept the TODD.
¶4 As personal representative of the Estate, Ty objected to Jef’s petition for partial distribution. Following additional briefing and a hearing held May 23, 2018, the trial court agreed with Jef and ordered the Property be distributed to Jef. Ty appeals.
¶5 “Probate proceedings are of equitable cognizance.” In re Estate of Sneed, 1998 OK 8, ¶ 8, 953 P.2d 1111. This Court will review the entire record on appeal and weigh the evidence, but will not disturb the trial court’s findings “unless they are clearly against the weight of the evidence or some governing principle of law.” Id. When construing a will, “[t]he intention of the testator is controlling,” and the trial court “must ascertain and give effect to the testator’s intent, unless the intent attempts to effect what the law forbids.” Matter of Estate of Westfahl, 1983 OK 119, ¶ 5, 674 P.2d 21. “This Court will not interfere with trial court’s construction of a will unless it is clearly against the weight of the evidence.” Cavett v. Peterson, 1984 OK 59, ¶ 21, 688 P.2d 52 (citing Savage v. Hill, 1959 OK 157, ¶ 15, 346 P.2d 323).
¶6 The primary issue on appeal is whether real property conveyed by a transfer-on-death deed that was not accepted via the statutory procedure and thus reverted back to the testator’s estate should be distributed according to the will’s specific provisions or via the will’s residuary clause. The mechanism of a transfer-on-death deed (TODD) is a relatively recent addition to Oklahoma law and serves as an alternative to traditional testate succession for the posthumous transfer of real property. This statutory will alternative was created though the enactment of the “Nontestamentary Transfer of Property Act,” which provides:
An interest in real estate may be titled in transfer-on-death form by recording a deed, signed by the record owner of the interest, designating a grantee beneficiary or beneficiaries of the interest. The deed shall transfer ownership of the interest upon the death of the owner. A transfer-on-death deed need not be supported by consideration . . . The signature, consent or agreement of or notice to a grantee beneficiary or beneficiaries of a transfer-on-death deed shall not be required for any purpose during the lifetime of the record owner.
¶7 In order to accept real estate granted via TODD, within nine months following the grantor’s death, the grantee beneficiary must execute and file an affidavit affirming (1) proof of the grantor’s death, (2) whether the grantor and beneficiary were married, and (3) a legal description of the real property. Id. A TODD beneficiary’s failure to file the requisite affidavit within the statutory period will result in the property reverting to the transferor’s estate. Id. A properly executed TODD may not be revoked by the provisions of a will. Id.
¶8 Here, the parties do not disagree that Decedent properly executed a Will wherein Decedent devised three particular real estate properties to Jef. Nor do they dispute that on the same day he executed the Will, July 12, 2016, Decedent also executed a TODD for two of the three properties devised to Jef (the Property), in which Decedent named Jef as the beneficiary. The parties further agree that Jef, allegedly unaware of the statutory requirements, failed to file the mandatory affidavit accepting the Property within nine months of Decedent’s death. As such, the parties agree the Property reverted to Decedent’s estate for probate according to the Will.
¶9 The dispute between the parties arises, however, in determining whether the Property reverted back to the estate to be distributed according to the specific devises in the Will, or whether the Property should be treated similarly to a disclaimed or lapsed gift such that it should be distributed according to the Will’s residuary clause. In determining the distribution of Decedent’s estate, we look firstly to the Will, which is the best indication of Decedent’s testamentary intent.
¶10 In the provisions providing for Decedent’s specific devise of the Property to Jef, the Will states that the Property shall go to Jef “if he survives [Decedent] by thirty (30) days” and if Decedent has “not disposed of said property or any part thereof prior to [Decedent’s] death including, but not limited to, by Transfer on Death Deed . . . .” The Will also states that the Decedent’s residuary estate “shall consist of all property or interest therein of whatever type and wherever located, both real and personal, tangible and intangible, not otherwise effectively disposed of in this Will, including any lapsed gifts . . . .”
¶11 Of note, the two instruments at issue here – the Will and the TODD – were executed on the same day. A similar question of the consideration of the combination of a will and TODD arose in In re Estate of Carlson, 2016 OK 6, 367 P.3d 486. There, the Supreme Court determined that the two documents, executed on the same day, should be construed together as a single estate plan in determining the testator’s intent. Id. ¶ 13. The Carlson court pointed to 84 O.S. 2011 § 154, which provides, “Several testamentary instruments, executed by the same testator, are to be taken and construed together as one instrument.” Id. The Supreme Court determined that although TODDs are nontestamentary documents, they can still be “examined with Decedent’s simultaneously executed testamentary instruments to determine Decedent’s intent . . . .” Id. ¶ 14.
¶12 Below, the trial court concluded that the Decedent’s complimentary Will and TODD evidenced a “belt and suspenders” approach, demonstrating Decedent’s intent that Jef should receive the Property under all circumstances. We agree. Where Decedent’s Will and TODD were executed on the same day, impliedly with the intention of creating a single scheme for the posthumous distribution of his estate, we take the two documents together in determining Decedent’s intent. As such, the trial court did not rule against the clear weight of the evidence in determining that the Decedent intended in the event that the TODD failed, Jef would still receive the Property through the Will.
¶13 Specifically, the words “not disposed of . . . by Transfer on Death Deed” evince an intent that the only alteration of the Will would be in the event that Decedent’s property was effectively otherwise transferred. This provision was likely included as an acknowledgment of the statutory prohibition of the canceling of TODDs via testamentary devise. Still, the nature of TODDs is such that nothing is transferred to the beneficiary upon execution, but instead the transfer of interest occurs only upon the grantee’s death with final disposition upon the beneficiary’s acceptance. See Joyce Palomar, 2 PATTON AND PALOMAR ON LAND TITLES § 333 (3d ed. 2018 update). No final property interest transfers to the beneficiary of a TODD prior to death and acceptance. As such, where no property interest was “disposed of” via the TODD because Jef never accepted it by filing the requisite affidavit, the specific devise in the Will remains effective and Jef is entitled to distribution of the Property.
¶14 We similarly reject Ty’s arguments that the unaccepted transfer of the Property by TODD was a lapsed gift or a “de facto disclaimer.” Firstly, the concept of a “lapse” primarily refers to an instance in which a testate beneficiary predeceases the testator. See R. Robert Huff, 1 OKLA. PROB. LAW & PRACTICE § 4.8 (3d ed. 2017 update). But where the predeceasing beneficiary is a child or other close relative of the testator, the lapsed gift is preserved by Oklahoma’s antilapse statute, which provides that the lapsed gift shall pass to the predeceased beneficiary’s issue. 84 O.S. 2011 § 142. A grant of property by TODD that is not accepted by the beneficiary is not a lapsed gift. But even if Jef had predeceased Decedent and the devise had lapsed, Jef’s testate share would have passed to his lineal descendants via the antilapse statute. As such, we reject Ty’s argument that the unaccepted transfer by TODD was a lapsed gift that should have been distributed via the residuary clause.
¶15 Further, Jef’s failure to accept the TODD could not constitute a disclaimer under Oklahoma law, which requires that a disclaimer of an interest passing by will, intestate succession, or other testamentary instrument shall be in writing. 84 O.S. 2011 § 22. In providing for the option of disclaimer, the Oklahoma Legislature provided a means by which a beneficiary could avoid the burdens associated with accepting a posthumous gift. See R. Robert Huff, 1 OKLA. PROB. LAW & PRACTICE § 24.17 (3d ed. 2017 update). But the Legislature also sought to protect beneficiaries from unintentionally disclaiming their share of an estate by requiring that such a disclaimer be explicit in writing. We will not go against the Legislature’s intent and thus reject Ty’s argument that the unaccepted TODD was a disclaimed interest.
¶16 During the pendency of this appeal, Ty submitted an additional issue for appellate review via motion pursuant to Oklahoma Supreme Court Rule 1.37(b). According to 12 O.S. 2011 § 990.1,
When a petition in error is timely filed, the Supreme Court shall have jurisdiction of the entire action that is the subject of the appeal. No additional jurisdictional steps shall be necessary to enable the Supreme Court to rule upon any errors made in the trial of the action which are asserted by any party to the appeal and involve any other party to the appeal.
Ty filed a motion with this Court seeking vacation of a post-appeal order by the trial court. Ty appeals a May 19, 2019 order by the trial court compelling his compliance with Jef’s discovery requests, ordering the reconciliation of items allegedly contained in Decedent’s safety deposit box and compliance with any subpoena duces tecum issued by Jef in pursuit of relevant bank records. Ty asserts that this Court should reverse and vacate the trial court’s order because the Oklahoma Discovery Code does not apply to probate proceedings. Oklahoma Supreme Court precedent indicates to the contrary.
¶17 In Stone v. Hodges, 1967 OK 214, 435 P.2d 165, the Oklahoma Supreme Court considered the novel question of whether the provision in the Discovery Code allowing for the use of interrogatories applied to probate proceedings. There, the language of the then-effective Code stated that the provision applied to “[a]ny party to a civil action or proceeding.” Id. ¶ 2. The title of the Act enacting the Code also specified that it was “[a]n Act relating to civil procedure.” Id. In Stone, the appellant claimed that the terms “civil action or proceeding” and “civil procedure” did not encompass probate proceedings. Id. The Supreme Court disagreed and determined the use of interrogatories was permitted in probate proceedings. Id. ¶¶ 3, 9.
¶18 Though slightly different, the language of the current Discovery Code is nearly identical to that addressed in Stone. The current provision, 12 O.S. 2011 § 3224, states: “The Oklahoma Discovery Code shall govern the procedure for discovery in all suits of a civil nature in all courts in this state.” We find that the words “suits of a civil nature” to be at least as broad as the words “civil action and proceeding” and hold that the Oklahoma Discovery Code applies to probate proceedings. We therefore deny Ty’s motion.
¶19 The trial court’s determination that the Decedent’s Will and TODD evinced an intent that Jef receive the entire Property in the event that the TODD was not accepted was not against the weight of the evidence. Further, the unaccepted transfer via TODD was not a lapsed gift or disclaimed interest. As such, we affirm the trial court’s order distributing the Property to Jef according to the Will’s specific devise. We also hold that the Discovery Code applies to probate proceedings and deny Ty’s motion to reverse or vacate the trial court’s May 19, 2019 order.