The Oklahoma Supreme Court made a decision regarding wills and trusts, that I believe affects a number of people. Although I don’t believe the decision is surprising, its potential outcome could have grave effects upon your household.

In the matter of the Estate of Jackson, 2008 OK 83, the Supreme Court held that Oklahoma’s pretermitted heir statute does not apply to the disbursement of assets in a revocable inter vivos trust, and in a probate proceeding, notice must be given pursuant to title 58, section 240 of the Oklahoma Statutes before a court’s order determinating heirs is binding. Id. at ¶ 1.

Here are a of definition that you need to understand to appreciate the significance of this decision.

First, a revocable inter vivos trust is an estate planning methods that enables the settlor (person creating the trust) to disburse property and assets without the probate process. This is a very useful document that will save you in the end. The revocable trust is the most common method of trust development in the estate planning process. (Read more here).

Second, a pretermitted heir is one of the potential beneficiaries, usually a child or grandchild of the testator/settlor, who the testator/settlor omits from the will/trust. Under a typical will distribution, the omitted (pretermitted) heir will receive the same distribution as those who are taking under the will.

The shocking aspect of Estate of Jackson, is that the Court has decided these omitted heirs do not receive a share of the inter vivos trust distribution. Although most people would presume that these omitted heirs would qualify, the Court reasons that the pretermitted heir statute applies only to wills, and not to trusts. Estate of Jackson at ¶ 17.

What does this mean for you? You must evaluate your trusts and estate plans to determine whether any of your intended beneficiaries are missing. Please seek the advice of a qualified estate planning profession to help you determine the proper course of action.

I know, you’re thinking you have plenty of time to evaluate this and make a determination. However, time passes too quickly, and who knows what tragic result your inactions could have.

If you contact our office, we’ll perform a free evaluation of your current estate plan. Take advantage of our  blog reader’s special to make appropriate changes to your current plan.