The Iowa Supreme Court this year considered Kiene v. Wash. State Bank, a lawsuit that questioned whether interested parties can challenge a testator’s capacity to draft, modify or execute a Will while the testator is alive.
The Court found neither Iowa Code § 633.637 nor any other section of the Probate Code allows a person to contest a testator’s estate planning documents or to challenge his/her testamentary capacity before death.
Disabled Testator Executes Two Wills and His Sister Sues
The testator in this action lives in a healthcare facility and suffers from autism, along with other several mental illnesses. After his mother died, he agreed to a conservatorship that established his brother-in-law as his guardian and Washington State Bank as his fiduciary and conservator.
In 2019, the testator’s sister learned her brother had executed several estate planning documents. After a brief investigation, the sister discovered two separate Wills with signatures dating twenty-three years apart (1992 and 2015).
The testator’s sister immediately sued, asking the District Court to determine whether her brother held testamentary capacity to execute the Wills, and if not, to have his testamentary documents set aside.
Conservator Moves to Dismiss Pre-Death Testamentary Capacity Lawsuit
In response to the legal action, the testator’s conservator moved to dismiss, claiming the sister did not hold standing to bring a will contest while the testator was still alive. Washington State Bank further argued the claimant could not sue because her interest in her brother’s estate had not yet vested.
The District Court denied the conservator’s motion, holding the testator’s sister held a right under Probate Code § 633.637 to learn whether her brother held testamentary capacity to execute the Wills in controversy.
Upon revising its motion to dismiss, the conservator petitioned the court to establish whether the case at hand involved resolving the testator’s present testamentary capacity or whether he held capacity in 1991 and 2019 to execute the documents in contestation.
If the court ruled on the latter question, the Bank further queried whether the court’s decision would be binding on all the heirs named in the Wills or just on the claimant. The sister then argued the court must first find whether her brother held testamentary capacity to execute the Wills before it could decide how its ruling would affect his heirs.
The District Court subsequently deferred to only assess the testator’s present testamentary capacity and “his current ability” to modify the Wills in question and any other future testamentary documents—the sister then appealed to the Iowa Supreme Court.
Iowa Supreme Court Resolves Ante-Mortem Probate Questions
The question before the high court was whether an interested third party under Iowa Code § 633.637 may seek declaratory judgment action of a ward’s testamentary capacity while he is still alive.
According to the sister, she held standing to sue as an interested third party because if the courts set aside her brother’s Wills, she would inherit under Iowa’s intestacy laws.
When scrutinizing Iowa Code § 633, Justice Waterman found no legislative intent in the statute that created heir or third-party beneficiary rights to challenge a Will’s validity before the testator dies—Waterman further held the Court has “never construed this statute to allow such a challenge” when examining “chapter 633 as a whole.”
The high court also ruled the legislator when enacting section 633 purposely omitted terms that would have allowed a third party the right to sue for a “determination of a ward’s testamentary capacity.” Thus, without the legislator’s selective inclusion of such terminology, the claimant had no remedy available to “set aside a will while the testator is alive.”
High Court Justice Reasons Against Pre-Death Probate Litigation
Justice Waterman, however, recognized chapter 633 “expressly provides specified powers and rights” to interested persons, and allowing such parties access to ante-mortem (pre-death) probate litigation under the section “may avoid some post-death will contests.”
Yet, letting these lawsuits proceed would most likely would provoke “unnecessary will dispute litigation” on testamentary documents that the courts would have never probated after the testator’s death, according to Waterman.
It therefore made more sense for the higher court to defer all will contests to formal probate proceedings—a time when all affected parties can join and/or challenge the deceased’s testamentary capacity when necessary.
Hence, according to Justice Waterman, “pre-death challenges to wills may be a waste of time,” since testators may ultimately pass away in debt or may legitimately modify their estate plans after receiving an adverse pre-death probate ruling.
Finally, the court recognized the law entitles testators to keep the terms of their estate plans confidential before their death—ante-mortem testamentary capacity action consequently invades a testator’s privacy rights by revealing bequeaths before death.
Such disclosure may generate “unwanted discord among family members” of which indirectly conflicts with current public policy, according to Justice Waterman.
Pros and Cons of Contesting Capacity Before Death
Post-mortem testamentary capacity litigation in Iowa has become common practice in probate litigation ever since the state’s highest court decided In re ESTATE OF FITZGERALD in 1932. The Iowa Supreme Court in Fitzgerald ruled that a testator/testatrix will hold capacity to draft, modify or execute his/her estate planning documents when he/she:
- possesses sufficient mentality to understand the nature and purpose of the instrument about to be executed;
- holds adequate capacity to know the extent and nature of his/her property;
- knows and comprehends the distribution in which he/she desires to make; and,
- understands which heirs or beneficiaries will have claims upon his/her bounty.
There are, however, a handful of states (Ohio, Arkansas, North Dakota, and Alaska) that allow heirs, beneficiaries and third parties to probate or challenge a Will while the testator is alive.
In Iowa, will challengers have asserted secondary authority arguments from other states in their lawsuits to influence the courts into accepting ante-mortem probate action.
This is exactly what claimant Kline attempted to do in the lawsuit explained above. For now, at least, our highest court has accepted the state legislator’s long-standing, traditional rule that “a Will doesn’t speak until the death of the testator.”
Hence, no party in Iowa currently holds legal standing to contest a person’s testamentary capacity or estate planning documents before the testator’s death.
Reasons Why Pre-Death Testamentary Capacity Litigation Fails
Remember that ante-mortem probate theory allows testators to pursue court rulings to validate their Wills and their capacity to execute them. Such judicial declarations in turn effectively bind the named heirs to the terms of the Will and prevent potential challengers from contesting the document after the testator dies.
Contrarily, ante-mortem will contests petition the courts to set aside a Will or to rule a testator lacks capacity to execute his/her estate plan. Adverse rulings likewise may ban legitimate heirs from receiving their legacies and open the door for unforeseen will challenges after the testator passes away.
Legal experts often further argue that pre-death probate action:
- Forces testators to watch his/her family members fight over estate assets.
- Compels litigation on all heirs when it’s probable that none of them would have disputed the Will after it entered probate.
- Allows unintended beneficiaries to receive estate assets.
- Invades the testator’s privacy interests.
- Wastes the court’s time and resources, since the testator may lawfully alter his/her testamentary documents after pre-death probate ends.
- Obligates testators to pay out-of-pocket for the legal expenses from pre-death testamentary capacity challenges as opposed to the estate as a whole paying for the same costs during probate.
And so, regardless of whether you are for or against ante-mortem probate litigation, the Iowa Supreme Court has spoken, and at least for now, heirs and recipients must wait until after a loved one passes away before they can fight for their inheritances.