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California closes loopholes in probate code to protect vulnerable adults

Tuesday, 1 October, 2019

The California State Legislature has amended the state’s probate code to create presumption of undue influence in two scenarios in which caregivers attempt to marry a vulnerable individual in order to access their wealth.

Under Assembly Bill 328, California Probate Code sections 21380, 21382, and 21611 have been amended to ensure that care custodians do not attempt to marry vulnerable dependents to make use of loopholes in the code. Such dependents are classified as adults of any age who cannot provide properly for their basic needs, have difficulty managing their financial resources, or are unable to resist fraud or undue influence.

As the law currently stands, a lifetime gift or beneficiary provision in a will or trust made by a dependent adult to a care custodian is presumed to be a result of fraud or undue influence.

However, spouses, domestic partners and cohabitants who receive such gifts from dependent adults are exempted: leading to the possibility that a caregiver might marry the dependent adult to avoid the aforementioned presumption.

The new Bill now extends the presumption of undue influence to include any “care custodian who commenced a marriage, cohabitation, or domestic partnership with a transferor who is a dependent adult while providing services to that dependent adult, or within 90 days after those services were last provided to the dependent adult, if the donative transfer occurred, or the instrument was executed, less than six months after the marriage, cohabitation, or domestic partnership commenced.”

Further, the Bill closes the loophole of “omitted spouse” status. Under the current law, it is presumed that if a marriage takes place after a will or trust has been created, and said will or trust is not updated, the surviving spouse, as an “omitted spouse,” can claim a share of assets equal to what they would have received had their spouse died intestate.

Under the new Bill, the probate code is now amended so that the spouse will not receive a share of the estate if:

  • the spouse was a care custodian of the decedent who was a dependent adult and the marriage commenced while the care custodian provided services to the decedent, or within 90 days after those services were last provided to the decedent; and
  • the decedent died less than six months after the marriage commenced.

The Bill comes into effect on January 1, 2020, and has been sponsored by the Trusts and Estates Section of the California Lawyers Association and supported by the California Judges Association.