Jim Flynn: Florida has condo lessons for Colorado

Jim Flynn - Business (2013)

When people finally get around to planning their estate, they tend to focus on the big-ticket items: real estate, investment accounts, funds in retirement plans, proceeds from life insurance policies, etc.

They pay less (or no) attention to personal effects - that is, items of tangible personal property such as photo albums, jewelry, china, art, fishing rods, school yearbooks, automobiles and National Geographic collections. Although these assets are often of little economic value, their sentimental value can be enormous, and emotions within a family can run high when the time comes to divide them up after someone's death. In fact, research concerning property distributions at death has shown that the distribution of personal effects is responsible for more family acrimony than just about anything else (with the possible exception of disinherited children).

The Colorado Probate Code addresses this issue by allowing tangible personal property - other than money - to be distributed in accordance with a written statement left by the decedent at the time of his or her death. Although a properly prepared will authorizing this procedure is necessary, for the purposes of the statement itself, the formalities required of a will are dispensed with. The decedent is permitted to prepare, and to change from time to time, a list of who gets what with no witnesses or notaries being necessary. The only requirements, in addition to a will authorizing the procedure, are that the statement must be in the decedent's handwriting or signed by the decedent, and the statement must describe the items of personal property, and who is to get them, with reasonable certainty.

No special form is required for a distribution of personal property statement. However, lawyers who do estate planning work will have a form they like to use for their clients.

If a decedent drops the ball and doesn't leave a list, or leaves only a partial list, the will is going to contain a "default" instruction, such as all tangible personal property to surviving spouse, all to Uncle Ted, all to Salvation Army, all to local landfill, etc.

Another default instruction might be that all tangible personal property not disposed of by a statement becomes a part of the decedent's "residuary estate"- or what's left after specific gifts are made from the estate. That property is to be sold, with the proceeds distributed according to the rules set out in the will for distribution of the residuary estate.

Or, the default instruction could be that the personal representative named in the will is given discretion to divide up the decedent's personal effects not addressed in a statement. In that case, the personal representative will distribute these assets in a manner he or she thinks would be in keeping with the decedent's wishes (and has the best chance of keeping peace in the family).

In all events, the distribution of tangible personal property at death is a matter to be taken seriously and, if family peace is an objective, distribution decisions should be made in a considerate, thoughtful and sensitive manner. Or, this can be looked on as a last opportunity to punish.

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Jim Flynn is a private attorney with Flynn Wright & Fredman LLC in Colorado Springs. Email him at moneylaw@jtflynn.com.

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