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Friday, September 10, 2010

Does my Ex have a right to my inheritance if we get divorced? What is a Vaughan Affidavit?

The short answer is that Judges in Massachusetts can consider inheritance or potential inheritances when dividing property in Massachusetts. This does not mean that inheritances are split equally but they will play a part in how property is divided and may affect support orders as well. Whether an inheritance has been received or not can make a big difference in how it affects the division and support.

Inheritances Received During or Before the Marriage

In Massachusetts the division of marital property in a divorce case is controlled by M.G.L. Chapter 208 Section 34, which states in pertinent part:

"In addition to or in lieu of a judgment to pay alimony, the court may assign to either husband or wife all or any part of the estate of the other, including but not limited to, all vested and nonvested benefits, rights and funds accrued during the marriage and which shall include, but not be limited to, retirement benefits, military retirement benefits if qualified under and to the extent provided by federal law, pension, profit-sharing, annuity, deferred compensation and insurance."

This means that the Judge in a divorce case can consider how to divide all property that is in the name of either person, and this includes property that was inherited during or before the marriage. However, as part of the division, the Judges can consider the "contribution of each of the parties in the acquisition, preservation or appreciation in value of their respective estates..."

As an example, if a Husband received inherited property prior to the marriage, then the Wife likely didn't have anything to do with the acquisition. But if the inheritance was then placed in a joint account or used to purchase a marital home, then it is arguable that the Wife had a part in the preservation or appreciation of the asset. This is called "merging" an asset into the marital estate. If the Husband inherited property during the marriage, then it is also possible the Wife contributed to the acquisition if she, for example, had a good relationship with the deceased. These are the types of factors that will be taken into consideration in deciding what an "equitable" division of the inherited property would be.

Inheritances Likely to be Received After the Marriage

One of the factors that the Judges in Massachusetts must consider in dividing assets and determining alimony is the "the opportunity of each for future acquisition of capital assets and income." This could include the possibility or likelihood of a future inheritance. Although inheritances aren't guaranteed because living relatives can change their wills before they die, the Court can consider how likely that is to happen, especially if the potential inheritance is significant.

In one case a party's parents objected to providing information about their estate plan arguing that because an expectancy of inheritance cannot be presently divided it should also not be discoverable. Vaughan v. Vaughan, SJC Single Justice, No. 91-485, p. 3 (1991) (unpublished).

The Single Justice in Vaughan held: "Although it is true that Allan's expectancy interests are not subject to division, a [probate court] judge, nevertheless, might properly take them into account in determining what disposition to make of the property which is subject to division."

Since the Vaughan case it has become common practice in a case where there is a potential inheritance for the relative to provide what is referred to as a Vaughan Affidavit describing in some detail the extent of their estate and their current estate plan. A properly completed Vaughan Affidavit should provide you with enough information to know whether a potential inheritance is significant enough to be considered by the Judge when determining the current division or support orders.

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