Rosoff v. Harding, 2005 WL 1163101 (Fla. 4th DCA May 18, 2005)

Sometimes a belts-and-suspenders approach to estate planning is not just overkill, it actually ends up doing more harm than good. In this case “Brother” wanted to look out for his sister. So far, so good. So Bother’s Will creates a testamentary trust for Sister’s life-time benefit and gives her a testamentary power of appointment over the trust corpus. Again, so far so good. But just in case Sister might be victimized, Brother’s Will required that any exercise of Sister’s power of appointment within 18 months of her death had to be witnessed by a corporate officer of his Corporate Trustee. In theory, this last clause probably sounded like a good idea. In practice, this belts-and-suspenders approach resulted in unintended consequences that the Fourth DCA characterized as “extremely unfortunate” and “unintentional,” but beyond the “court’s power to correct.”

Sister, the decedent in this case, published a 1982 Will exercising her power of appointment primarily in favor of her nephew. In 1991 Sister executed a new Will that continued to primarily favor her nephew. In 2000, at age 95, Sister executed a third Will, again primarily favoring her nephew. Sister died less than 18 months later. Except for the fact that Sister’s 2000 Will was not executed in the presence of the corporate officers of Brother’s Corporate Trustee, her 2000 Will was validly executed in all respects under Florida law. There was also no suggestion fraud or undue influence. Sister’s nephew, the primary beneficiary of all three of Sister’s Wills, tried to argue that based on the doctrine of “dependent relative revocation,” Broward County Circuit Court Judge Dale Ross should ignore the fact that the exercise of Sister’s power of appointment in her 2000 Will was invalid due to the belts-and-suspenders safety measures Brother built into her trust, ignore the fact that in all other respects Sister’s 2000 Will was valid, and effectuate Sister’s clear intent to exercise her power of appointment in favor of favored nephew. Unfortunately for nephew Judge Dale Ross said no, and in an interesting opinion analyzing the doctrine of “dependent relative revocation,” the Fourth DCA reluctantly agreed. The Fourth DCA defined the doctrine of “dependent relative revocation” by quoting from a 1940 Florida Supreme Court Opinion, Stewart v. Johnson, 194 So. 869 (Fla. 1940), as follows:

This doctrine has been stated and reiterated by many courts since it was first expunded in 1717, but stated simply it means that where testator makes a new will revoking a former valid one, and it later appears that the new one is invalid, the old will may be re-established on the ground that the revocation was dependent upon the validity of the new one, testator preferring the old will to intestacy.

The problem in this case was that although Sister invalidly exercised her power of appointment, her last Will was valid under Florida law. So the court was left powerless to “re-establish” her previous Will. Resulting unfortunate domino effect: Sister’s valid 2000 Will revoked her previous Will, thereby revoking her prior exercise of her power of appointment, thereby depriving favored nephew of the inheritance Sister had been trying to effectuate since she executed her first Will in 1982 – almost 20 years prior to her death.