Under Arizona law, certain assets can bypass the probate process and transfer directly to beneficiaries. While these non-probate assets, such as jointly owned property, payable-on-death accounts, and trust-held assets, often simplify estate administration, they are also frequently the subject of disputes and litigation. Questions may arise regarding rightful ownership, improper beneficiary designations, lack of capacity, undue influence, or allegations of mismanagement.
At Berk Law Group, our focus is on helping clients resolve disputes and litigate issues in Arizona involving numerous issues, including non-probate assets, ensuring a fair and lawful outcome through effective probate litigation strategies.
Common Types of Non-Probate Assets and the Disputes They Involve
Jointly Owned Property with Right of Survivorship
[Learn more about rights of joint account holders]
Assets such as real estate or bank accounts owned jointly with another person often pass directly to the surviving owner without probate. For example, spouses owning property as community property with right of survivorship (WROS) in Arizona can automatically inherit the property. However, disputes can arise if there are questions about the true intent behind the joint ownership or allegations of coercion in adding a joint owner. Additionally, disagreements may occur if the surviving owner is accused of misusing funds while the original owner was alive.
Payable on Death (POD) and Transfer on Death (TOD) Accounts
Payable on Death (POD) and Transfer on Death (TOD) accounts are designed to transfer directly to named beneficiaries, bypassing probate. However, disputes may arise if multiple beneficiaries are named, errors exist in beneficiary designations, or undue influence is suspected during the designation process. For example, it is not uncommon for family members to contest the validity of changes made to beneficiary designations, particularly when these changes were made late in life or under suspicious circumstances.
Beneficiary-Designated Accounts
[Explore our probate litigation services for beneficiary disputes]
Life insurance policies, retirement accounts, and annuities that have a named beneficiary bypass probate. Nevertheless, these beneficiary designations can be contested, particularly in cases involving allegations of fraud, undue influence, or outdated designations. For instance, if a beneficiary designation is not updated after significant life events, such as a divorce or remarriage, disputes can arise regarding who the rightful beneficiary should be, often leading to litigation.
Assets Held in Trust
Assets placed in a trust bypass probate, but disputes over trusts are common. Issues may include allegations that the trust was improperly created, that the trust terms are ambiguous, or that the trustee has breached fiduciary duties. For example, beneficiaries may accuse a trustee of misusing trust assets, failing to distribute assets as specified, or not acting in the best interests of all beneficiaries, which often requires probate litigation to resolve.
Small Estates
Arizona law allows a streamlined process for small estates to avoid probate through affidavits if the total value of the deceased’s personal property is below \$75,000 or real property is valued under \$100,000. Disputes can arise if heirs disagree about the valuation of the estate, whether certain assets qualify under the small estate threshold, or if there are allegations of improper use of the affidavit process.
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Protecting Non-Probate Assets from Financial Exploitation Under Arizona Law – Estate and Property Disputes
[See our dedicated page on preventing abuse and financial exploitation of vulnerable adults]
While non-probate assets can often simplify the process of transferring assets, they are not without risks. In particular, these assets can be vulnerable to financial exploitation, especially when a person in a position of trust takes advantage of a vulnerable adult. It is crucial to understand the protections available under Arizona law to safeguard these assets. Arizona law provides important protections for vulnerable adults against financial exploitation, especially when it comes to non-probate assets such as trusts, jointly held property, and payable-on-death accounts. Financial exploitation can occur when someone in a position of trust, like a family member or caregiver, manipulates or takes advantage of a vulnerable adult for personal gain, which often involves undue influence or misuse of authority to alter asset ownership.
What Constitutes Financial Exploitation?
Financial exploitation often involves coercing a vulnerable adult to change their will or trust, misusing a power of attorney to access funds, or improperly taking property. Some common examples include:
– A caregiver convincing an elderly person to change their beneficiary designations under false pretenses.
– A family member using undue influence to gain access to a joint bank account.
– Misuse of a power of attorney to transfer non-probate assets, such as payable-on-death accounts.
Such exploitation can result in disputes over the rightful ownership of non-probate assets, requiring litigation to resolve these complex and sensitive issues.
Legal Protections Available for Financial Exploitation
Arizona law provides legal avenues to pursue claims against those who exploit vulnerable adults, especially in matters involving non-probate assets. These cases often require swift legal action to protect assets and ensure they are distributed fairly. Remedies may include recovering misappropriated assets, pursuing damages, and seeking to invalidate improper transactions.
Our Legal Team’s Approach to Protecting Your Assets
If you suspect financial exploitation of a loved one, you have the right to take legal action to protect their assets and hold the responsible parties accountable. For example, a common scenario involves a caregiver convincing an elderly person to change their beneficiary designations or transfer ownership of property under false pretenses. Our experienced probate litigation team can assist you in navigating the complexities of these claims under Arizona law. We also help resolve other probate-related disputes, ensuring that vulnerable adults and their assets are safeguarded effectively.
Contact Us for Litigation Assistance
If you are involved in a dispute over non-probate assets, suspect financial exploitation, or need assistance with any probate-related litigation, we are here to help. Our team of experienced probate litigators will work to protect your interests and ensure a fair resolution.
Related Pages You May Find Helpful:
– [Understanding Trusts and Estates Disputes & Litigation]
– [Guardianship and Conservatorship Disputes]
Please also browse our video library.
If you have any questions or need guidance, please contact us today for a consultation.
