Holley v. Grigg, 65 S.W.3d 289 (Tex. App.—Eastland 2001, no pet.).
Decedent owned an investment account on the date of his death which
named his five children as beneficiaries. The account also provided that
if a beneficiary predeceased Decedent, that beneficiary’s share would
pass to the surviving children. Decedent did not select the option of
having a deceased beneficiary’s share pass to the deceased beneficiary’s
children. When Decedent died, one of his children had predeceased him
survived by a child. In a summary judgment, the trial court held that
this child was not entitled to share in the brokerage account under the
express terms of the account.
The appellate court affirmed. The brokerage account qualified as a valid
nontestamentary transfer under both Probate Code § 450 and the
equivalent statute of Missouri, the state whose law is to govern under
the terms of the account. The court held that the account agreement was
unambiguous and that there was no evidence that even if Decedent had
made a unilateral mistake when he executed the account agreement by not
selecting the anti-lapse option, it would not provide the court with a
basis to alter the contract.
Moral: The estate planner must carefully inspect the beneficiary
designations on non-probate assets to make certain they provide for the
disposition of property the client desires.