New York Probate and Estate Administration Lawyer Blog
In the process of estate administration, when there is a disagreement about who has title to property or there has been a theft of assets, the executor of an estate can initiate a turnover proceeding to get more information and to recover property that belongs to the estate. SCPA § 2103
Background
Decedent died on July 13, 2017. She left a will and was survived by six adult children as well as her long-time companion, the petitioner William Koughn. The decedent and Koughn split their time between homes in Florida and in New York. However, in February 2017, the decedent’s children forced her to move from Florida to New York and initiated a guardianship proceeding. Shortly before her death, one of the decedent’s sons, George Mahoney, was appointed as her guardian.
In May 2018, this Court admitted decedent’s November 2016 will to probate. George Mahoney and another son, Steven Mahoney, were named co-executors of her estate. The will included the following testamentary gifts:
- Koughn a life estate in her Florida condominium, where the two had cohabitated since 1998
- $250,000 be placed in trust to pay for all the condominium’s real estate taxes, homeowners liability, casualty, wind, hurricane and flood insurance and any other costs of maintenance and repair for the condominium and its appurtenances.
- That a trust is established a in the amount of $250,000 and to make annual distributions from this trust in the amount of $50,000 to Koughn each January after decedent’s death for five years. SCPA 2102
- $5,000 to her sister
- The remaining of the multimillion-dollar estate to her children.
There was also a significant amount of property that Kough was in possession of at the time of the decedent’s death that the co-executors claim belong to the estate. The property includes:
- $20,000 from decedent’s checking account
- The contents of a safe deposit jointly owned by decedent and Koughn
- $36,000 from a Charles Schwab investment account jointly owned by decedent and Koughn
- Cash and gold coins kept in a safe in decedent and Koughn’s home
- Certain household furnishings
- 2010 Ford Sport Trac motor vehicle that was jointly owned by decedent and Koughn
- Boat trailer, boat motor, and box utility trailer
- Certain financial paperwork.
The co-executor filed a petition demanding that Kough return property that they allege belongs to the estate. Kough filed a petition to compel the co-executors to pay the $50,000 annual payments and to established the trusts as required by the will. In the alternative, he requested the court remove the co-executors since they were not following the terms of the will. The two cases were joined.
Discussion
In a turnover proceeding, the burden is on the petitioner to establish that the property belonged to the decedent. Once the petitioner meets that burden, it shifts to the respondent to establish that it was a gift. In this case, the co-executors are the petitioners and the respondent is Kough.
The closely reviewed the evidence related to the $20,000 that was transferred to Kough’s checking account, the property in the safe, and Charles Schwab account. The court determined that there was no evidence that the $20,000 transfer to Kough’s account was improper. In fact, the bank verified that that transfer was legitimate. Similarly, the court did not find that the co-executors produced credible evidence that the contents of Kough’s safe belonged to the estate as well as the vehicle and boat items. Thus, the burden never shifted to Kough to prove that the items were gifts. As far as the Schwab account, the court determined that Kough was only entitled to half of it and that the other half must be returned to the decedent’s estate.
The court also granted Kough’s request that the $50,000 annual payments, plus interest be paid. As for the other requests, including Kough’s request that co-executors be removed a the court left that to be decided later.