Adult Adoptions Generate Legal Disputes over Trust Rights
Adult adoptions are sometimes used by trust fund beneficiaries who want to transfer the trust money to a same-sex partner after death, but in some cases the device is leading to legal disputes.
Adult adoptions are barred in almost half the states, the New York Times reports. Elsewhere, a current trust beneficiary sometimes adopts a same-sex partner if the trust designates the beneficiary’s children as next in line to receive the money. Such adoptions can produce legal battles over the intent of the trust creator.
The New York Times reports on an appeal by the one-time lesbian partner of a woman whose grandfather founded IBM. The granddaughter, Olive Watson, was 43 when she adopted her lesbian partner, Patricia Ann Spado, who was one year older. They had been together 14 years at the time of the adoption, but they broke up less than a year later.
Spado’s lawyer, David Keyko of Pillsbury Winthrop Shaw Pittman in New York, wrote a letter to the family lawyer asserting his client’s right to a portion of the family trusts after Watson’s mother died.
A probate judge in Greenwich, Conn., ruled the trusts were designed for grandchildren who had a “typical parent/child relationship” with Watson and her siblings, and Spado was not an intended beneficiary, the story says. Spado has appealed. In a separate action, a probate judge has annulled the adoption 17 years after it took place. Spado has also appealed that decision.
Keyko told the Times that estate planners need to be aware that adoptions can complicate trusts. “If you leave things in trust, which is a great estate-planning device, you give your children the ability to some degree to manipulate that by adoption,” he said.
A trust creator can foil such plans by excluding beneficiaries who are adopted after a certain age, the story says.
