Take-Away: Michigan’s revocation-on-divorce statute revokes all provisions made for an ex-spouse and the ex-spouse’s relatives, in a wide variety of instruments created by a divorced individual, including a Will and Trust. A relative is one who is related to the ex-spouse by blood, adoption, or affinity. The affinity of the ex-spouse’s relative with the divorced individual can be established by the personal relationship between the relative and the divorced individual and does not automatically end when the marriage ends. Consequently, the automatic revocation-on-divorce result is not a clear as the language of Michigan’s statute would suggest.

Background: The Estates and Protected Individuals Code (EPIC) contains a revocation-on-divorce statute that negates beneficial provisions for a former spouse and that former spouse’s relatives. The statute [MCL 700.2807(1)(a)(i)-(iii) provides, in part, the following:

Except as provided by the express terms of a governing instrument, court order, or contract relating to the division of the marital estate made between the divorced individuals before or after the marriage, divorce, or annulment, the divorce or annulment of a marriage does all of the following:

(a) Revokes all of the following that are revocable:

(i) a disposition or appointment of property made by a divorced individual to his or her former spouse in a governing instrument and a disposition or appointment created by law in a governing instrument to a relative of the divorced individual’s former spouse;

(ii) A provision in a governing instrument conferring a general or nongeneral power of appointment on the divorced individual’s former spouse or on a relative of the divorced individual’s former spouse;

(iii) A nomination in a governing instrument, nominating a divorced individual’s former spouse or a relative of the divorced individual’s spouse to serve in a fiduciary or representative capacity….

[MCL 700.2807(1)(a)(i)-(iii).]

Presumed Intent of the Testator: This statute is intended to reflect the presumed intention of the decedent, which is that he or she does not want their former spouse, or the former spouse’s relative, from inheriting any of their assets when they die.

Relative Defined: EPIC defines a relative of the divorce individual’s former spouse to mean an individual who is related to the divorced individual’s former spouse by blood, adoption or affinity and who, after the divorce or annulment, is not related to the divorced individual by blood, adoption or affinity. [MCL 700.2806(e).]

Affinity: EPIC does not provide any definition of affinity. Blood and adoption are fairly easy to understand and demonstrate. Much less clear is the slippery word affinity.

Rule of Construction and Not Substantive Rule of Law: A couple of Michigan Court of Appeals cases have had the occasion to look at  MCL 700.2807(1)(a).  The issue in each case was that the Will in question had been signed before the divorce and before Michigan adopted EPIC. The Will had not been modified after the decedent’s divorce. Under the prior Revised Probate Code (RPC), only the ex-spouse of the decedent was disinherited if they continued to be named as a beneficiary or fiduciary of their former spouse’s estate. So it was clear that the former spouse who was living was not entitled to receive any distribution under the RPC. However,  not so clear was with regard to the children of the ex-spouse, i.e. the decedent’s step-children, named as specific legatees or residuary beneficiaries.

In each of those cases, In re Estate of Fink, Michigan Court of Appeals No 278266 (July 24, 2008) and In re Estate of Monahan, Michigan Court of Appeals No. 271408 (November 20, 2007) extrinsic evidence was admitted to show that despite the divorce, the decedent’s step-children were permitted to retain their interest in their deceased former step-parent’s estate. In the Monahan decision, there was evidence that even after the divorce, Mr. Monahan participated in a step-child’s wedding, he gave $30,000 to that same step-child to purchase a home, he celebrated many holidays with the step-children and their children (celebrations that often also included his former wife), he referred to his step-children as ‘my children,’ he referred to their children as ‘my grandchildren’ and he told friends that he was naming the step-children as the beneficiaries of his $100,000 life insurance policy. In the Fink case, the two step-sons offered 11 affidavits that their former step-father intended for them to have the opportunity to purchase his farm and equipment at its state equalized value, even though the divorce with his ex-wife (the sons’ mother) had ended years earlier.

The result was, as a rule of construction [MCL 700.8102(c)] and not a substantive rule of law, a court will permit extrinsic evidence to show that an ex-spouse’s relative may still be able to retain the benefits assigned to him or her under their former step-father (or step-grandfather’s) Will or Trust.

Recent Decision: The propensity of probate and appellate courts to adhere to seemingly bright line default rules that govern the disposition of property on death in the face of facts that they believe show the default rules do not carry out the presumed intent of the decedent, was on display in a recent decision from the Arizona Court of Appeals.

Estate of Podgorski, -__ P.3d —(2020) WL 4529620 Arizona Court of Appeals, Division 1:

Facts:  The had no prior children but the wife had children from a prior marriage. The husband and wife had no children of their own. The husband and wife created a joint revocable trust, of which the wife’s children were the sole beneficiaries and named co-personal representatives and co-trustees after the husband’s death. The husband and wife later divorced. The husband failed to change his estate plan. When he later died, one of his two former step-children offered his Will for informal probate. The husband’s siblings filed a petition to remove the former step-child as personal representative from their deceased brother’s estate. They contended that Arizona’s revocation-on-divorce statute revoked the provisions of husband’s pour-over Will and the Trust with regard to the former step-children. If the contest was successful, the deceased ex-husband’s estate would pass intestate to his siblings.

Disinheritance on Divorce Statute: Arizona’s revocation-on-divorce statute defines, like Michigan’s, a relative of the exspouse by blood, adoption or affinity, and who after the dissolution of marriage is not related to the divorced person by blood, adoption or affinity.

Trial Judge: The Superior (i.e. probate) court judge rejected the siblings’ petition. The trial judge found that the husband had a continuing relationship with his step-children after the divorce. In dismissing the petition, the trial judge focused on the fact that the husband continued to pay premiums on a life insurance for which his former wife was named as primary beneficiary and her children were named as contingent beneficiaries. Based upon the fact of continued life insurance premium payments, the judge concluded that manifested an intent of the decedent to ‘reaffirm all dispositions to [the former wife’s] children.’ Thus, the husband’s relationship with his ex-wife’s children was “not interrupted by the divorce”, and accordingly the Arizona revocation-on-divorce statute did not apply.

Appellate Court: The Court of Appeals affirmed the trial judge. It held that affinity is defined to mean a connection between each spouse and the relatives of the other spouse. Apparently the Arizona cases that define affinity are silent with regard to the question if all affinity created by marriage ends with the dissolution of marriage. The Court went on to observe that if all affinity relationships ended with the dissolution of the marriage that created them, the state’s legislature would not have needed to carve out an exception to revocation by divorce.

The appeals court noted that there is nothing in Arizona’s statute that requires revocation of a disposition to anyone who had an affinity relationship with the decedent that continued independently after the dissolution of the marriage that created it.

Because the wife’s children’s relationship with their former step-father ‘continued unabated’ after the divorce and until the decedent’s death, Arizona’s statute did not operate to revoke the dispositions to the wife’s children. However, the apparent ‘unabated relationship’ with his former step-children was to pay a life insurance premium on that benefited the step-children’s mother, not them.

Like the two reported Michigan cases above, this Court did not view the Arizona revocation-on-divorce statute as a bright line rule. Instead, it applied facts of the post-judgment relationship between the divorced person and the ex-spouse’s relatives to find a continuing affinity.

From what I am able to glean, the Court seemed to rely almost exclusively on the fact that the husband had failed to change the beneficiary designation on his life insurance policy, just as he had continued to name his ex-spouse as the primary beneficiary of that policy, and her children as the contingent life insurance beneficiaries. His failure to change the beneficiary designation on the life insurance policy is consistent with his failure to change his estate plan after the divorce. Thus it seems a leap of faith to focus on the omission as to change the beneficiary designation on the life policy as an indication that the husband-insured intended to continue to have a relationship with his former step-children, in effect overriding the presumed intent behind the revocation-on-divorce statute.

Conclusion: It always surprises me to learn how many folks go through a divorce (friendly or contested) who never follow-up with updating their estate planning documents to reflect their divorced status. While most divorce judges will not allow changes to Wills, Trusts, and beneficiary designated assets pending the divorce, they will permit a change in durable powers of attorney to remove a spouse named as agent or patient advocate. But once the divorce has concluded, there is no good reason not to revisit out-of-date estate planning documents. With the failure to change those Wills and Trusts after a divorce, courts and beneficiaries are left to grapple with and decipher the decedent’s presumed intent reflected by their unchanged estate planning documents, or in the Podgorski case, an unchanged beneficiary life insurance beneficiary designation. While MCL 700.2807(1) reads like a bright-line default rule to carry out the decedent’s presumed intent, the courts seem to struggle with applying that default rule and grasp at facts to find a ‘continuing relationship of affinity’ with the ex-spouse’s relatives. It does not seem that it takes too much to demonstrate affinity with the decedent.