Impact of Divorce on Dispositions to Stepchildren

Take-Away: While a divorce automatically revokes a disposition to an ex-spouse in a governing instrument like a Will or Trust, all by a Michigan statute, there continues to be a debate if a bequest or devise to a stepchild is also automatically revoked when a divorce occurs. Welcome to the vague world of affinity.

Background: In the past we have covered the topic affinity, but the Michigan Supreme Court recently provided some additional insight (but not much guidance) with regard to the impact of divorce on estate planning documents where stepchildren are named. The issue deals with that section of the Estates and Protected Individuals Code (EPIC) that provides that a divorce automatically revokes a disposition to a former spouse and his/her relatives. Specifically, that section provides that a divorce revokes a disposition to a relative of the divorced individual. i.e., the decedent’s former spouse. [MCL 700.2807(1)(a)(i).] A relative of the divorced individual’s former spouse is defined as “an individual who is related to the divorce individual’s former spouse by blood, adoption or affinity and who, after the divorce, is not related to the divorced individual by blood, adoption or affinity.” [MCL 700.2806(e).] Relation by blood and adoption are fairly easy to understand. Less clear is what is meant when EPIC uses the undefined term affinity, since at common law there are different definitions of affinity.

Affinity: In addition, how affinity is used the revocation-by-divorce statute also creates some confusion.  The way the revocation-by-divorce statute is written, there is an ‘exception’ to the affinity revocation provision if there is a child born of the ‘failed’ marriage. Consequently, if a child is born during the marriage and he/she survives their deceased parent, then any stepchildren from that same marriage remain related by affinity to the deceased stepparent, even if the parents divorced. In that situation, a former stepchild can inherit under EPIC if named as a beneficiary in their deceased stepparent’s estate planning document. In short, the statute creates a bit of confusion as to when the revocation-by-divorce statute applies, and when it does not: some stepchildren will continue to receive dispositions if they have a living step-sibling, while other stepchildren will be disinherited by the same statute if there are no living step-siblings.

Common Law Definition of Affinity: While there are apparently two different interpretations of affinity at common law, Michigan generally has followed the definition that “affinity is the relation existing in consequence of marriage between each of the married persons and the blood relatives of the other.” Bliss v Caille Bros. Co 149 Mich 601 (1907).

Supreme Court: The Supreme Court issued a decision last month, or more accurately it refused to accept an appeal, that deals with a stepchild’s affinity, but in doing so it spent several pages to explain why it did not need to accept the appeal, and at least one Justice asked the Michigan Legislature to get take a second look. For a topic not worthy of the Courts time and attention, it seems to have attracted a lot of its time and its attention.

Case: In re Joseph & Sally Grablick Trust, Michigan Supreme Court (August 11, 2023)

Facts: Joe and Sally were married. Sally had a daughter, Katelyn, from a prior marriage. Katelyn was 8 when her mother married Joe. During the marriage Joe executed a Will in which he referred to Katelyn as his ‘stepchild.’ Joe also executed a joint revocable Trust with Sally in which Katelyn was identified as ‘the only living child of the settlors.’ Joe had created a Trust to provide for Joe’s mother and sister. Later, Joe and Sally divorced. Katelyn claimed that despite the divorce by her mother, Joe and Katelyn ‘remained close.’ After Joe died, Katelyn was appointed the Personal Representative of Joe’s estate. Katelyn then filed petitions in both the Trust proceeding and the Will proceeding  for an order to determine Joe’s heirs- specifically, Katelyn.

Dispute: Joe’s mother and sister moved for summary disposition on Katelyn’s two petitions. They claimed that EPIC had automatically revoked all of Joe’s dispositions to Katelyn after the divorce, citing MCL 700.2807(1)(a)(i)-(3).] The disagreement arose from the context of Katelyn’s continuing relationship with Joe after her mother’s divorce, and Joe not updating his Will or his Trust after the divorce where Katelyn is prominently described as either his ‘stepchild’ or as ‘the only child of our marriage.’ Did those circumstances, coupled with Katelyn’s testimony that she and Joe ‘remained close’ constitute a type of affinity at common law, after the divorce,  that permitted Katelyn to continue to take under her former stepfather’s governing instruments?

Probate and Appeals Courts: The probate court agreed that Katelyn’s interest in the Joe’s Will and Trust was revoked by virtue of her mother’s divorce from Joe in light of the direct and clear language used in MCL 700.2807(1). That conclusion was later sustained at the Michigan Court of Appeals.

Michigan Supreme Court: At this point Katelyn then filed an application for leave to appeal the Court of Appeals decision to the Michigan Supreme Court. That application was officially denied by the Supreme Court. However, rather than simply issue a cursory ‘appeal denied,’ Chief Judge Clement then wrote a multi-page decision on why that denial  was appropriate. Not to be outdone, Justice Viviano issued his own multi-page concurring decision. Justice Welch also spent several pages in her concurring decision- this later sounded, more, like a dissent than a concurring opinion. So we have three Justices who denied Katelyn’s request to formally address the issue as to what is meant by affinity of a stepchild, but who then felt compelled to comment at length on the definition of affinity used in the revocation-by-divorce statute.

Chief Justice Clement: The Justice starts her concurring decision with the concise reason for her denial. Joe “very easily could have clarified that he wanted petitioner to inherit under his will despite his divorce from petitioner’s mother. I am also not convinced that the instant problem arises so frequently that it merits attention from our Court… However, I tend to believe that there is some merit in petitioner’s arguments that in this context affinal relationships can continue beyond divorce if individuals choose to remain close.” To reach this conclusion she noted that:

(i) EPIC’s automatic revocation- on-divorce provision is designed to avoid the necessity of evidentiary hearings to determine whether individuals continued to maintain their affinal relationship despite the dissolution of the marriage that gave rise to that relationship; (sort of a ‘let’s don’t clog the dockets of the trial courts with this kind of case’ reason); and

(ii) “Additionally, it is very simple for testators to avoid the automatic revocation under EPIC should they wish to do so-they can clearly state in their will that they wish dispositions not to be automatically revoked upon divorce, or after a divorce they can amend their will to clarify their intent…Indeed, I see no influx of cases challenging EPIC’s automatic-revocation provisions, so it stands to reason that the controversial application of the revocation provision is a problem testators generally successfully avoid…[I]t offers the practical benefits of a clear, uniform rule and its pitfalls can easily be avoided.” (sort of a, ‘Joe, you should have updated your Will and Trust after the divorce’ excuse.)

Justice Viviano: The Justice took a different approach. He instead focused on the presumed legislative intent behind MCL 700.2807 when it was adopted. Specifically, when Michigan adopted its version of the Uniform Probate Code back in 2000 it changed the  of how divorce impacted Will provisions.

Under the old Revised Probate Code, if there was a divorce, the former spouse was treated as having predeceased  his/her spouse, but that left the former spouse’s relatives as continuing beneficiaries under the ex-spouse’s Will. With Michigan’s adoption of the Uniform Probate Code, rather than treat the former spouse as having predeceased their former spouse, now the divorce automatically revokes not only the former spouse’s disposition (or beneficial interest) but also his/her relatives and those relationships through the extended concept of affinity, i.e. a stepchild.

This change by the Uniform Probate Code was implement based on the presumed intent of a testator. “In the vast majority of cases, an individual would not want bequests or devises to a former spouse’s relatives to remain valid after a divorce.”…These two interpretive principles make it abundantly clear that the Legislature did not intend the revocation-on-divorce provision to require or allow courts to consider whether an affinal relationship created by a married survived divorce” (Once again we have a ‘default’ provision under EPIC where the Legislature is making an assumption of what someone would want if they were later divorced. The Legislature re-writes the Will or Trust for the lazy testator.)

Justice Welch:  The Justice, while claiming to agree with the other two, took the occasion to encourage the Legislature to take another look at MCL 700.2807 due to changing demographics of the ‘modern family.’

“The underpinnings of this section of EPIC are based upon antiquated notions of family relationships set forth in cases decided at a time when divorce was largely prohibited by law. Further, the current statutory scheme revokes clearly written directives from a decedent, which is contrary to how individuals typically understand estate planning matters.”

“As a final matter, in almost all facets of our law, it is axiomatic that a party is held to their own words….The challenged portion of EPIC in this matter appears to be the exception to this rule. Rather than hold people to what they have clearly stated in a legally binding document, EPIC instead assumed that a testator or grantor has changed their mind amount dispositions to their stepchildren, regardless of whether the stepparent had a close relationship with their stepchildren or not.

Only if the stepparent proactively states that they really meant what they previously stated in writing can stepchildren remain beneficiaries….While this result is, as I noted earlier, based upon antiquated notions of divorce, it is also contrary to every norm we have in our legal system and a concept that most people well understand: what we put in writing is the best expression of our intent. It is counterintuitive that the law presumes a grantor or testator did not mean what they said in writing.”

Conclusion: It is admittedly strange to see the Supreme Court not agree to accept an appeal on a topic, and then spend several pages to explain why it did not, and along the way also express strong thoughts on the automatic disinheritance-by -divorce statute that it refused to consider. While that statute does create a ‘hard-and-fast’ rule that can be followed, it is based on the premise that a stepparent intends to “strip stepchildren of all benefits after a divorce- even when that stepparent included a stepchild in an estate plan.” And as Justice Welch also notes, with 48% of Michigan residents self-representing themselves in their divorce, “this level of self-representation should broadly counsel against an exception to axiomatic rules that the average pro se litigant would likely understand. The desire to apply an easy rule to estate plans postdivorce is certainly understandable. But EPIC is first and foremost supposed to assess donor intent… A statute assuming that a written estate plan means what it says would likewise be an easy rule to apply.” So stepchildren continue to be at risk of being disinherited when their parent files for divorce.