What is A Heggstad Petition?
Sometimes a person who has created a trust may fail to place a property or asset into that trust before they die. This can happen for a number of reasons. Maybe an extenuating circumstance, such as declining health, hindered them from being able to place their property/asset into the trust. Maybe the decedent incorrectly believed the property was transferred; this could be due to improperly filling out the documentation to have the such property/asset transferred. Maybe the decedent just forgot. In cases like these, that property would typically have to go through a timely and expensive process known as probate. A Heggstad petition is filed out to avoid such probate proceedings. It is used when a property/asset owner dies with their property/asset still in their name, even though they intended for the property/asset to be transferred to the trustee(the living trust).
The precedent was established in the 1993 case of Estate of Heggstad. In 1989 Halvard Heggstad, property owner, established a will which named his son, Glenn Heggstad, as executor of that will. Halvard also created a living trust, in which he also deemed his son as the successor trustee. The documents in Halvard Heggstad’s trust included a schedule of his properties. On that list, item number five was a Menlo Park address that was incorrectly labeled as a partnership interest.
Soon thereafter, Halvard Heggstad married but never changed his will. A few months following his marriage, he died. After his death, there was a dispute regarding the Menlo Park address property. Glenn Heggstad claimed that the property listed in the trust belonged to him despite the error. The stepmother contested that it had not be legally transferred, and consequently should be given to her, the surviving spouse. After reviewing the documents, the probate court determined that Halvard Heggstad did, in face, INTEND to give the property to his son in his trust and, as a result, Glen Heggstad was awarded the property. Thus, the Heggstad petition was born.
Why File A Heggstad Petition?
If someone has created a trust and has intended to place a particular property/asset in there, but failed to do so, filing a successful Heggstad petition will prevent the process of a probate proceeding by the court. Avoiding a probate proceeding can potentially save you a lot of time and money.
Timeframe Of Filing A Heggstad Petition
Heggstad petitions should be filed as soon as beneficiaries notice a disparity between the trust details and the actual title transfer of the property in question. The typical duration of this process is about 60 – 90 days, from preparation and filing of the petition to the final judgment, compared to a probate process which can take upward of 6+ months and thousands of dollars.
Filing a Successful Petition
There are a few factors that increase the chances of success when filing a Heggstad petition. If the property in question is on a signed schedule of assets, for example, the trustee’s case would be strengthened. Be sure that the property’s address is documented as well, as it gives specificity and confirmation of the particular property in dispute. Another factor that would strengthen your case would be a signed a trust document, by the property owner, that clearly establishes intent to distribute the property. While signed letters may be able to help a judge in their decision, it would be best to present documents that were witnessed and notarized by attorneys. Another helpful inclusion would be if the property was included in a pour over will; as pour over wills are traditionally understood to work in conjunction with a trust. Essentially, the more documentation you can present, the stronger a person can build a case for him/herself.
Cesar has received his Masters of Science in Integrated Design, Business and Technology from the University of Southern California.
