Often the intersection of science and law creates situations that no one could have anticipated. There is no better example of this than assisted reproductive technologies in which posthumously conceived children are born after the death of a parent, and the lag of state inheritance laws to address whether these children have the same inheritance rights as children born during the decedent’s lifetime.
Current data from the Center for Disease Control and Prevention reveal that the use of assisted reproductive technologies has more than doubled over the past decade. Many reasons exist for this trend. Early detection of diseases, such as cancer, allows individuals an opportunity to plan to freeze genetic material for the purpose of having children in the future and possibly after their death.
Within the context of estate planning different scenarios abound. Take for example, the situation of a husband and wife who decide to freeze genetic material to allow for a future child, in the event that one spouse falls ill or dies. How should a child conceived and born after the death of a parent be treated under the law with respect to his or her inheritance? If the deceased parent left a will allowing for a distribution to his “children, issue and/or descendants”, would a posthumously conceived child be included in that definition? Further, what if a trust was created decades ago by a grantor who wanted to ensure that those funds would benefit his sons and grandchildren? Would he long ago have considered a grandchild born posthumously after the death of his son to be his grandchild for whom an inheritance was intended? What if his deceased son’s spouse remarried? These are issues probate courts across the country will have to address.
For the estate planning practitioner, this may be a difficult topic to introduce to clients. In the past it may have seemed far-fetched. Now, however, it may be prudent to raise this possibility of planning for posthumous children and allow the clients to decide whether or not to include pertinent language in their estate planning documents.
While one may think that this question only concerns wealthy families, in reality, the posthumously conceived children issue has manifested itself across the economic spectrum. Wealthy families may attempt to qualify for distributions from a large trust fund. Lower income families may attempt to qualify for social security death benefits.
In the 2012 US Supreme court case of Astrue v. Capato, the court ruled on the question whether Karen Capato’s posthumously conceived twins were entitled to their father’s social security benefits. The circumstances of this case were heartbreaking. Karen and Robert Capato were married in 1999, in Florida where they resided. Robert was diagnosed with esophageal cancer. Knowing that he would become sterile after undergoing chemotherapy, Robert froze his sperm and directed that in the event of his death his genetic material would be subject to the directions of his wife Karen. Robert died in 2002. Via in vitro fertilization Karen gave birth to twins 18 months after her husband’s death. Karen then applied for survivor’s insurance benefits on behalf of her twins. Her application was denied by the Social Security Administration (SSA) on the basis that the twins had to be eligible to inherit under state intestacy law. However, under Florida law, a posthumously conceived child could only inherit if conceived during the decedent’s lifetime.
At some point after her husband’s death Karen Capato moved to New Jersey where she filed her appeal. The District Court agreed with the SSA’s reading of the statute and determined that the twins could qualify if the same right existed under the state’s intestacy law. The Court of Appeals for the Third Circuit reversed and ruled that the twins were the biological children of the decedent and thus should qualify for survivor benefits irrespective of state intestacy law. Justice Ginsburg, in her opinion for a unanimous Supreme Court acknowledged the case’s tragic circumstances but reversed the Third Circuit’s ruling. The Court held that Congress enacted the Social Security law with a mechanism to resolve questions of insurance benefits by reference to state intestacy law. As a result, Karen’s claim for SSA benefits were denied since Florida’s intestacy laws do not recognize inheritance rights of posthumously conceived children. However, intestacy laws differ from state to state, the outcomes of these types of claims will vary depending on the residence of the decedent.
At the other end of the spectrum are cases in which family members seek trust fund assets for the benefit of posthumously conceived children. In the New York County Surrogate’s court case of In re Martin B., decided in 2007, the issue was whether two posthumously conceived children could qualify for distributions under their grandfather’s trust created for the benefit of his two sons and “any grandchildren”. Did the grandchildren fit the definition under the trust? The proceeding was commenced by the widow of Martin B. together with their son’s widow who conceived two children five years after his death. A compelling factor was that the surviving spouse of Martin B. had the right to control trust distributions. Possessing veto power over trust distributions, even if their application to the court failed, the surviving spouse could have disallowed distributions to the sole surviving son. Acknowledging that Martin B’s trust, created in 1969, probably did not contemplate posthumously conceived grandchildren as possible heirs, the court nevertheless decided that children conceived with the consent of their parents should enjoy the same rights as naturally born children. Using a sympathetic reading of Martin B.’s trust instruments, the court found that the grantor would have wanted his bloodline to share in the trust’s assets.
Alerted by such decisions, some states have revisited their intestacy laws to address the issue. At least ten states, including California, Colorado, Florida, Iowa, Louisiana, Maryland, Massachusetts, New Jersey, New Mexico, and North Dakota, have recognized posthumously conceived children under laws of intestacy. While all of these states have some kind of requirement to prove that the decedent consented to the use of genetic material by the surviving spouse, the new laws are far from uniform. Some states require the parents to be married at the time of death. Others have a set time frame within which a child must be conceived. Although a deadline for conception may seem harsh, from a logistical standpoint it make sense, otherwise long settled estates may be reopened by new claimants. In California, there is an added requirement that a surviving spouse give notice within four months of the decedent’s death to the fiduciary of intent to use the decedent’s genetic material. This requirement places the burden upon the surviving spouse to give notice lest, the child be excluded from inheritance.
Given that biotechnology has forged a new reality, not just a theoretical question, should an estate practitioner introduce this concept to clients preparing estate planning documents? The issue of conceiving a child after the death of a spouse from frozen genetic material can be controversial. Some clients may find that the practice does not square with their personal values and morals, and thus, practitioners may be reluctant to raise it. On the other hand, discussing this topic does not seem more controversial than explaining the different options of a “living will” to a client who may disagree with artificial nutrition or hydration. In drafting provisions confronting this issue in estate planning documents, practitioners may address clients’ wishes of whether or not to include posthumously conceived children as potential heirs. By raising this possibility, the client is allowed the opportunity to consider it. Counsel should consider adding the question to their checklist for estate planning.