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What happens if the order of death among family members becomes unexpected? More precisely, what happens if a beneficiary of a nonprobate transfer under a beneficiary deed drafted pursuant to the Nonprobate Transfers Law of Missouri does not survive the owner of the real property? Who receives the real property when the owner dies under those circumstances?

Bill and Jane had one son named Tom. Bill and Jane did a noble thing. They raised the minor children of Jane’s sister Sue who was tragically killed in an international airline flight. Sue at the time of her death was a single mother because her husband had predeceased her due to cancer. Sue’s minor children were Amy and Ted. Bill and Jane never legally adopted Amy and Ted but raised them well as their court-appointed co-guardians and conservators.

Bill and Jane loved Amy and Ted as much as their own son Tom. Tom, Amy and Ted grew up. Each married a nice spouse. Each couple had two children; however, Ted’s two children did not find favor with Bill and Jane for unexplained reasons.

Although their liquid assets were modest, Bill and Jane owned hundreds of acres of land in Camden County, Missouri near the Grand Glaize Bridge. Pursuant to the encouragement of Bill’s golfing buddies and Jane’s luncheon ladies, Bill and Jane asked their attorney to draft a beneficiary deed to cover all their acres of real property in Camden County. The beneficiaries named on the beneficiary deed were as follows: Tom, Amy LDPS and Ted no LDPS. If Tom, Amy and Ted survived the last of Bill and Jane to die, Tom, Amy and Ted each were to receive an undivided one third interest as a tenant in common under the beneficiary deed upon the death of the survivor of Bill and Jane. One day after Bill and Jane signed the beneficiary deed, it was recorded in the Recorder of Deeds’ Office for Camden County, Missouri.

Bill died four years later. Jane died two years after Bill’s death. Jane still owned all the acres of land in Camden County described in the beneficiary deed. Before Jane’s death, the unexpected happened. Tom was snorkeling in the Caribbean and died unexpectedly of a heart attack. Amy died before Jane when Amy was fatally killed in a car accident by a drunk driver who was going the wrong way on a one way street. Ted, a community resource officer for a school district, died in a senseless high school shooting. All transferee beneficiaries under the beneficiary deed died before the last owner of the real property.

Who receives the hundreds of acres of real property when Jane died last if the beneficiary deed remained the same? Answer is Tom’s two children in equal undivided shares receive a one half interest in the hundreds of acres in Camden County. Amy’s two children in equal undivided shares receive the other one half interest in the hundreds of acres in Camden County. Each of these individuals receive an undivided one fourth interest in the entire acreage as tenants in common. Ted’s children do not receive anything under the beneficiary deed.

The use of LDPS in the beneficiary deed was important to promote the clients’ objectives. To find out more about the use of LDPS on beneficiary deeds or on TOD accounts, call our office and visit with one of our estate planning attorneys to make certain that your directions are accurately reflected.

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