The Virginia General Assembly overhauled Virginia’s elective share statute this past year, and one of the big results will likely be an increase in litigation.
My colleague Brett Herbert recently wrote a blog post summarizing some of the more significant changes in the elective share framework that go into effect on January 1, 2017 (that post can be accessed here). This post focuses on a specific change that adds a time requirement in which a surviving spouse asserting a claim for the elective share must file a lawsuit to determine the elective share.
Under the prior Virginia law, when a surviving spouse wanted to assert a claim for the elective share, she needed to record a written claim in the court clerk’s office within six months of the later of the admission of the decedent’s will to probate, or the qualification of an administrator of the estate. For those instances where there was some debate as to the amount of the elective share, the attorney for the surviving spouse would often negotiate with the attorney for the administrator until they settled upon the correct value. That task could be complicated by several factors: (1) the surviving spouse always wanted the figure to come in at a high amount, and therefore would take an aggressive position as to the valuation of certain assets, businesses interests, etc.; (2) the administrator and surviving spouse may have disliked each other; and (3) the administrator could have attempted to assert a claim that the surviving spouse was statutorily barred from taking the elective share due to desertion or abandonment. The result – in instances where the parties contested the proper amount of the elective share – was often lengthy negotiations following the recording of the claim for the elective share. In the event the parties still couldn’t resolve the matter, there was a statutory procedure available that authorized one of the parties to file a lawsuit and put before the court the proper calculation of the elective share. The key takeaway was that under the old system, there was no time period in which the surviving spouse had to file the lawsuit after having recorded the claim for the elective share.
That has changed under the new law. Now, a surviving spouse is legally required to file a lawsuit no more than six months after recording the claim for the elective share. The result will be a much shorter period of time for the surviving spouse to negotiate with the administrator as to the value of the elective share, before the surviving spouse is required to file a lawsuit. In light of this, surviving spouses and their attorneys will need to remain vigilant and ensure that they file a lawsuit with sufficient time to preserve the surviving spouse’s rights. This is especially the case when the augmented estate includes assets that are difficult to value, or that require complicated appraisals (and therefore take longer to value). In sum, surviving spouses and their attorneys need to remain more vigilant under the new law, and the result will be more matters that end up in litigation due to the new deadline.