What is a Heggstad Petition?
Drafting a trust and funding it (changing title to your assets to the name of your trust) is a multi-step process. If a person fails to fund or title his/her property in the name of the trust during his/her lifetime the “Heggstad Petition” (named after a decedent in the case) is a means to escape the full probate process.
A Heggstad Petition can create a simplified process of distributing property through a trust that initially failed to adequately fund the trust with all the property owned by the decedent. Absent the ability to utilize this petition an executor/successor trustee of a trust would have to go through the otherwise lengthy, complicated, and expensive process of probate. However, through the use of the Heggstad Petition, the Successor Trustee will make the argument by petition before the court that the Settlor/Trustor intended for the property not actually titled in the trust to be included as an asset of the Trust.
Should the Heggstad petition be successful, the court’s judgment will allow for the transfer of the excluded property into the trust as if it were adequately funded by the decedent.
What must be provided to the Court to File a Heggstad Petition?
In order to utilize the Heggstad petition, the court will need certain information, the following of which is of particular importance:
- A copy of the Trust Document;
- Identifying information of the decedent and all the beneficiaries;
- Description(s) of the assets not funded;
- All evidence available to show the decedent’s intention with regard to the assets excluded from the trust; and
- What remedy is being sought to carry out the decedent’s intentions.
When can a Heggstad Petition may be Filed?
As mentioned above, there must be property owned by the decedent that was not included in the trust and a showing that the decedent intended for the asset to transfer through his/her trust but failed to do so before death. Some common showings of intent and failure to complete the transfer are as follows:
- Decedent was prevented from making the transfer due to some extenuating circumstances, such as declining health;
- Decedent initiated the transfer process but passed away before completing the transfer; and/or
- Decedent believed the property was transferred, however, the documentation was flawed or other issues result in and incomplete or correct transfer based on intent.
Each probate case is unique as to why property was not included in a trust. If you are uncertain on whether you may be able to benefit from a Heggstad Petition or you are in need of assistance with trust administration, contact us for review of your case today.
