The Omitted IRA Beneficiary; What Can Be Done?

By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold, NJ Estate Administration Attorney

Recently new clients come to me with a dilemma regarding their mother’s IRA.  Both are sisters, yet the mother only named one of them as beneficiary to her IRA.  The mother died with no other assets, yet it is clear the mother intended to have both daughters share everything equally through her will.  The daughter who received the IRA wanted to split it with her sister, and have her set up her own IRA in a tax beneficial way but neither knew how to do this.

We advised the one sister to disclaim 50% of the IRA.  This portion disclaimed then goes to the mom’s estate.  Thereafter we will petition the surrogate’s court to appoint one sister executrix of the estate, and present that paperwork to the custodian of the IRA to gain access to the disclaimed funds.  The one sister can then renounce her interest in administering the estate, allowing the other sister to become executrix.  Once the appointment occurs, the estate IRA can be set up and the forgotten sister will have access to her own IRA with the funds her mother intended her to get.

If a similar situation happens to you, first ensure that the will says that everybody receives the remaining assets equally.  Have the named beneficiary disclaim their respective interest in the estate.  Then figure out who is going to administer the estate.  If there is no will, you will need to have somebody bonded for the total value of the account.  Optimally, you will want an administrator who is not a named beneficiary.  Every other sibling must then renunciate all rights to administer the estate and appoint the sibling who wishes to administer.  Once the sibling is appointed, the sibling can present the paperwork authorizing him or her to access the money and can give the other siblings their fair share of money.

To discuss your NJ Estate Administration & Probate matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at fniemann@hnlawfirm.com.  Please ask us about our video conferencing consultations if you are unable to come to our office.

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Judge permits Alabama city to leave school district despite finding racial motive


Education Law


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A U.S. district court judge in Birmingham, Alabama, found that the nearby city of Gardendale wants to leave its school district for racial reasons, a message she said “assail[s] the dignity of black schoolchildren.”

Nonetheless, the Washington Post reported Thursday that Judge Madeline Haikala ruled that Gardendale may take steps toward secession, in part because she was concerned that students of color would be blamed if she blocked it. She was also sympathetic to parents who wanted local control, the newspaper said.

Gardendale is about 11 miles north of Birmingham—Alabama’s largest city—and they share a school district that is predominantly African-American.

The Post said that schools in many of Birmingham’s other suburbs have broken away from the district, sharply reducing the tax base while increasing the number of low-income and African-American students, and that Gardendale has been trying to break away for years.

But the Post also said this is the first time a court has examined if there was a racial motivation behind secession, and the first time it answered yes.

The newspaper describes Haikala’s 190-page decision (PDF) as “blistering” in its criticism of secession organizers. She found ample evidence in public statements suggesting that backers of secession saw it as a way to control the number of African-American students from other communities attending local schools—including students from nearby North Smithfield who attend under a desegregation plan. Gardendale has proposed to include North Smithfield in its new district, but only after leaders decided that was essential to getting approval from a court.

“The message from separation organizers and from the Gardendale Board is unmistakable. The Court may not turn a blind eye to that message,” the opinion says. “The message is intolerable under the 14th Amendment.”

Nonetheless, Haikala granted secessionists a partial victory, permitting them to run two elementary schools for Gardendale students only, subject to a desegregation order she also required. A third elementary school must take students from North Smithfield. If there’s good-faith compliance with that order in three years, she said, the court will consider permitting Gardendale to run its own K-12 school system—but the Board of Education must include at least one African-American member.

Attorneys involved in the case who represent African-American students criticized the ruling as undermining integration. U.W. Clemon, an attorney and former federal judge, said other majority-white communities in the county are already considering creating their own districts. He and Monique Lin-Luse of the NAACP Legal Defense and Educational Fund said their clients may ask the judge to reconsider.

Chris Segroves, president of the Gardendale Board of Education, said the goal is local control, not segregation.


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Arkansas governor dismisses calls for investigation of convulsions during execution

Death Penalty


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On Thursday night, Arkansas carried out the fourth of eight executions it scheduled over 11 days, putting Kenneth Williams to death for the murder of a deputy prison warden nearly two decades earlier.

But this one had complications, The Associated Press reported Friday.

About three minutes into the execution, the AP reported, Williams began lurching and jerking about 20 times against the leather straps holding him down. Wendy Kelley, director of the Arkansas Department of Correction, told Gov. Asa Hutchinson it was like “coughing without noise,” although other witnesses said they heard sounds coming from Williams.

“The accounts of the execution of Mr. Williams tonight are horrifying,” Williams’ lawyer Shawn Nolan said in a statement (PDF). And the American Civil Liberties Union of Arkansas said the Eighth Amendment prohibition against cruel and unusual punishment may have been violated, the AP reported. Both groups asked Hutchinson for a full investigation of how this was allowed to happen, but the Republican said there was no reason to do anything other than a routine review of execution procedures.

“I think it’s totally unjustified,” he told the AP. “You don’t call for an independent investigation unless there’s some reason for it. Last night, one of the goals was there not be any indications of pain by the inmate, and that’s what I believe is the case.”

Arkansas routinely performs autopsies on executed prisoners, but results don’t become available for four to six weeks.

The unusually compressed schedule stems from the fact that the sedative midazolam—one of three drugs used in Arkansas’ lethal injection cocktail—expires Sunday. Courts have stayed four of the planned executions.

The three that took place before Thursday did not raise similar concerns, although witnesses to the execution of Jack Jones on Monday said his mouth moved after he should have been unconscious. However, executions involving the sedative have raised objections in other states where inmates took 43 minutes to two hours to die. All of the inmates in Arkansas’ recent executions died within 20 minutes.

Williams was sentenced to death for killing Cecil Boren in 1999 during an attempted prison break in which Williams hid in a barrel of hog slop. At the time, Williams was less than a month into a life sentence for killing a college student.

Related articles:

ABAJournal.com: “Federal and state judges block executions of eight Arkansas inmates; state appeals”


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Famed defense lawyer Richard ‘Racehorse’ Haynes dies


Obituaries


Richard “Racehorse” Haynes. ABA Journal file photo by Scott Pasfield.

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The storied, colorful, extraordinarily successful Houston criminal defense lawyer Richard “Racehorse” Haynes died early Friday, not long after his 90th birthday, the Houston Chronicle reports.

Haynes’ style and demeanor changed when he entered a courtroom, where he would go from easygoing to taking command of the place, Chris Tritico, the Haynes family spokesman and a criminal defense lawyer, told the Chronicle.

“You saw a guy who went from 5-foot-8-inches to 9 feet tall,” said Tritico, who got his start helping out at Haynes’ law office in 1978, just two days after high school graduation. “He owned it. He took control. And he never let go.”

Indeed, Haynes was “the master of courtroom theatrics,” as shown in a 2009 ABA Journal profile.

For example, the profile offered, Haynes once shocked himself with a cattle prod to show a jury that, while it “hurts like hell, it’s not deadly.” He threatened to drive a nail through his hand to show a jury it wasn’t very painful. (He’d had a doctor inject the area with Xylocaine). And he mocked opposing counsel by cross-examining an empty witness chair. (The prosecutor, fearing Haynes’ cross-examination, had refused to call the key witness.)

On his first case, just a day after being admitted to the bar, Haynes accidentally stepped into a chewing tobacco spittoon as he moved to address the jury. His client was acquitted of all charges and Haynes surmised they’d felt sorry for him for having such a clumsy lawyer.

So Haynes proceeded to reprise that as a deliberate stunt nearly a dozen times, always getting acquittals. It ended when the judge saw him heading for the spittoon, called him to the bench and said, “You’re not going to kick over that spittoon again, are ya?”

Read the ABA Journal’s 2009 story about Richard “Racehorse” Haynes.

His clients included the rich and poor alike and, because of him, his cases sometimes became like no others.

Haynes represented 40 clients charged in capital cases and none got death sentences; he had a 12-year string of DUI cases in which all 163 clients were acquitted; and he won all but two of three dozen women in what he called “Smith & Wesson divorces,” in which they killed abusive husbands in self-defense.

One of them was a former Dairy Queen worker, whose husband, until his death, was speaker of the Texas House of Representatives and the son of a former governor. The woman was acquitted.

Haynes’ most famous case was his defense in 1976 of T. Cullen Davis, believed then to be the wealthiest person ever tried for murder in the United States. Davis was accused of murdering his stepdaughter, his estranged wife’s boyfriend and attempted murder of his wife.

Haynes’ strategy: his client was at the movies and someone else was at the scene at the time of the murders. He also cross-examined the estranged wife for 13 days, going into sexual questions having nothing to do with the matter—which some critics said put her on trial.

Davis was found not guilty.

Haynes was a Houston native and graduate of what now is the University of Houston Law Center.


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Employers can pay women less than men based on salary histories, 9th Circuit rules


Labor & Employment Law


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The San Francisco-based 9th U.S. Circuit Court of Appeals ruled Thursday that an employer can pay a woman less than a man for the same work if he was paid more in his previous job and the employer used prior salaries as a measure in a reasonable business policy, the San Francisco Chronicle reports.

In the ruling in Rizo v. Yovino (PDF), the 9th Circuit cited and upheld its earlier ruling in a similar case in 1982. In that matter, Kouba v. Allstate Insurance Co., the appeals court said that an employee’s prior salary can be considered “a factor other than sex” under the federal Equal Pay Act if the employer can show that doing so “effectuate[s] some business policy” and is done “reasonably in light of [its] state purpose as well as its other practices.”

In that case and in the current one, the appeals court remanded the matter for the trial court to evaluate the business reasons put forth by the Fresno County school system in setting the salaries.

The case was brought by Aileen Rizo, who was hired by Fresno County schools in 2009 as a math consultant, a management position. She had previously worked as a schoolteacher in Arizona for 13 years and in Fresno County got a starting salary of $62,733, almost $10,000 more than at her last job, but at the bottom of the scale in her new one.

In 2012, Rizo learned in lunchtime conversation with colleagues that a man who had just been hired in the same position as hers was getting approximately $79,000 a year, and subsequently learned that others in the job, all men, made more than she did. She sued.

In response, the county used an affirmative defense, detailing four business reasons supporting its procedure for determining starting salaries primarily on the basis of prior salary.

Judge Lynn S. Adelman, a district judge sitting with the 9th Circuit on designation from the Eastern District of Wisconsin, detailed those in his opinion for the unanimous three-judge panel.

First, that the policy includes no subjective opinions; it encourages candidates to leave current jobs to work for the county because they receive an automatic 5 percent pay raise above their current salaries; the policy prevents favoritism because it ensures consistency in application; and the policy is a judicious use of taxpayer dollars.

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Deborah Rhode. Photograph courtesy of Stanford University.

“But, the district court did not evaluate whether these reasons effectuate a business policy or determine whether the County used prior salary ‘reasonably,’ as required by Kouba,” Judge Adelman wrote, remanding the case to U.S. Magistrate Judge Michael Seng, of the Eastern District of California, to make that determination.

One prominent critic says the decision feeds rather than stems pay discrimination against women.

“This decision is a step in the wrong direction if we’re trying to really ensure that women have work opportunities of equal pay,” Deborah Rhode, who teaches gender equity at Stanford Law School, told the Associated Press. “You can’t allow prior discriminatory salary setting to justify future ones, or you perpetuate the discrimination.”

Daniel Siegel, Rizo’s lawyer, told the Associated Press that the case could reach the U.S. Supreme Court because other appeals courts have decided differently on the issue.

“The logic of the decision is hard to accept,” Siegel says. “You’re OK’ing a system that perpetuates the inequity in compensation for women.”

Rizo’s case, brought under the federal Equal Pay Act, was filed before California enacted its own Fair Pay Act, which says that employers can use salary history as a factor but any pay gap between sexes also must be based on at least one other factor such as job experience, the San Diego Union Tribune reported.


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