U.S. Supreme Court cites Florida inheritance law in unusual case

The U.S. Supreme Court recently handed down its decision in the case of Astrue v. Capato. The circumstances of the case are ones most of us will never experience. Nonetheless, the case has lessons for everyone. It underscores the importance of creating a precisely worded estate plan that takes all contingencies into account, and keeping it regularly updated.

When Florida resident Robert Capato was diagnosed with esophogeal cancer, he and his wife Karen were concerned that chemotherapy might leave him sterile. He had his sperm frozen for possible future use. Although Capato went on to father a child with his wife, he died in 2002. Karen then underwent in-vitro fertilization while living in Florida, using her late husband's stored sperm. She moved to New Jersey during the pregnancy, and gave birth to twins 18 months after Robert's death.

The Capatos had signed a notarized document stating that "Any children born to us, who were conceived by the use of our embryos, shall in all respects and for purposes, including but not limited to descent of property, be children of our bodies." However, Robert Capato's will, signed in Florida, did not make mention of any children who might be born subsequent to his death. The only beneficiaries mentioned in his will are his wife Karen; the child they conceived when he was alive; and his children from a prior marriage. And therein is the problem: According to Florida law, children conceived after a parent's death cannot inherit from the parent, unless they are referred to in the parent's Will.

The Supreme Court got involved because Karen attempted to claim Social Security Survivor Benefits for the twins. Social Security turned down the application, stating the father had to have been alive when the children were conceived. A federal judge agreed. The case then went to the Circuit Court of Appeals, which reversed the decision, and found its way to the Supreme Court. The Justices ruled unanimously that the twins are not eligible for survivor benefits because the federal government - i.e, the Social Security Administration - must base its decisions upon each state's own inheritance laws. Even though Karen actually gave birth to the twins in New Jersey, they were conceived in Florida, and thus, Florida intestacy laws apply. Wrote Justice Ginsburg: "The law Congress enacted calls for resolution of Karen Capato's application for child's insurance benefits by reference to state intestacy law."

This is highly unusual case, to be sure. Still, all of us can learn from it. Consult with an experienced Elder Law/Estate Planning attorney when drafting your estate plan.

You can read the Supreme Court decision here.