Articles Posted in Estate Planning

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The issue on appeal to the Supreme Court in this case pertained to the extent to which the federal Employee Retirement Income Security Act (ERISA) preempted the Pennsylvania Probate, Estates and Fiduciaries Code, 20 Pa.C.S. 6111.2. The Decedent Paul Sauers, III obtained a $40,000 life insurance policy in 1997 from the Hartford Life Insurance Company pursuant to a employee group benefit plan which was subject to ERISA. At the time of his death, Decedent's beneficiaries were his ex-spouse and his nephew as contingent beneficiary. William F. Sauers, administrator of Decedent’s estate, filed in the Orphans’ Court of York County a petition for rule to show cause why primary beneficiary ex-Spouse should not have surrendered to the Contingent Beneficiary all interest in the proceeds of the insurance policy pursuant to 20 Pa.C.S. 6111.2. The ex-spouse objected and filed a motion to dismiss the petition for rule to show cause, arguing that regardless of any Pennsylvania statute to the contrary, ERISA mandated taht the proceeds of the policy be paid to her as the primary beneficiary of the policy. Upon review, the Supreme Court held that while an estate may properly bring a cause of action on behalf of a contingent beneficiary to a life insurance policy in a county orphans’ court seeking the proper distribution of assets, ultimately, ERISA preempts Section 6111.2 of the Probate Code. To the extent the en banc panel of the Superior Court held otherwise, the Court reversed and remanded this appeal to that court for further proceedings.View "In Re: Estate of Sauers" on Justia Law