In 2013, the State Legislature amended South Carolina Probate Code Section 62-2-507. Also known as the ‘revocation by divorce statute,’ Section 62-2-507 revokes a testator’s will to the extent necessary to omit an ex-spouse from inheriting from the testator’s estate. The 2013 amendment expanded the ‘revocation by divorce’ principle to not only include wills, but also to include non-probate transfers, such as life insurance policies, annuities, and other transfer on death accounts. Because in today’s world substantial value is transferred by non-probate means, the lack of a statutory presumption revoking those transfers created instances where ex-spouses were often allowed to inherit despite the prior divorce.
It is important for individuals to be aware of this amendment in the event of a divorce or during the administration of an estate. However, it is not prudent for individuals to rely solely on this statute as a catch all and not update their testamentary and other documents post-divorce. As evidenced by a recent U.S. District Court opinion, there may be instances where this statute is preempted by competing federal law, and an ex-spouse can still receive death benefits.
In Bostic v. Bostic, the Plaintiff, the current spouse of decedent, claimed she was entitled to her deceased husband’s life insurance benefits as Section 62-2-507 revoked the defendant’s prior beneficiary designation of his ex-spouse. Id. The decedent had been divorced and remarried, but had failed to update his life insurance policy to name the current spouse as the named beneficiary. Id. Unfortunately for the current spouse, the Court ruled as the life insurance policy was issued through the decedent’s employer and therefore governed by ERISA, that law preempted Section 62-2-507, and the ex-spouse received the policies’ benefits. Id.
Ultimately despite the legislature’s intention to expand Section 62-2-507 in 2013, there may still be instances where an ex-spouse can inherit or receive benefits when individuals fail to update their testamentary or other non-probate documents.
At Hyde Law Firm, P.A., our team can assist individuals in their estate planning and administration needs. Please contact our team for a consultation to review any probate or estate planning concerns that you may have.