Transfers in Fraud of Marital Rights in Relation to Nonprobate Transfers

A claim that a transfer of property is in fraud of marital rights is where a spouse, after the death of the other spouse, seeks to set aside and void a property transfer. It is a unique type of fraud, separate and distinct from the traditional fraud which consists of nine elements. “If established, the equitable claim would result in the fraudulent conveyance being set aside, and in the fraudulently conveyed property being recovered by the surviving spouse to the extent of the surviving spouse’s interest therein.” Carmack v. Carmack, 603 S.W.3d 900, 906 (Mo. Ct. App. 2020). The key inquiry is whether the spouse made the transfer with the intent and purpose of defeating the surviving spouse’s inheritance rights. Id.

A nonprobate transfer may fall within the purview of a transfer in fraud of marital rights claim. They are “transfers” for purposes of a transfer in fraud of marital rights claim. See Section 474.150, RSMo. Prior to Carmack, this was somewhat unsettled in that a nonprobate transfer takes effect upon death, Section 461.005(7), RSMo, and because nonprobate transfers are not part of an estate, there were arguments that these were beyond the scope of a fraud in marital rights claim.

But, in light of Carmack, a change in a beneficiary designation may permit a fraud in marital rights claim if it is demonstrated that the decedent spouse made the change with the “intent and purpose” of defeating the surviving spouse’s marital rights. Carmack, 603 S.W.3d at 909.