2023 Vermont Statutes › Title 9 - Commerce and Trade › Chapter 134 - Transfer on Death Security Registration › § 4359. Nontestamentary transfer on death

§ 4359. Nontestamentary transfer on death
(a) A transfer on death resulting from a registration in beneficiary form by an owner whose last domicile was in this State is effective by reason of the contract recording the registration between the owner and the registering entity and this chapter and is not testamentary. “Nonprobate transfer” means a transfer described in this subsection.
(b) A transferee of a nonprobate transfer is subject to liability to any probate estate of the decedent for allowed claims against that estate and statutory allowances to the decedent’s spouse and children to the extent the estate is insufficient to satisfy those claims and allowances. The liability of a nonprobate transferee may not exceed the value of nonprobate transfers received by that transferee.
(c) Nonprobate transferees are liable for the insufficiency described in subsection (b) of this section in the following order of priority:
(1) a transferee designated in the decedent’s will or any other government instrument, as provided in the instrument;
(2) the trustee of a trust serving as the principal nonprobate instrument in the decedent’s estate plan as shown by its designation as devisee of the decedent’s residuary estate or by other facts or circumstances, to the extent of the value of the nonprobate transfer received;
(3) other nonprobate transferees, in proportion to the values received.
(d) A provision made in one instrument may direct the apportionment of the liability among the nonprobate transferees taking under that or any other governing instrument. If a provision in one instrument conflicts with a provision in another, the later one prevails.
(e) Upon due notice to a nonprobate transferee, the liability imposed by this section is enforceable in proceedings in the Probate Division of the Superior Court in this State, whether or not the transferee is located in this State.
(f) A proceeding under this section may not be commenced unless the personal representative of the decedent’s estate has received a written demand for the proceeding from the surviving spouse or a child, to the extent that statutory allowances are affected, or a creditor. If the personal representative declines or fails to commence a proceeding after demand, a person making demand may commence the proceeding in the name of the decedent’s estate, at the expense of the person making the demand and not of the estate. A personal representative who declines in good faith to commence a requested proceeding incurs no personal liability for declining.
(g) A proceeding under this section must be commenced within one year after the decedent’s death, but a proceeding on behalf of a creditor whose claim was allowed after proceedings challenging disallowance of the claim may be commenced within 60 days after final allowance of the claim.
(h) Unless a written notice asserting that a decedent’s estate is insufficient to pay allowed claims and statutory allowances has been received from the decedent’s personal representative, a trustee receiving a nonprobate transfer is released from liability under this section with respect to any assets to the trust’s beneficiaries. Each beneficiary to the extent of the distribution received becomes liable for the amount of the trustee’s liability attributable to those assets received by the beneficiary. (Added 1999, No. 23, § 1; amended 2009, No. 154 (Adj. Sess.), § 238a, eff. Feb. 1, 2011.)