Opinion ID: 901240
Heading Depth: 1
Heading Rank: 2

Heading: Interest Calculated From the Date of Death

Text: [¶ 6.] Dennis contends that the interest he was required to pay under the will should not have been calculated from the date of death. Because it was not possible to figure the amount on which interest was due until April 11, 2002, the day the circuit court ruled on the proper valuation for the farmland, Dennis insists that it was not possible for him to perform his obligations. For their part, the other siblings argue that from the date of Lawrence's death Dennis had possession of the farmland and he benefited from the use of that property for six crop seasons. [¶ 7.] The gist of Dennis's position is that from the date of Lawrence's death until April 11, 2002, he was prohibited from making the payments because of the actions of Lynette and Judene acting as personal representatives, and because a value was not placed upon the property before that time. His argument is premised on several sections of the South Dakota Codified Laws, Title 20, dealing with excuse for want of performance because of delay or prevention. These statutes are not pertinent to the issue here. Instead, we look to Title 29A, the Uniform Probate Code. [¶ 8.] SDCL 29A-3-101 provides: The power of a person to leave property by will, and the rights of creditors, devisees, and heirs to the person's property are subject to the restrictions and limitations contained in this code to facilitate the prompt settlement of estates. Upon the death of a person, that person's real and personal property devolves to the persons to whom it is devised by will or to those indicated as substitutes for them in cases involving lapse, renunciation, or other circumstances affecting the devolution of testate estate, or in the absence of testamentary disposition, to the heirs, or to those indicated as substitutes for them in cases involving renunciation or other circumstances affecting devolution of intestate estates, subject to homestead allowance, exempt property and family allowance, rights of creditors, elective share of the surviving spouse, and administration. Under this statute, real and personal property devolves to the persons to whom it is devised, at the time of the testator's death. Dennis does not argue that SDCL 29A-3-904 applies. That statute provides: General pecuniary devises bear interest at the category B rate of interest specified in § 54-3-16 beginning one year after the first appointment of a personal representative until payment, unless a contrary intent is indicated by the will. Here, the will indicated a contrary intent because it provided an alternative interest rate and the first payment with interest was to begin one year from the date of Lawrence Holan's death. Nor does Dennis argue that he did not receive the property devised to him by the will. He simply believes that it was impossible or impracticable for him to perform his obligation under the will. We must examine this question not simply from Dennis's perspective but also from the perspective of the remaining siblings, who were entitled to their bequests from the date of Lawrence's death. [¶ 9.] While there is some conflict in the cases on whether a will contest stays the accrual of interest, the majority view is that it does not. See Estate of Vaden, 677 P2d 659 (OklaCtApp 1983); 97 CJS Wills § 2013 (2001). Courts refusing to deviate from a statutory commencement date for interest reason that the right to receive interest is incident to the legacy itself. Vaden, 677 P2d at 665. Those receiving a money legacy are in a similar position to creditors and are therefore entitled to interest from the time they would have received payment absent the delay from a will contest. This rationale accords with testamentary intention: wills are ordinarily made with the expectation that distribution will not be postponed. When delays occur from a will contest, they may lessen the value of the bequest. [¶ 10.] Although we concede some force to Dennis's excuse that the lack of a judicially determined valuation on the property and a delay caused by the will contest presented impediments to the performance of his obligations under the will, we think the general rule better comports with testamentary intent. The rule has the advantage of setting a beginning point for interest accrual that cannot be changed by the vagaries of the probate process, and thus it enables testators to give certainty to their bequests without a need to use special provisions. Woodward's Estate v. Holton, 62 A 718 (Vt 1906). We think the general rule should apply even where, as here, some of the devisees opposed the will. Therefore, the siblings were entitled to interest on their pecuniary devises from the date of Lawrence's death.