Opinion ID: 1255263
Heading Depth: 1
Heading Rank: 2

Heading: issue i: acceleration of the remainder interest

Text: The South Carolina General Assembly set forth a statutory scheme for the Disclaimer of Property Interests. S.C. Code Ann. § 21-37-10 to 80 (Cum. Supp. 1985). [2] Wallace's interest is a life interest, which is a disclaimable property interest. S.C. Code Ann. § 21-37-40(b). Wallace, as a beneficiary of a trust, is a person who may make a disclaimer. S.C. Code Ann. § 21-37-40(a)(7). The statute governing the passage of such a disclaimed property interest reads: If a person becomes entitled to an interest in property because of the death of a decedent including ... a testator... and the person disclaims the interest, the interest devolves ... as if the person predeceased the decedent, unless the instrument governing the devolution... of the interest contains another disposition thereof in the event of a disclaimer.... S.C. Code Ann. 21-37-50(a). Under this statute, Wallace, having disclaimed, must be treated as though he predeceased Mrs. Pate. The interest then devolves to the remaindermen maindermen unless it can be shown that Mrs. Pate's Will provided for another disposition in the event of Wallace's disclaimer. The Court of Appeals held that the language in the Will which reads o[n] Wallace's death acts as another disposition. We disagree. A construction that the term on Wallace's death constitutes another disposition is not justified solely by the fact that after giving Wallace a life interest it is provided that the gift over shall take effect on his death. See Restatement of Property § 231, comment (j) (1936). The phrase [o]n Wallace's death was used only to indicate the provision of a life estate in Wallace. The Court of Appeals reasoned that as long the legal effect of [Mrs. Pate's] Will was to postpone distribution of the remainder interest until Wallace's death the Will provided for a different disposition from the statute. 360 S.E. (2d) at 154. This is a misinterpretation of the language of the statute, which allows acceleration unless the instrument governing the devolution ... contains another disposition thereof in the event of the disclaimer ... When the statute speaks of another disposition, what is meant is an alternative disposition. This means Mrs. Pate would have had to provide for something else to happen to the interest between the time Wallace disclaimed and the time the interest devolved to Petitioners. There is no such provision in the Will. The interest goes direct from Wallace to the Petitioners. We find that: 1) Wallace is a person who may properly disclaim; 2) Wallace, having disclaimed, is treated as though he predeceased Mrs. Pate; and 3) because no other disposition exists, the interests of the remaindermen are accelerated and vest. Accordingly, we reverse the Court of Appeals on this issue.