§ 30-3.5. Satisfaction of elective share.
§ 30‑3.5. Satisfactionof elective share.
(a) Repealed by SessionLaws 2009, c. 368, s. 1, effective August 27, 2009, and applicable to decedentsdying on or after October 1 , 2009.
(a1) Apportionment. Thepersonal representative shall apportion the liability to the surviving spousefor the amount of the elective share among all responsible persons as follows:
(1) The net value ofeach nonspousal asset shall be determined by calculating the value of thenonspousal asset under G.S. 30‑3.3A and reducing such value by thatportion of the claims (including year's allowances to persons other than thesurviving spouse) payable out of, charged against, or otherwise properlyallocable to the nonspousal asset.
(2) Using the net valueof each nonspousal asset as determined under subdivision (1) of thissubsection, the personal representative shall determine each responsibleperson's liability to the surviving spouse by multiplying the amount of theelective share by a fraction, the numerator of which is the net value of theresponsible person's nonspousal assets and the denominator of which is the netvalue of all of the nonspousal assets.
(a2) Recovery FromResponsible Persons. In recovering assets from responsible persons, thefollowing rules apply:
(1) To the extent thepersonal representative is a responsible person, the personal representativeshall satisfy its liability to the surviving spouse out of its nonspousalassets according to the following order of priority:
a. The personalrepresentative shall satisfy its liability out of the net value of thenonspousal assets passing by intestate succession by allocating the liabilityproportionately among each intestate heir based on the fraction of the netvalue of the nonspousal assets passing by intestate succession that eachintestate heir is entitled to receive.
b. If the net value ofthe nonspousal assets passing by intestate succession is not sufficient tosatisfy the personal representative's liability in full, the personalrepresentative shall satisfy its remaining liability out of the net value ofthe nonspousal assets passing as part of the decedent's residuary estate byallocating the liability proportionately among each beneficiary of thedecedent's residuary estate based on the fraction of the net value of thenonspousal assets passing as part of the decedent's residuary estate that eachresiduary beneficiary is entitled to receive.
c. If the net value ofthe nonspousal assets in the residuary estate is not sufficient to satisfy thepersonal representative's liability in full, the personal representative shallsatisfy its remaining liability by allocating the remaining liabilityproportionately among each other beneficiary of the decedent's will based onthe fraction of the net value of the remaining nonspousal assets each otherbeneficiary is entitled to receive.
(2) The personalrepresentative shall recover from each other responsible person the responsibleperson's liability to the surviving spouse.
(3) Each responsibleperson, including the personal representative in its capacity as a responsibleperson, may elect to satisfy its liability in full by any of the followingmethods:
a. Conveyance of thatportion of the responsible person's nonspousal assets (or identical substituteassets), valued on the date of conveyance, sufficient to satisfy theresponsible person's liability; or, if the value of the responsible person'snonspousal assets on the date of conveyance is less than the responsibleperson's liability, conveyance of all of the responsible person's nonspousalassets (or identical substitute assets).
b. Payment of theliability in cash.
c. Payment of theliability in other property upon written agreement of the surviving spouse atvalues agreed by the surviving spouse for purposes of determining the extent ofthe liability satisfied.
d. Any combination ofthe payment methods set forth under sub‑subdivision a. through d. of thissubdivision, provided that the total value of assets conveyed by theresponsible person equals such responsible person's liability.
(a3) Inability or Refusalto Pay. The personal representative shall be entitled to petition the clerkof court for an order requiring any responsible person to satisfy itsliability. Upon refusal of a responsible person to obey such an order, thepersonal representative shall be entitled to a judgment against suchresponsible person in the amount of the liability and to any other remedies theclerk deems appropriate. Although the responsible person shall remain primarilyliable for such responsible person's liability for the elective share, thefollowing rules apply:
(1) If the responsibleperson makes a gratuitous transfer, whether inter vivos or by testate orintestate succession, of all or any part of the responsible person's nonspousalassets or the proceeds thereof after the decedent's death, then the gratuitoustransferee shall be liable for the amount transferred, and the personalrepresentative shall be entitled to recover that amount from the transferee asif the transferee were the responsible person.
(2) If the responsibleperson is a fiduciary and makes a distribution of all or any part of theresponsible person's nonspousal assets or the proceeds thereof after thedecedent's death, then the distributee shall be liable for the amount transferred,and the personal representative shall be entitled to recover that amount fromthe distributee as if the distributee were the responsible person.
If, after exhausting all otherremedies in this section, the personal representative cannot reasonably recovera responsible person's liability, then, with the approval of the clerk, thedefaulting responsible person's liability shall be apportioned on a pro ratabasis among the responsible persons who have not defaulted. Each nondefaultingother responsible person shall be liable for the amount of the liabilityapportioned to it in the same manner and to the same extent as its originalliability for the elective share; provided, that each responsible person'sliability shall not exceed the responsible person's proportionate share of thevalue of the nonspousal assets based on the values used in determining TotalNet Assets. Each nondefaulting other responsible person shall be entitled to aproportionate share of any judgment against or subsequent recovery of theliability from the defaulting responsible person.
(b) Standstill Order. After the filing of the petition demanding an elective share, the personalrepresentative, surviving spouse, or any responsible person may request theclerk to issue an order that any responsible person not dispose of all or aportion of the decedent's Total Net Assets or the proceeds thereof pending thepayment of the elective share. The decision to issue such an order shall be inthe discretion of the clerk. A person who violates the standstill order may beheld in civil contempt of court pursuant to Article 5A of Chapter 2 of theGeneral Statutes. The clerk shall enter an order terminating the standstillorder upon the clerk's determination that the standstill order is no longernecessary or desirable.
(c),(d) Repealed by SessionLaws 2009, c. 368, s. 1, effective August 27, 2009, and applicable to decedentsdying on or after October 1 , 2009.
(e) Bond. If aresponsible person distributes or disposes of nonspousal assets prior to finalapportionment of the elective share and expenses, the personal representativemay require the responsible person or the transferee to provide a bond or othersecurity for the responsible person's liability for payment of the electiveshare and apportioned expenses in the form and amount prescribed by thepersonal representative, with the approval of the clerk. (2000‑178, s. 2; 2009‑368,s. 1.)