What is a Heggstad Petition?

Probate is a court proceeding that determines the disposition of your assets upon your death. However, if during your lifetime, you transfer ownership of your assets (or, at the very least, your significant assets) out of your personal estate and into your trust, you can avoid the cost of probate. Because the trust never dies, the trust assets are never subject to probate. So even upon your death, the trust assets can be used immediately to take care of your family – without court proceedings, without court fees and costs, without delay.

But what if you forget to transfer a significant asset to your trust during your lifetime? Is your family stuck with a very expensive and time-consuming probate proceeding? Maybe not. If you include that asset in a property schedule – such as a Schedule A to your trust – then, under some circumstances, you can get out of the costly probate proceedings by using what is called a Heggstad Petition (named after a 1993 California case Estate of Heggstad, 16 CA4th 943, 20 CR2d 433).

The Heggstad Petition seeks to obtain a court judgment that an asset held in the deceased person’s name is actually owned by the trust because the asset was intended to be transferred to the trust. The usual basis for such a petition is that the asset was listed in a property schedule. If the petition is granted, the court issues an order declaring that the asset is in fact trust property and orders the asset transferred to the trustee. It is therefore important to update the property schedules attached to your trust – just in case.

But the best way to avoid the cost and delay of probate (and the cost of filing a Heggstad Petition!) is to fund your trust during your lifetime. What does that mean? It means that you should transfer all major assets to your trust during your lifetime, period. It undoubtedly takes time and effort, but to your loved ones, it is well worth the investment.