In re Estate of Reynolds, 87 N.Y.2d 633 (1996), gives a history of the elective share:
The context of this dispute is the surviving spouse’s right of election, whose roots are found in former Decedent Estate Law § 18, which, in turn, abolished the common-law rights of dower and curtesy. In their place, a surviving spouse was given a right to elect to take a percentage share of a deceased spouse’s estate, limited to assets passing under a will.
Experience developed under that statute indicated the right of election protection for surviving spouses could be easily evaded by timely use of various inter vivos transfers. Adjudicative efforts to recapture asset transfers, which had as their sole purpose the circumvention of the rights of the surviving spouse, proved inadequate or uneven (compare, Matter of Halpern, 303 NY 33; Matter of Crystal, 39 NY2d 934; with Newman v Dore, 275 NY 371). Thus, the Legislature initiated a special study for the purpose of proposing legislation which would more effectively protect the survival rights of spouses (3d Report of Temp St Commn on Estates [“Bennett Report”], 1964 NY Legis Doc No. 19, at 11). The Bennett Report concluded that certain inter vivos transfers should be subject to a surviving spouse’s right of election against a deceased spouse’s total testamentary dispositional plan.
The Bennett Report suggested that the Legislature follow the basic approach outlined in the Report of the New York State Bar Association Committee on Trusts and Estates, which declared that “whatever test or approach is used, the following types of transfers might be considered subject to the elective rights of the surviving spouse … [including those] where a power of appointment has been retained” (1964 NY Legis Doc No. 19, at 138 [emphasis added]). That is the only type at issue here. While the precise proposed phrasing did not find its way into the law, the enacted version had the same goal and purpose, as reflected in EPTL 5-1.1. The history and language thus strongly demonstrate that the intent behind the “testamentary substitute” protection for the surviving spouse’s right of election was to fold into the estate those assets over which a settlor retains meaningful control in addition to the right to receive the lifetime income.
Reserving a testamentary limited power of appointment is a testamentary substitute. In re Estate of Reynolds, 87 N.Y.2d 633 (1996).
RESEARCH 4/1/2021 - What about reserving a lifetime limited power of appointment?