## Facts

- Rose Rappaport died on August 31, 2006, survived by four adult children: Irwin Rappaport, Karen Brecher, Joel Rappaport, and Susan Rappaport, who had chronic disabilities requiring specialized care.
- Rose’s will was admitted to probate by decree dated March 7, 2007, and Irwin, Joel, and Karen were appointed co-executors.
- Article FOURTH of the will created a testamentary trust for Susan, funded in an amount equal to the federal estate tax unified credit equivalent (approximately $2 million).
- Article FOURTH directed the trustees to invest the trust and “pay all the net income” to Susan during her lifetime in quarterly or more frequent installments.
- Article FOURTH also gave the trustees discretion to distribute principal for Susan’s “health, support and maintenance.”
- On Susan’s death, Article FOURTH directed distribution of the remaining trust principal and accrued income to Rose’s issue then living, per stirpes; in another clause, it specifically named Rose’s other children (Joel, Irwin, and Karen) as the remainder beneficiaries, share and share alike, per stirpes.
- Elsewhere in the will, Rose stated that dispositions for Susan were not to jeopardize Susan’s current or future eligibility for governmental benefits, and that Rose’s goal was to provide Susan the same lifestyle she enjoyed during Rose’s lifetime.
- Susan was not receiving governmental benefits when Rose died, but the will’s mandatory income-distribution language raised concern that future eligibility for Medicaid or similar benefits could be impaired.
- Irwin filed a proceeding in Surrogate’s Court seeking construction and reformation of Article FOURTH to operate as a supplemental-needs trust by removing Susan’s mandatory right to all income and making distributions discretionary and supplemental to benefits.
- A guardian ad litem appointed for Susan supported reformation as consistent with Rose’s intent and in Susan’s best interests.
- The New York State Department of Health opposed, arguing the mandatory-income provisions showed Rose intended Susan to receive all income even if benefits eligibility were affected, and that reformation would be improper.

## Issues

1. May a Surrogate’s Court reform a testamentary trust that requires mandatory income distributions to a disabled beneficiary into a supplemental-needs trust to preserve the beneficiary’s current or future eligibility for governmental benefits when the will, read as a whole, expresses that intent?

## Decision

- The court granted Irwin’s petition and reformed Article FOURTH to create a supplemental-needs trust for Susan.
- The court found that the will, considered as a whole, showed Rose’s primary intention was to provide for Susan while preserving Susan’s eligibility for governmental benefits.
- The court held that the requested reformation did not change Rose’s testamentary plan; it altered the manner of administration (discretionary, supplemental distributions) while leaving the beneficial scheme intact (Susan as lifetime beneficiary; the same remainder beneficiaries upon Susan’s death).
- The court credited the guardian ad litem’s report that reformation served Susan’s best interests, including protecting potential future benefits eligibility.
- The court rejected the Department of Health’s reliance on the mandatory-income language, concluding that provision conflicted with the expressed benefits-preservation intention and could be corrected through reformation.

## Legal Principles

- A court construing a will seeks to carry out the testator’s intent, determined from the instrument as a whole rather than isolated words or clauses.
- New York courts may reform testamentary provisions to correct drafting that defeats an expressed aim to preserve a disabled beneficiary’s eligibility for governmental benefits, including by converting a trust to a supplemental-needs trust structure consistent with EPTL 7-1.12.
- Reformation is especially appropriate where it changes trust administration (e.g., replacing mandatory income rights with trustee discretion for supplemental distributions) without changing the dispositive plan (the identity of the lifetime beneficiary and remainder beneficiaries).
- In proceedings affecting a disabled beneficiary, the court may place substantial weight on a guardian ad litem’s report when assessing intent and the beneficiary’s best interests.
- Opposition based solely on mandatory distribution language may be overcome where other will provisions expressly direct that the disabled beneficiary’s interest not impair current or future public-benefits eligibility.

## Conclusion

In *Matter of Rappaport*, the Nassau County Surrogate’s Court reformed Rose Rappaport’s Article FOURTH testamentary trust—originally requiring quarterly payment of all net income to her disabled daughter, Susan—into a supplemental-needs trust, because the will as a whole reflected Rose’s intent to support Susan while preserving eligibility for governmental benefits, and the change affected only trust administration, not the overall distribution plan.


Matter of Rappaport, 866 N.Y.S.2d 483 (2008)