McKeehan v. McKeehan, 355 S.W.3d 282 (Tex. App.—Austin 2011, pet. denied).


Miscellaneous Matters

Non-Testamentary Transfers


Husband and Wife were joint owners of an investment program.  After Husband died, a dispute arose between Wife who claimed the investment had the survivorship feature and Husband’s Children from a prior relationship who claimed the investment lacked the survivorship feature.  The trial court viewed the investment under Texas law and because there was no express provision for survivorship, ruled in favor of Children.  Wife appealed.


The appellate court determined that the investment contained a valid choice-of-law clause which clearly provided for Michigan law to govern the investment.  The evidence demonstrated that Husband agreed to be governed by this clause.  In addition, the choice of law clause was valid under Texas law because it dealt with an issue in dispute which could have been resolved by an express provision in the contract.  Under Michigan law, the investment did have the survivorship feature.  Michigan law presumes that jointly held property has the right of survivorship even if the survivorship feature is not expressly stated.  The court rejected Children’s claim that because the investment is personal property, it must be governed by Texas law as Texas was the Husband’s domicile at death.  Accordingly, the court reversed and awarded the investment to Wife.


Moral:  Instruments governing non-probate transfers need to be studied carefully to determine if they have a choice of law provision which would cause another state’s law to apply which may yield significantly different results than the application of Texas law.