Under Tennessee wrongful death law, the distribution of proceeds obtained after a settlement for wrongful death are governed by common law not statute. Basically, the law provides that the wrongful death proceeds are distributed under the law of intestate succession.
Thus, if a decedent left behind a surviving spouse and one child, each would receive one-half of the proceeds. If the wrongful death decedent left behind a surviving spouse and two children, each of them would receive one-third of the wrongful death proceeds. A surviving spouse would never receive less than a one-third share of the recovery, even if there were three or more surviving children.
A recent case from the Tennessee Court of Appeals faced a question never addressed before in Tennessee: what happens to wrongful death proceeds when the surviving spouse entered into a postnuptial agreement agreeing to waive all rights which she acquired as a result of her marriage to the defendant?
A few more facts. Fourteen years after Mr. and Mrs. Rickman were married, they entered into a postnuptial agreement waiving their rights to the property of the other, including all "rights they may have acquired by reason of their marriage." Mr. Rickman died first, and his wife entered an Order in the probate action acknowledging that she was not entitled to any portion of Mr. Rickman's estate.
Thereafter, one of Mr. Rickman's children (from a prior marriage), acting as Administrator of the Estate, filed a wrongful death lawsuit against a health care provider. The lawsuit was settled several months later, and Mrs. Rickman claimed a portion of the proceeds. Mr. Rickman's children claimed the postnuptial agreement barred her from recovering any portion of the proceeds, and the instant litigation ensued.
(Those unfamiliar with Tennessee wrongful death law need to know that even though the administrator of an estate has the right to file a wrongful death lawsuit the proceeds of any recovery in the action belong not to the estate but, as stated above, pass to the beneficiaries under the law of intestate succession. Thus, the fact that the widow disclaimed any interest in the estate of Mr. Rickman was not dispositive of the issue of whether she was entitled to any portion of the wrongful death proceeds.)
The Tennessee Court of Appeals affirmed the decision of the trial court denying Mrs. Rickman any recovery from the wrongful death settlement. The court ruled that *[w]idow’s only claim to entitlement of the proceeds from the wrongful death action is 'by reason of [her] marriage' to the decedent. Accordingly, the postnuptial agreement, which is undisputedly valid and enforceable, waives her right to share in the wrongful death proceeds." The court did not follow the precedent from several other states on the issue, noting differences in the wording of the postnuptial agreements in those cases and differences in the wrongful death law.
Although not discussed in the opinion, the same reasoning would apply to prenuptial agreements, which are much more common than postnuptial agreements.
It is unknown whether Mrs. Rickman will ask the Tennessee Supreme Court to review this case. The opinion was issued on October 15, 2013, and she has sixty days to file a request for Supreme Court review.
The opinion should be of interest to all Tennessee wrongful death lawyers as well as to lawyers who draft prenuptial and postnuptial agreements. The broad language of these agreements would frequently result in the surviving spouse not receiving wrongful death proceeds arising from the death of the other. On the other hand, a Tennessee prenuptial agreement or postnuptial agreement could be drafted to allow for the survivor to share in wrongful death proceeds if desired.