Court of Appeals hears dispute over whether long-term partner's interest reduces estate tax

Division 2 of the Washington Court of Appeals heard oral argument in Estate of Jack Frank (No. 607280) over whether a long-term committed intimate relationship can reduce a decedent's gross estate for Washington estate-tax purposes.

Kelly Owings, an assistant attorney general representing the Department of Revenue, told the three-judge panel that the committed intimate relationship (CIR) doctrine is ‘‘not the same as a marriage’’ and that the trial court erred by treating the relationship between Jack Franks and Annalise Roldan as giving the surviving partner the same estate-tax benefits spouses receive. Owings said the CIR doctrine, she argued, exists primarily as an equitable tool to divide property when a relationship ends, and that estate tax liability should be determined by the decedent's legal ownership at the moment of death.

‘‘The trial court gave Mr. Franks and Ms. Roldan the exact same community property interest as spouses without the need for marriage,’’ Owings told the panel, adding that the consequence was a reduction in the value of Mr. Franks' gross estate. She urged the court to reverse the trial court's ruling and reinstate the Department's findings.

Peter Talovich, counsel for the personal representative of Jack Franks' estate, said the dispute is about well-established property rights rather than marital benefits. Talovich argued that under Washington law a committed intimate partner who contributed to property acquired during the relationship owns an undivided one-half interest in community-like property and that the Department sought to tax property that belonged to Ms. Roldan.

Talovich noted the parties had stipulated to a 40-year committed intimate relationship and said the superior court correctly applied the CIR doctrine without expanding it. He also said that the settlement agreement included indemnification for Ms. Roldan against future claims arising from administration of the estate, including taxes.

The panel pressed both sides on timing and the distinction between equitable and legal ownership. A judge asked whether language from prior cases (including Oliver v. Fowler and Witt v. Young, discussed at argument) suggested a partner could have rights prior to a court's declaration. Owings replied that those decisions recognize an equitable interest but do not grant a substantive property right equivalent to spousal ownership absent specific legal authority to do so for estate-tax valuation.

Talovich countered that Washington courts have long recognized the surviving CIR partner's interest and that the estate inventory process reflects ownership at death. He said probate inventory procedure is the established means to determine what property is part of an estate and therefore subject to tax.

In rebuttal, Owings reiterated the Department's position that case law (including a Division III decision cited in briefing) requires a court determination before applying community-property analogies and that post-death equitable adjustments do not change the gross estate at the moment of death.

The court concluded argument without announcing a decision and moved to its next case. The panel did not take testimony or hear additional witnesses during the session.

The case record shows the following key references and procedural details: case number 607280; three minutes reserved for rebuttal; the parties' briefing cited federal code language and several Washington decisions (Oliver v. Fowler; Witt v. Young; Vasquez v. Hawthorne; a Division III decision identified in argument as Kelly and Mossling).