The $1 million was part of a $7.5 million settlement paid by New Jersey in 2006 amid charges of failures by its Division of Youth and Family Services. All the money will go to care for the surviving boys, who are in foster care.
The brothers - Faheem's twin Raheem Williams, and 4-year-old Tyrone Hill Jr. - were found starving and clad in clothes soaked in urine and feces in a locked room adjacent to where the corpse was found.
"The facts of this case would shock the cynical and wound the most hardened of heart," Appellate Judge Donald G. Collester wrote for the court.
"How cruel, ironic, and inequitable it would be to hold that M.W. retained the right to inherit $1 million from the child she burned, abused, neglected, and abandoned. Equity, morality, and common sense dictate that physically or sexually abusive parents have no right of inheritance ...," Collester wrote.
A lawyer for Melinda Williams did not return a message seeking comment.
Before Faheem's death, Melinda Williams had entrusted the boys to a cousin, Sherry L. Murphy, so she could serve a jail term. She was freed and living in New York when Faheem died after being injured by Murphy's teenage son.
In court filings, the Melinda Williams said she should get Faheem's share of the settlement because DYFS was negligent in protecting the children while they were with Murphy.
A spokesman for the state Attorney General's Office, Lee Moore, said, "The decision was a just and fair outcome for the children."
DYFS was overhauled amid outrage when it was learned that the child protection agency had investigated abuse complaints involving Williams but closed the file 11 months before Faheem's body was found in January 2003 in the basement of an apartment rented by Murphy.
Murphy's son, Wesley, admitted performing a wrestling move on Faheem that included forcefully driving his knee into the child's abdomen and led to his death. He pleaded guilty to reckless manslaughter and was sentenced to three years in prison; he has since served his time.
Murphy was sentenced in 2005 to 25 years in prison for her treatment of the surviving children. A charge of attempted murder was dropped in a plea deal in which she admitted hiding Faheem's body.
Authorities never charged Melinda Williams with mistreating her children.
New Jersey sought to keep Williams from sharing in the settlement to her sons. A state judge in Essex County in 2006 had terminated her parental rights to all three children, and Tuesday's appellate ruling means that all those decisions have been upheld.
Investigators were told the boys got no food and were forced to eat their vomit and drink urine. They were tied at the ankles and wrists. They were burned with lit cigarettes by Murphy and- their mother, and their mother repeatedly ignored agreements with DYFS to improve her parenting, records show.
--- On the Net: Court opinion: http://tinyurl.com/2f84zo
