Wills, Trusts, & Estates Outline PDF

**[WILLS, TRUSTS, & ESTATES]** **INTRODUCTION** - Governing Laws - Uniform Probate Code - Uniform Trust Code - \[South Carolina Probate Code\] - Terminology -- - [Testate] -- someone who died with a will (devisee is who receives the property) - [Inte...

**[WILLS, TRUSTS, & ESTATES]** **INTRODUCTION** - Governing Laws - Uniform Probate Code - Uniform Trust Code - \[South Carolina Probate Code\] - Terminology -- - [Testate] -- someone who died with a will (devisee is who receives the property) - [Intestate] -- someone who died without a will (heirs receive the property) - [Partial Intestacy] -- where an individual has left a will but, for one reason or another, the will does not fully deal with the whole of their estate - [Testator/testatrix] -- a person who has died and left a will - [Personal Representative/Executor/Administrator] -- a fiduciary who is chosen to administer the decedent's probate estate; the personal representative inventories the estate property and informs interested persons that probate has begun - [Probate Court (Surrogate's Court/Orphan Court)] -- a judicial process to make sure that a deceased person\'s debts are paid and assets are allocated to the correct beneficiaries - [Will/Testament/Last Will & Testament] -- a will or testament is a written instrument that indicates the intent of the testator regarding the disposition of his/her estate after death (for a will to be valid the testator must have **testamentary intent**) - [Devise] - a testamentary disposition of real or personal property - [Devisee] - a person designated in a will to receive a devise - [Heirs] -- someone entitled to inherit from a decedent under the laws of intestacy; a living person has **no** heirs - Types of Estates -- - Probate estates - Nonprobate property - Trust estate - Taxable estate - Why do we probate estates? - To evidence all of the transfers of title to property from the decedent to the heirs or devisees - To protect creditors of the decedent; creditors must file claims against the estate - Can only attach their claim to property - What does it cost to probate an estate? - Court fees - Professional fees (lawyers, appraisers, etc.) - Personal Representative is entitled to a fee for his/her services - Contested estates are more expensive than non-contested estates - Creditors and Nonclaim Statutes - Creditors of an estate **must** file any claims against the estate within the time frame set by statute - This rule does not apply to mortgages and other secured loans - Any claim filed after the claim period is over is barred by law - In addition to running a notice in the newspaper, Personal Representative may elect to directly notify creditors - **South Carolina:** The time frame is the [earlier] of one year from decedent's date of death or 8 months from the first publication of the creditor's notice - Closing the Estate - PR may need to sell real and/or personal property - PR required to file tax returns for the decedent, and if applicable, an estate tax return and an income tax return for the estate - PR must handle all creditors' claims by either allowing or disallowing the claims - PR must distribute the estate assets in accordance with the terms of the will or according to the intestacy statutes if decedent died without a will - Once administration is complete, an application or petition to close the estate must be filed and accepted by the court - The court will then discharge the PR - Avoiding Probate - Personally property may be transferred without the necessity of the probate process if all heirs/devisees agree - Will Substitutes - - Living trusts - Jointly owned property - Jointly owned property - Pay-on-death (POD) and transfer-on-death (TOD) designations - Named beneficiaries for life insurance policies and retirement accounts - Freedom of Disposition - Property is transferred in accordance with the decedent's wishes or by default rules if decedent left no estate plan - American law allows an owner of property to control the disposition of the property after death - **US law favors freedom of disposition over an heir's expectation of inheritance** - [Restatement (3^rd^) of Property] -- American law does not grant courts the authority to question the wisdom, fairness, or reasonableness of the donor's decision about how to allocate his/her property - "Dead Hand" Control - The attempt to control property after your death - For policy reasons, dead hand control is limited, specifically by the rules against perpetuities - What are the limitations? - Surviving spouse's share - Creditors - State and federal taxes (if applicable) - Cannot be unconstitutional - Cannot violate public policy - Public Policy and Inheritance - We want families to support one another - We want a person to have the right to dispose of his/her property according to his/her wishes - We need an orderly transfer of title and the purpose of probate law is to facilitate rather than regulate - *[Shapira v. Union National Bank]* -- - RULE - A condition precedent to a bequest requiring the putative devisee to marry within a particular faith is a reasonable restriction that does not violate public policy or the Fourteenth Amendment of the United States Constitution. - Incentive Trusts -- - Incentive trusts provide support while placing conditions on distributions from the trust - The "incentive" is monetary payments for pursuing an education, living a lifestyle that is in line with the settlor's moral code - Professional Responsibility - Duties of the estate planning attorney -- - Be competent - Maintain client confidentiality - Identify your client - Identify any conflicts of interest - Make sure you ask the right questions - Privity of contract -- the relationship between the parties to a contract, allowing them to sue each other but preventing a third party from doing so - *[Simpson v. Calivas]* -- - RULE - An attorney who drafts a will owes a duty to identified intended beneficiaries of the will who may enforce the attorney's contract with the testator as third party beneficiaries. - Typically, attorneys **only** owe reasonable care to those in privity of contract - There are exceptions to the rule, however, when there is a foreseeable risk to persons not in privity of contract - Drafting Attorneys Duties to Beneficiaries of an Estate - [Common Law] -- - the attorney-client relationship is between the attorney and the testator/testatrix - privity -- the attorney owes a duty only to the client he has contracted with - [Modern Trend] -- - Exceptions to the privity rule - Attorneys may be liable to third party beneficiaries due to reasonably foreseeable harm - Gives the beneficiaries standing to sue the attorney for malpractice - Attorney owes a duty to the intended beneficiaries as third party beneficiaries of the attorney-client relationship - What is an "issue"? - **UPC §1-201(24)** -- An "issue" of an individual means descendant - *[A v. B]* - - RULE - Under the New Jersey Rules of Professional Conduct, a lawyer may disclose a client's confidential information where the lawyer's services have been used to commit a fraudulent act and the disclosure is needed to rectify the consequences of that act. - Joint Representation of Spouses - Estate planning is fundamentally (and typically) non-adversarial - Joint representation of married clients is often more economical and provides a coordinated estate plan - Make sure your retainer agreement or a separate disclosure specifically spells out the attorney's duty of confidentiality in joint representation - Confidentiality After Death of a Client -- Testamentary Intent - Typically rules of professional conduct prevent an attorney from revealing information related to the representation of a client, unless the client gives consent - The attorney-client privilege continues after the death of a client - A lawyer may not disclosed deceased client confidences in the estate planning context **unless the disclosure is impliedly authorized or would further the interests and intent of the client** **INTESTACY** - The law of intestacy applies to any portion of a decedent's probate estate that has not been disposed of by a will. - This may occur if: - The decedent dies without a will, - The will is partially or wholly invalid, or - The will fails to dispose of some portion of the probate estate - **UPC § 3-203. Priority Among Persons Seeking Appointment as Personal Representative** \(a) Whether the proceedings are formal or informal, persons who are not disqualified have priority for appointment in the following order: \(1) the person with priority as determined by a probated will including a person nominated by a power conferred in a will; \(2) the surviving spouse of the decedent who is a devisee of the decedent; \(3) other devisees of the decedent; \(4) the surviving spouse of the decedent; \(5) other heirs of the decedent; \(6) 45 days after the death of the decedent, any creditor. - Intestacy Statutes -- Default Rules for Succession - The rules are based on the **probable intent** of the decedent - Intestacy statutes only govern probate property - There are also some public policy considerations behind the statutes -- trying to preserve the economic health of the family; an orderly transfer of title - Typically based on family relationships - As such, they typically do not provide for unmarried cohabitating partners, step-children, or blended families - Under the UPC adopted children and children born outside of the marriage are treated the same as children born of a marriage (this is a split from common law) - **UPC §1-201(20). "Heirs"** - Someone entitled to inherit from a decedent under the law of intestacy. - Generally, intestacy statutes are designed to distribute property in a manner that most decedents would desire, prioritizing a surviving spouse and surviving children over more distinct relatives. - Survivorship Requirement - [Modern Law] - To take by intestacy, an heir **must survive** the decedent by **120 hours (five days)**. Otherwise, an heir is deemed to have **predeceased** the decedent and he/she cannot take by intestacy. - Without this 120-hour survival requirement, it would be possible for the decedent's more remote relatives to be disinherited because the heir survived the decedent by mere moments. - [Common Law]- An heir was deemed to survive the decedent if the heir outlived the decedent by any length of time, even only an instant - This created a vexing problem for vehicular accidents and other instances in which the decedent and heir died at practically the same time**.** - *[Janus v. Tarasewicz]* -- - RULE - Under the Uniform Simultaneous Death Act, the party whose claim to the decedent's assets or insurance proceeds depends on survivorship has the burden of proving it by a preponderance of the evidence. - **UPC §2-102(1). When does the surviving spouse get all of the estate?** - Two instances when a surviving spouse gets all of the estate: 1. the decedent has no surviving descendants and no surviving parents, **OR** 2. the decedent's surviving descendants are also the descendants of the surviving spouse **and** there are no other descendants of the surviving spouse who survive the decedent - **UPC §2-102(2)-(4). Surviving Spouse Gets Less than 100%** - The decedent has no surviving descendants but s/he is survived by at least one parent -- the surviving spouse will get the first \$300,000 plus 3/4 of the remainder. UPC §2-103 will determine what happens to the remaining 1/4 of the remainder. - The decedent's surviving descendants are also descendants of the surviving spouse but the surviving spouse also has one or more surviving descendants who are not descendants of the decedent --spouse gets first \$225,000 plus1/2 of the remainder. UPC §2-103 will determine what happens to the remainder - to the decedent's descendants by representation. - The decedent has surviving descendants who are not descendants of the surviving spouse -- surviving spouse gets the first \$150,000 plus 1/2 of the remainder. UPC §2-103 will determine what happens to the remainder - to the decedent's descendants by representation - What if there is no surviving spouse? (UPC §2-103(a),(b); 2-105)) 1. To the decedent's descendants by representation; 2. If no descendants, then to decedent's parents and their descendants; 3. If no parents, then to grandparents and their descendants (decedent's aunts, uncles and cousins); 4. If no one in parent or grandparent line, then to step-children; 5. If no one in grandparent line and there are no step-children, then escheats to the state Table Description automatically generated - **South Carolina Probate Code --** - **Section 62-2-102. Share of the Spouse.** - The intestate share of the surviving spouse is: 1. If there is no surviving issue of the decedent, the entire intestate estate 2. If there are surviving issue(s), one-half of the intestate estate - **Section 62-2-103. Share of Heirs other than Surviving Spouse.** - The part of the intestate estate not passing to the surviving spouse under Section 62-2-102, or the entire estate if there is no surviving spouse, passes as follows: **TRANSFERS TO CHILDREN** - By Representation - What happens to the share of a child that predeceases a parent? - If that child left descendants, those descendants take the share of the deceased child - The descendants of the deceased child "represent" the dead person and divide that share - Jurisdictions differ in methods of representation - [English Per Stirpes] -- - Used in approximately 1/3 of the states - Each **line** of descent is treated equally - Property is divided into a share for each living and deceased child who has a descendant living - Vertical equality, however, there may be unequal shares horizontally - [Modern Per Stirpes] (followed by South Carolina) - - Also called Per Capita with Representation - Used in just under half of the states (including SC) - The estate is divided equally at the 1^st^ generation where there is a **living person** - Vertical equality, and horizontal equality at the closest living generation - [Per Capital at Each Generation] (followed by UPC) -- - Used in about a dozen states and the UPC - In this system, the initial division occurs at the first generation where there is a living descendant, **the remaining shares, if any, are combined and divided equally at the next level** - Horizontal equality but no vertical equality - "Equally near, equally dear" - Ancestors, Collaterals, and Others - [Collateral Kindred] -- persons who are related to the decedent by blood but are not descendants or ancestors - [Laughing Heirs]- distant relatives who didn't really know the decedent and didn't grieve for him/her but still inherit - [Stepchildren]- some states allow them to inherit if there are no other takers (and California extends it to some in-laws) - Half-Bloods - Excluded in English common law - **UPC §2-107** -- a relative of the half-blood is treated the same as a relative of the whole-blood - Negative Wills -- - Common law rule was that you cannot disinherit merely by stating "relative X is being disinherited" - You must devise the entire estate to others through the will or relative X may inherit through partial intestacy - **UPC §2-101(b)** authorizes a negative will - Transfers to Children - We now consider the treatment in contemporary intestacy law of: 1. Adopted children 2. Posthumously born children 3. Nonmarital children 4. Children born with the aid of assisted reproductive technology - *[Hall v. Vallandingham]*- - RULE - An adopted person does not have the right to inherit from the estate of a natural parent who dies intestate, nor the right to inherit through that natural parent by way of representation. - **Section 2-115. Definitions** \(1) "Adoptee" means an individual who is adopted. \(4) "Functioned as a parent of the child" means behaving toward a child in a manner consistent with being the child's parent and performing functions that are customarily performed by a parent, including fulfilling parental responsibilities toward the child, recognizing or holding out the child as the individual's child, materially participating in the child's upbringing, and residing with the child in the same household as a regular member of that household. \(5) "Genetic father" means the man whose sperm fertilized the egg of a child's genetic mother. If the father-child relationship is established under the presumption of paternity under \[insert applicable state law\], the term means only the man for whom that relationship is established. \(6) "Genetic mother" means the woman whose egg was fertilized by the sperm of a child's genetic father. \(7) "Genetic parent" means a child's genetic father or genetic mother. \(9) "Relative" means a grandparent or a descendant of a grandparent. - Parent-Child Relationship and the UPC - **Section 2-116. EFFECT OF PARENT-CHILD RELATIONSHIP.** - Except as otherwise provided in Section 2-119(b) through (e), if a parent-child relationship exists or is established under this subpart, the parent is a parent of the child and the child is a child of the parent for the purpose of intestate succession. (emphasis added) - **Section 2-118. ADOPTEE AND ADOPTEE'S ADOPTIVE PARENT OR PARENTS.** - \(a) A parent-child relationship exists between an adoptee and the adoptee's adoptive parent or parents. - \(b) For purposes of subsection (a); - 1\) An individual who is in the process of being adopted by a married couple when one of the spouses dies is treated as adopted by the deceased spouse if the adoption is subsequently granted to the decedent's surviving spouse; and 2\) a child of a genetic parent who is in the process of being adopted by a genetic parent's spouse when the spouse dies is treated as adopted by the deceased spouse if the genetic parent survives the deceased spouse by 120 hours. - **Section 2-119. ADOPTEE AND ADOPTEE'S GENETIC PARENTS.** - \(a) Except as otherwise provided in subsections (b) through (e), a parent-child relationship does not exist between an adoptee and the adoptee's genetic parents. - \(b) A parent-child relationship exists between an individual who is adopted by the spouse of either genetic parent and: - \(1) the genetic parent whose spouse adopted the individual; and - \(2) the other genetic parent, but only for the purpose of the right of the adoptee or a descendant of an adoptee to inherit from or through the other genetic parent - \(c) A parent-child relationship exists between both genetic parents and an individual who is adopted by a relative of a genetic parent, or by the spouse or surviving spouse of a relative of a genetic parent, but only for the purpose of the right or the adoptee or a descendant of the adoptee to inherit from or through either genetic parent. - \(d) A parent-child relationship exists between both genetic parents and an individual who is adopted after the death of both genetic parents, but only for the purpose of the right of the adoptee or a descendant of the adoptee to inherit through either genetic parent - \(e) \[omitted\] - Adoption and Intestate Succession - In a majority of states, an adopted child inherits from adoptive relatives and also from genetic relatives if the child is adopted by a step-parent - Under the UPC as revised, the key determination is whether there is a **parent-child relationship** - 3^rd^ party adoption severs the parent-child relationship and neither the genetic parent nor they child may inherit through or from one another - If a family relative or step-parent adopts a child, the child may still inherit through and from both the genetic parents and the step-parent; however, once a genetic parent has his/her parental rights terminated (by death or by court order), that genetic parent cannot inherit from the child - In a step parent adoption where the genetic parent married the step-parent, the step-parent can inherit from the child - A child can inherit from and through its adoptive parents and its genetic parent(s) if the child was adopted after the death of the genetic parent(s) - [Adult Adoption]- - most intestacy statutes draw no distinction between the adoption of a child and the adoption of an adult - **UPC §2-113. INDIVIDUALS RELATED TO DECEDENT THROUGH TWO LINES.** - An individual who is related to the decedent through two lines of relationship is entitled to only a single share based on the relationship that would entitle the individual to the larger share. - [Stranger to the Adoption Rule] -- - Adopted child is presumptively barred if the donor was not the adoptive parent; can be overcome by evidence to the contrary - *[Minary v. Citizens Fidelity Bank & Trust Co.]* - RULE - Where an adult is adopted for the purpose of making that person an heir entitled to inherit under a pre-existing testamentary instrument, that person will not be considered an heir if doing so conflicts with the intention of the testator. - How to avoid the problem that arose in *Minary*? - A well drafted will/trust will include a definition of what "heirs" or "descendants" means, including whether or not adopted children and children conceived through reproductive technology are included - Power of Appointment -- allows a designated person to alter the beneficiary of a gift - [Class Gifts] -- - a **class gift** refers to a gift given to a group of persons. At the time of the class gift, the number of persons in the group/class may be uncertain in number but the number will be ascertainable in the future. For example, the triggering event that sets the class may be the death of the donor. - Ex: "to my children", "to my nieces and nephews", or "to my siblings" - **UPC §2-705(f). TRANSFEROR NOT ADOPTIVE PARENT.** - In construing a dispositive provision of a transferor who is not the adoptive parent, an adoptee is not considered the child of the adoptive parent unless: - \(1) the adoption took place before the adoptee reached \[18\] years of age; - \(2) the adoptive parent was the adoptee's stepparent or foster parent; or - \(3) the adoptive parent functioned as a parent of the adoptee before the adoptee reached \[18\] years of age - *[O'Neal v. Wilkes]* -- - RULE - Under Georgia law, a contract for adoption is invalid unless entered into by a parent or guardian, the only persons with authority to contract for adoption. - **Uniform Parentage Act and UPC §2-104** - **Posthumous children** -- children born after the decedent's death, may inherit an intestate share from the estate. The typical posthumous child, is conceived before, but born after, his/her father's death. - **The Uniform Parentage Act** -- establishes a rebuttable presumption that a child born to a woman within 300 days after the death of her husband is a child of that husband. (presumption of parentage) - In a few states, **posthumously conceived** children (who are conceived by assisted reproduction after the decedent's death) may inherit if: 1. The deceased parent consented to the posthumous conception, and 2. The child was in utero within [36 months] after the decedent's death or born within [45 months] after the decedent's death. - [Equitable Adoption Rule] -- - in general terms, the judicial doctrine of "equitable adoption" recognizes a valid parent-child relationship in the absence of a formal adoption proceeding, holding a person who has acted like a child's parent for a number of years (without ever formally adopting the child) to the same rights and obligations as an adoptive parent - [Nonmarital Children] -- - [Common Law] -- they were given harsh treatment and did not inherit from neither the father or mother - [Today] -- all states permit inheritance by a nonmarital child from the child's mother - **SCPC §62-2-109. MEANING OF CHILD AND RELATED TERMS.** - If, for purposes of intestate succession, a relationship of parent and child must be established to determine succession by, through, or from a person: - \(1) From the date the final decree of adoption is entered, and except as otherwise provided in Section 63-9-1120, an adopted person is the child of an adopting parent and not of the natural parents except that adoption of a child by the spouse of a natural parent has no effect on the relationship between the child and that natural parent. - \(2) In cases not covered by (1), a person born out of wedlock is a child of the mother. That person is also a child of the father if: - \(i) the natural parents participated in a marriage ceremony before or after the birth of the child, even though the attempted marriage is void; or - \(ii) the paternity is established by an adjudication commenced before the death of the father or within the later of eight months after the death of the father or six months after the initial appointment of a personal representative of his estate and, if after his death, by clear and convincing proof, except that the paternity established under this subitem (ii) is ineffective to qualify the father or his kindred to inherit from or through the child unless the father has openly treated the child as his and has not refused to support the child. - \(3) A person is not the child of a parent whose parental rights have been terminated under Section 63-7-2580 of the 1976 Code, except that the termination of parental rights is ineffective to disqualify the child or its kindred to inherit from or through the parent. - **SCPC §63-9-1120. ADULT ADOPTION** - South Carolina allows for adult adoption with the consent of the person to be adopted or his/er guardian and with the consent of the spouse (if any of a sole adoptive parent) filed in writing with the court - *[Woodward v. Commissioner of Social Security]* -- - RULE - Posthumously conceived children have the right to inherit under Massachusetts intestacy laws if the genetic relationship to the decedent is established and the deceased parent consented to the posthumous conception and posthumous support of the child or children. - **UPC §2-121. CHILD BORN TO GESTATIONAL CARRIER.** - A parent-child relationship between a gestational child and the\ child's gestational carrier does not exist unless the gestational carrier is:\ (1) designated as a parent of the child in a court order described in subsection (b);\ or\ (2) the child's genetic mother and a parent-child relationship does not exist under this section with an individual other than the gestational carrier. - [Surrogacy] -- - the courts are not in agreement over who is a parent of a child born to a surrogate - in some states, surrogacy agreements are prohibited or are enforceable only under certain conditions - *[Johnson v. Calvert]* - A genetic mother, may bring an action to determine the existence of a mother and child relationship. The natural mother and child relationship may be established by proof of her having given birth to the child. Where a surrogate was used, she can establish the relationship, but the adoptive mother may also establish the relationship. Further the relation of the adoptive father and child may be relevant. - [Assisted Reproduction] -- - a child conceived by assisted reproduction (other than posthumously or by gestational surrogacy) is in a parent-child relationship and thus is entitled to inherit by, from, or through the child's birth mother (UPC §2-120 (c)) - there can also be a parent-child relationship with another person if the other person either consented in writing to assisted reproduction by the birth mother with the intent to be the other parent of the child, or functioned as a parent of the child within [two years] of the child's birth (UPC §2-120(f)) - [Advancements] -- - If a child wishes to share in the intestate distribution of a deceased parent's estate, the child must permit the administrator to include in the determination of the distributive shares the value of any property that the decedent, while living, gave the child by way of **advancement.** - [Common Law] -- Any lifetime gift by the decedent to a child was presumed to be an advancement -- in effect, a prepayment -- of the child's intestate share. - The doctrine is based on the assumption that a parent would want an equal distribution of assets among children and that true equality can be reached only if lifetime gifts by the parent are taken into account in determining the amount of equal shares. - [Modern Law] -- Many states have reversed the common law assumption of advancement. - In these states, a lifetime gift is presumed **not** to be an advancement unless it is shown to have been intended as such. - **UPC §2-109. ADVANCEMENTS.** - The UPC requires that the intention to make an advancement be declared in writing signed by the parent or child. - If the child predeceases the parent, the property is not taken into account in computing the division and distribution of the decedent's intestate estate, unless the decedent's contemporaneous writing provides otherwise. - [Hotchpot (Advancements)] -- - if a gift is treated as an advancement, it is accounted for in distributing the decedent's estate by bringing it into a **hotchpot.** - Ex: Assume that the decedent, O leaves no spouse, three children, A, B, and C, and an estate worth \$50,000. One daughter A, received an advancement of \$10,000. To calculate the shares for A, B, and C, the \$10,000 gift is added to the \$50,000 estate, and the total \$60,000 *hotchpot* is divided by three, resulting in a \$20k share per child. But because A has already received a \$10,000 advancement on her share, she receives only \$10,000 from the estate. - **UPC §2-110. DEBTS TO DECEDENT.** - A debt owed to a decedent is not charged against the intestate share of any individual except the debtor. If the debtor fails to survive the decedent, the debt is not taken into account in computing the intestate share of the debtor's descendants. - [Minors] -- - **Guardianship of the person** - If both parents die while a child is a minor, the court will appoint a guardian of the person, usually from among the nearest relatives - This person may not be whom the parents would want to have custody of the child - For a parent with a minor child, an important reason to make a will is to designate a guardian of the person for the child - It is a good idea also to select an alternate - Guardianship of the person for a minor is covered by **UPC §5-201 to 5-210** - Management of property - **Guardianship of the property and Conservatorships** - The expense and inflexibility of a guardianship for property has led to its replacement with a *conservator* system - The guardian of the property has been renamed the *conservator* and given "title as trustee" to the protected person's property along with investment powers similar to those of a trustee - A conservatorship has far more flexible powers than a guardian - **Custodianship** - A *custodian* is a person who is given property to hold for the benefit of a minor under the Uniform Transfers to Minors (UTMA) - Under these acts, some form of which has been enacted in every state, property may be transferred to a person, including the donor, as *custodian* for the benefit of the minor - A custodian is not under the supervision of the court - **Trusteeship** - A trust is the most flexible of all property arrangements - A trust can postpone possession until the donor thinks the child is competent to manage the property -- or can postpone possession entirely, requiring that some or even all of the property remain in trusts for generations - Whereas conservatorship/guardianship the child must receive the property at 18 - Under custodianship at 18 or 21 **BARS TO SUCCESSION** 1. Slayer Statutes 2. Voluntary Disclaimer - [*In re Estate of Mahoney* (the Slayer Rule)] -- - RULE - Where the statutes of descent require distribution of a decedent's assets to the party responsible for the wrongful killing of the decedent, the estate must pass as statutorily required but equity imposes a **constructive trust** requiring the killer to hold the assets in trust for the decedent's next of kin. - **Constructive Trust** -- a trust imposed by a court on equitable grounds against one who has obtained property by wrongdoing, thereby preventing the wrongful holder from being unjustly enriched. The sole duty of the constructive trustee is to convey the property to its rightful claimant. - In *Mahoney*, the court authorized the imposition of a constructive trust on Charlotte Mahoney to prevent the unjust enrichment of her inheriting by reasoning of her wrongful killing. - **UPC §2-803. "SLAYER STATUTE"** - An individual who feloniously and intentionally kills the decedent forfeits all benefits under this article with respect to decedent's estate - Joint tenancies -- become tenancies in common - In the absence of a criminal conviction, the probate court must determine whether, under the civil standard of preponderance of the evidence rather than criminal standard (BARD), the individual would be found criminally accountable for the killing. - [Unworthy Heirs] -- - Someone you do not want to inherit - Ex: A spouse that abandoned the decedent; Parents that don't support children; Relatives that take advantage of or abuse a vulnerable person - [Disclaimer] -- - Sometimes an heir or a devisee will decline to take the property, a refusal that is called a **disclaimer**. - The gift is deemed revoked and treated as if the recipient predeceased the testator. - The most common reasons for disclaiming are to reduce taxes or to keep property from creditors - At common law, when a person died intestate, title to real and personal property passed to the decedent's heirs by operation of law **WILLS, FORMALITIES, & FORMS** - The Probate Code of every state includes a provision, known for historical reasons as the *Wills Act*, which proscribes rules for making a valid **will** - A person who dies with a valid will is known as a **testator**, and is said to die **testate** - By making a will in compliance with the Wills Act, a testator ensures that her probate property will be distributed in accordance with her actual intent rather than presumed intent of intestacy - The Wills Act implements the principle of freedom of disposition - A will is a peculiar legal instrument because it does not take effect until after the testator dies - In consequence, probate courts follow what has been called the "worst evidence" rule of procedure - The Wills Act of every state requires compliance with particular **formalities** for making or revoking a will - [Four Functions of a Will] 1. Evidentiary 2. Channeling/uniform 3. Cautionary/ritual 4. Protective function - **UPC §2-501. WHO MAY MAKE A WILL.** - An individual 18 or more years of age who is of sound mind may make a will. - [Execution of Wills -- Attested Wills] - Three core formalities for the making of an attested will: 1. Writing; 2. Signature; and 3. Attestation - [Statutory Formalities for Formal Wills Requirements] - **Statute of Frauds** -- - Need a writing; - Signature; and - Attestation via subscription by **3** witnesses - **Wills Act (1837)** -- - Need a writing; - Signature; and - **Subscription** -- the Wills Act requires that the will be signed "at the foot or end thereof" - Attestation via subscription by **2** witnesses - Requires that both witnesses be present when the will is signed or acknowledged - **UPC (revised 2008)** -- - Need a writing; - Signature; and - Attestation via subscription by **2** witnesses **or notarization** - **SCPC §62-2-502. Execution.** - Need a writing; - Signed by the testator or in the testator's name by some other individual in the testator's presence and by the testator's direction; and - Signed by at least **2** individuals each of whom witnessed either the signing or the testator's acknowledgement of the signature of the will - *[In re Groffman]* -- - RULE - Even where a will accurately represents the wishes of the testator, the will cannot be enforced if it fails to comply with the statutory requirements for proper execution. - [Attestation Clauses] -- - a clause that recites that the will was duly executed in accordance with the particulars of the applicable Wills Act - if a witness testifies that the steps for due execution were not satisfied, as in *In re Groffman*, an attestation clause gives the proponent's lawyer ammunition for a vigorous cross-examination in which the witness may be impeached with the text of the clause - [Modern Trend] -- the attestation clause is normally augmented with an affidavit in what has come to be known as a **"self-proving will"** - *[Stevens v. Casdorph]* -- - RULE - A will can be enforced despite a testator's non-compliance with the statute's technical requirements for valid execution of a will only if the witnesses who failed to sign in the presence of the testator acknowledge their signatures in the presence of each other and the testator. - [Concious Presence Test] -- - Restatement (3^rd^) of Property - recognizes that a person can sense the presence or actions of another without seeing the other person. - If the testator and the witnesses are near enough to be able to sense each other\'s presence, typically by being within earshot of one another, so that the testator knows what is occurring, the presence requirement is satisfied - [Order of Signing] -- - An issue that comes up is signatures by marks (i.e. signing with an "X" has been accepted in some places), signatures with assistance, electronic signatures, etc. - Another potential source of trouble is the order of signing... - In general, the testator must sign or acknowledge the will before witnesses attest. - [Delayed Attestation] -- - In a state that does not require the witness to sign the will in the presence of the testator, must the witness sign while the testator is still alive? - The UPC takes the position that a "reasonable time" could extend until after the testator's death - [*Taylor v. Holt* (Signature in the Will Execution)] -- - RULE - Any mark, symbol, or other method, including a computer-generated signature, meets the will statute's signature requirement if the testator makes or adopts it with the intention that it authenticates the will. - [Interested Witnesses and Purging Statutes] -- - **From Disqualification to Purging** - In early England, an interested witness was not permitted to testify in court, hence a will attested by an interested witness could not be proved in probate - To alleviate the harsh outcome, Parliament passed an act that came to be known as the **purging statute** - The **purging** statute allowed a will attested by an interested witness to be admitted to probate, but it voided (purged) any bequest to the interested witness - A will attested by an interested witness would be valid, but the witness would not take his devise - A slim majority of states have purging statutes - If the will is witnessed by a sufficient number of disinterested witnesses, the interested witness is said to be *supernumerary* and may take his full devise - **Trend Away from Purging** - **UPC §2-505(b)** and a minority of states do not require that any of the witnesses be disinterested; an interested witness is not purged of his devise - **UPC §2-505. WHO MAY WITNESS & INTERESTED WITNESSES.** - \(a) An individual generally competent to be a witness may act as a witness to a will. - \(b) The signing of a will by an interested witness does not invalidate the will or any provision of it. - **SCPC §62-2-504. SUBSCRIING WITNESSES NOT COMPETENT BECAUSE OF INTEREST; EFFECT ON GIFTS TO THEM.** - \(a) A subscribing witness to any will is not incompetent to attest or prove the same by reason of any devise therein in favor of the witness, the witness\'s spouse, or the witness\'s issue. If there are two disinterested witnesses to a will in addition to the interested witness, then the devise is valid and effectual, if otherwise effective. If there are not two disinterested witnesses to a will in addition to an interested witness, then the devise is null and void to the extent of the value of the excess property, estate, or interest so devised over the value of the property, estate or interest to which the witness, the witness\'s spouse, or the witness's issue would be entitled upon the failure to establish the will. The voided portion of the devise shall pass by intestacy in accordance with Section 62-2-101 et seq., provided the share of the interested witness, the witness\'s spouse, or the witness\' issue shall not increase due to the devise passing by intestacy. - \(b) A subscribing witness to any will is not incompetent to attest or prove the will by reason of any appointment within the will of the witness, the witness\'s spouse, or the witness\'s issue to any office, trust, or duty. The appointment of a witness, a witness\'s spouse, or a witness\'s issue is valid, if otherwise so, and the individual so appointed, in such case, is entitled by law to take or receive any commissions or other compensation on account thereof. - \(c) A subscribing witness to any will is not incompetent to attest or prove the will by reason of any charge within the will of debts to any part of the estate in favor of the witness, the witness\'s spouse, or the witness\'s issue as creditor. - [Model Execution Ceremony] -- - Under the usual choice of law rules, the law of the state where the decedent was domiciled at death governs the validity of a disposition by will of personal property, and the law of the state where real property is located governs the validity of a disposition by will of that property. - **UPC §2-506. CHOICE OF LAW AS TO EXECUTION.** - A written will is valid if executed in compliance with Section 2-502 or 2-503 or if its execution complies with the law at the time of execution of the place where the will is executed, or of the law of the place where at the time of execution or at the time of death the testator is domiciled, has a place of abode, or is a national. - **UPC §2-504. SELF-PROVING AFFIDAVITS.** - **UPC § 2-504(a)** - One-step self-proving affidavit that combines the attestation clause and self-proving affidavit; the testator and the witnesses sign only once. - **UPC § 2-504(b)** - Two-step self-proving affidavit to a will that is already signed and attested; the testator and witnesses sign the separate affidavit after they have signed the will. - **UPC §3-406. FORMAL TESTACY PROCEEDINGS; CONTESTED CASES.** - In a contested case in which the proper execution of a will is at issue, the following rules apply: - \(1) If the will is self-proved pursuant to Section 2-504, the will satisfies the requirements for execution without the testimony of any attesting witness, upon filing the will and the acknowledgment and affidavits annexed or attached to it, unless there is evidence of fraud or forgery affecting the acknowledgment or affidavit. - \(2) If the will is notarized pursuant to Section 2-502(a)(3)(B), but not self-proved, there is a rebuttable presumption that the will satisfies the requirements for execution upon filing the will. - \(3) If the will is witnessed pursuant to Section 2-502(a)(3)(A), but not notarized or self-proved, the testimony of at least one of the attesting witnesses is required to establish proper execution if the witness is within this state, competent, and able to testify. Proper execution may be established by other evidence, including an affidavit of an attesting witness. An attestation clause that is signed by the attesting witnesses raises a rebuttable presumption that the events recited in the clause occurred. - *[In re Pavlinko's Estate]* -- - RULE - To be valid and enforceable, a will otherwise validly executed must strictly comply with the requirement of the Wills Act of 1947 that the testator sign the will and the will may not be revised by the court to make it compliant with the Wills Act of 1947. - [Strict Compliance Rule] -- - Under traditional law, a will must be executed in strict compliance with all the formal requirements of the applicable Wills act - The strict compliance rule guards against a spurious finding of authenticity -- a "false positive". - *[In re Snide]* - - RULE - If the testators of mutual wills mistakenly sign each other's wills, and the wills are simultaneously executed with statutory formality and contain identical reciprocal testamentary schemes, the wills may be read together in order to be enforced in probate. - [Substantial Compliance; Langbien's Test] -- 1. Does the noncomplying document express the decedent's testamentary intent; and 2. Does it sufficiently approximate Wills Act formality to enable a court to conclude that the document serves the purpose of the Wills Act? - [Harmless Error Rule] -- - Doctrine that a will may be valid even if the formalities of execution were not strictly observed if the will proponent shows by **clear and convincing evidence** that the decedent intended to adopt the document as his will. - This rule applies not only to defects in executing a will but also to defects in revoking a will or reviving a will. - **UPC §2-503. HARMLESS ERROR RULE.** - Although a document or writing added upon a document was not executed in compliance with §2-502, the document or writing is treated as if it had been executed in compliance with that section if the proponent of the document or writing establishes by clear and convincing evidence that the decedent intended the document or writing to constitute - \(1) the decedent's will, - \(2) a partial or complete revocation of the will, - \(3) an addition to or an alteration of the will, or - \(4) a partial or complete revival of his \[or her\] formerly revoked will or of a formerly revoked portion of the will - *[In re Estate of Hall]* - RULE - If a will has not been properly witnessed, it may be considered valid if there is clear and convincing evidence that the testator intended it to be his or her will. - [Applying Harmless Error Rule] -- - Is there clear and convincing evidence that the decedent intended the document or writing to constitute: 1. the decedent's will, 2. a partial or complete revocation of the will, 3. an addition to or an alteration of the will, or 4. a partial or complete revival of his \[or her\] formerly revoked will or of a formerly revoked portion of the will - *In re Groffman* -- the will was witnessed at the home of a friend and the witnesses didn't sign in the presence of one another - *Stevens v. Casdorph* -- testator signed the will in the bank lobby and then the witnesses signed at separate teller stations - *In re Pavlinko's Estate* -- husband and wife mistakenly executed each other's will - *In re Will of Ferree* -- testator's will was notarized but not witnessed - *[In re Probate of Will and Codicil of Macool]* - RULE - A will that the decedent did not review and give final assent to cannot be admitted to probate. - *[In re Estate of Javier Castro]* - RULE - A will written and signed on a tablet computer can constitute a valid signed writing. - [Holographic Wills] -- - A **holographic will** is a **handwritten** will by the testator; it need NOT be attested by witnesses. - **Not permitted in South Carolina** - In most states, a will may be admitted to probate if it qualifies as a holographic will under the relevant state's law, even if it does not meet the requirements for an attested will. - [Traditionally] - a holographic will had to be entirely in the testator's handwriting - **UPC §2-502. HOLOGRAPHIC WILLS.** - Under the UPC, a holographic will is valid if the signature and the material portions of the will are in the testator's handwriting. - [Oral Wills] -- - Generally not valid - In some states, an oral (or nuncupative) will may be valid in some cases if the property disposed of is below a certain dollar value, and the terms are written down within a certain time after the testator's oral declarations - i.e. Ohio - **Uniform Electronic Wills Act** -- - Allows for electronic wills - [Goals of the Act] -- - to allow a testator to execute a will electronically while still maintaining the protections of paper wills; - to create execution requirements that will result in a valid will without the necessity of court intervention; - to protect the four functions of will formalities - As of now it is only allowed in 4 states - **South Carolina does not allow** - *[In re Kimmel's Estate]* - RULE - If an informal document contains evidence of the decedent's intent to make a posthumous gift, that document is enforceable as a will even though the document also contains language that is not testamentary in nature. - [Conditional Wills] -- - Wills that presume that the language of the condition is not meant to be a condition but rather is a statement of the inducement for making the will - Ex: "if I die...", "if anything happens to me..." - Will still be valid usually even if the event does not happen immediately - *[In re Estate of Gonzalez]* - RULE - By requiring only the \"material provisions\" to be in the testator\'s handwriting, rather than requiring, as some existing statutes do, that the will be \"entirely\" in the testator\'s handwriting, a holograph under Me. Rev. Stat. Ann. tit. 18, § 2-503 may be valid even though immaterial parts such as date or introductory wording be printed or stamped. A valid holograph might even be executed on some printed will forms if the printed portion could be eliminated and the handwritten portion could evidence the testator\'s will. - [Codicil] -- - A codicil to a will is a document made after a will that adds to, subtracts from, or changes the will in part - Must be executed with the same formalities as a will (i.e. must be in compliance with the Wills Act) - A codicil republishes the will as of the date of codicil - *[In re Estate of Kuralt]* - RULE - A letter that conveys a decedent's testamentary intent to make a specific bequest is enforceable as a holographic codicil to the decedent's formal will. **REVOCATION OF WILLS** - Wills are said to be [ambulatory], meaning that it is subject to amendment or revocation by the testator at any time prior to death - All states permit revocation of a will by: 1. Subsequent writing executed with Wills Act formalities, or 2. By a **physical act** such as destroying, obliterating, or burning the will - An oral declaration that a will is revoked is NOT enough - If a duly executed will is not revoked in accordance with the applicable revocation statute, the will must be admitted to probate - **UPC § 2-507. REVOCATION BY WRITING OR BY ACT.** - A will or any part thereof is revoked: - By executing a subsequent will that revokes the previous will or part expressly or by inconsistency; or - By performing a revocatory act on the will with intent of revoking - Revocatory act i.e. burning, tearing, canceling, obliterating - [Express and Implied Revocatory Writings] - A writing executed with Wills Act formalities may revoke an earlier will in whole or in part by **express revocation** - A writing executed with Wills Act formalities may also revoke a prior will in whole or in part by **inconsistency -- implied revocation** - Issues arise when a testator executes a subsequent will that does not include an express revocation clause - **UPC § 2-507. REVOCATION BY WRITING OR ACT** - subsequent will that does not expressly revoke a prior will, but makes a **complete disposition** of the testator's estate, is treated as presumptively revoking the prior will by inconsistency - if the subsequent will does not make a complete disposition of the testator's estate, it is instead viewed as a **codicil,** and any property not disposed of under the codicil is disposed of in accordance with the prior will (UPC § 2-507) - **codicil --** a testamentary instrument that supplements, rather than replaces, an earlier will - *[Thompson v. Royall]* - RULE - A written revocation on the back of a will that does not otherwise comply with statutory requirements for revocation cannot effect a revocation by cancellation unless the written revocation obliterates or defaces the text of the will. - [*Harrison v. Bird* (Lost/Misplaced Wills)] - RULE - The fact that a decedent's original will that was in her possession before her death is missing after her death gives rise to a rebuttable presumption that she revoked the will by destroying the will. - Missing/lost will = rebuttable presumption of revocation - [Lost Wills and the Presumption of Revocation] - - A **presumption of revocation** arises when a will last known to be in the testator's possession cannot be found (or is found in mutilated condition) - The law presumes that the will cannot be found because the testator destroyed or mutilated it with the intent to revoke it. - Burden shifts to proponent of the will to overcome the presumption - Standard of evidence is split in jurisdictions... - Some require clear and convincing evidence - Some require preponderance of the evidence - If a will is lost, typically a copy will not be admitted to probate, but it can be used as evidence to prove intent - Other things that can be used as evidence is attorney's notes - If a lost or mutilated will was *last known to have been in the possession of someone other than the testator,* there is no presumption of revocation - *[In re Estate of Stoker]* - RULE - A will can be revoked by a subsequent inconsistent will. - [Partial Revocation] -- - **UPC § 2-507** and the statutes of most states authorize partial revocation by physical act - In a few states, a will cannot be revoked in part by an act of revocation; it can be revoked in part only by a subsequent writing - Some states do not allow partial revocation -- the entire will is admitted to probate regardless of the partial revocation - [Dependent Relative Revocation] -- - If a testator undertakes to revoke her will upon a mistaken assumption of law or fact, under the doctrine of **dependent relative revocation (DDR)** the revocation is ineffective if the testator would not have revoked the will but for the mistaken belief - A typical DRR case involves a testator who revokes a prior will under a belief that a new will is valid but, in fact, for some reason unknown to the testator, the new will is invalid. - [Dependent Relative Revocation; Restatement (3^rd^) of Property] -- - \(a) A partial or complete revocation of a will is presumptively ineffective if the testator made the revocation: - \(1) in connection with an attempt to achieve a dispositive objective that fails under applicable law, or - \(2) because of a false assumption of law, or because of a false belief about an objective fact, that is either recited in the revoking instrument or established by clear and convincing evidence. - \(b) The presumption established in subsection (a) is rebutted if allowing the revocation to remain in effect would be more consistent with the testator's probable intention. - *[LaCroix v. Senecal]* - RULE - Under the doctrine of dependent relative revocation, if a testator revokes all or part of her will intending the revocation to be effective only if a subsequent will or codicil can be validly substituted, and the subsequent will or codicil is actually not valid, then the revocation fails to the extent that the condition on which it was based was not met. - **UPC §2-509. REVIVAL OF REVOKED WILLS.** - \(a) If a subsequent will that wholly revoked a previous will is thereafter revoked by a revocatory act under Section 2-507(a)(2), the previous will remains revoked unless it is revived. The previous will is revived if it is evident from the circumstances of the revocation of the subsequent will or from the testator's contemporary or subsequent declarations that the testator intended the previous will to take effect as executed. - \(b) If a subsequent will that partly revoked a previous will is thereafter revoked by a revocatory act under Section 2-507(a)(2), a revoked part of the previous will is revived unless it is evident from the circumstances of the revocation of the subsequent will or from the testator's contemporary or subsequent declarations that the testator did not intend the revoked part to take effect as executed. - \(c) If a subsequent will that revoked a previous will in whole or in part is thereafter revoked by another, later will, the previous will remains revoked in whole or in part, unless it or its revoked part is revived. The previous will or its revoked part is revived to the extent it appears from the terms of the later will that the testator intended the previous will to take effect. - [Revocation by Operation of Law] -- 1. **Divorce** a. UPC §2-804 b. Joint ownership -- become tenants in common 2. **Revocation by marriage** c. Premarital wills that are silent on a pretermitted spouse (married after the will was executed) d. [Common law] -- a premarital will is revoked upon marriage (most states have changed this rule) e. **Pretermitted spouse** -- a surviving spouse whom the decedent spouse married after the executing of his/her will -- may take an intestate share of deceased spouse's estate, unless the will indicates that the omission was intentional or the spouse is provided for in the will or by a will substitute 3. **Revocation by birth of children** f. **Pretermitted children** -- children born after the execution of the will; unless there is evidence of the contrary, these children **will share in the will.** **COMPONTENTS OF A WILL** 1. **Integration** a. Under the doctrine of integration, all papers that are present at the time of execution and are intended to be part of the will are treated as part of the will. b. *[Estate of Rigsby]* i. RULE - Where a purported will contains more than one page, it must be made clearly apparent that the testator intended that all of the pages together should constitute his last will and testament. 2. **Republication by Codicil** c. Under the doctrine of republication by codicil, a validly executed will is treated as re-executed (republished) as of the date of the codicil. d. The doctrine should be applied only if updating the will carries out the testator's intent. e. CAN AFFECT WHO RECEIVES BEQUESTS (purging states and interested witnesses) 3. **Incorporation by reference** f. Allows for a writing that was in existence but not present at the time of execution and that was not itself executed with testamentary formalities to be absorbed into the testator's will -- a kind of constructive integration g. *[Clark v. Greenhalge]* ii. RULE - A will may incorporate by reference any informal document not executed in the manner of a will that was in existence at the time of execution of the will, or a codicil to the will, and is shown by adequate proof to be the document referenced in the will. h. **UPC §2-510. INCORPORATION BY REFERENCE** iii. Any writing in existence when a will is executed may be incorporated by reference if the language of the will manifests this intent and describes the writing sufficiently to permit its identification. 4. **Acts of Independent Significance** i. If the beneficiary or property designations are identified by reference to acts or events that have a lifetime motive and significance apart from their effect on the will, the gift will be upheld under the doctrine of **acts of independent significance** (also called the doctrine of nontestamentary acts) j. **UPC §2-512. EVENTS OF INDEPENDENT SIGNIFICANCE.** iv. A will may dispose of property by reference to acts and events that have significance apart from their effect upon the dispositions made by the will, whether they occur before or after the execution of the will or before or after the testator's death. The execution or revocation of another individual's will is such an event. - **UPC §2-513. SUBSEQUENT WRITINGS AND TANGIBLE PERSONAL PROPERTY.** - The UPC allows a testator to dispose of tangible personal property by a separate writing, even if prepared after the execution of the testator's will, provided that the will makes reference to the separate writing - A slim majority of states have adopted a version of UPC §2-513 - [Joint Wills and Contracts] - - During life a person may exercise her *freedom of contract* to bind herself to a particular exercise of her *freedom of disposition* at death by way of a *contract to make a will* or *not to revoke a will* - Contract law, not the law of wills, applies - Need clear and convincing evidence that a contract does exist - **Contracts to Make a Will** - - A contract to make a will typically arises in the context of a premarital or divorce agreement or as part of an agreement to take care of a sick or older person - **Contracts Not to Revoke a Will** -- - **Joint Wills -** cases involving a contract not to revoke a will typically involve a married couple that has executed a joint will or mutual wills. - Despite being relatively uncommon, joint wills have spawned a great deal of litigation. Well-counseled testator do not use them. - **Mutual wills** (**reciprocal or mirror-image wills**) - are separate wills of two persons that contain mirror-image provision - The term mutual wills is also occasionally -- and confusingly -- used to describe a joint will or reciprocal or mirror-image wills that are accompanied by a contractual agreement not to revoke - keep in mind - if one of the spouses' dies the other (surviving spouse) can change the estate plan... - **UPC §2-514. CONTRACTS CONCERNING SUCCESSION.** - A contract to make a will or devise, or not to revoke a will or devise, or to die intestate... may be established only by - \(i) provisions of a will stating material provisions of the contract, - \(ii) an express reference in a will to a contract and extrinsic evidence proving the terms of the contract, or - \(iii) a writing signed by the decedent evidencing the contract. The execution of a joint will or mutual wills does not create a presumption of a contract not to revoke the will or wills. - *[Keith v. Lulofs]* - RULE - The mere fact that the provisions of two wills mirror each other is insufficient to show an intent to make the provisions of the wills irrevocable. - [Dead Man's Statute] -- - a statute designed to prevent perjury in a civil case by prohibiting a witness who is an interested party from testifying about communications or transactions with a deceased person against the decedent unless there is a waiver - most states have abrogated the rule, and it is not in the federal rules of evidence **CAPACITY AND CONTEST** - considering a **will contest** in which the contestant alleges that a will executed with proper formalities was nonetheless not voluntary because of the incapacity of the testator or the undue influence, duress, or fraud of another - also considers the parallel claim that the decedent would have made a new will but for the undue influence, duress, or fraud of another - [Capacity to Make a Will]- - Capacity to make a will is minimal... - Testator must be capable of knowing and understanding in a general way: 1. The nature and extent of his/her property, 2. The natural objects of his/her bounty, and 3. The disposition that he/she is making of that property 4. And capable of relating these elements to one another and forming an orderly desire regarding the disposition of the property - **The Cunningham Test --** mental capacity to make a will requires that: - The testator understand the nature of her act; - She knows the extent of her property; - She understands the proposed testamentary disposition; - She knows the natural objects of her bounty; and - The will represents her wishes - **Lower threshold** for testamentary capacity for wills, than lifetime gifts and contracts. - **UPC §3-407. BURDEN OF PROOF.** - On the CONTESTANT of the will when regarding mental capacity - "Contestants of a will have the burden of establishing lack of testamentary intent, or capacity, undue influence, fraud, duress, mistake, or revocation." - Burden of proof -- - Proponent contestant proponent - Capacity can come and go - i.e. a testator who suffered from dementia/Alzheimer's - *[In re Wright's Estate]* - RULE - a few isolated acts of abnormal behavior cannot satisfactorily rebut an inference of testamentary capacity - *[Wilson v. Lane]* - RULE - To prove lack of testamentary capacity, the party challenging the will must present proof showing that the testator's condition prevented her from having a decided and rational desire as to the disposition of her property. **INSANE DELUSIONS** - **Insane delusion** -- a false idea about reality that testator adheres to despite all evidence against the contrary - Contestants have to prove [two] things: 1. Testator believed the insane delusion; and 2. The will is a product of the insane delusions - *[In re Strittmater's Estate]* - RULE - Where a testator's distribution of her estate is the product of insane delusions, the will must be set aside. - [*Breeden v. Stone* ] - RULE - To invalidate a will for lack of testamentary capacity due to insanity, the contestant bears the burden of proving that the testator was not of sound mind and to the extent testator suffered from insane delusions, the delusions impacted the distribution of the estate. - **Insane Delusions Test** -- there must be a causal connection between the insane delusion and the creation of the will **UNDUE INFLUENCE** - A donative transfer is procured by undue influence if the influence exerted over the donor overcame the donor's free will and caused the donor to make a donative transfer that the donor would not otherwise have made. - [Inferring Undue Influence] - The trier of fact may infer undue influence from circumstantial evidence that - The donor was susceptible to undue influence, - The alleged wrongdoer had an opportunity to exert undue influence , - The alleged wrongdoer had a disposition to exert undue influence, and - There was a result appearing to be the effect of undue influence - *[In re Estate of Sharis]* - RULE - The conduct of a named beneficiary in a will may amount to undue influence even without proof of specific acts of the beneficiary at the time the will was executed. - [Presumptions and Burden Shifting] - - **Caregivers** -- - Some jurisdictions presume statutorily undue influence! - **Confidential Relationships** -- - fiduciary, reliant, and/or dominant-subservient relationship, trustee relationship - **Suspicious Circumstances** -- - In addition to a confidential relationship, to trigger a presumption of undue influence a contestant must usually show the existence of suspicious circumstances - This can often be satisfied by showing that the influencer procured the will - Unnatural disposition, lack of independent advice, will produced in secrecy or haste, sudden change in donor's attitude - *[In re Will of Moses]* - RULE - The presumption of undue influence will be overcome by independent advice and counsel of an uninvolved attorney if that advice and counsel addresses testator's distribution of the estate to the person with whom the testator has a confidential or fiduciary relationship. - *[Lipper v. Weslow]* - RULE - In addition to showing that a beneficiary of the will had the motive and opportunity to unduly influence the testator, contestants of a will must also prove that the will, as written, reflects that the beneficiary's wishes were substituted for the wishes of the testator. - [No-Contest Clauses] -- - Deprives an unsuccessful contestant of her bequest under the challenged will. - If enforceable and if accompanied by a substantial enough bequest, a no-contest clause may deter a will contest - [Gifts to the Lawyer Drafting the Will] - May be a violation of the Rules of Professional Conduct (unless drafting will for a family member) **DURESS -- undue influence + imprisonment or threat of (physical harm)** - *[Latham v. Father Devine]* - RULE - Where a beneficiary of a presently executed will prevents the testator from revoking that will and executing a new will in favor of another beneficiary by fraud, duress or undue influence, and the testator dies with the original will in effect, the property devised under that will to the wrongful beneficiary is held in constructive trust for the intended beneficiaries of the unexecuted will. - **Equitable Remedies -- Constructive Trust** - The will is probated but it is set into a constructive trust to protect testator's freedom of disposition **FRAUD** 1. A misrepresentation was made with the intent to deceive the T and with the purpose of influencing the testamentary disposition; and 2. The fraud caused the testator to dispose of his/her property in a way that s/he would not have done but for the fraud - Two types of fraud: - **Fraud in the Execution** -- wrongdoer intentionally misrepresents the contents of the document the testator actually signs - **Fraud in the inducement** -- making a misrepresentation that causes a testator to revoke a will, refrain from making a new will, etc. to work out in the wrongdoers favor **TORTIOUS INTERFERENCE WITH AN EXPECTANCY** - Does not go in probate (civil court matter) 1. The existence of an expectancy 2. Intentional interference with the expectancy through tortious conduct 3. Causation 4. Damages - *[Schilling v. Herrera]* - RULE - An injured party may establish the tort of intentional interference with an expectancy of inheritance by showing that tortious conduct resulted in the loss of his expectancy and such tortious conduct precluded the injured party from seeking relief in the probate court. - Protecting testator's freedom of disposition, not benefactor's inheritance rights - Longer statute of limitations time period under tortious inheritance with an expectancy (tort claim) than statute of limitations in probate court - However, must avail yourself of probate court remedies first **CONSTRUCTION OF A WILL** - the traditional rules: - **4 Corners of the Document** - - look at the four corners of a will; no extrinsic evidence to fix mistakes or ambiguities - **Plain Meaning Rule (No Extrinsic Rule)** - - extrinsic evidence can come in to resolve an ambiguity; however, if there is no ambiguity *plain meaning* of the language has to be applied to the will - **No Reformation** - - courts may not reform a will to correct a mistaken term to reflect what the testator intended the will to say - *[Mahoney v. Grainger]* - Testimony as to a testator's intention in using certain language in her will may not be admitted to prove the meaning of the language unless the language is ambiguous and susceptible to different meanings. - The usual justification for the plain meaning and no reformation rule is the worst evidence problem... - Because a testator is unable to corroborate or refute extrinsic evidence of intent that is at odds with the words of her will, she is protected from fraud and error by categorically excluding such evidence - *[In re Estate of Cole]* - RULE - In some jurisdictions, courts may consider extrinsic evidence of the testator's intent to resolve ambiguities in the will that remain despite consideration of the surrounding circumstances, regardless of whether the ambiguities are latent or patent. - [Ambiguities] -- - **Patent Ambiguity** - A patent ambiguity is evident from the face of a will -- i.e. in *Cole* the inconsistency between "two hundred thousand dollars" and "\$25,000" - Under traditional law, extrinsic evidence is not admissible to clarify a patent ambiguity - If the true meaning cannot be determined by looking at extrinsic evidence it is likely to be void - **Latent Ambiguity** - Latent ambiguity arises when a language of the writing is clear on its face but contains ambiguity in light of the extrinsic evidence that suggests more than one way of interpretation (manifests itself only when the terms of a will are applied to the facts) - [Equivocation] - when two or more persons or things fit the description exactly - [Personal Usage] - leaving a gift to someone using a nickname for them - [No Exact Fit] - a description in a will does not exactly fit any person or thing (most common) - [*Arnheiter v. Arnheiter* (Ad Hoc Relief for Mistaken Terms)] - RULE - If a will describes property or a beneficiary by several characteristics, and nothing or no one matching all of those characteristics exists, then the less essential characteristics of the description may be disregarded as long as the remaining characteristics match an existing person or property. - *[In re Gibb's Estate]* - RULE - If mistaken identification of property or a beneficiary seems to frustrate the testator's intent, extrinsic evidence is permitted to show whether there was a mistake, and if a mistake is shown to be the cause, the mistaken details will be disregarded. - **UPC §2-805. REFORMATION TO CORRECT MISTAKES.** - The court may reform the terms of a governing instrument, even if unambiguous, to conform the terms to the transferor's intention if it is proved by clear and convincing evidence what the transferor's intention was and that the terms of the governing instrument were affected by a mistake of fact or law, whether in expression or inducement. - *[In re Estate of Duke]* - RULE - Reformation of an unambiguous will is permissible if clear and convincing evidence establishes an error in the expression of the testator's intent and establishes the testator's actual specific intent at the time the will was drafted. - [Clear and Convincing Evidence -- Restatement (3^rd^ of Property)] - The higher standard of proof... imposes a greater risk of an erroneous factual determination on the party opposing reformation. Tilting the risk of an erroneous factual determination in this fashion is appropriate because the party seeking reformation is seeking to establish that a donative document does not reflect the donor's intention. This tilt also deters a potential plaintiff from bringing a reformation suit on the basis of insubstantial evidence. **DEATH OF A BENEFICIARY & ANTILAPSE STATUTES** - [Types of Gifts] -- - **Specific Gift** -- the description only fits one item owned by the testator - Ex: "I leave my grandmother's wedding ring to Tasha" "I leave my Rolex watch to Roger" - **Demonstrative Gift** - a demonstrative devise is a hybrid: a general devise, yet payable from a specific source - Ex: a testator's will gives B "the sum of \$100k to be paid from the proceeds of sale of my Apple stock" -- most courts would hold this is a demonstrative devise; the executor must comply with selling the Apple stock to raise the \$100k, however, if there is not \$100k in the Apple stock then other property must be sold in order to raise the full \$100k - **General Gift** - a devise is general if the testator intends to confer a benefit out of the general property of the estate rather than to give a particular asset - Ex: a devise of \$100,000 to A -- if there is not \$100k in cash in the testator's estate at death, the legacy is not adeemed; other property must be sold to satisfy A's general legacy - **Residuary Gift** - conveys the portion of the testator's estate not otherwise effectively devised by other parts of the will - Ex: devise to A "all the rest, residue, and remainder of my property and estate" - [Antilapse Statutes] -- - In a sense these statutes are misnamed... they do not prevent a lapse; rather, they substitute other beneficiaries, usually the dead beneficiary's descendants, if certain requirements are met - A typical **antilapse statute** [ ] (such as UPC § 2-605) provides that if a predeceased devisee is related to the testator in a prescribed way and is survived by one or more descendants who also survive the testator, those descendants are substituted for the predeceased devisee - [Presumed Intent] - The theory behind the antilapse statutes is one of *presumed intent* - The idea is that, for certain predeceasing devisees, the testator would prefer a substitute gift to the devisee's descendants rather than for the gift to pass in accordance with the common law of lapse - [Scope] - An antilapse statute applies to a lapsed devise *only* if the devisee bears the particular relationship to the testator specified in the statute - Revised UPC adds a devise to a stepchild - In a few states, the statute applies to all devisees, whether a relative of the testator or not - [Default Rules] - Because the antilapse statutes are designed to implement presumed intent, they prescribed default rules that yield to an expression of the testator's actual intent that is contrary to the statute - [Common Law of Lapse] -- - **Specific, Demonstrative, or General Devise** -- devise fails into the residue - **Residuary Devise** -- if residuary devise lapses, heirs of the testator take by intestacy. If only a share lapses, no-residue-of-a-residue rule applies. - **Class Gift** -- surviving members of the class divide the gift - **Void Devise** -- if devisee is already dead or otherwise an ineligible taker, the devise is void and the common law rule of lapse applies - **UPC §2-605. ANTILAPSE; DECEASED DEVISEE; CLASS GIFTS.** - If a devisee who is a grandparent or a lineal descendant of a grandparent of the testator is dead at the time of execution of the will, fails to survive the testator, or is treated as if he predeceased the testator, the issue of the deceased devisee who survive the testator by one hundred twenty (120) hours take in place of the deceased devisee and if they are all of the same degree of kinship to the devisee they take equally, but if of unequal degree than those of more remote degree take by representation. One who would have been a devisee under a class gift if he had survived the testator is treated as a devisee for purposes of this section whether his death occurred before or after the execution of the will. - [No-Residue-of-a-Residue Rule] - the portion of the residuary estate that did not itself pass under the will could not be considered part of the residuary estate at all - [Words of Survivorship] -- - Ex: "to my surviving children" or "if he survives me" language - **UPC § 2-603. ANTILAPSE; DECEASED DEVISEE; CLASS GIFTS.** - b\) \[Substitute Gift.\] If a devisee fails to survive the testator and is a grandparent, a descendant of a grandparent, or a stepchild of either the testator or the donor of a power of appointment exercised by the testator's will, the following apply: - \(3) For the purposes of Section 2-601, words of survivorship, such as in a devise to an individual "if he survives me," or in a devise to "my surviving children," **are not**, in the absence of additional evidence, a sufficient indication of an intent contrary to the application of this section. - The rule of **UPC § 2-603(b)(3)** has received a chilly reception in the state legislatures... only seven states have adopted it - SOUTH CAROLINA IS **NOT** ONE OF THEM - *[Ruotolo v. Tietjan ]* - RULE - Mere survivorship language is an insufficient indication that the testator intended to negate operation of the antilapse statute. - **SCPC §62-2-603. MAJORITY SURVIVORSHIP RULE.** - Words of survivorship in a devise to an individual, such as, \"if he survives me,\" or to \"my surviving children,\" **are**, in the absence of additional evidence, a sufficient indication of an intent contrary to the application of subsections (A) and (B). - [Class Gifts and Antilapse] - Under the lapse rules, a **class gift** is treated differently from a gift to individuals - If a class member predeceases the testator, the surviving members of the class divide the total gift, including the deceased member's share, unless an antilapse statute applies - In a few states, the antilapse statutes do not apply to dispositions to class members who died before the execution of the will - [What is a class?] - A class gift arises if the testator was group minded - A testator is said to be group minded if he uses a class label in describing the beneficiaries, such as "to A's children" or "to my nephews and nieces" - A gift to named beneficiaries who for a natural class may be construed as a class gift if the court decides that the testator would have wanted the survivors to divide the share of a predeceasing beneficiary rather than for it to lapse - *[Dawson v. Yucus]* - RULE - For a devise to be defined as a class gift, the number of beneficiaries and the size of the shares must be uncertain, depending on the number of class beneficiaries surviving at the time of the testator's death. (ascertainable beneficiaries) **CHANGES IN PROPERTY AFTER EXECUTION OF A WILL** - If the testator's actual intent is not evident, the court will apply rules of construction that are meant to implement the probable intent of the testator. - Ademption only applies to **specific devises!** - i.e. gifts -- "my property at 123 Main Street"; "my car"; or "my 3-carat diamond ring to my Aunt Jane" - ademption does **not apply to general, demonstrative, or residuary devises** - **traditional identity theory of ademption --** if a specifically devised item is not in the testator's estate, the gift is extinguished - **modern intent theory of ademption --** if the specifically devised item is not in the testator's estate, the beneficiary may nonetheless be entitled to the replacement or cash value of the original item, if the beneficiary can show that this is what the testator would have wanted - [Burden of Proof] - As originally drafted, UPC §2-606(a)(6) put the burden on the party claiming ademption - Revised UPC §2-606(a)(6) (in 1997) puts the burden on the party opposing ademption - *[In re Estate of Anton]* - RULE - Where a specific devise is removed from an estate by the act of an attorney-in-fact that was not known or assented to by the testator, the devise is not adeemed, i.e., cancelled, to the extent that identifiable proceeds remain in the possession of the estate. 1. **Ademption by Extinction** a. Suppose a will includes a specific devise of an item of property, but the testator sells or gives the item away before death i. What happens to the devise? b. A specific devise of real or personal property is subject to the doctrine of **ademption by extinction** 2. **Ademption by Satisfaction** c. **Ademption by Satisfaction** may be applicable if a testator makes an inter vivos transfer (in life transfer) to a devisee after executing the will d. If the testator is a parent of the beneficiary (or stands in loco parentis) and sometime after executing the will transfers to the beneficiary property of a similar nature to that devised by the will e. The doctrine is akin to that of advancements under intestacy law f. **Ex:** T's will devises \$50,000 to her son, S, and her residuary estate to her daughter, D. After executing the will, T gives S \$30,000. There is a presumption that the gift was in partial satisfaction of the legacy, so that S will take only \$20,000 at T's death g. The doctrine of satisfaction usually applies to general pecuniary bequests but **not specific bequests** (i.e. when specific property such as a painting or bible is devised) during the testator's life, the gift is adeemed by extinction, not by satisfaction. h. Because the intent of the testator is frequently difficult to ascertain, some states have enacted statutes requiring that the intention of a testator to adeem by satisfaction be shown in writing, as under UPC §2-609 3. **Exoneration of Liens** i. Suppose that T's will devises Blackacre to her daughter, A. At T's death, Blackacre is subject to a mortgage that secures a debt on which T was personally liable. Does A take Blackacre subject to the mortgage, or is she entitled to have the debt paid out of residuary assets so that the title will pass to A free of the lien? j. In some states, A takes Blackacre free of the mortgage ii. These jurisdictions follow the common law doctrine of ***exoneration of liens*** -- under this doctrine, if a will makes a specific disposition of real or personal property that is subject to a mortgage to secure a debt on which the testator is personally liable, it is presumed that the testator wanted the debt, like other debts, to be paid out of the residuary estate 4. **Abatement** k. The problem of **abatement** arises if an estate lacks sufficient assets to pay the decedent's debts as well as all devises l. In such circumstances, some devises must be abated or reduced m. Abatement functions like bankruptcy n. In the absence of an indication in the will of how devises should abate, devises ordinarily abate in the following order: iii. Residuary devises are reduced first iv. General devises are reduced second v. Specific and demonstrative devises are the last to abate and are reduced pro rata o. As a practicing lawyer -- it is often a sound practice to make substantial devises to multiple devisees in the form of shares of the residue (perhaps with a dollar cap) **TRUSTS -- CHARACTERISTICS AND CREATION** - In contemporary practice, trusts have trumped wills as the preferred vehicle for implementing a donor's freedom of disposition - [Types of Trusts] - **Inter vivos** - created during the settlor's lifetime by declaration of trust or by deed of trust*,* often as a will substitute [to avoid probate] - **Testamentary trusts** -- created by the testator-settlor's valid will; a testamentary trust does not exist and thus cannot distribute property until the testator/settlor dies - **Revocable v. irrevocable trusts** - **Charitable trusts** -- a charitable trust is created for one or more charitable purposes. Charitable trusts are subject to special rules that do not apply to ordinary private trusts. - **Pet trusts (honorary)** -- a pet trust provides for the care of one or more animals that are alive during the settlor's lifetime. A pet trust will terminate upon the death of the last animal for which the trust was established to provide. - **Oral trusts** -- must be proved it was declared by clear and convincing evidence - **Written trusts** -- a writing signed by the settlor is necessary to satisfy the Statute of Fraud to create a trust for real property - **Trust --** a trust is a legal arrangement in which a settlor conveys property to a trustee to hold as a fiduciary for one or more beneficiaries - May be **testamentary*,*** or - maybe **inter vivos** - **Trustee --**