Ch 6: Power to Transfer

Question 1

What means of support is the surviving spouse entitled to? (T)

Answer 1

The surviving spouse is entitled to the following means of support: (1) Social Security, (2) pension plans, (3) homestead exemption, (4) personal property, and (5) family allowance.

Question 2

Who can receive a worker’s survivor benefits from Social Security? (T)

Answer 2

Only a spouse can receive a worker’s survivor benefits from Social Security.

Question 3

What are pension plans governed by ERISA required to give spouses? (T)

Answer 3

Pension plans governed by the ERISA are required to give spouses survivorship rights.

Question 4

How are the surviving spouse’s rights different under Social Security than pension plans? (T)

Answer 4

Unlike Social Security, a surviving spouse can waive her rights in the spouse’s pension plan. These waivers are subject to strict requirements.

Question 5

Under homestead statutes, what are the characteristics of a set acreage or value of real property? (T)

Answer 5

Under homestead statutes, a set acreage or value of real property is:

i) Exempt from creditors’ claims;

ii) Inalienable during the life of the owners without consent; and

iii) Distributed at death according to statute, not by will.

Question 6

What are the decedent’s minor child(ren) entitled to in the absence of the surviving spouse? (T)

Answer 6

The decedent’s minor child(ren) are entitled to the exemption amount in the absence of a surviving spouse.

Question 7

What do some states have to which the surviving spouse or, if none, any minor child(ren) of the decedent are entitled? (T)

Answer 7

Some states have a statutory list of tangible personal property or a monetary amount to which the surviving spouse or, if none, any minor child(ren) of the decedent are entitled.

Question 8

What is the family allowance and who is entitled to it? (T)

Answer 8

The surviving spouse has a right to a family allowance during probate. Minor children may also receive a family allowance in some jurisdictions. Depending on the jurisdiction, the family allowance is either a set amount or based on the marital standard of living.

Question 9

What does community property consist of? (T)

Answer 9

Community property is a method for distribution of marital assets that is used in only nine states. Community property consists of the earnings and certain acquisitions of both spouses during the marriage.

Question 10

In a community property state, what happens to property when one spouse dies? (T)

Answer 10

At the death of one spouse, one-half of the community property is already owned by the surviving spouse, and only the decedent’s half is subject to disposition by will.

Question 11

What is quasi-community property? (T)

Answer 11

Quasi-community property is separate property that would have been community property if the parties were domiciled in a community-property state when they acquired it.

Question 12

For distribution purposes, how is quasi-community property treated? (T)

Answer 12

Quasi-community property is treated like community property for distribution purposes.

Question 13

In common law states, what does the elective share give the surviving spouse? (T)

Answer 13

In common-law states, the elective share gives the surviving spouse a fraction (often one-third) of the decedent’s estate if the surviving spouse elects to take the elective share rather than any gift contained in the will.

Question 14

In common law states, what does the elective share apply to? (T)

Answer 14

The elective share applies to all property of the decedent, regardless of when it was acquired.

Question 15

Does the elective share exist in community property states? (T)

Answer 15

No. The elective share does not exist in community-property states.

Question 16

Instead of the elective share, what exists in community property states? (T)

Answer 16

Instead, the surviving spouse is entitled to a forced share of one-half of the community property and quasi-community property. The spouse must elect to take this share in lieu of all other interests she may have under the testator’s will and must file a notice of election within a specified time period. The elective share is personal to the surviving spouse.

Question 17

What does the UPC subject property acquired before marriage, as well as that acquired during marriage to? (T)

Answer 17

The UPC subjects property acquired before marriage, as well as that acquired during marriage, to the “marital-property” portion of the augmented estate to which the surviving spouse is entitled.

Question 18

Why is the UPC augmented estate broader than the share under a community property state? (T)

Answer 18

The UPC augmented estate is broader than the share under a community-property state because it includes property acquired before marriage and property gifted to the spouse during marriage.

Question 19

Under the UPC, what may the surviving spouse take? (T)

Answer 19

Under the UPC, the surviving spouse may take an elective-share amount equal to 50% of the value of the marital-property portion of the augmented estate.

Question 20

Under the UPC, what is the surviving spouse’s elective share? (T)

Answer 20

Under the UPC, the surviving spouse may take an elective-share amount equal to 50% of the value of the marital-property portion of the augmented estate. The marital-property portion is calculated by applying a set percentage to the augmented estate that increases as the length of the marriage increases (e.g., 6% for the first year, 30% at five years).

Question 21

How is the elective share satisfied? (T)

Answer 21

The elective share is satisfied first from property already received by the surviving spouse, then from the rest of the estate.

Question 22

Are life estates granted to the surviving spouse considered in the valuation of elective shares? (T)

Answer 22

No. Life estates granted to the surviving spouse are considered support and do not count in the valuation.

Question 23

In many states, how may a spouse set aside inter vivos transfers by the decedent made during the marriage without spousal consent? (T)

Answer 23

In many states, the surviving spouse can set aside inter vivos transfers by the decedent made during the marriage, without spousal consent, if the decedent initiated the transfer within one year of his death, retained an interest in the property transferred, or received less than adequate consideration.

Question 24

How can the surviving spouse’s right to take her elective or forced share be waived? (T)

Answer 24

The surviving spouse’s right to take her elective or forced share can be waived in writing if the writing is signed after fair disclosure of its contents.

Question 25

A spouse may waive in whole or in part, before or during the marriage, the right to receive what from his spouse's estate? (T)

Answer 25

A spouse may waive in whole or in part, before or during the marriage, the right to receive any of the following from his spouse's estate: i) Property that would pass by intestate succession or by testamentary disposition in a will executed before the waiver; ii) Homestead, exempt property, or family allowances; iii) The right to take the share of an omitted spouse; or iv) The right to take against the testator’s will.

Question 26

May the right to take under a will be waived in a prenuptial agreement? (T)

Answer 26

Yes. The right to take under a will may be waived in a prenuptial agreement. But if the testator devises property to the surviving spouse, the agreement does not prevent the surviving spouse from taking the property.

Question 27

How can a waiver be valid? (T)

Answer 27

The waiver can be valid if the terms of the waiver must be objectively fair and reasonable to both parties. Additionally, the waiver must be in writing, independent legal counsel, and adequate knowledge.

Question 28

What does the must be in writing requirement mean for waivers? (T)

Answer 28

The waiver must be voluntary, in writing, and signed by the surviving spouse. The waiver can be revoked or altered only by a subsequent writing signed by both parties, unless it specifies other means of revocation.

Question 29

What does the independent legal counsel requirement mean for waivers? (T)

Answer 29

The surviving spouse must be represented by independent legal counsel at the time the waiver is signed.

Question 30

What does the adequate knowledge requirement mean for waivers? (T)

Answer 30

The surviving spouse must have had adequate knowledge of the property and financial obligations of the decedent at the time the wavier is signed.

Question 31

What is the rule for omitted spouses? (T)

Answer 31

A marriage following the execution of a will does not invalidate the will. But a spouse who is not mentioned in the will is entitled to an intestate share of the testator’s estate if the parties married after the will was executed, unless: i) A valid prenuptial agreement exists; ii) The spouse was given property outside of the will in lieu of a disposition in the testator’s will; or iii) The spouse was specifically excluded from the will.

Question 32

What is the presumption when a spouse is omitted from a will? (T)

Answer 32

When a spouse is omitted from a will, there is a rebuttable presumption that the omission was a mistake.

Question 33

What is the UPC approach to omitted spouses? (T)

Answer 33

Under the UPC, an omitted spouse has the right to receive no less than her intestate share of the deceased spouse’s estate from that portion of the testator’s estate that is not already devised to a child or descendant of the testator if: i) The child is not a child of the surviving spouse; and ii) The child was born before the testator married the surviving spouse.

Question 34

What does the UPC allow for the omitted spouse doctrine for evidence? (T)

Answer 34

The UPC expands the allowable evidence to include any other evidence that the will was made in contemplation of the testator’s marriage to the surviving spouse.

Question 35

When does the doctrine of advancements usually apply? (T)

Answer 35

The doctrine of advancements usually applies only to intestate succession. However, there is some authority for the proposition that the doctrine applies if a will leaves property to the testator’s heirs.

Question 36

How did the common law view advancements? (T)

Answer 36

At common law, any lifetime gift to a child was presumed to be an advancement of that child’s intestate share and was binding on those who would have succeeded to the child’s estate had the child predeceased the decedent.

Question 37

Regarding of the doctrine of advancements, what was the child's burden under the common law? (T)

Answer 37

The child had the burden of demonstrating that the lifetime transfer was intended to be an absolute gift that was not to be counted against the child’s share of the estate.

Question 38

What is the hotchpot analysis for advancements? (T)

Answer 38

If a gift is treated as an advancement, the donee must allow its value to be brought into the hotchpot. The advancement is added back into the estate, and the resulting total estate is divided by the number of children taking from the estate. The advancement is then deducted from the total share of the child to whom it was given.

Question 39

What happens if a child receives an inter vivos share that exceeds the hotchpot share to which each child is entitled? (T)

Answer 39

If a child receives an inter vivos share that exceeds the hotchpot share to which each child is entitled, then that child does not take but is also not required to pay back into the estate.

Question 40

What is the modern rule/UPC rule for advancements? (T)

Answer 40

The UPC approach (the modern trend) provides that a gift is an advancement only if: i) The decedent declared in a contemporaneous writing (or the heir acknowledged in a writing) that the gift was an advancement; or ii) The decedent’s contemporaneous writing or the heir’s written acknowledgment otherwise indicates that the gift was to be accounted for in computing the division and distribution of the decedent’s intestate estate.

Question 41

For an advancement to be legal, who must it be made to? (T)

Answer 41

The gift must be made to an individual who, at the donor’s death, is an heir.

Question 42

If the recipient of the advancement fails to survive the decedent, what happens? (T)

Answer 42

The gift must be made to an individual who, at the donor’s death, is an heir. If the recipient of the gift fails to survive the decedent, 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.

Question 43

When is the value of an inter vivos gift determined? (T)

Answer 43

The value of an inter vivos gift is determined at the time the recipient takes possession or enjoys it, whichever occurs first.

Question 44

Unlike the common law approach, who does the UPC apply to as far as advancements and gifts are concerned? (T)

Answer 44

Unlike the common-law approach, the UPC applies to all heirs, not just the decedent’s children.

Question 45

How are lifetime gifts to beneficiaries who take under a will examined? (T)

Answer 45

Lifetime gifts to beneficiaries who take under a will are examined in a similar manner and follow the same rules as advancement of intestate shares.

Question 46

How will an inter vivos transfer occurring between the testator and beneficiary satisfy the gift? (T)

Answer 46

An inter vivos transfer occurring between the testator and beneficiary will satisfy the gift if: i) The testator intends that the transfer satisfy a testamentary gift; and ii) There is a written acknowledgment of that satisfaction by the testator or beneficiary.

Question 47

What are the three ways for others to manage property for minors? (T)

Answer 47

The three property management options are: (1) guardianship, (2) custodianship, and (3) trusteeship.

Question 48

Custodianship and trusteeship are only available through what means? (T)

Answer 48

Custodianship and trusteeship are available only through the creation of a will.

Question 49

What is a guardianship?

Answer 49

A guardian has minimal power over property and must complete a difficult process to obtain the necessary court approval to act on a minor's behalf.

Question 50

What is the modern trend for guardianship? (T)

Answer 50

The modern trend is to transform this function into a conservatorship, in which the conservator acts as a trustee for the minor, who provides an annual accounting to the court.

Question 51

What is the Uniform Transfers to Minors Act? (T)

Answer 51

The UTMA, enacted in all states, appoints a custodian to use the property of a minor at the custodian’s discretion on the minor’s behalf without court approval and with no accounting requirement. The custodian must hand any remaining property over to the minor when she turns 21.

Question 52

Under the UTMA, what happens if the beneficiary was a minor when the will was executed but turns 21 before the testator’s death? (T)

Answer 52

If the beneficiary was a minor when the will was executed but turns 21 before the testator’s death, then the property passes directly to the minor unless the will instructs otherwise.

Question 53

When can a trust postpone possession to? (T)

Answer 53

Under a guardianship or conservatorship the child must receive the property at age 18 or 21, but a trust can postpone possession until a time when the donor thinks the child will be competent to manage the property.

Question 54

What is a permitted heir statute? (T)

Answer 54

Pretermitted heir statutes permit children of a testator under certain circumstances to claim a share of the estate even though they were omitted from the deceased testator’s will.

Question 55

Does the birth or adoption of a child after the execution of a will invalidate that will? (T)

Answer 55

The birth or adoption of a child after the execution of a will does not invalidate the will, but those children are omitted from the will.

Question 56

What happens if a testator dies without putting their children in the will? (T)

Answer 56

If the testator then dies without revising the will, there is a presumption that the omission of the child was accidental.

Question 57

When does the omitted child statute not apply? (T)

Answer 57

The omitted child statute does not apply if: i) It appears that the omission of the child was intentional; ii) The testator had other children when the will was executed and left substantially all of his estate to the other parent of the pretermitted child; or iii) The testator provided for the child outside of the will and intended this to be in lieu of a provision in the will.

Question 58

Does the UPC apply to children adopted or born before or after execution of the will? (T)

Answer 58

The UPC rule applies to children adopted or born after the execution of the will.

Question 59

What kind of evidence is permitted to show the testator’s lack of intent to omit the child, and ambiguities are resolved in the child’s favor? (T)

Answer 59

Extrinsic evidence is permitted to show the testator’s lack of intent to omit the child, and ambiguities are resolved in the child’s favor. But unlike the UPC omitted-spouse doctrine, the omitted-child doctrine does not expand the scope of evidence admissible to show the testator’s intent to omit the child.

Question 60

If the testator had no other children when the will was executed, what does the child take? (T)

Answer 60

If the testator had no other children when the will was executed, then the child takes her intestate share.

Question 61

If the testator has at least one other child living at the time of the execution of the will, and the will devised property to at least one of those children, where is the omitted child's share taken from? (T)

Answer 61

If the testator has at least one other child living at the time of the execution of the will, and the will devised property to at least one of those children, then the omitted child’s share is taken from that portion of property already devised to the other child, and it must equal the share the other child receives.

Question 62

Does the UPC extend the protection of the omitted-child statute to children of whom the testator was unaware? (T)

Answer 62

No, the UPC does not extend the protection of the omitted-child statute to children of whom the testator was unaware, but it does extend omitted-child status to children the testator believed to be deceased.

Question 63

If a party was responsible for the decedent's death, can they take property from them? (T)

Answer 63

No. A party cannot take property from a decedent if he was responsible for the decedent’s death.

Question 64

If a joint tenant kills another joint tenant, what rights do they lose? (T)

Answer 64

A joint tenant loses the right of survivorship benefits.

Question 65

How does the UPC and most jurisdictions treat the killer in respect to the decedent? (T)

Answer 65

The UPC and most jurisdictions treat the killer as if he predeceased the decedent.

Question 66

What are the requirements for murder to bar a person from inheriting from the decedent? (T)

Answer 66

The killing must have been intentional and felonious to bar the killer from taking.

Question 67

How does the UPC treat a killer's issue? (T)

Answer 67

The UPC treats the killer as if he disclaimed the property, which allows the killer’s issue potentially to take under the anti-lapse, per stirpes, and per capita doctrines, if the issue qualify.

Question 68

Because acceptance of a testamentary gift is presumed, what must a party do to a gift she does not want to accept? (T)

Answer 68

Because acceptance of a testamentary gift is presumed, a party must actively disclaim the gift if she does not want to accept it.

Question 69

How is the disclaiming party treated regarding the decedent? (T)

Answer 69

The disclaiming party is treated as if she predeceased the decedent, and the property is distributed to the next eligible taker.

Question 70

What do most jurisdictions require for disclaimers? (T)

Answer 70

Most jurisdictions require that the disclaimer be in writing, signed, and filed within a certain period after the decedent’s death.

Question 71

Under federal law and for the disclaimer to be valid for tax purposes, when must the disclaimer be filed? (T)

Answer 71

Under federal law, and for the disclaimer to be valid for tax purposes, the disclaimer must be filed nine months from the later of the decedent’s date of death or the heir’s or beneficiary’s turning 21.

Question 72

When disclaiming an interest acquired through joint tenancy, how long does the surviving joint tenant have to disclaim the interest? (T)

Answer 72

When disclaiming an interest acquired through joint tenancy, the surviving joint tenant has nine months from the date of the other joint tenant’s death to disclaim the interest.

Question 73

When the future interest being disclaimed is a life estate, when are the testator's remaindermen determined? (T)

Answer 73

When the future interest being disclaimed is a life estate, the testator’s remaindermen are determined at the testator’s death rather than the life tenant’s death as would generally be the case. The remainder is accelerated because the interest passes as though the disclaimant, in this case the life tenant, predeceased the decedent.

Question 74

Who can make a disclaimer? (T)

Answer 74

A disclaimer can be made by a third party (e.g., guardian, custodian, trustee, or personal representative) on behalf of a minor, incompetent, or decedent. A spendthrift clause in a will does not preclude a disclaimer.

Question 75

How are people who are guilty of elder abuse treated in most jurisdictions? (T)

Answer 75

Most jurisdictions treat the abuser as if they predeceased the decedent.