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1

Intergration: The Staple Rule

Restatement (Third) of Property: Wills and Other Donative Transfers § 3.5 Integration of Multiple Pages or Writings Into a Single Will.To be treated as part of a will, a page or other writing must be present when the will is executed and must be intended to be part of the will.

Evidence of testator’s intent includes:
•T and Ws initial each page
•Use non-black ink, state the color of the ink, consider using ink with tracing compounds or ink mixed with T’s DNA to enhance likelihood of T’s will probated as desired
•Securely fastened together and not unfastened and refastened; multiple staple holes = indication of page insertion
•Number with page ___ of ___ to ensure that pagination is true
•Ensure that all pages same size, color, type•Consistent typeface
•Same toner cartridge
•Blank space avoided
•Do not conclude page at the end of the sentence; instead, let sentences flow from page to page

2

Integration: Documents Incorporated by Reference

•Effect:
•Distributes property or provides instructions for the distribution of property pursuant to a document that is not physically part of the will

•Policy:
•Reflects T’s intent; provides flexibility to T.

•Common Law Rule:
•Permits the incorporation of a writing if:
•The document was in existence at or prior to the will’s execution
•The will expresses testator’s intent to include the document in the will
•Testator’s will describes the writing with sufficient specificity to permit its identification
•Testator’s will states that the writing is in existence at the time the will is executed.

3

UPC Documents Incorporated by Reference

UPC 2-510
•A written Doc in existence at the time of will execution
•May be incorporated into the will IF
•Language in will manifests intent to incorporate the document AND
•Will describes the document sufficiently to permit its identification
•(Should doc fail requirements, devise passes to residue, if will includes one; if not, passes through intestate succession)

4

Integration: Property Lists

UPC 2-513
•Effect:
•Permits the probate distribution of property pursuant to a document that is separate from the will, even if the document is not executed prior to or concurrent with the will.

•Policy:
•Reflects T’s intent; provides flexibility to T

UPC 2-513
•Written statement or list of tangible personal property (not cash)
•Not otherwise specifically distributed in will
•Referred to in T’s will
•Shall dispose of property
•As long as:
•T signs list
•T describes the items and devisees with reasonable certainty.
•May be written after will
•May be changed after written
•If more than one list, provisions of most recent list revoke previous lists

5

Dispositive Provisions: Types of Devises

1) Specific
•Sufficient precision to indicate exactly which property T intended beneficiary to take.
•T intends B to take that property and ONLY that property and not the value of the property.
Example: “My monogram inscribed gold cuff links to. . . ” OR "MY 100 shares of Twitter"

2) General
•Cannot determine precisely which property T intended to devise at time of will’s execution or at T’s death.
•T intended to devise value not specific property.
Example: “$100 to . . .” OR “100 shares of Twitter . . .”

3) Demonstrative
•General gift with specific source named
•T intended specified amount of money to pass to devisee, and offered instruction on which asset should be liquidated to obtain funds.
Example: “$100K from sale of art work to. . .”

4) Residual
•All other property; typically a catchall provision•Could represent leftovers
•Could represent key gifts
Example: “All the rest, residue, remainder of my property to. . . ”

6

Dispositive Provisions: Powers of Appointment

•Purpose:
•Giving the gift to give
T (donor) empowers another (donee) to give property away


•Effect:
•Provides great flexibility to T
•Powers can be general
•Donee can give to self or anyone donee selects, including donee’s estate or donee’s creditors (object or appointee) •Donee’s receipt of power is taxable to donee
•Powers can be special or limited
•Donee may only give property to an object or appointee (or class of same) as prescribed by Donor
•Donee’s receipt of power is NOT taxable to donee
•Donor can require Donee to give power away in Donee’s will
•Testamentary Power; could be general or specific

7

Administrative Provisions: Appointment of Fiduciaries

•Powers:
•Marshal assets, pay debts, clear title—distribute property pursuant to will

•Duties:
•Owes fiduciary duties to will beneficiaries
------Loyalty
•Put beneficiaries’ interests first
•No self-dealing
----Advancing own account
•No close to self-dealing
-----Advancing account of those close to executor (spouse/kids)
•No conflict of interest
-----Factoring the interests of one other than self or beneficiary into decision regarding will property
•No comingling of estate property with executor’s property
•Keep Beneficiaries informed of probate process


•UPC—
Executors removed for cause
•Breach of duty
•Misrepresentation
•Failure to comply with court order
•Mismanagement
•Incapacity/incompetence

8

Administrative Provisions: Bond

•Bond = Insurance against PR waste, mismanagement, looting
•Personal Representative secures bond, such that if bad acts occur and estate suffers loss, beneficiaries still get $ from will
•Most states require bond
•Most Ts waive bond b/c they select PR whom they trust

•UPC:
•Informal probate requires bond ONLY when will requires it or an interested party demands it
•Formal probate only requires bond if interested party demands it AND court agrees bond is desirable.

9

No Contest Clauses

UPC § 2-517. Penalty Clause for Contest.
A provision in a will purporting to penalize an interested person for contesting the will or instituting other proceedings relating to the estate is unenforceable if probable cause exists for instituting proceedings.

10

Appointment of Guardian for Minor Children

•T may use will to appoint guardian for surviving minor children
•May also do so in unattested doc
•Appointment may arise upon T’s incapacity/incompetence, as well as death
•Will that names guardian creates a rebuttable presumption that court should confirm appointment•Interested parties may contest appointment
•Minor at 14 or older
•Other parent
•Another who has care and custody of child may contest
•Will of last parent to die controls guardian appointment
•Absent appointment in will, interested party can petition for guardian
•Court may appoint guardian if doing so is in minor’s best interests AND
•Parents agree;
•Parents’ rights terminated; or
•Parents unwilling/unable to exercise rights

11

Just Debts Clause

Superfluous Clauses that Create Confusion

Modern Approach: Non-Exoneration
-Just Debts vary by jurisdiction

UPC 2-607 Non-Exoneration
A specific devise passes subject to any mortgage interest existing at the date of death, without right of exoneration, regardless of a general directive in the will to pay debts.

12

Negative Wills

•Provisions that state that an heir or class of heirs will take nothing from T at intestacy
-Treats the negative heir as if he/she has predeceased the testator and passes property to other heirs.

•Common Law
-Not enforceable
-T should not be able to keep statutory scheme from operating

•UPC & Restatement
-Enforceable
-T ought to be able to express intent, even if only to express concern re Intestate Succession
-If utilized, the provision treats the “negative heir” has predeceasing T and passes property to other heirs

13

Lapse

•Arises when:
•B predeceases T
•B actually dies before T dies
•B disclaims
•B treated as predeceasing
•Slayer statute

•Conceptually:
•A donative transfer cannot be made to a person who is deceased, because a decedent lacks juridical personality

•In the event of lapse, law will not automatically save gift and distribute to B’s heirs

•Generally:
•Lapse of specific, demonstrative, general devise
•Gift falls into residue, unless anti-lapse statute applies •Lapse of residue gift

•UPC:
•If anti-lapse statute does not catch gift, lapsed gift is soaked up by other residue takers (they take residue of residue)

•If no other residue taker, residue property passes through intestacy

•Minority:
•Lapsed share, even if there are other residue takers, share passes through intestacy to testator’s heirs (other takers’ shares not enhanced; no residue of the residue)

14

Survival: UPC Rules

•To receive a share of Intestate’s estate, an heir must survive the Decedent by 120 hours (5 days).

•2-104
To receive a gift from Testator’s will, the devisee must survive the Testator by 120 hours (5 days).

•2-702
Applies to wills and nonprobate transfers

15

General: Lapse/Anti-Lapse Rules

At common law, if devisee was dead when will executed OR predeceased T AND T provided no alternative Beneficiary = Gift lapsed
Falls into residue, if one present in will if NOT
Falls into intestate estate
IF NO residue or residue taker predeceases


Most states have anti-lapse statutes that catch the gift and give it to a descendant of the predeceasing devisee.

•Degree of relationship to testator necessary to trigger lapse varies from state to state.

•If covered by the statute, devisee must be survived by descendants (not just heirs), who will take on the devisee’s behalf.

16

UPC: Beneficiary's Death & Lapse

•Devisee is:
•T’s grandparent or a descendant of T’s grandparent
•T’s children, T’s parents, siblings, nieces, nephews, uncles, aunts, cousins, cousins’ children;
•Or T’s stepchild;

and

•Devisee is dead at will’s execution OR Devisee predeceases T;

and

•Devisee has surviving descendants

•Devisee’s surviving descendant(s) take the gift by representation





T may draft around rule

In a devise
“To A; if A fails to survive me to B”“
To A, and not to A’s descendants”

In a separate provision
“If the devisee of any nonresiduary devise does not survive me, devise passes with the residue”

In a residuary clause
“including all lapsed or failed devises”

17

Lapse in the Residue

At common law:
•Majority rule (UPC Rule)
-Absent application of anti-lapse, if the testator devises the residue of his probate estate to more than one person and one of the residue devisees predeceases testator, the other residue devisees take the predeceasing devisee’s share.
-Lapsed gift soaked up by the other residue takers

•Minority rule
- Absent application of anti-lapse, if the testator devises the residue of his probate estate to more than one person and one of the residue devisees predeceases testator, the share drops out of the residue and passes through intestate succession.

18

UPC: Lapse in the Residue

•If T devises her residue to two individuals and the devise fails as to one of them, the other takes the failed person’s share, unless the anti-lapse statute saves the gift or T has otherwise provided in T’s will.

•If the residue is devised to more than two persons and the gift to one fails, the failed gift is distributed in proportion to the others’ gifts, unless the anti-lapse statute saves the gift or T has otherwise provided in T’s will.

•If the residue fails as to all takers, the property in the residue passes to T’s heirs through intestacy.

19

Lapse in Nonprobate Gift

•UPC 2-706 and 2-707
•Extends reach of lapse to nonprobate transfers •Governing instruments
•Includes insurance policy, deed, security registered in beneficiary form, TOD, POD
•Catches gift designated to a beneficiary who is testator’s grandparent, descendant of testator’s grandparent, or testator’s stepchild

20

Class Gifts

*Allows testators to identify a group of beneficiaries in relation to their status or membership in a defined class.
*Class can close on certain points (ex. Highschool graduation, marriage, turning 30)
*On the date the class closes, only those who remain in the class share the gift.
*Gives testator flexibility so he/she does not have to revise the will every time the class changes.
Ex.
Class Gift- "To my children"
Not Class Gift- "To my children, A, B and C"


Restatement (Third) of Property: Wills & Other Donative Transfers § 13.1:
(a) A class gift is a disposition to beneficiaries who take as members of a group. Taking as members of a group means that the identities and shares of the beneficiaries are subject to fluctuation.
(b) A disposition is presumed to create a class gift if the terms of the disposition identify the beneficiaries only by a term of relationship or other group label. The presumption is rebutted if the language or circumstances establish that the transferor intended the identities and shares of the beneficiaries to be fixed.

21

Discrepancies Between Dispositive Provisions and the Probate Estate

*Addresses the "Stale Will" problem when the testator's will differs from property found in the testator's estate at death.

4 Default Rules:
1) Ademption by Extinction
2) Ademption by Satisfaction
3) Abatement
4) Accession

22

Ademption by Extinction

*Applies when property described in a SPECIFIC DEVISE is not found in the testator's estate.

*Common Law/Majority Rule: A Specific Devise Fails if property specifically named in the devise cannot be identified by the estate. (Beneficiary Receives no replacement property).

Intent/UPC Approach: If, at T’s death, T does not own the precise property specifically devised in his will, but the T owned property that T intended to replace the specifically devised property, the specific devisee takes the replacement property.

23

Ademption by Satisfaction

*Applies when the testator changes the timing of a gift from testamentary to inter vivos but fails to amend the will accordingly.
-Most jurisdictions presume inter vivos gifts are not made in satisfaction of a testamentary devise.

UPC:
Ademption by satisfaction only applies if the testator manifests intent to satisfy affirmatively, in writing, or if the devisee has made a written acknowledgement of the satisfied devise.
-Often requires factual inquiry into the testator's intent.

Restatement:
Restatement (Third) of Property: Wills & Other Donative Transfers § 5.4. Post-Execution Events Affecting Wills An inter vivos gift made by a testator to a devisee or to a member of the devisee's family adeems the devise by satisfaction, in whole or in part, if the testator indicated in a contemporaneous writing, or if the devisee acknowledged in writing, that the gift was so to operate.

24

Abatement

*Provides an orderly system for reducing testamentary gifts when the probate estate does not contain sufficient assets to cover estate expenses/creditor claims/devises to beneficiaries.
*Abatement establishes the order testamentary gifts are reduced in these circumstances.


UPC 3-902
Order of Reduction:
1) Property not disposed of by will
2) Residuary Devises
3) General Devises
4) Specific Devises

25

Accession

*Refers to an increase or addition to property.
*Applies when a testator devises shares of stock or securities and after the will's execution, those securities produce additional shares because of a stock split/stock dividend/corporate merger/subsidiary spinoff.

General Rule: Beneficiary receives additional shares produced by the devised securities after the will's execution.

Some jurisdictions limit a beneficiary's entitlement to additional shares to specific devises of securities.

26

Common Law Rules of Construction

1) Plain Meaning Rule
2) No Reformation Rule
3) Doctrines distinguishing patent and latent ambiguities

Modern Approach:
Extrinsic evidence may be considered to resolve an ambiguity or correct a mistake.

27

Ambiguities

1) Patent Ambiguity
-An uncertainty of meaning discernible directly from the language of the will.
ex. "I give one thousand dollars ($10,000) to my cousin, Steve"
-Does not look at extrinsic evidence
-Bequest fails and passes to residuary

2) Latent Ambiguity
-Not apparent from the face of the will, hidden so they can only be revealed by extrinsic evidence.
ex. "$10,000 to my cousin, John" (executor discovered the testator had 2 cousins named John)
-Courts generally consider extrinsic evidence to resolve the ambiguity to prevent failure of the gift.

28

Resolving Ambiguities: Modern Approach

Restatement (Third) of Property: Wills & Other Donative Transfers § 11.1. Ambiguity Defined
An ambiguity in a donative document is an uncertainty in meaning that is revealed by the text or by extrinsic evidence other than direct evidence of intention contradicting the plain meaning of the text.
Restatement (Third) of Property: Wills & Other Donative Transfers § 11.2. Resolving Ambiguities in Accordance with the Donor’s Intention
(a) An ambiguity to which no rule of construction or constructional preference applies is resolved by construing the text of the donative document in accordance with the donor’s intention, to the extent that the donor’s intention is established by a preponderance of the evidence.
(b) Ambiguities to which no rule of construction or constructional preference applies include those arising when:
1) the text or extrinsic evidence (other than direct evidence contradicting the plain meaning of the text) reveals a mistaken description of persons or property.
(2) the text reveals an apparent mistaken inclusion or omission.
(3) extrinsic evidence (other than direct evidence contradicting the plain meaning of the text) reveals that the donor’s personal usage differs from the ordinary meaning of a term used in the text.

29

UPC: Reformation to Correct Mistakes

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.

30

Mistake

Majority: No reformation rule
Modern Trend (UPC/Restatement): Permits a will to be reformed to correct a mistake.
May reform even if unambiguous to conform to the testator's intent if proven by clear and convincing evidence.