Flashcards in Trusts and Estates Generally Deck (123):
Do you have a right or a priviledge to dispose of your proerty when you die
A decedent has the right to dispose of his or her property at death. The state has broad authority to regulate this process, but cannot completely abrogate this right.
What are the 5 exceptions to the validity of conditional gifts
1. a complete restraint on marriage
2. requires the practice of a certain religion
3. encourages divorce or family strife
4. requires the committing of a crime
5. dictates the destruction of property
What is the remedy for an invalid conditional gift?
Some wills contain a gift-over clause that specify where the gift goes in the event it violates public policy. If no such clause exists, the court will strike the piece that violates public policy and permit the beneficiary subject to the condition to take the property.
Property will pass either through a non-probate instrument, or through probate. What are 4 examples of non-probate instruments
(1) property held in joint tenancy,
(2) life insurance contracts,
(3) legal life estates and remainders, and
(4) intervivos trusts.
Property will pass either through a non-probate instrument, or through probate. What are the two ways in which property can pass through probate.
1. intestacy, or
2. through a will
What is an executor?
What the personal representative is called if the decedent dies testate and names the personal representative. The personal Represenative is appointed by the probate court to oversee the adminstrative process of wrapping up and probating the decedent's affairs.
What is an administrator?
What the personal representative is called if the decedent dies intestate or testate but the will fails to name a personal representative. The personal Represenative is appointed by the probate court to oversee the adminstrative process of wrapping up and probating the decedent's affairs.
What are the six duties of personal representative/executor/administrator?
1. file petition for appointment as PR
2. give notice to interested persons
3. collect assets and file inventory
4. settle claims against estate
5. pay debts, taxes, expenses of administration
6. distribute remaining assets as req’d by will, statute, or court
What are the differences between supervised and unsupervised admisntration?
After appointment—personal representative has broad powers and administers estate without going back to court. UPC approach, but interested parties can petition for supervised approach.
Supervised: Court must approve every detail. more costly/time consuming.
What percentage of thep opulation dies intestate?
Roughly 50 percent.
Is an expectancy treated as a property interest?
What are the seven levels of a typical intestacy distribution scheme?
(1) surviving spouse,
(4) issue of parents,
(5) grandparents/issue of grandparents,
(7) escheats to state.
What is the Common Law regarding the survival requirement
heir must prove by the preponderance of the evidence that he or she survived the decedent by a millisecond.
What are the two modern options regarding the survivial requirement?
Option 1: require the heir to prove by clear and convincing evidence that he or she survived the decedent
Option 2/UPC: require the taker prove by clear and convincing evidence that he or she survived the decedent by 120 hours (5 days)
Who has the burden of proving survivorship?
The burden is on the party whose claim depends on survivorship (preponderance of the evidence)
How does UPC 2-102 calcualte a surviving spouses share? There are 4 levels
1. surviving spouse takes 100 percent of the decedent’s intestate property if no issue or parents, or 100 percent if all the decedent’s issue are also issue of the surviving spouse and the latter has no other issue;
2. $300k plus 75 percent of the rest if decedent had no surviving issue but surviving parents;
3. $225k plus 50 percent of the rest if all the decedent’s surviving issue are also the issue of the surviving spouse but the latter has other issue; or
4. $150k plus 50 percent of the rest if one or more of the decedent’s surviving issue are not issue of the surviving spouse.
What are the 4 methods jdxs use in calculating the shares to descendants?
1. English Per Stirpes (Strict Per Stirpes)
2. Modern Per Stirpes
3. Per Capita with Representation
4. Per Capita at each generation (UPC approach)
Decribe the English Per Stirpes System
Treats each line of descent equally. Divided into as many shares as there are children.
Describe the Modern Per Stirpes System
each branch of the family is to receive an equal share of an estate. Estate is divided equally at first generation in which there are living takers.
Describe the Per Capita with Representation system
if all the heirs are of the same degree of relationship to the decedent, meaning they are all children, or all grandchildren, then the estate will be distributed per capita. However, if they are not of the same generation, for example if children and grandchildren survive, then the younger generation will only be entitled to the that portion of the estate that older generation would have received had they survived.
Describe the Per Capita at each generation system. this is also the UPC approach.
heirs of the same generation will each receive the same amount. The estate is divided into equal shares at the generation closest to the deceased with surviving heirs. The number of shares is equal to the number of original members either surviving or with surviving descendants. Each surviving heir of that generation gets a share. The remainder is then equally divided among the next-generation descendants of the deceased descendants in the same manner.
Do adopted Children count as Issue?
Yes. As a general rule, adoption severs the relationship between the adopted child and the natural parent as that is the same gender of the adopting parent. Exception if being adopted by stepparent (child can inherit from all three, but the natural parent being replaced by the adopting parent cannot inherit through the child.
Do Children born out of wedlock count as issue?
Yes. The child can inherit from natural parents, but for natural parent to inherit through child, they must acknowledge and support the child.
Do Post Humously conceived Children count as issue?
Yes, but there are conditions. in UPC jdx (2-705), it is
ok as long as (1) the predeceased parent authorized post-humous use of sperm, and (2) the child is living at time of distribution date, or is in utero 36 months of or is born within 45 months of distribution date.
At common law during intestacy, how are intervivos gifts to children factored in?
At common law, intervivos gifts are presumed to count against child’s share decedent’s intestate estate.
What is the modern trend/UPC regarding intestacy and how intervivos gifts to children are treated?
with the modern trend, only counts against child’s share only if in writing that was the intention.
Does a child need to pay back the money if their intervivos gift exceeds the share they would have gotten?
What are the two main bars to succession with intestacy?
Homicide and a disclaimer. In both cases, the party is treated as having predeceased the decedent.
What is a disclaimer?
An heir or devisee declines to take property
Sometimes done to avoid taxes
Most states treat a disclaimant as though he/she died before the decedent
Most states require a devisee to disclaim within 9 months
Sometimes done to avoid creditors
What are the two elements of general capacity?
testator is 18 years old and of sound mind.
Do you need testamentary capacity for both executing and revoking a will?
What are the 4 elements of having a sounds mind?
Sound mind = the ability to know (1) the nature and extent of his or her property, (2) the natural objects of his or her bounty, (3) the nature of the testamentary act he is performing, and (4) how these all relate to constitute a plan for disposing of their property
What is an "insane delusion"?
a false perception of reality that the testator adheres to against all reason and evidence to the contrary.
What is the majority test for insane delusion?
if a rational person could not reach the same conclusion under the circumstances, the belief is an insane delusion
What is the miniority test for insane delusion?
if there is any factual basis to support the belief, the belief is not an insane delusion.
What is a No contest clause
Says if a beneficiary under the instrument sues to contest the instrument, he loses whatever he would take under the instrument
What is the Worst Evidence Rule?
person who executes will has best evidence of intent and is dead.
What are the three requirements of a common law will?
(1) a writing that is (2) signed by testator and (3) witnessed.
What constitutes a signature?
Anything the testator intends to be his signature is his signature, even an X. In most states, another can sign for the testator as long as the signature is made in the testator’s presence and at his direction.
Is Strict Compliance more common law or modern trend?
What are the 5 common requirements of will signing at common law?
3. everyone is present
4. sign in a statutorily mandated order (typically witnesses after the testator).
5. signature subscribe the text.
What is the common law and modern trend of delayed signatures?
Common law is that witnesses have to sign right after the testator does. Modern trend allows a reasonable amount of time to pass (not defined but can even extend beyond the death of the testator)
What is the misdescription doctrine
The misdescription doctrine is a legal method in which words are struck—but not added—to see if a will can be made intelligible so that it can be validated and admitted to probate. When a few words do not make sense in the context of the will, the court tries to determine the testator's intent by hearing evidence for the intended meaning of the misdescription, then strikes the words to see if there are enough words to determine the testator's intent.
What is the remedy for scrivener's error?
creation of a constructive trust that will receive the property and distribute it according the testator's intent.
Does the UPC require that the signature of a will subsribe the text?
What are the five main ways the UPC differs from the common law?
1. Witness present at the same time – under the UPC, the witness need not be present at the same time; the testator can sign or acknowledge in front of witnesses separately.
2. Acknowledgement: under the UPC the testator can either acknowledge the signature or the will in front of another.
3. Conscious presence: expressly provides that where another signs for the testator, the conscious presence approach applies to the requirement that the party signing the testator’s presence and at his direction.
4. Writing below signature: UPC does not require the signature subscribe the will.
5. Delayed Attestation: need to sign within a reasonable period of time.
What are the two elements of the judicial curative doctrine?
(1) there is clear and convincing evidence that the testator intended the document to be his will and (2) there is clear and convincing evidence that the testator substantially complied with the Wills Act formalities.
What are the pros and cons of the harmless error doctrine?
Pros: give flexibility to find testators intent. Con: lose the bright line rules found with Strict compliance… more open to fraud… judicial interpretation.
Why does the UPC (and why might a JDX) allow a notarized will to be OK
If prepared without a lawyer, a court may allow a notarized document to be probated because it shows the testator tried to make it official
What are the 4 (and sometimes 5) elements of a holographic will?
(1) there must be a writing,
(2) the writing has to be in the testator’s handwriting (either completely or at least the material provisions depending on jdx,
(3)the writing must be signed by the testator, and
(4) the writing must express testamentary intent.
Some states require (5) the form be dated.
What are the 4 ways a will can be revoked?
(1) by act, (2) by writing (if the writing qualifies as a will, (3) by presumption, or (4) by operation of law.
What two elements are needed for a will to be revoked by act?
(1) the act is destructive in nature (tearing burning, scratching out, etc.) and (2) the testator intended to revoke with the act performed.
What is revocation by presumption?
if the will was last in the testators possession, and cannot be found after his death, a presumption arises that the testator revoked the will (by act). The presumption can be rebutted if proponents prove by a preponderance of the evidence a more plausible explanation exists for why the will cannot be found.
What are the majority and minority views on reviving a past will?
Min. JDX: Revoked will cannot be revived unless reexecuted with testamentary formalities or republished by being referred to in a later duly executed testamentary writing
Maj. JDX/UPC: Will #2 legally revokes Will #1 when Will #2 is executed, but Will #1 is revived when Will #2 revoked if testator so intends
Can you partially revoke by physical act?
JDXs are split. concerns over increased potential for fraud, and that any new gifts should have to go through wills process.
What is dependent relative revocation?
It makes a revocation of a former will ineffective if the testator made the revocation through execution of a new will, and that newly executed will is determined invalid.
What are the 5 elements of Dependent relative revocation
if the testator
(1) revoked in whole or in part,
(2) based upon a mistake, and
(3) the testator would not have revoked but for the mistake, the revocation will not be given effect under dependent relative revocation.
The courts appear to also require
(4) the mistake must be set forth in the revoking instrument and be beyond the testators knowledge, or
(5) there must be a failed alternative scheme (typically an attempt at a new will that failed.
What is the majority rul on divorce? (revocation by operation of law
Overwhelming majority rule is that divorce automatically and irrebutably revokes all provisionsin a testators will in favor of the the ex-spouse, unless the will expressly provides it
What are pretermitted heirs
1. If will executed prior to child’s birth or adoption, many states provide a forced share o/t deceased parent’s estate for the omitted child
what does integration mean?
b. Integration: those pieces of paper physically present when the will is executed and that the testator intends to be part of the will constitute pages of the will
What is the Doctrine of "Squeezed out"?
1. Testator revokes first will by a second will
2. Testator then executes a codicil to the first will
3. If the first will is republished, the second will is revoked by implication (“squeezed out”)
4. This applies only if updating the will carries out the testator’s intent
What are two examples of contracts not to revoke a will
joint will, mutual will
does the modern trend/UPC say a presumption of contract arises with a joint will/mutual will.
Says the instrument does not create the presumption of a contract?
What are the three judicial remedies if a will doesn't comply with a contract (to execute a will in a certain way)
1. will is probated but D has contractual remedy for breach of contract
2. Court may order specific performance
3. court may impose constructive trust
What is the common law approach to the admissibility or extrinsic evidence
Extrinsic evidence is only admissible if there is a latent ambiguity, but not it the ambiguity is patent (ambiguous on its face. Cannot be used to counter show a plain meaning is not what the testator intended.
What is the modern trend approach to the admissibility of extrinsic evidence
admit extrinsic evidence to help construe the will, and maybe even reform the will, anytime there is clear and convincing evidence (1) that the will contains a mistake, and (2) its effect upon the testators intent.
what is lapse?
If the beneficiary predeceases the testator, the gift is said to lapse and will fail.
What is anti-lapse
Provides that (1) when there is a lapse, and (2) the predeceased beneficiary meets the requisite degree of relationship to testator (depends on jdx), and (3) the predeceased beneficiary has issue who survive the testator, then the gift will go to the issue of the predeceased beneficiary (4) as long as the will does not express an intent that anti-lapse should not be applied.
As a general rule, does the anti-lapse doctrine apply t ogifts to predeceased spouses?
What does the UPC say about the degree of relationship for the antilapse doctrine?
degree of relationship must be a grandparent or a lineal descendant of a grandparent. 1990 amendment to include step-children.
How does the restatement define a class gift?
class gift is created if terms of disposition identify beneficiaries in term of relationship or other group label.
what are the four factors in determing if it is a class gift?
(1) how the beneficiaries are described, (2) how the gift is described, (3) whether all individuals share a common characteristic, and (4) the overall testamentary scheme.
What are the four types of gifts?
Specific, general, demonstrative, residuary
How do the common law, the modern trend, and the UPC deal with ademption of a specific gift.
Common Law: irrebuttable presumption the gift is revoked
Modern trend: same as common law, but creates an exception when the property was transferred involuntarily by testator.
UPC: presumption against revocation arises, and the beneficiary is entitled to any replacement property the testator owns at the time of death
What are the four avoidance doctrines for ademption of a specific gifts.
1) classify as general, not specific. (2) change in form, not substance (change in bank accounts), (3) Construe at time of death, (4) outstanding balance.
What is the doctrine of independent significance
Will may dispose of property. by referring to some act that has significance apart from disposing of probate assets—in this case, an inter vivos trust that disposes of assets transferred to the trust during life
What are the four elements of a valid trust?
(1) intent by settlor to create the trust,
(2) the trust must be funded,
(3) the trust must have ascertainable beneficiaries,
and sometimes (4) the terms of the trust must be in writing if the trust property includes real property or testamentary trust.
What is the difference between deed of trust and declaration of trust?
In a declaration of trust the settlor remains the trustee, whereas in a deed of trust it is a third party.
What does UTC 206 say about the revocability of a trust
Trust is presumptively revocable unless it says explicitly that it is irrevocable.
What are the four duties of a trustee of a discretionary trust
(1) duty to make a decision,
(2) duty to inquire as to the beneficiary's status and needs (and follow up if incomplete),
(3) a duty to act reasonably, and
(4) a duty to act in good faith.
In a discretionary trust, what does the term of art "comfortable support and maintenance" actually mean?
intent that the beneficiary maintain standard of living that he or she was accustomed to at the time he or she became a beneficiary of the trust.
Is a beneficiary's interest in a trust alienable?
What is the main characteristic of a spendthrift trust?
A beneficiary of a spendthrift trust cannot voluntarily or involuntarily alienate his/her interest
what are the four UTC exceptions to a spendthirft clause?
(1) ex-spouses (alimony), (2) children entitled to child support, (3) a creditor who has provided services for the protection of a beneficiaries interest in a trust, and (4) tax claims by state and federal government.
When does a trust need to be written?
When it includes real property or when it is a testamentary trust.
What is a mandatory trust?
When a trustee must distribute all of the income to a beneficiary on a regular basis.
What are a creditors rights to a beneficiary's interest in a trust
they step into the shoes of the beneficiary and acquires the exact same rights. If mandatory, they get same right to receive property. if discretionary, the creditor cannot force the trustee to exercise his discretion.
Trust modification: settlor and beneficiaries agree
The trust can be modified regarldess of trustee objection
Trust modification: Trustee and beneficiaries agree
the trust can be modified regardless of if settlor objects
Trust modification: Beneficiaries consent but trustee objects
can be modified in certain cirsumstances
What is the claflin doctrine?
under the claflin doctrine, a court can order a trust prematurely terminated over a trustee exception when (1) all the beneficiaries consent, and (2) there is no unfilled material purpose. Restatement says it is ok as long as the court determines the reasons to terminate outweigh the unfilled material purpose.
What are the six types of charitable trusts
1. relief of property
2. the advancement of education
3. the advancement of religion
4. the promotion of health
5. governmental or municipal purposes
6. any other purpose the accomplishment of which is beneficial to the community at large
What is the power of appointment
a power of appointment is the authority the donor gives to the donee that permits the donee to determine, at a future point, what persons will be entitled to enjoy the property over wihich the donee has power
What is "takers in default"?
the person/s who would take the property if the donee fails to effectively exercise power
What is a general power of appointment?
a power is a general power if the groups of appointees in whose favor the power can be exercised includes either the donee, the donee's estate, the donee's creditors, or the creditor's of a donee's estate
what is a special power of appointment?
if the group of appointees excludes the donee, the donee's estate, the donee's creditors, and the creditor's of a donee's estate
Does a witness need to read the will for it to be valid?
What is the harmless error doctrine?
grants “dispensing power” to courts to excuse harmless errors on the part of the testator
Who is an interested witness?
witness who gets a direct financial benefit if will upheld
What are the three approaches the court can take to cure an instrument signed by an interested witness? (common law, modern, UPC)
Common Law: will is entirely void
Modern Trend: Devise to interested witness is void, but rest of will valid;
but If interested witness is also an intestate heir, then only void
as to the witness’s profit
UPC - no effect whatsoever on will
what are the four elements of undue influence?
a. a susceptible T;
b. opportunity to influence;
c. actual exercise of undue influence; And
d. causation (T does what T otherwise would not have done)
what are the effects of undue influence?
a. Voids only those parts of will affected by the UI
b. If wrongdoer already has property, then holds it in
what are the evidentiary presumptions of Undue Influence
a. Confidential relationship = presumed undue influence
b. Active participation in making will = presumed UI
c. Rebut UI presumption if T gets independent legal advice
what are the four elements of fraud?
a. misrepresentation made to T;
b. with intent to deceive;
c. T is in fact deceived; AND
d. Causation (T does what T otherwise would not have done)
What is the difference between fraud in the execution/fruad in the inducement?
a. Fraud in the execution = T deceived as to nature/contents of document T is signing
b. Fraud in the inducement = T deceived as to some fact outside the will
Walk through the exam analysis for Wills
1. classify all property (probate vs. nonprobate)
2. determine which items devised by will
3. determine which items of probate property remain and must pass
4. analyze devisees:
a. if identity unclear, court may admit extrinsic evidence to
determine T’s intent (class gifts issue - when open; when closes)
i. is there any nonmarital, adopted, posthumous child?
ii. Is any child pretermitted heir?
iii. Can T’s SS claim elective share?
what are the four questions you ask in regards to pretermitted children?
1. is child of T completely omitted from will?
2. was child born before OR after will written?
3. any evidence that T intended to omit child?
4. what share of T’s estate does child get?
What four points do you need to hit on an exam regarding a surviving spouses elective share?
1. must elect against will in very short period after death;
2. state law will specify Surviving Spouse fraction
3. state law will specify whether fraction applies to nonprobate
property as well as probate property
4. Surviving Spouse elective share rights may be waived in advance (prenuptial or
What is an elective share.
If the surviving spouse is omitted or given very little in a will, they may be able to "elect" to take their elective share, a statutorily set minimum percentage. They then forfeit their other devises.
What happens if all beneficiaries of a trust die out?
goes back to settlor or settlors heirs.
What are the four remedies if a trustee breaches their duties?
1. recover money or property wrongfully paid out
2. recover any profits earned by trustee due to breach
3. surcharge trustee personally for losses
4. remove trustee from office
What can spouse reach with in elective share in a common law jdx and a modern/upc jdx
common law they can only get a percentage of probate property.
Modern/UPC they can reach the "augmented estate" which includes nonprobate and possibly intervivos gifts.
Spousal Protection: Separate Property Approach
any property acquired by either spouse are that spouses property. A spouse has no interest in the property while during the marriage, but would have a guaranteed 'elective share' in the property oncethe marriage ends (either in death or divorce).
property acquired before marriage is separate, during marriage is community. Upon the death of one spouse, the surviving spouse has an automatic half interest in each piece of community property
Is a surviving spouse entitled to the deceased spouses Social Security payments and Private Pension plans?
Under the UPC, can a spouse's estate claim an elective share if the spouse is dead?
What is an "omitted spouse," and what are they entitled to?
Typically applies where a testator has a will, gets married, and doesn't revoke/revise said will. Create a rebuttable presumption that the spouse was unintentionally omitted. If established, the omitted spouse will get no less than their intestate share (UPC)
How do you over come the rebuttable presumption of the omitted spouse? (three ways)
Show with evidence that it was intentional
Show that provided for the spouse outside of the instrument
show the surviving spouse waived their right to property.
How do you overcome the rebuttable presumption of an omitted child? three ways
Show with evidence that it was intentional
Show that they provided for the child outside of the instrument.
Show that he had more children, and gave all of his estate to the parent of the omitted child.
What is an honorary trust?
Trusts with an honorable intention (like taking care of a pet or gravesite) technically fail because they do not have an ascertainable beneficiary. Court will allow if the "trustee" agrees to honor the terms of the "honorary trust"
Does a testamentary power of appointment fall to the residuary clause if not mentioned in the will?
in a majority of JDXs, no.
UPC - yes, but only if it is a general power and there is no taker in default named in the originating instrument or the will manifests an intention to include the property of the trust.
What is the rule of convenience?
The rule of convenience closes a class automatically when when one member of the class is entitled to possession of his interest. No one else can enter the class, even if they would otherwise be entitled .