Wills and Trusts

Question 1

Gifts

Answer 1

1. Intent to make a gratuitous transfer;
2. Delivery; and
3. Acceptance.

Question 2

Restrictions on Conditional Bequests

Answer 2

1. Violative of Constitutional Rights (SDP and EP)
2. Total Restraints on Marriage
3. Destruction of Property

Question 3

Simultaneous Death Act

Answer 3

1. A beneficiary who fails to survive the decedent by five days is deemed to have predeceased the decedent.
2. Requires clear and convincing evidence of survival by five days.

Question 4

Shares Under Intestacy

Answer 4

Spouses: at least half
Others: issue -> parents -> issue of parents -> grandparents -> issue of grandparents -> issue of spouse.

Question 5

Per Capita (by the head)

Answer 5

1 / (the number of surviving individuals in the first generation with surviving members + the number of predeceased individuals belonging to that generation with surviving issue)

Question 6

Per Stirpes (by the stock)

Answer 6

1 / the number of individuals in the generation following the decedent

Question 7

Escheat

Answer 7

If there is no taker, the intestate estate passes to the state.

Question 8

Adopted Children

Answer 8

Adopted children are considered the biological child of their adoptive parents. Thus, they can take from their adoptive parents but not from their natural parents. (Avoids double inheritance)

Question 9

Stepchildren

Answer 9

Stepchildren cannot inherit from their step parent unless adopted.

Question 10

Adopted Adults

Answer 10

Adopted adults cannot take if: (1) they are an adult adopted for the purpose of bringing that person under the provision of a preexisting will; and (2) the testator did not intend to devise their estate in that manner.

Question 11

Equitable Adoption

Answer 11

An otherwise failed adoption can be enforced if proven, by clear and convincing evidence, that the parents intended to adopt the claimant.

Question 12

Posthumous Children

Answer 12

Children conceived during the life of a decedent, but born after the decedent’s death, may take.

Question 13

Postmortem Conception

Answer 13

Children conceived and born after the decedent’s death may take only where: (1) the child is genetically related to the decedent; and (2) the decedent consented to posthumous reproduction and support of the child.

Question 14

Advancements

Answer 14

A lifetime gift by a decedent to a child is presumed not an advancement unless: (1) the decedent declared so in a contemporaneous writing; or (2) the heir acknowledged it.

Question 15

Hotchpot

Answer 15

If a gift is an advancement, the gift’s value is added to the estate and the recipient heir’s portion is reduced by that amount.

Question 16

Slayer Rule

Answer 16

A slayer—or person who feloniously and intentionally kills the decedent—is deemed to have predeceased the decedent.

Question 17

Will Formalities

Answer 17

A will must be: (1) in writing; (2) signed by the testator; and (3) either: (a) signed by two individuals within a reasonable time after witnessing the testator’s signature; or (b) signed by the testator before a notary.

Question 18

Presence Requirement

Answer 18

Both witnesses must, simultaneously, be physically present in the room and see the testator sign the will.

Question 19

Arguments to Extend Presence

Answer 19

Line of Sight Test: the witness had the ability to see the signature if they had looked at the time of signing
Conscious Present Test: the witness comprehended the signature through sight, hearing, or consciousness
Covid-19: Zoom will ceremonies are sufficient.

Question 20

Purging

Answer 20

Where an interested witness acknowledges the will, any extra benefit is purged; meaning, the share she would take in excess of her share under intestacy is eliminated.

Question 21

Harmless Error

Answer 21

Courts can dispense with the formal requirements, where a claimant can prove, by clear and convincing evidence, that the testator intended the defunct document to serve as her will.

Question 22

Holographic Wills

Answer 22

Courts may dispense with the formal requirements, where a testator handwrote the will and signed it (at the bottom).

Question 23

Holographic Will Forms

Answer 23

Only handwritten word: some jurisdictions only consider handwritten words, requiring that both the testamentary intent and disposition of property be in writing
Pre-printed and handwritten word: some jurisdictions consider both handwritten and pre-printed words on a form to establish the testamentary intent and disposition of property.

Question 24

Revocation of Wills

Answer 24

By subsequent will: executing a will that revokes the previous will expressly or by inconsistency.
By physical act: performing a revocatory act—like, buring, tearing, or obliterating—if the testator intended the act to reovke the will.

Question 25

Presumption of Revocation by Physical Act

Answer 25

**Missing Wills:** Where a testator possessed the will before her death, but the will cannot be located after her death, it is presumed destroyed. **Duplicate Wills:** Where a duplicate of the will is destroyed by the testator, it is presumed that all other duplicates are destroyed.

Question 26

Dependent Relative Revocation ("DRR")

Answer 26

Where a testator revokes her will based on a mistaken assumption of law (implicit) or fact (on the face of the instrument), the revocation is ineffective if the testator would not have revoked her will in the absence of the mistaken belief.

Question 27

Revocation by Operation of Law

Answer 27

**1.** Divorce (existing will bequesting to former spouse is revoked); but **2.** Not Marriage

Question 28

Integration

Answer 28

All papers that are present at the time of execution of a will and intended to be part of that will are treated as part of the will.

Question 29

Republication

Answer 29

A will is treated as if it were executed when its most recent codicil was executed, unless the outcome would be counter to the testator's intent.

Question 30

Incorporation by Reference

Answer 30

A nontestamentary writing may be incorporated into a will if: (1) the document is in existence at the time the will is executed; (2) there is a reference in the will incorporating the document; and (3) the document must be sufficiently identified in the will.

Question 31

Acts of Independent Significance

Answer 31

A testator can change the disposition of their property without formally altering the will, as long as the changes stem from reasons unrelated to the will itself. For instance, leaving a gift to “my employees” and then firing them and replacing them with new people.

Question 32

Contracts Relating to Wills

Answer 32

**Ways a contract can relate to a will:** (1) a contract to make a will favorable to another; (2) a contract not to revoke a will favorable to another; and (3) a contract not to make a will.

Question 33

Contracts Concerning Succession

Answer 33

**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:** (1) Provisions of a will stating material provisions of the contact; (2) express reference in a will to contract and extrinsic evidence proving the terms of the contract; or (3) a writing evidencing the contract and signed by the party alleged to have breached the contract.

Question 34

Mental Capacity

Answer 34

**A testator must be capable of knowing and understanding:** (1) the nature and extent of her property; (2) the natural objects of her bounty (who would take under intestacy); and (3) the disposition that she is making of that property.

Question 35

Insane Delusion

Answer 35

A will is invalid for insane delusion if the testator's will was a result of her adherence to a false conception of reality against all evidence and reason to the contrary.

Question 36

Undue Influence

Answer 36

**Factors:** (1) unnatural disposition; (2) the testator's susceptibility to undue influence; (3) the opportunity to influence; and (4) the influencer had the disposition to influence. **Fiduciary Presumption:** There is a presumption that dispositions to fiduciaries are a product of undue influence.

Question 37

No Contest Clauses

Answer 37

Prohibit an unsuccessful claimant from taking under a will. Generally only enforced to the extent the claimant lacked probable cause.

Question 38

Ambiguities

Answer 38

**Patent Ambiguities:** Ambiguities on the face of the testamentary instrument. Extrensic evidence is barred and the gift fails. **Latent Ambiguities:** Ambiguities that arise when the will is applied to fact. Extrensic evidence admissable to determine what the testator's intent was.

Question 39

Lapse Devises

Answer 39

**Lapse:** A lapse is when a beneficiary predeceases the testator. **Specific or general devises:** Lapse falls to the residue. **No Residue of the Residue Rule:** Lapse falls to intestacy.

Question 40

Antilapse Statutes

Answer 40

**Rule:** No lapse if, a related predeceased beneficiary who is survived by at least one descendant. If lapse occurs, it falls to the residue (even if the residue lapses). **Contrary Intent:** If a will expresses contrary intent or a substitute disposition, antilapse statutes do not apply.

Question 41

Void Devises

Answer 41

Where a beneficiary is dead when named or is an ineligible taker, like a dog, the devise is void. Such devises pass under intestacy.

Question 42

Creation of Class Gifts

Answer 42

**Creation:** A class gift is a disposition to beneficiaries who take as members of a group. Taking as members means the the identities and shares of the beneficiaries are subject to fluctuations. **Presumption:** Terms of disposition identifying the beneficiaries only by terms of relationship or other group label are presumed to create a class.

Question 43

Fixed Shares

Answer 43

If the terms expressly fix the identities and shares of the beneficiaries, the disposition is to beneficiaries whose identities and shares are fixed.

Question 44

Disposition of Class Gifts

Answer 44

**Common Law:** Where a class member predeceases the testator, the rest of the class absorbs the member's share. **Antilapse Statutes:** Typically apply to class gifts, meaning the share of a member who predeceases the testator passes to that member's issue.

Question 45

Ademption

Answer 45

Occurs when property that is no longer owned by the testator at the time of the devise.

Question 46

Types of Ademption

Answer 46

**Ademption by Extinction:** Where the testator attempts to devise specific property that is unavailable. **Admption by Satisfaction:** Where a testator makes a gift during her lifetime to a devisee after the will is executed, it is adeemed by satisfaction if it is declared as such in writing.

Question 47

Theories of Ademption

Answer 47

**Identity Theory (CL):** Devises of property that fail for ademption are extinguished. **Intent Theory (Modern Rule):** Devises of property may be replaced if the beneficiary proves that it was the testator's intent. There is no ademption where the disposition occurs without the testator's knowledge, or where a transfer merely changes form, not substance.

Question 48

Elective Share

Answer 48

**Rule:** In a separate property jurisdiction, a sposue can choose to take under a will, or under the elective/forced share statute. **Note:** there is no elective share in community property jurisdictions.

Question 49

Premarital Wills / Pretermission Statutes

Answer 49

Pretermission statutes generally allow a surviving spouse to take an intestate share of the testator's estate, unless: (1) the spouse is provided for in a marital agreement; (2) the spouse is provided for in the will; or (3) the testator expressly made clear an intent to exclude the spouse.

Question 50

Protections for Surviving Children

Answer 50

An ommitted child receives a share equal to what she would have taken at intestacy, unless: (1) it appears the omission was intentional; (2) the testator devised all her estate to the child's parent; or (3) the testator provided for the child by a transfer outside the will with the intent that such a transfer be in lieu of a bequest.

Question 51

Resulting Trust

Answer 51

An equitable reversionary interest that arises by operation of law where: (1) an express trust fails or makes an incomplete disposition; or (2) if the corpus is purchased by a third party for value. | Reversionary interest means the corpus reverts to the settlor

Question 52

Elements of a Trust

Answer 52

1. Settlor; 2. Trustee; 3. An ascertainable beneficiary who is not the trustee; 4. Specific property to be held in trust; 5. Intent to trust; 6. A valid purpose; and, 7. In the case of a transfer of trust, delivery.

Question 53

Types of Trust / Creation

Answer 53

**Testamentary Trust:** Created by will **Deed/Transfer of Trust:** Where the settlor transfers property to a trustee for the benefit of an ascertainable beneficiary **Declaration of Trust:** Where a settlor declares herself the trustee of certain property for the benefit of an ascertainable beneficiary

Question 54

Trust Property

Answer 54

The settlor must expressly declare which property is subject to the trust. Note, the settlor must have a present interest in the property to declare it.

Question 55

Ascertainable Beneficiaries

Answer 55

The beneficiary of a trust need only be ascertainable under some objective standard and not violative of the rule against perpetuities.

Question 56

Class Trusts

Answer 56

Trust to an objectively determinable group of people, like "my family."

Question 57

Charitable Trust

Answer 57

A trust created for a charitable purpose. Such trusts do not need ascertainable beneficiaries.

Question 58

Honorary Trusts

Answer 58

Equitable trust, which allows a settlor—without fiduciary duties—to dispose of property pursuant to a settlor's wishes if a trust fails.

Question 59

Oral Trusts

Answer 59

Trust created by an assertion, rather than an instrument, and proven by clear and convincing evidence. Only inter vivos.

Question 60

Secret Trusts

Answer 60

**Secret Trusts:** Trust where a settlor secretly agrees to create a trust then devises the corpus to the trustee in her will. (constructive trust) **Semi-Secret Trusts:** Failed trust where a testator attempts to create a trust in her will without naming a beneficiary. (resulting trust)

Question 61

Discretionary Trusts

Answer 61

**Creation:** A trust granting the trustee absolute discretion to dispose of the corpus. **Distributions:** Neither beneficiary or her creditors can compel a trustee to make a distribution.

Question 62

Support Trusts

Answer 62

**Creation:** Trust granting the trustee discretion to make dispositions for the support of the beneficiary. **Distributions:** Certain beneficiaries can force distribution for necessary income.

Question 63

Spendthrift Trusts

Answer 63

**Creation:** Trust that prohibits voluntary and involuntary alienation. **Exceptions:** Where the beneficiary is also a settlor; or the corpus was fraudulently transferred to the trust, a creditor may be able to force a distribution.

Question 64

Self-Settled Asset Protection Trusts

Answer 64

APT statutes may allow a settlor-beneficiary to shield her assets from creditors by placing them in trust for her own benefit.

Question 65

Trust Modification / Termination

Answer 65

**Consent:** A trust can be modified with consent of all the beneficiaries, if it is not contrary to a material purpose of the trust. **Changed Circumstances:** Trustee may deviate from the terms of a trust if compliance would defeat the settlor's purpose. **Trust Decanting:** If permissible under the original trust, a trustee may move the assets from the original trust into a new trust with different terms.

Question 66

Creation of Revocable Trusts

Answer 66

**General Rule:** A trust is revocable if the settlor retains the right to revoke, alter, or amend the trust. **Inter Vivos Trusts:** Presumed revocable, unless the terms indicate oterwise. **Testamentary Trusts:** Irrevocable per se.

Question 67

Fiduciary Duties in Revocable Trust

Answer 67

Trustee only owes duties to the settlor (only way to allow revocation).

Question 68

Modification of Revocable Trust

Answer 68

**A settlor may revoke or amend a revocable trust:** (1) by substantial compliance with the terms of the trust; or (2) any method manifesting clear and convincing intent to revoke.

Question 69

Pour-Over Wills

Answer 69

A settlor establishes a trust and then executes a will devising her estate to the trustee of the trust. (avoids probate)

Question 70

Duty of Loyalty

Answer 70

**General Rule:** Trustee must administer the trust solely for the interest of the beneficiaries.

Question 71

Conflicts of Interest

Answer 71

**Rule:** Some fact that makes it so the trustee cannot act only on behalf of the beneficiaries. **Standard of Care:** Trustee must act in good faith and fiar dealing.

Question 72

Self-Dealing

Answer 72

**Rule:** A trustee, or her spouse, cannot deal directly with the trust. **Prohibition:** No-further-inquiry rule bans self-dealing *per se*. **Defenses:** (1) the trust permitted the conflict; (2) all beneficiaries consented; or (3) court approval in advance.

Question 73

Duty of Prudence

Answer 73

A trustee must administer the trust as a prudent person would by exercising reasonable care, skill, and caution.

Question 74

Exceptions to the Duty of Prudence

Answer 74

**Discretionary Trusts:** Courts won't interfere where a trustee of a discretionary trust acts in good faith. **Exculpatory Clause:** Set a higher threshold of fiduciary misconduct before the trustee is liable.

Question 75

Exoneration of Liens

Answer 75

**CL:** If a will makes a specific devise of real or personal property, it is presumed that the testator intended that any debt attached be paid by the residue of the estate. **UPC:** A specific devise passes subject to any mortgage interest existing at the date of death, without right of exoneration, regarldes of a general directive in the will to pay debts.

Question 76

Prudent Investor Rule

Answer 76

**A trustee must:** (1) diversity; (2) not speculate; (3) earmark; (4) account; (5) not commingle funds; and (6) delegate reasonably.

Question 77

Remedies for Breach of Trust

Answer 77

**Accounting:** Trustee must provide the beneficiaries with trust statements. **Ratification:** Beneficiaries may consent to a transaction after the fact. **Surcharge:** Trustee must pay the beneficiaries the difference between the FMV and the amount obtained in a transaction. **Tracing:** Beneficiaries may recover property disposed of wrongfully, unless the buyer acquired it in good faith for value.