Wills & Trusts Flashcards
(31 cards)
Revocation by Physical Act
1) a testator can revoke a will by burning, tearing, canceling, destroying, or obliterating it;
2) and intent to revoke
- revocation by tearing must be through a material part
- cancelling must be through material part or at least touch the words of the will
*witnesses are not necessary for a valid revocation by physical act
Intestate Succession
Any part of a decedent’s estate not properly disposed of by will, passes to the decedent’s intestate heirs by statute
1) if there is no surviving spouse, a decedent’s intestate estate passes to her issue
2) issue of the same generation take equally
3) CP and SP are treated differently
Revival
If a will is revoked by a subsequent testamentary instrument, and the subsequent instrument is revoked, then the original will survives.
Holographs
CA recognizes holographic (handwritten and unattested) wills and codicils if it is in the testator’s writing and has
1) testator’s signature
2) material terms of gifts made and names of beneficiaries/other material provisions/dispositive provisions
Codicil
A codicil is a testamentary instrument INTENDED to modify, amend, or revoke an existing will and must be EXECUTED with the same FORMALITIES as a will.
Integration
A will can be all pages
1) present at the time of the EXECUTION; and
2) the testator INTENDED to CONSTITUTE her will
* extrinsic evidence can be used to show which papers were intended to be included
* the witness requirement doesn’t require the witnesses to observe what papers were present, merely that it was in fact, a will
Omitted Child
1) A decedent may disinherit a child from their will.
2) CA provides protections for children thought dead, parent unaware of the birth, or born after the will was executed.
3) the omitted child would take intestacy shares
Resignation of a Trustee
1) A trust needs a trustee to have LEGAL title but a trust does to fail due to lack of designated trustee
2) the court can appoint a trustee
3) in the interim, the trust resides with the settlor’s estate or with the court
4) Once assigned, a trustee can only resign by
(a) permission of the court (b) as authorized by the trust (c) consent by all beneficiaries
Trust Termination by Beneficiaries
1) must be unanimous amongst ALL BENEFICIARIES (including existing, potential, unborn or unascertained, of present and future interests)
2) must not impair the MATERIAL PURPOSE of the trust as determined by analyzing the instrument as a whole and the surrounding purpose.
Trustee Duty of Care
In a revocable trust, duty is to the settlor
In an irrevocable trust duty is to the beneficiaries
Duty of care is the same care, skill, and caution that a reasonably prudent person would use in managing her own property.
Trustee Liability to Beneficiaries
If a trustee BREACHES the trust, beneficiaries may sue for a
SURCHARGE- the amount needed to RESTORE trust PROPERTY and DISTRIBUTION to what it would have been BUT FOR the BREACH, for which the trustee is personally liable
Trustee Duties
1) LOYALTY AND IMPARTIALLITY:
Duty to ADMINISTER solely in the beneficiary’s interest, and if there is more than one, then to act impartially.
2) ACCOUNT
Keep and render accounts, and furnish information to beneficiaries at their request.
3) PRESERVE TRUST PROPERTY and MAKE PRODUCTIVE
Implied duty to make the property productive, Which include the duty to invest. The trustee must invest trust funds within a reasonable time after receiving themand continually review those investment.
*If the trustee fails to invest, she is chargeable the amount of income that would normally accrue from appropriate investment.
4) SEPARATE and EARMARK
trust assets must be kept physically separate from the trustee’s personal assets and titled in the trustee as trustee.
5) INVEST
as a prudent investor as determined
a) general economic conditions
b) the possible effect of inflation/deflation
c) tax consequences
d) role each investment plays in the overall portfolio
e) other resources of the beneficiaries
f) expected return from income and appreciation of capital
g) needs for liquidity, regularity of income, preservation or appreciation of capital
h)an asset’s special relationship or value to he purpose of the trust or one or more of the beneficiaries
6) DIVERSIFY
diversify investments of the trust unless the trustee reasonably determines that, because of special circumstances, the purposes of the trust are better served without diversification.
Defenses to Trustee Duty of Care Breach
1) Consent : beneficiaries expressly or impliedly consented to the breach
2) Time: laches, statute of limitations
3) Discretion under the trust: power/discretion/flexibility bestowed on trustee in the trust
Re-execution
A will can be re-executed by
a) a testator acknowledging her signature; or
b) a testator acknowledging the will and having witnesses attest to it
Re-publication
A physically revoked will cannot be republished.
Incorporation by Reference
The court will infer the testator intended to incorporate the writing into the will if : a document by reference it must be
1) in existence at the time the will was EXECUTED
2) sufficiently DESCRIBED in the will
3) there is PROOF that the preferred document is the ONE DESCRIBED in the will
Undue Influence
1) A will is INVALID if it is obtained through undue influence
2) Undue influence is mental or physical COERCION that DEPRIVES the testator if her FREE WILL and substitutes the DESIRES OF ANOTHER for hers.
3) Will contestants must show
a) INFLUENCE was exerted on the testator
b) the EFFECT of the influence was the OVERPOWER the MIND and FREE WILL of the testator; and
c) the PRODUCT of the influence was a will that would not have been executed BUT FOR the influence
CL Presumption of Undue Influence
A will challenger can shift the burden of proof to the will proponent if it is shown that
1) there was a CONFIDENTIAL relationship between the will proponent and the testator (includes fiduciary but also relationships where decedent relies heavily on and places more trust than normal in another)
2) the beneficiary PARTICIPATED in procuring, drafting, or executing the will
3) the will provisions are UNNATURAL and FAVOR the alleged influencer
Undue Influence Factors
a) opportunity to exert influence
b) susceptibility of the testator to influence due to age or physical condition
c) whether the beneficiary was active in procuring the will
d) whether the disposition in the will are at a variance with the expressed intentions of the testator
e) whether the will provisions seem unnatural
Undue influence statutory
CA provides a statutory presumption that a PROVISION in FAVOR of one of the following people is a product of FRAUD:
1) DRAFTS the will (includes his relatives & associates)
2) TRANSCRIBES the will if a fiduciary at the time of transcription
3) testators CARE CUSTODIAN
Failed Gift
A gift fails if the devisee is dead prior to the testator’s death.
A failed gift returns to the testator’s residue.
If there is no residue, it is distributed based on intestate succession.
Anti-Lapse Statute
Generally, if a beneficiary dies for the testator, the gift fails or lapses and returns to the residue of the testator’s estate. CA provides an anti-lapse statute if the beneficiary was kindred or “blood relative” of the testator, or the testator’s spouse/domestic partner.
Per CA’s anti-lapse statute
1) the ISSUE OF THE PREDECEASING BENEFICIARY
2) take the beneficiary’s gift
3) PER CAPITA with REPRESENTATION
Specific Legacy/Devise
Gift of a particular item of property distinct for all other object’s in the testator’s estate.
- subject to revocation by ademption if no longer in the testator’s estate at his death
- generally regardless of intent, but CA looks at intent
- extrinsic evidence is admissible to prove testator intent
General Legacy
gift of a general economic benefit, payable out of the general assets of the estate
