Wills and Trusts Review Session One
October 8, 1999
General information
- don’t need to memorize section numbers of CA probate code; just need to know what it says
- order that he goes through stuff will be different than the one he did in class
- will have three essay questions on exam - one each on wills, trusts, and intestacy
- will be multiple choice and true/false questions
-
I.. General approach when focusing on a question dealing with intestacy succession
A.. Determine what law applies
1.. to do that make a distinction between the type of property the intestate person has
a.. personal property - use the law of intestate’s domicile at time of death
b.. real property - use the law of citus of the real property (state or country in
which the real property is located whose law applies to determine the heirs by intestacy
B.. identify the potential heirs and other issues that may impact the disposition of
the property; do particular facts of the case raise issues determining disposition; here are the types of issues that may be raised:
1.. was their an heir born after intestate’s death (posthumous heir)
a.. general rule is that if heir is conceived while intestate is alive, the heir
will inherit
2.. look for adopted individuals - normally adopted individuals inherit from and through the adoptive parents; may under limited circumstances inherit from and through the biologicals; generally when adoptive person dies, it is the adoptive family that takes although there are limited circumstances when biologicals could inherit.
3.. look for non-marital children (wedlock) - rules are different depending on
whether non-marital child is inheriting from mother or father
a.. from mother - only need proof of birth from mother (easiest)
b.. from father - has to show a presumption of paternity or a court
judgment of paternity; or clear and convincing evidence that the father openly held the child out as his own
4.. children that are the result of alternative reproduction technologies - not many rules in CA
5.. look for step and foster children - CA one of the very few states that allow foster or step child to inherit like a child under certain circumstances:
a.. if the relationship began when person was a minor and continued through the joint lifetimes of the parent
6.. half blooded situation - if dealing with inheritance by collaterals (adopted children’s biological family); in many states this is relevant but not CA
7.. fact that heir is not USA citizen - does not prevent them from being an heir
8.. did the heir kill the intestate - if there was a felonious and intentional
killing the heir cannot inherit
a.. a criminal conviction is not necessary to show this; can be shown instead by a preponderance of the evidence
b.. if shown the heir is disqualified from being an heir
9.. abuse of elder or dependant intestate - if heir abused heir or dependant than heir can be disqualified
10.. property acquired from a pre-deceased spouse - if spouse dies without descendants and without remarrying certain property that is inherited from the deceased spouse, passes to the deceased spouses side of the family
a.. real - 15 years
b.. real - death within last 5 years and value at leat $10,000
11.. advancements - did the intestate make an advancement to the heir; if property documented, the advancement has to be computed in
12.. survival issue - heir must outlive the intestate by a minimum of 120 hours; if not the heir is deemed to have predeceased
13.. disclaimer - the heir can disclaim the property - can effectively remove himself from the intestate scheme by disclaiming property; property then passes as if the heir had already deceased
C.. determining distribution (do this step only if decedent is married)
1.. community property - surviving spouse will own all community property; because already owned half and then inherits the deceased spouse’s half
2.. quasi community - the rules are the same as community; surviving spouse inherits the deceased spouse’s half; surviving spouse will own all the quasi community
3.. separate property - surviving spouse could end up with all, half or one third depending on the family situation
a.. gets all - no descendants or first line relatives; no issue and neither parent is still alive and no descendants of parents still alive (no brothers or sisters, nieces and nephews)
b.. gets one half - if there is either one blood line of descendants OR no descendants but there are first line relatives (deceased spouse had only one child, or if no descendants, the deceased spouse left at least one parent or descendant of parent (brothers, sisters)
c.. gets one third - if there are two or more blood lines of descendants still alive (deceased spouse leaves more than one surviving child, one child and issue of deceased child, issue of several deceased child; must have at least 2 or more surviving blood lines)
d.. any separate left passes as if there were no surviving spouse (under step 4 below)
D.. where balance of estate goes; (could be rest of separate property or if the
person was unmarried at time of death, then this would the whole estate)
1.. priority order for determining the heirs:
a.. descendants (lineal) - children, great grandchildren, etc
i.. CA uses per capita with representation - divide into initial shares at first generation with surviving members
ii.. also need to know per stirpes and distribution with representation
b.. parents (if no descendants) - half to each or all to surviving parent; many states vary on this
i.. many states would give other half to siblings if only one parent was alive
c.. descendants of parents (no descendants and no parents) - brothers and sisters and nieces and nephews
i.. goes to descendants of parents per capita with representation
d.. grandparents and their descendants - four grandparents each get a third, three each a third, two get half each, one grandparent left gets all; no equality between sides of the family
i.. if all grandparents deceased then goes to aunts and uncles by per capita with representation; do not try to keep half on each side of the family like many states do
e.. former step children and descendants (step children that were not treated as real child) - children of the predeceased spouse
f.. next of kin is who it goes to next - CA uses civil law with a parentalic preference rule (won’t have a problem where we need to figure this out
g.. deceased spouses parents and there descendants
h.. escheat to the CA government - final step, if no heirs can be found at
all
ANSWERS TO ESSAY QUESTIONS
4. Paul died on April 13, 1998 leaving no will. He was survived by Elizabeth, his wife, and Carolyn, their daughter. Paul is also survived by Rodney, a son born to Paul and Victoria. Paul and Victoria never married and Paul never adopted Rodney. Rodney died on April 16, 1998 survived only by his wife, Doris, and their twin sons, Jason and Willie.
Paul’s distributable estate consists of:
a) Community property
b) Quasi-community property
c) Separate personal property — $600,000 cash
Under California Law, what is the correct disposition of Paul’s estate? Explain your answer fully.
ANSWER
- should start by drawing a family tree
- this question is on the easy side of the scale
1.. determine the law that applies
Answer: questions says the law is CA
2.. special factors that may arise in determining distribution
Answer:
a.. can Rodney qualify as a child? He was born out of wedlock. There is not enough information to determine if Paul is Rodney’s child. Here a fact was left out. Make alternative presumptions and proceed. Here you need to analyzie the questions as if there was sufficient evidence and as if there was not.
i.. assume Rodney is a child
a).. if Rodney was a child, then survival issue is raised - he only outlived by 3 days. Rodney will be treated as predeceasing and his share would go to J and W. He did not outlive by 120 hours
ii.. also say what would happen if Rodney was found to not be a child
3.. distribution step
Answer:
a.. Elizabeth will receive all quasi community and, community property
b.. is Rodney a child (affects separate property distribution)?
1.. YES - if Rodney is a child then this messes up the separate since there would be two bloodlines; Elizabeth would get one third of the separate and the rest would need to be divided between Carolyn and Rodney’s kids. Carolyn gets $200,000 and Rodney’s kids get $100,000 each
2.. NO - if Rodney is not a child then Elizabeth would get half the separate and the balance to Caroline
Essay number 5.
5. Dee C. Dent’s valid will in relevant part reads as follows:
Disposition of Estate
A. I leave my collection of empty sardine cans to my beloved husband, Herman
Dent. If Herman predeceases me, I leave the collection to the Sardine Association of America.
B. I leave $10,000 to my wonderful son, Oscar Dent.
C. I leave $40,000 to my siblings, share and share alike.
D. I leave $150,000 to my best friend, Steve Austin.
E. All the rest, residue, and remainder I leave to the Ground Zero Society.
Dee died on November 1, 1998 while giving birth to a second son, Felix Dent. Herman had a heart attack and had died about nine months earlier. Dee sold the sardine can collection on October 31, 1995 for $50,000. Dee had four siblings when the will was executed but only Sarah survived Dee. All siblings were (are) married and have surviving children. After paying all debts and administration expenses, $100,000 remains for distribution. In an organized manner, fully discuss the issues raised by these facts and propose a detailed distribution plan for Dee’s estate. Explain who will receive what and why.
ANSWER
- this question is a bit harder
- difficult thing is to figure out the exact way to address all the issues
- first identify all the issues
I.. Spot the issues
A.. there is an omitted child
B.. how to handle the siblings (class gift issue)
C.. abatement (not enough money to pay everyone)
D.. ademption
II.. start with the easiest thing: Felix’s share
A.. share of an omitted child comes off the top
1.. no indication that there are any exceptions
2.. rule for omitted child - take as he would under intestacy
a.. Felix’s share is $50,000
b.. now the estate is reduced to having only $50,000 left
III.. distribute the rest of the estate following the abatement rules
A.. Specific gifts to relatives are first
1.. the sardine cans - but the gift to Herman lapses (because he did not survive) and the Sardine Association gift adeems because the collection is not there
B.. general gifts are next
1.. general gifts to relatives get paid first
a.. Oscar’s gift paid next and then the gift to the siblings
b.. to make up the share of the omitted child we do it proportionally; have to
do this separately; pretend that Felix is not in the estate at first to figure out who gets what and then reduce proportionally
i.. Oscar - $10,000
ii.. Siblings - $40,000
iii.. Steve - $50,000
This is where the estate would have gone but for Felix
c.. Everyone’s estate needs to be reduced proportionally to make up Felix’s share. Therefore everyone’s share is reduced by half. (Oscar 10K, Siblings 20K, Steve 25K)
d.. since the anti-lapse statute applies, Sarah’s share would be affected. Based on the facts we know for sure that Sarah would have to get at least 5K. We do not know where the $15K would go.
C.. general gifts to non-relatives
1.. Steve’s gift