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Wills and Trusts Review Session Two 1999

 

October 29, 1999

 

Analytical framework for a wills question - bare bones outline to be sure that you spot the issues; finding the issue will get you big points; remember to read the question closely

 

5 Step process

I.. ascertain the validity of the will (read the question closely as often the question will presume the question is a valid will); four elements:

A.. testator must have legal capacity - the status of being able to make a will in the first place

1.. CA - being at least 18 years old, being married or divorced; being on active duty in the US military; court declaration of emancipation; with court permission the conservator of a minor or incompetent can write a will for the minor

††††††††††† B.. testamentary capacity - sound mind requirement

††††††††††† ††††††††††† 1.. understand nature of the testamentary act - know you are writing a

document that gives away property when you die

††††††††††† ††††††††††† 2.. understand and recollect the nature of you property - you know what

you own

††††††††††† ††††††††††† 3.. have knowledge of family members - spouse, children, etc.

††††††††††† ††††††††††† 4.. the above must be all done at the same time (know what you are doing,

nature of property, and family members)

C.. testamentary intent - testator intended the very document being executed to be the will

††††††††††† D.. to comply with the requisite formalities - types of formalities to be satisfied

depends on the type of will:

††††††††††† ††††††††††† 1.. non-holographic will (formal, atestated will)

††††††††††††††††††††††† ††††††††††† a.. must be in writing

††††††††††††††††††††††† ††††††††††† b.. must be signed by the testator (proxy signatures allowed)

††††††††††††††††††††††† ††††††††††† c.. must have at least TWO witnesses (competent, know they are

witnessing a will, must see either the testator sign the will, or the testator must acknowledge the signature, or the testator acknowledges the document as the testatorís will)

i.. CA requires the witnesses to be together at the same time when the above is completed

ii.. interested witness - witness being a beneficiary does not impact the validity of the will; impacts the validity of the gift to that beneficiary

††††††††††† ††††††††††† 2.. holographic will

††††††††††††††††††††††† ††††††††††† a.. in writing

††††††††††††††††††††††† ††††††††††† b.. signed by the testator

††††††††††††††††††††††† ††††††††††† c.. material provisions must be in the testatorís own handwriting

i.. CA - says only the MATERIAL provisions must be in the testatorís handwriting

††††††††††††††††††††††† ††††††††††† d.. no requirement of witnessing

††††††††††† ††††††††††† 3.. oral or non-cupative will

††††††††††††††††††††††† ††††††††††† a.. no longer valid in CA

††††††††††††††††††††††† ††††††††††† b.. all wills in CA must be in writing

††††††††††† ††††††††††† 4.. statutory will - follows the form provided in the probate code

a.. have their own set of requirements which vary somewhat from normal requirements; will not be tested on the requirements

II.. Can the will be contested?

††††††††††† A.. insane delusions

††††††††††† B.. hallucinations

††††††††††† C.. undue influence

††††††††††† ††††††††††† 1.. direct

††††††††††† ††††††††††† 2.. presumed - to a drafter, witness beneficiary

††††††††††† D.. fraud

††††††††††† E.. duress

III.. If the will is invalid or the will is set aside because of the contest; then you now have intestacy

††††††††††† A.. Use the intestacy framework to figure out intestate distribution

IV.. What we do if the will is valid

††††††††††† A.. has the will been revoked?

††††††††††† ††††††††††† 1.. totally

††††††††††† ††††††††††† 2.. partially

††††††††††† ††††††††††† 3.. types of revocation

††††††††††††††††††††††† ††††††††††† a.. by operation of law (statutes)

††††††††††††††††††††††† ††††††††††† b.. revocation by physical act

††††††††††††††††††††††† ††††††††††† c.. revocation by subsequent writing (another will or codicil)

††††††††††† ††††††††††† 4.. might run in to other issues here to discuss in exam

††††††††††††††††††††††† ††††††††††† a.. revival

††††††††††††††††††††††† ††††††††††† b.. dependant relative revocation

V.. determine how to distribute the property; major issues (memorize this list):

††††††††††† A.. ademption of specific gifts (specific gift not in estate anymore)

††††††††††† ††††††††††† 1.. know basic rule and exceptions

††††††††††† B.. satisfaction of gifts

††††††††††† C.. affect of change in value

††††††††††† ††††††††††† 1.. know special rules for corporate securities

††††††††††† D.. potential of interest on a pecuniary gift

††††††††††† ††††††††††† 1.. might get interest if distribution is delayed more than one year after testatorís death

††††††††††† E.. exoneration of debts on specific gifts

1.. CA presumes no exoneration

††††††††††† F.. abatement

††††††††††† G.. apportionment of estate tax liability (all beneficiaries share proportionally)

††††††††††† H.. affect of marriage of testator (rights of new spouse under premarital will)

††††††††††† I.. divorce of a testator from a beneficiary (ex-spouse will loose gifts)

††††††††††† J.. omitted children (children born or adopted after will execution may receive a

share)

K.. if beneficiary dies prior to the testator (lapse, and application of anti lapse statute)

††††††††††† L.. failure of a charitable gift - use of cy pres to correct it

††††††††††† M.. ambiguities of instrument (patent, latent)

††††††††††† ††††††††††† 1.. CA if ambiguous may bring in extrinsic evidence

††††††††††† N.. external integration issues

††††††††††† O.. incorporation by reference concerns

††††††††††† P.. bring in material using doctrine of facts of independent significance

††††††††††† Q.. precatory language - language that is not binding

††††††††††† R.. class gifts - such as gifts to children

††††††††††† S.. conditional gifts

††††††††††† T.. possibility that the will is the result of a contract

††††††††††† U.. will that is created as a result of an election

††††††††††† V.. the will does not govern the non-probate assets (survivorship accounts, joint

accounts, trusts)

 

 

Review of questions -

-         begin by reading question to spot the key issues and the facts

-         do not do stream of consciousness approach to writing an exam

-         draw a picture of the relevant parties - about 25% of missed points comes from misreading the facts - do a diagram

-          

 

Question 1

- do not need to go through elements of a valid will because the questions says it is valid

 

Part 1

A..Sam will win if he is an omitted child; will also win if he is deemed a product of undue influence because then the estate would pass by intestacy

††††††††††† B.. aunt wants to win

††††††††††† ††††††††††† 1.. must argue that Sam is not an omitted child

 

Samís arguments

††††††††††† A.. that he is an omitted child

1.. can take his intestate share - if the will is invalid, he would take everything under intestacy; wants the will to be found invalid

2.. he will claim to be an omitted child because he was born after will execution

††††††††††† ††††††††††† 3.. Sam will say he is not provided for by gift to friend

††††††††††††††††††††††† ††††††††††† a.. the gift is precatory in nature

††††††††††††††††††††††† ††††††††††† b.. Fred can use the property as he wants and there is no legal

binding put on the gift

c.. if the language is found to be not precatory, the presumption does not apply why we have a gift to a trust ???

††††††††††† B.. Fred is a witness to the will which raises a presumption that the gift to Fred

was inappropriately acquired

††††††††††† ††††††††††† 1.. but Fred can bring in evidence to show that the gift was not procured

by fraud or undue influence

††††††††††† ††††††††††† 2.. if we find there is no undue influence then Fred will get his share

††††††††††† ††††††††††† 3.. Aunt will risk triggering the no-contest clause and then she will get

nothing

††††††††††††††††††††††† ††††††††††† a.. she could ask the court to do a pre-contest determination

††††††††††† C.. Fred exerted undue influence and the whole will is invalid

††††††††††† ††††††††††† 1.. but weak argument because Fred only is getting a quarter of the estate

††††††††††† ††††††††††† 2.. this will be a question of fact

†††††††††††††††††††††††

†††††††††††

Auntís arguments

††††††††††† A.. Sam is not an omitted child

††††††††††† ††††††††††† 1.. Samís omission is intentional because the will mentions children

††††††††††† ††††††††††† 2.. Sam is actually provided for in the will

a.. the part to friend was an express provision for Sam, therefore he is not omitted

B.. Aunt wants to take the residual - was originally planned to be a quarter; but now it is three quarters because the gift to Wilma lapses; will only win if the will is valid; must also show that Sam was not omitted

1.. must argue that the gift to Fred is good AND it is for the benefit of Sam - Sam cannot be an omitted child

 

 

Question 2

 

Validity of will not presumed - go through the elements

††††††††††† 1.. legal capacity - no issues

††††††††††† 2.. testamentary capacity - no issue

††††††††††† 3.. testamentary intent - no issue

††††††††††† 4.. formalities - give facts which support the formalities

 

Organize by person

 

TOM

-         presumption that he procured gift by undue influence because he is also a witness

-         he can rebut the presumption because it is a very small gift compared to the rest of the estate

-         it is Tomís burden to prove this though

 

HANK

-         the son in law

-         he is not a beneficiary

-         non of the property is going to go to Doraís estate because she predeceased Gloria

-         no property could have got in Doraís estate for him to receive it

 

GAIL

-         the granddaughter

-         she wants the residence; her argument is based on the anti lapse statute

-         anti lapse statute applies when the beneficiary is a kindred of the testator or testatorís spouse; the relationship is close enough to trigger the statute

-         if triggered, the property goes to the descendants of the beneficiary

-         Seth will argue that the will required Dora to survive by 30 days, and since she did not, the rest will pass by the residual clause

-         The probate code answers this questions (21110b) - the requirement that the initial transferee survive shows a contrary intent - the likely outcome is that Seth will win; the anti lapse statute will not apply because of the survival restriction

 

MAX

-         the friend

-         is Max bound by the request to distribute the property as indicated in the letter?

-         Probably not since the language is precatory - on the other hand, request is strong than words like ďhopeĒ so you could make an argument that it is not sufficiently precatory

-         The letter was prepared after will execution so no way to bring it in by reference

-         Facts of independent significance - no separate significance of letter because the letter has no independent reason for existing

-         Maybe the letter is a codicil - signed, but no witnesses so it canít be an attested will, can not be holographic because the letter is typed

-         Therefore no legal theory that can be used to bring that letter in as any kind of binding instruction

-         CA does not recognize oral wills

 

BEN

-         similar discussion as MAX since he canít claim under the letter

 

SETH

-         the son

-         will get the residue - $100,000 or $90,000 if Tom rebuts the presumption; also the house because Gail does not get it

 

Question Number 3

 

Is the 1995 will valid?

-         NO

-         Witnesses were never together

-         Ness did not know he was witnessing a will (publication requirement was not met)

How should Tessís estate be distributed, assuming the will is not valid?

-         first distribute through intestacy

-         the 1992 will would remain - but there is a problem - physical act revocation

-         the revocation by Tess of 1992 will was based on the implied condition that the 1995 will was valid; however, just because you have this type of fact pattern does not mean that the courts will apply relative dependant revocation because we are trying to do what the testator intended; if we did this Sam would get nothing; this is not what the testator wanted; intestacy is better to follow the testatorís intent

 

Question 4

First question - was the will validly executed

-         two witnesses, they knew it was a will, they saw the testator sign, they were together when they signed

-         this can be a brief discussion

-         the fact that one of the witnesses does not impact the validity of the will

Second question - how should the estate be distributed?

-         problem with son being an interested witness; presumption that his gift was invalid

-         the presumption should be able to be rebutted easily since the problem says no undue influence

-         even if we did not have that, the son is an heir and would take MORE by intestacy; obvious that no undue influence was asserted

What to do about the farm?

-         half of the gift was marked out;this is a partial revocation by physical act; CA recognizes this

-         so if there is evidence that the testator is the one that struck out F2ís name, that would be sufficient to revoke that gift

-         the question remains as to how much of the farm F1 gets? Probably only gets one half the farm; canít enlarge a gift by physical act - can only revoke

Son gets:

-         everything except half the farm

-         it all passes through the residual clause