Chapter 1 - The Essentials

Question 1

What are probate courts?

Answer 1

State-level judicial forum with jurisdiction over decedents’ estates.

Question 2

What is the difference between an HEIR and a BENEFICIARY/DEVISEE/LEGATEE?

Answer 2

Heir = a person who inherits property by intestacy.

Beneficiary/Devisee/Legatee: a person who inherits property by will

Question 3

What is a personal representative? What do they do in a probate procedure?

Answer 3

A person appointed by a court to administer an estate

A PR files an application for probate listing all of the decedent’s family members, heirs, and beneficiaries.

Question 4

UPC § 3-108 – Probate, Testacy and Appointment Proceedings; Ultimate Time Limit

Answer 4

a) No informal probate or appointment proceeding or formal testacy or appointment proceeding, other than a proceeding to probate a will previously probated at the testator’s domicile and appointment proceedings relating to an estate in which there has been a prior appointment, may be commenced more than THREE years after the decedent’s death, except for five enumerated exceptions

Question 5

When does a religious restraint on marriage cross the public policy line?

Answer 5

Restatement (Second) of Property, Don. Trans. § 6.2, cmt. (1983)

If marriage within the permitted sphere would be so contrary to those beliefs that it is unlikely that such marriage will ever occur, the restraint is general and invalid. By the same token, if the religious beliefs of the transferee do not stand in the way of such marriage, but the number of persons eligible for marriage to the transferee is negligible, the restraint is again general in effect and therefore invalid.

Question 6

What is testamentary freedom?

Answer 6

The owner’s right to give away property by selecting WHO gets WHAT.

Restatement (Third) of Property: The controlling consideration in determining the meaning of a donative document is the donor’s intention. The donor’s intention is given effect to the maximum extent allowed by law.

Id: Freedom of testamentary disposition is curtailed only to the extent that the donor attempts to make a disposition or achieve a purpose that is PROHIBITED OR RESTRICTED by an OVERRIDING RULE OF LAW.

Question 7

When does PUBLIC POLICY preclude carrying out a choice with one’s property?

Answer 7

Restatement (Second) of Trusts § 124

Where an attempt is made to confer such a power upon a person who is given no other interest in the property, there is no such restraint and it is against public policy to allow him to exercise the power if the purpose is merely capricious.

Question 8

What factors determine when a regulation constitutes a taking that requires just compensation (Fifth Amendment)?

Answer 8

1. Economic impact of the regulation
2. Interference with reasonable investment backed expectations
3. Character of the governmental action

NOTE: Complete abolition of both the descent and devise of a particular class of property may be a taking.

Question 9

What are examples of NON-PROBATE transfers?

Answer 9

Joint tenancies, revocable trusts, payable-on-death accounts, life insurance, inter vivos trusts

Question 10

What is the statute of limitations for creditor claims against a probate estate? Non probate?

Answer 10

Typically, several months for a probate estate.

UPC § 3-803: limitation period of one year for unprobated estates.

NOTE: Due process requires the personal rep to provide ACTUAL notice to known or reasonably ascertainable creditors. Unknown creditors may be notified by publication.

Question 11

How does the UPC define an INCAPACITATED person?

Answer 11

UPC § 5-102(4): An incapacitated person is an adult who is unable to receive and evaluate information or make or communicate decisions to such an extent that the individual lacks the ability to meet essential requirements for physical health, safety, or self-care, even with appropriate technological assistance.

UPC § 5-304: Judicial guardianship may be instigated by anyone interested in an incapacitated person’s welfare (implicated person becomes a “ward”)

UPC § 5-314(a): Guardian makes decisions regarding care and health; must consider the expressed desire & personal values of the ward, encourage the ward to participate in decisions and at all times act in the ward’s best interest.

Question 12

What are the three primary ways of managing property on behalf of an incapacitated person?

Answer 12

1. Conservatorship — After judicial adjudication of incapacitation, a conservatorship authorizes the court-appointed conservator to manage the disabled person’s property under the court’s supervision (See Britney Spears conservatorship)
2. Durable powers of attorney — Provides for the appointment of an agent to transact legally on a person’s behalf during any period of incapacity.
3. Inter Vivos Trusts — A person may transfer property into a trust to be managed by third party trustees during any period of incapacity. The trust can also establish procedures for determining whether the settlor has become incapacitated (such as by majority vote of a committee consisting of the settlor’s family & primary care doctor).

Question 13

What if a testator wants to include in their will what to do with their body after death?

Answer 13

Unlike at common law, modern courts are more likely to enforce a decedent’s preferences concerning the disposition of final remains.

FLORIDA: Follows the common law rule, so any directive in the will regarding the disposition of decedent’s body will not have the same effect as the provisions directing the disposition of his property.

Question 14

What is the SLAYER RULE? What forms of homicide trigger the rule?

Answer 14

UPC § 2-803(b): Slayer forfeits all benefits derived from the victim under a will, trust, intestacy, or non-probate instrument.

UPC § 2-803: “felonious and intentional killing”

• Does NOT apply to negligent homicides
• Slayer also loses any right of survivorship in joint tenancies held w/ the victim and cannot serve in a fiduciary capacity on behalf of the victim.
• A person who has been found NOT GUILTY in the murder trial is NOT conclusively eligible to inherit and may still be barred by probate.
• Some jurisdictions disinherit the slayer and any indirect beneficiaries such as their children.

Question 15

What is a disclaimer?

Answer 15

An heir or beneficiary’s voluntary decision not to accept inherited property

• Under the relation-back doctrine a valid disclaimer “relates back” to immediately before the decedent’s death, meaning that the disclaimant never gained possession of the disclaimed property.
• Important bc the disclaimant may have to pay a gift tax on giving it away after taking possession and creditors may come after them.

Question 16

Can disclaimants select alternate takers for disclaimed property?

Answer 16

NO.

• The property passes to the next eligible taker under the decedent’s will or by priority established in the intestacy statutes.
• If everyone disclaims → asset escheats to the state.

Question 17

Are all disclaimers effective?

Answer 17

NO.

• Disclaimer by an insolvent heir might be considered fraudulent transfer.
• Some jurs. prohibit disclaimers used to ensure that the heir qualifies for medicaid or other public assistance.
• Most states and the IRS for gift tax purposes require disclaimers to be made w/in 9 months of the decedent’s death.

Question 18

What are the two main issues of professional responsibility in trusts & estates representation?

Answer 18

Malpractice Liability: Many courts allow beneficiaries or would-be beneficiaries to sue for malpractice when a lawyer botches a decedent’s express directives. Estate planning attorneys owe a duty of professional care

Client Confidentiality / Conflicts of interest: Critically important that an estate planner explain the nuances of attorney-client relationships and secure a written waiver of conflicts of interest before agreeing to any joint representation.

• By nominating a personal rep, a client impliedly waives any claim of atty-client privilege with respect to communications necessary for estate administration (post-death), unless the client expressly manifested the lenient to maintain the privilege. Cannot provide complete legal files.

Question 19

How do survival actions work?

Answer 19

Survival statutes preserve claims that the decedents could have asserted if she survived. Survival actions must be brought by the estate’s personal representative because damages belong to the estate.

Wrongful Death actions: Loss of consortium or companionship, emotional distress or grief, pecuniary loss, loss of services, etc. potentially available for a decedent’s survivors to recover for their own injuries arising from the wrongful death of a close relative

• Damages in a wrongful death action are paid to the statutorily designated beneficiaries (not to the estate) bc they compensate for injuries suffered by the beneficiaries… Thus wrongful death statutes differentiates between the capacity to bring an action the right to share in damages…
• The judge splits the recovery among eligible heirs

Question 20

What is the difference between SURVIVAL and WRONGFUL DEATH actions?

Answer 20

Survival = claims that the decedent could have brought herself if she were still alive, and therefore are brought in the name of the estate.

Wrongful death = claims for injuries to parties who are adversely affected by the decedent’s death and, therefore are brought in their names individually or on their behalf.