Final

Question 1

How are personal property and real property governed?

Answer 1

The decedent’s domicile is going to govern all of their personal property. Real property is governed where the property is located.

Question 2

Community Property

Answer 2

Property acquired by marriage not separate property, and all mutations of that property.

Presumption of Community Property
Assume anything the couple has it community property unless you’re given facts that would make you think otherwise.

Question 3

Separate Property

Answer 3

Property acquired before marriage, or property acquired by the spouse during marriage by gift, devise, or descent; or the recovery for personal injuries sustained by the spouse during marriage, except any recovery for loss of earning capacity during marriage.

Question 4

Two major policies behind intestacy laws

Answer 4

1) carry out the probable intent of the decedent
2) providing for the decedent’s family after the decedent’s death (focus on who decedent is obligated to support) After the spouse, children will take to the exclusion of everyone else in all jurisdictions.

Question 5

Rules of Intestacy - Surviving Spouse - Personal Property/Real Property (chapter 201)

Answer 5

Surviving spouse takes 1/3 of personal estate.
2/3s descends to the person’s children.

Surviving spouse entitled to a life estate in one-third of the person’s land, with the remainder descending. 2/3 outright interest in land passes to descendants, as well as a 1/3 remainder interest.

If no children, surviving spouse receives all of personal estate; is entitled to one-half of the person’s land without a remainder to any person.

If no surviving parents, siblings, surviving spouse is entitled to the entire estate.

Question 6

Rules of Intestacy - Surviving Spouse - Community Property (chapter 201)

Answer 6

Surviving spouse acquires decedent’s 1/2 community property to obtain all community property so long as all of the surviving children are children from the two spouses. If there are children from a prior relationship of decedent, they take his 1/2 instead.

Question 7

120-hour Rule (§ 121.101-121.153)

Answer 7

The beneficiary needs to survive the decedent by 5 days otherwise they are treated as if they predeceased the decedent.

Question 8

English per stirpes (strict per stirpes)

Answer 8

Each child treated equally.
Always do the first division at the kids level regardless of whether they are alive or dead, and then we drop it through the rest of the group.
ex: C1, even though deceased, would still get 1/3, but it would go to his descendants

Question 9

Modern per stirpes (per capita with representation)(Texas)

Answer 9

We do our first division at the generation where someone is alive.
If all C’s are dead, go to GC, than drop it through even if one of the GC is dead.

Question 10

Per capita @ each generation (UPC approach)

Answer 10

First division just like modern per stirpes, however instead of dropping down predeceased’s share, you add all the descendants shares into a pot and then split the amount equally.

Question 11

Share of Ancestors and Collaterals

Answer 11

Looking at the family tree, you start from the inside and work your way out.
Texas does not protect against “laughing heirs.”
In-laws do not take in Texas. Escheats to the state.

Question 12

Half-Bloods (§201.057)

Answer 12

Texas, as a minority, only allows half-bloods to take half of what whole-blooded descendent takes.
(Helge emphasis: It is impossible to have half-blooded children or descendants, obviously they are yours. This only applies to collateral relatives.) For sake of ease, give two shares to each whole blooded and only one to half blooded.

Question 13

Negative Disinheritances

Answer 13

Language has to say clearly that they are disinheriting individuals, or maybe specify who your inheritors are.

Question 14

Adoption (§201.054)

Answer 14

Dual inheritance is mandated (can inherit from both biological and foster parents). However, it’s a one-way street, biological parents can’t inherit from deceased biological children who were adopted, however adoptive parents can.

Always the possibility that the court may determine that in a closed adoption, adopted children may not inherit from biological parents.

Question 15

Adult Adoption (162.507)

Answer 15

An adopted adult may not inherit from or through the adult’s biological parent. (as an adult, no ones making the decisions for you anymore, so there’s an implication that you are aware of the consequences of severing ties with biological parents)
Gay couples might proceed through adult adoption in order to guarantee through intestacy (if the will is deemed invalid) will pass from the decedent to their partner and not to the decedent’s parents.

Question 16

Equitable Adoption

Answer 16

Children are sometimes passed around from family member to family member.
Ex: Man treats child as a daughter. Her children call him granddad. He calls them his grandchildren. He passes, and she wants to take his estate.
She needed to prove the following:

Equitable Adoption:

1) Agreement between foster parent and natural parent.
2) Performance by the natural parents of the child in giving up custody.
3) Performance by the child by living in the home of the adoptive parents
4) Partial performance by the foster parents in taking the child into the home and treating it as their child, and . . .the intestacy of the foster parent.

In Texas law, formal agreement is not always necessary.

Question 17

Posthumous Children (201.056)

Answer 17

No right of inheritance accrues unless you’re born—except for children of the decedent (posthumous lineal heirs will inherit from the intestate).

Question 18

Non-marital Children

Answer 18

Under common law, “illegitimate children” could not inherit. The statutes below correct this.

Section 201.051
Maternal inheritance - not difficult per se.

Section 201.052
Paternal inheritance – there’s a presumption that any children born within 301 days of the dissolution of a marriage is the child of the former husband.
If husband consents to the use of donor sperm, he is the father.
Subsection (C) allows a child to petition the court to establish who their father is.

Question 19

Reproductive Technology

Answer 19

Artificial insemination:
201.056 in the estate code is really the only section that deals with posthumous heirs. In the family code however, 160.707, a spouse must have consented to the use of their genetic material before passing. We don’t know however how this issue would be decided in Texas, since there is no statute on point in the estate code.

Surrogate Parentage:
Pursuant to 160.754, a gestational agreement must be established and authorized.
Helge’s Points:
1) Has to be a voluntary agreement;
2) Have to use someone who’s gone through a successful pregnancy;
3) intended parents must be married to each other;
4) must determine who’s going to be responsible for healthcare expenses;
5) the eggs can’t be the surrogate’s eggs (don’t want their to be a legal claim by the surrogate mother)

lots of hoops…

Question 20

Advancements (§201.151)

Answer 20

A lifetime gift from a decedent to a child.

Under common law, it was seen as a prepayment of the child’s inheritance. It was presumed under common law that a gift was an advancement. You specifically have to say, “this is an advancement” modernly.

An advancement has to be in writing either by the decedent or by the heir in order to be treated as such.

Ex: Hotchpot
D gives a lifetime gift of $10,000 to A. D dies with a $50,000 estate. Create a hotchpot by adding gifts and estate amount. So, $50k plus 10K equals 60k. Divided amongst A, B, and C (the heirs), B and C get 20k each, while A would now only get 10k.
Now, if the advancement is more than “A” hypothetically would have gotten, it doesn’t matter because D wanted A to have that money (“A” wouldn’t have to pay back the money). B and C would just split the estate and A wouldn’t get any further funds.

Question 21

Slayer rule (§201.058)

Answer 21

In Texas, 201.058 restates an article of the state Constitution prohibiting corruption of the blood. Accordingly, an imprisoned person, even one on death row, may inherit property.

Texas’s slayer rule only applies if a beneficiary of a life insurance policy is convicted and sentenced as a principal or accomplice in willfully bringing about the death of the insured. Texas courts resort to the constructive trust principle to prevent the murdering heir from inheriting. Legal title does not pass to the murderer but equity treats the murderer as a constructive trustee of the title because of the unconscionable mode of its acquisition and then compels the murderer to convey it to the heirs of the deceased, exclusive of the murderer.

A civil suit can trigger the statute.

Question 22

“Bad parent” (§201.062)

Answer 22

Statute enumerates situations in which the dead-beat parent is disqualified from inheriting decedent son’s estate. Ex: abandonment for at least three years.

Question 23

Disclaimer (§122.001-121.153)

Answer 23

Allow for post-mortem estate planning. Why?
• Reducing tax liability
• Creditors of the beneficiary
o Except IRS

In order to have a valid disclaimer:

1) Must be in writing
2) Notarized
3) Filed within 9 months from the date of death.
a. File w/ court
b. File w/ personal representative of the estate

Partial disclaimer (is okay, it doesn’t have to be all or nothing. You have to do a vertical slice not a horizontal slice. You can’t disclaim a remainder interest and keep a life estate. If you get shares of stock, you can disclaim 100 of the 500 you received.)

You cannot accept any benefits from disclaimed property (*wish I didn’t take that stock).

Irrevocable (can’t avoid child support obligations however).

Ex: Child of decedent files a disclaimer to avoid taxation so inheritance passes straight to grandchild.

Question 24

Probate

Answer 24

Probate’s aims:

1) Clear Title
2) Protect creditors
3) Management (who’s going to handle the estate?)

There is no lapse in title, title vests immediately subject to a lien for payment of creditor’s claims, as well as to the management rights of the personal representative during the probate process.

Question 25

Informal Probate Procedures - Application for family allowance with an order of no administration; Section 353.101:

Answer 25

If it’s all community property, she’s presumed to have no money. So she can petition the court for living expenses to be released provided she is in good standing with creditors.

Question 26

Informal Probate Procedures - Muniment of Title

Answer 26

Need will and a court order.
1) no unpaid debts other than mortgage 2) testate.
There is a requirement that within 180 days for the administrator to file an affidavit to take account of the estate proceedings. The benefit is really to avoid being named personal representative. If you don’t file the will within 4 years, you can’t get a personal representative.

Question 27

Informal Probate Procedures - Small estate affidavit (205.001):

Answer 27

1) Nonexempt probate assets cannot exceed $50,000. (homestead and exempt property not counted) (in our hypo – only mutual funds qualify as probate/nonexempt)
2) Intestate
3) Solvent (liabilities can’t exceed the estate worth)

Question 28

Informal Probate Procedures - Proceedings to Declare Heirship

Answer 28

Court order that says who your heirs are.
We need an attorney ad litem and guardian ad litem appointed for unknown heirs. They search records, and interview people. It’s time intensive, then there’s a hearing, and the court makes a determination.

Question 29

Informal Probate Procedures - Non-Statutory Affidavit of Heirship (203.001)

Answer 29

Affiant swears under oath that the facts are true in which title companies or other institutions may rely on without a formal determination of heirship, to clear defects in title to real property. Must be on file for 5 years.

Question 30

Goals of Will making

Answer 30

1) Ritual: imports caution, and impresses a notion of seriousness
2) Protective: protecting the testator; their loved ones; protection from outside influences; protecting from future selves (lack capacity).
3) Evidentiary: testator has passed, we can’t ask them what they intended later.
4) Channeling:

Question 31

Formalities of will making in Texas:

Answer 31

1) in writing
2) signed by testator or another in the presence of testator and at testator’s direction
3) attested by 2 witnesses in presence of T; or wholly in testator’s handwriting (dispenses with 2 witness requirement)

Question 32

Formalities of will making in Texas: Presence

Answer 32

In Texas, you don’t need both witnesses present at the same time.
Conscious Presence (Texas): the witness is in the presence of the testator if the testator, through sight, hearing, or general consciousness of events, comprehends that the witness is in the act of signing. The test is one of mental apprehension (likely have to be in same room)

Other jurisdictions may require the “line of sight test” - testator does not actually have to see the witnesses sign but must be able to see them were the testator to look.

Question 33

Formalities of will making in Texas: Signature

Answer 33

Valid, even if you don’t sign your full name. Any mark of intent counts. If you’re not able to sign your will, you can ask your friend standing next to you to sign for you, and they can sign in your presence. (don’t know about digital signatures; rubber stamps haven’t been ruled on).
You can sign anywhere in Texas, don’t need to sign at the end. There’s a question however as to whether you meant for only certain portions to apply in the will (before the signature only?)

Order of signing:
It makes sense that the testator sign first, and then the witnesses, because they’re attesting to his signature. It’s okay in Texas for witnesses to sign first if it’s all done in one procedural setting.

Question 34

Purging Statutes

Answer 34

At common law, we’d just say a witness who’s also a beneficiary is disqualified.
Now, we disqualify witnesses from taking as beneficiaries to remove this conflict of interest.

General rule in Texas:
Purge the bequest.

Exceptions:
1) You can keep your intestate share, or the bequest, whichever is less.
Reasoning: you’re not really motivated to lie, because you’ll still get your intestate share anyway.
2) or, will can be proven by other witness.
You only need to have one witness testify in Texas as to the validity of the will.
3) If the other witness is not available, another person can corroborate the interested witness’s testimony.

Question 35

Self-Proving Affidavit

Answer 35

Recites that all the requirements of due execution have been complied with and permits the will to be probated expeditiously. It’s a substitute from having witnesses come in to testify. When you have this in your will, you just give it to the court and they go, “Great, we’ll probate it.”

In Texas, 251.102-103, there are two alternate forms:

1) Traditional 2-step: Sign the will, and the self-proving affidavit says, I did sign the will.
2) Sign combined languages in a signature block.

A will can be self-proved anytime the witnesses are still alive. Texas accommodates where the will isn’t signed by the witnesses, but the affidavit is.

Clients need to put these documents in a safe deposit box, not their safe. If you safeguard wills, file it with the probate court, and you’re done.

Question 36

Alternatives to Strict Compliance with Will Formalities

Answer 36

1) Dispensing Power; Harmless Error Rule (UPC)
- We can just do away with one of the formal requirements if it can be shown by clear and convincing evidence that the testator intended the document to serve as their final testamentary document.
2) Substantial Compliance
- “close enough” to the standards.

Texas is a strict compliance jurisdiction.

Question 37

Holographic Will (251.107)

Answer 37

1) in writing
2) signed by T
3) wholly in T’s handwriting.

Policy:
Not really serving any protective or other significant functions of traditional willmaking besides the fact that it’s harder to forge a whole document than simply a signature. The ritual function is lacking given formalities typically impress upon others a certain significance in the actions being performed.
Half the states don’t allow for holographic wills because of these factors. Also, how do you prove intent that someone meant for a document to serve as their last and final testamentary will? Courts generally don’t want to get into such a mess of litigation.

Question 38

Testamentary Intent in Holographic Wills:

Answer 38

We are not looking solely for testamentary disposition. Was the document intended to serve as a will?
Language to the significance of “when I die” is needed, and that this document is to only take effect “when I die.”
There has to be something more than merely saying I want these people to get these things.
It’s extremely difficult to demonstrate testamentary intent.

Question 39

Conditional Wills

Answer 39

Ex: Writing before taking a trip.
At minimum, a document may be serving a testamentary purpose; an expression of the testator thinking about their death. They would have to be clear in the letter that they want the document to serve conditionally upon whether they survive a given event they are undertaking.

Material provisions and signature in T’s handwriting in Texas.

Texas does not require a date on the will, but some jurisdictions do.

Question 40

How to Revoke a Will

Answer 40

1) In writing (a will) (attested doc or holographic will); or,
2) Physical act w/ intent to revoke

You can revoke a holographic will with an attested will, and vice versa. The will can’t be revoked orally, it needs to be done in one of the above ways. Texas is a strict compliance state.

Testator must have capacity, therefore any challenge as to lack of capacity (e.g. insane delusion, undue influence) may defeat an argument for revocation.

You can’t undo a revocation just by tearing up your second will. If the document is revoked by inconsistency, then it’s gone for good. Amendments do not revoke the entire document for inconsistency, so tearing up a codicil would not revoke the original will necessarily. Furthermore, it depends whether a codicil is revoked when the amended will is revoked. A mere amendment doesn’t stand on its own, however, if circumstances show the codicil to be able to stand on its own, then it’s good.

Codicil = an instrument that supplements, rather than replaces, an earlier will. Also, where there is a subsequent document that contradicts will, it is treated as a codicil so long as it meets formalities.

You have to write void on the actual writing; it has to “touch” the writing. We have to ascertain intent for a holographic will as well, so writing in the margins “VOID” and signing doesn’t have context (surplusage rule). If she wrote “This will is VOID,” then signed, this would be good. If you scratch it out, you don’t have to sign.
The presumption is that if the will was last in the testator’s possession, the presumption is that the will was revoked, and the burden is on the petitioner to prove the testator did not revoke the document.

Question 41

Harmless Error Rule:

Answer 41

Not a rule in Texas.

Where decedent’s testamentary intent is evident, and there was an intent to revoke an original will, and not a newer will, the court will allow for the original will to be revoked even though the second will would have been revoked in a more stringent jurisdictions like Texas.

Question 42

Lost Wills and the Presumption of Revocation

Answer 42

If we know there’s a will, but can’t find it, and it was last known to be in the possession of the testator, we presume they destroyed it. If there’s a fire, we might presume there was no intent for the testator to revoke it.

Photocopies are not admissible of wills themselves. They can only be used as evidence to overcome a presumption that a will was destroyed by the testator. Sometimes they use the lost will provision to show that a prior will was destroyed so they don’t have to prove up the contents of the prior will.

Question 43

Partial Revocation

Answer 43

Some states allow for striking lines and initialing to alter a will. Texas does not allow this. In Texas, you have to do a codicil which revokes what you intend to remove.
In Texas, you can really deface the type and get away with partial revocation because the court isn’t going to throw out the will entirely.
All these rules get thrown out when it comes to holographic wills because courts realize holographic wills are messy.

Question 44

Dependent Relative Revocation (Equitable Doctrine Approach)

Answer 44

The court is looking for a valid revocation of a will, and that because of some mistake of law or fact, the testator would not have made that revocation. Court may apply this doctrine to ignore this otherwise valid revocation.

If the Court determines there’s been a valid revocation based on mistake of law or fact, the Court can apply the doctrine of DRR to further the testator’s intent contrary to reasoning behind strict formalities. Is there enough evidence to say that ignoring the revocation furthers the testator’s intent? The degree of difference in inheritances will be a critical factor in making this determination. If trying to chance the beneficiaries, the testator could choose between X getting it and nobody getting it, what would they do? The court would likely infer nobody…

No DRR where woman voids her will and dies before the lawyer can correctly write out a will to her liking.

Where testator mistakes a person to be dead and provides a valid revocation to take her out, court will apply DRR.

DRR and revival are really two entirely separate things.

Question 45

Revival

Answer 45

Majority Rule:  We allow revival if that is what the testator would have intended.
Minority Rule (TEXAS): No revival of revoked wills unless you have re-execution of the first will, republication by codicil, or create a new will with the same terms.  You have to do something more than just revoke the new will to get the old one back, even if that’s the testator’s intent.

Incorporation By Reference:
Allows for a writing that was in existence but not present at the time of execution and that was not itself executed with testamentary formalities to be absorbed into the testator’s will:
1) doc. in existence; 
2) intent to incorporate; 
3) sufficiently identify doc. in will.

The doctrine is only supposed to incorporate the document as it is in existence, not what it is later. Main rationale for the doctrine in general is to allow for convenience (document could be in another location), not have a roundabout way of circumventing formalities.

Republication by Codicil: amend a revoked will to revive it.

Question 46

Divorce

Answer 46

Texas estates code 123.001 writes spouse, in-laws, and stepchildren out of the will upon divorce.
Family Code Section 9.301: a divorce automatically revokes spouse as beneficiary as life insurance policy unless there are exceptions in the policy.

9.302: retirement plans.
Exception: Employer-sponsored plans are guaranteed by federal law and trump state law.

Trusts 123.052: if you have a trust that you set up during your lifetime, you can set up a revocable or irrevocable designation to your spouse.

What if you get married after you make your will?
Some states have “forced shares” or “elective shares” where the spouse can take even though they weren’t written into the will. Texas doesn’t allow this. Community property statutes are seen to strike a balance in light of this.

What about children?
There is protection in Texas for them.

Question 47

Acts of Independent Significance (Chapter 255)

Answer 47

Valid lifetime significance and motive. Also called the doctrine of non-testamentary acts.

So long as the testator has a valid lifetime significance and motive, the change of gifts is allowed under this doctrine.
The motive must be beyond doing certain acts in order to give them to a certain person in order for it to be valid.

Ex: “Phillip gets the car I own at my death.” Regardless of change in value and style of car from when she executes this will to when she dies, whatever car she owns at her death goes to Phillip. This is independent lifetime motive b/c the reason he would get a new car is b/c testator wants a new car, not b/c he wanted to change his bequest to Phillip.
Testator needs to say I give to A my house and the contents of my house, in order to get the contents in the house—can’t just say “to A my house.”

Content with titles cannot pass under the Texas statute (e.g. artwork, cars, motor home, etc.)

Need to find an independent motive for a particular action other than simply deciding who gets what under the will.

Ex: “Contents in right hand drawer” – Might satisfy independent motive; you might argue organization, or maybe because the right hand drawer had a lock. If

Question 48

Contracts Relating to Wills

Answer 48

You can make a contract to create a will, to modify a will, or to revoke a will.
E.g. A pre-nuptial agreement that includes disposition of property upon death, not just divorce.
E.g. Care-taker agreement: “If you take care of me, I’ll leave you XYZ upon my death.”
E.g. Buy-Sell agreements in companies that say if one of the owners dies the owner’s interest is automatically offered to be bought by the company.

If that contract is breached, results are sought under contract law – not probate law. The will will usually be probated – and then the contract suit will be brought against the estate, and the contract remedy will be enforced through a constructive trust, contact damages, etc. 254.004, super statute of frauds, governs (must be in writing).

We don’t recognize that merely executing a joint will is going to bind the parties contractually. A joint party can revoke the will. A joint will is not a contract under Texas law. A surviving spouse can revoke it without incurring damages.

Question 49

Mental Capacity - “Sound Mind”

Answer 49

Capable of knowing & understanding:

1) the nature and extent of property (general awareness of what you own)
2) the natural objects of his or her bounty, and (do they know who their family members are?)
3) the disposition that he or she is making of that property, and must also be capable of

Capacity Thresholds
Will requires less mental ability than other contracting activities. A dead person does not need protection from economic loss. Gifts and marriage are different.

Question 50

Contesting the Will (65.001)

Answer 50

Allows any interested person to contest the will.
Interested person includes spouses, heirs, etc.
Once you accept any benefits, you cannot contest the will.

Statute of limitations for contesting wills:
2 years from will being admitted to probate or 2 years from the date of fraud or forgery.

Question 51

Mental Capacity - “Insane Delusion”

Answer 51

False sense of reality to which one adheres to against all evidence to the contrary.

Minority: no basis in fact. If there is some minimal basis of fact, I.D. not reached (texas)

Majority: if rational person cannot reach the same conclusion based on the facts presented.

You still have to figure out causation: did the insane delusion affect the will?

Approaches:

1) direct causation over independent reason (maj.)(tex)
2) Presumption that insane delusion caused unnatural disposition (min.)

Question 52

Undue Influence

Answer 52

In a word, coercion.
Test:
1) testator is susceptible to undue influence
2) Influencer has the motive (money) and opportunity to exert the undue influence
3) Will is product of undue influence (you can be weak minded, but if you’re able to withstand that pressure, then it’s not undue influence)(Texas focuses here).

Question 53

Presumption of Undue Influence Test

Answer 53

In Texas, you have to use direct evidence. There is not a presumption of u.i. in Texas.

When proven, shifts the burden of proof to the alleged influencer to show there was NOT undue influence. This favors will contestants.
Test:
1. A confidential relationship exists between the testator and influencer - E.g. A lawyer, a power of attorney, a caregiver (unfettered opportunity to influence), etc.
AND
2. Suspicious circumstances - E.g. The will is drafted by a family member of the proposed beneficiary, and is substantially different from previous wills; influencer is made POA then absconds with the money and didn’t take care of the testator

•	Suspicious circumstances: 
o	Unnatural disposition
o	Multiple wills
o	Secrecy/haste
o	Bad guy participation in the drafting of the will
o	What did the bad guy take? 
o	Access
o	Motives
o	Statements of the donor and donee
o	Lack of independent advice or council 

Just like insane delusion, if undue influence is shown to impact only part of the will, the court will invalidate only those portions affected by the undue influence; however, if the undue influence impacts a majority of the will, the court will likely invalidate the whole thing.

o Sexual relationships - in the past were seen as a suggestion of deceit or a caution to the court without marriage. However, today it is seen as more of a relationship and marriage is not a necessity. A sexual relationship can show a loving relationship or a controlling relationship or a lack of a relationship at all.

Question 54

No Contest Clause

Answer 54

A clause in a will that says if you contest the will, you take nothing under the will.
• Crap-shoot, because if you win you may get more, but if you lose you get nothing. However, if you’re only left a small amount anyway, you might as well try because you’ve got nothing to lose.

Majority:
No contest clause exception, Texas:
Show 1) just cause, 2) brought in good faith
No contest clauses are strictly construed. You could still contest who’s executor. If you want to encompass everything you have to have a very broadly written clause.
– policy is we want people to come forward with evidence that the will is not really valid if proof is available.

Minority:
We’re going to enforce a no contact clause unless it was forged.

Question 55

Lawyer’s Ethics in drafting and taking under a will:

Answer 55

TDRPC 1.08(b) – It is unethical and against ABA rules to draft a will for a non-family member in which you or a family member are a beneficiary.
TPC 58(b) – (deals with whether or not the bequest is void) – normally, bequest to the drafting attorney, their spouse, their employee, any descendant of their parent or parent is void.
Except – if the devise is made to any of the above and they are the testator’s spouse, an ancestor or descendant of the testator, or is related within the 3rd degree of consanguinity or affinity to the testator. (pg. 93)

Question 56

Fraud

Answer 56

• Deals with the situation in which the testator is intentionally deceived into doing something they don’t want to do. It’s different from undue influence b/c the fraud feasor doesn’t have to overcome will of testator, they just have to trick them.
Knowledge and reliance are the two key elements.

1. A material representation
2. The representation was false
3. Speaker knew statement was false or showed reckless disregard for the truth (hardest element to prove)
4. Speaker made representation w/ intent that it should be acted upon by the party
5. Party acted in reliance upon the representation
6. Party thereby suffered injury

• Hard to prove, but if you can, it has same effect as undue influence:

1. Strike the entire will if the fraudulent part can’t be stricken alone
2. Strike the fraudulently induced part of the will
3. Institute a constructive trust (probate will as written, but impose a constructive trust to transfer money from “new best friend” to “old best friend.”

Two types of fraud

1. Fraud by inducement – false statements are purposely made to testator to induce them to make a will that includes someone or leaves someone out (telling them their child is dead; telling them lies about their best friend)
2. Fraud by compulsion – false documents, getting them to sign a piece of paper they do not know is a will (such as telling them “this is just a mortgage paper” when it’s really a will)

Question 57

Duress

Answer 57

Duress is undue influence to the extreme – when undue influence becomes coercive (E.g. holding a gun to your head as you draft the will)
Can look at combination of claims to decide if invalidation should somehow be made.
Constructive Trust remedies – this is especially important remedy when it was the children/family members themselves who are accused of duress, b/c if the will is simply invalidated and estate is intestate, then the children inherit anyway. Against policy of rewarding someone despite their crime, so: constructive trust!

Question 58

Tortious Interference with Expectancy

Answer 58

A tort claim against someone who acted in a way that intentionally interfered with your expectancy; not a challenge to the will.
• Texas follows this rule:
1. Expectancy
2. Intentional tort interference (fraud, undue influence, coercion)
3. Causation
4. Damages

Res Judicata: most of the time the intentional tort is also grounds for overturning the will in probate court. You have to first go through the probate court and exhaust your probate remedies before you can sue for tort damages. Correcting the will is the preference of the court instead of trying to impose monetary tort damages.

Question 59

Mistaken or Ambiguous Language

Answer 59

Majority Rule (Texas Rule)
• Plain Meaning Rule: don’t want to disturb the plain meaning of a word or phrase by bringing in any other evidence. Whatever’s written on the paper is what’s admitted to probate, regardless of the fact there is extrinsic evidence that 100% shows that language was a mistake.
• No Reformation for Mistake: court will not allow extrinsic evidence in to correct a mistake that the testator has made. We will not reform a will to correct a mistake that the testator has made.
• This includes omission (under Texas law), inducement to make a gift (Texas law as well)
• If attorney makes a mistake in drafting the will (“House to Bob” instead of “Sally”), it doesn’t matter if testator signs it; the will speaks as finally written and signed.
• Rule: As long as the language is unambiguous, the court will not allow extrinsic evidence.
• Rule 2: If there is ambiguity, there is no limit amount of extrinsic evidence.

Question 60

Kinds of Ambiguity

Answer 60

Patent (ambiguity on face of document)
• Obvious mistake that results in ambiguity (like part of a sentence being left out)
• OR: All my property to Bob. Watch to Sally. (What does this mean? Who gets the watch?)

Latent (ambiguity not evident on face of document; usually found out once you start distributing property)
• Equivocation – when a description fits two people/entities equally well (equal fit) (e.g. To my neighbor Bob. Two neighbors named Bob.)
• Partial Fit – description doesn’t fully fit anything
• Either way, extrinsic evidence may come in no matter what kind of ambiguity.

Personal Usage Exception – testator refers to a person in an idiosyncratic manor. You can introduce evidence that the testator really meant someone else. Refers to someone mistakenly over and over, but really intends a certain person to receive a gift.

Question 61

Mere Erroneous Mistake Doctrine

Answer 61

Where a description of a thing or person consists of several particulars and all of them do not fit any person or thing, less essential particulars may be rejected provided the remainder of the description clearly fits.
• Estate of Gibbs – removed middle initial to arrive at correct beneficiary
• Arnheiter? - street address number was a little wrong, so incorrect part was taken out completely, despite the fact there was no ambiguity, and b/c owner didn’t own house, it was therefore a mistake; but by removing number, it reads “My house at Harrison Avenue,” which could only fit one house. Problem solved. Kinda weird and fishy.
o *Note: if 304 Harrison Avenue didn’t exist, there would be ambiguity and extrinsic evidence could have been admitted.

Texas does not follow these rules – doesn’t matter if it’s a scrivener’s error, the court does not correct mistakes, period.

Question 62

Predeceased Beneficiaries

Answer 62

Failed Gifts – Texas groups the following together as failed gifts:
• Lapsed devise – devise fails b/c beneficiary dies after the will is made but before the testator dies.
• Void devise – beneficiary is dead before the testator executes the will (or it’s left to a dog)
• *Only time this distinction is important is with class gifts

Question 63

Anti-Lapse Rules (255.152)

Answer 63

Rule -
If a devisee who is a descendant of the testator or descendant of testator’s parents is deceased at time of execution of will, fails to survive the testator, or is treated as predeceasing the testator, the descendants of the devisee who survived the testator by 120 hours take the devised property in place of the devisee.

Does not actually prevent gift from lapsing, but sometimes substitutes one beneficiary for another where the gift would lapse

• Applies only to gifts to the kids or grandkids of the deceased, or descendants of the deceased’s parents
o Cousins and spouses are NOT descendants of your parent! This doesn’t apply to them.
o The property is divided into as many shares as there are surviving descendants in the nearest degree of kinship to the devisee and deceased persons in the same degree whose descendants survived the testator. (follow Texas intestate rules here for dividing between the generations)

• If a person would have been a devisee under a class gift if the person had survived the testator, he is treated as a devisee (follow distribution above) unless he was dead before the will was executed.
• This is the only exception – any other failed gift will pass to the residuary! (see chart above)
• Texas - this does NOT apply if testator has language in the will providing otherwise : “to my surviving children” or “to such of my children as shall survive me” prevents application of this exception.
• The anti-lapse statute DOES NOT apply to non probate transfers

Question 64

Changes in Property after execution

Answer 64

Ademption by Extinction
• If the testator gave a gift before dying that he also put in his will, the gift is adeemed by extinction because it is no longer part of the estate.
o Specific Devise: specific pieces of property
o General devise (like an amount of money) cannot be adeemed, instead stuff in the estate is sold in order to come up with that money.
o “Demonstrative Gifts”
• 100 shares of stock in apple?
• Or $10,000 from the sale of my shares of stock?
o Residuary – everything that is not a specific, general, or demonstrative devise. “everything” or “all other property”
• Ademption by extinction applies only to specific devises
• Texas Rule: §
o Follows the identity theory, which is also the majority rule.
• If the property is no longer there, then it is adeemed, and the beneficiary takes nothing.
o What if the house burns down?
• Or what if the guardian has to sell the house?
• In situations when the property is disposed of involuntarily, where the testator did not intend for the house to burn down, or had no capacity to agree to sell the house?
• Involuntary transfer exception: Here, we would give the proceeds from the insurance to the beneficiary, etc.
o Intent theory: minority rule: ask what the testator would have intended? Would he have intended the beneficiary to take the $$ from the sale of the specific item? If so, they get the $$

Question 65

Homestead Right of Occupancy for Surviving Spouse:

Answer 65

Surviving spouse has the exclusive right to occupy the homestead rent free for the rest of their life or until they abandon the property. Beneficiaries cannot do anything to compromise this right.
Ex: stepmom can’t be kicked out. Life tenant vs. remainder person responsibilities.

Other protections:
Social security, defined benefit plan (pension plan), 401k,

Question 66

Exemptions from Creditor’s Claims:

Answer 66

Creditors can’t force you to sell your home to repay debts. When does this extend beyond the debtor’s death? If you’re survived by a spouse or minor child, your homestead is exempt from creditor’s claims.
Homestead right is the same regardless of kind of property.

What personal property is exempt from creditor’s claims?
Tangible Personal Prop. up to $30,000 for an individual, $60,000 for a family. Not bank account, not stocks.
Why do we care?
There is something called a Personal Property Set Aside (353.051) which says that the exempt portion of the property shall be set aside for the surviving spouse. If dying spouse yields everything to children, if representing surviving spouse we’d point out homestead right of occupancy for S.S., and we ask the court to set aside personal property out of the estate for her regardless of what the will says.

(online class: you have to pay: You still have to pay class-1 claims, then you pay things like family allowances, then things like lawyer fees. The will beneficiaries get paid last; there’s an ordering to who gets paid if there’s not enough money as well)

Question 67

Spousal Allowances

Answer 67

Homestead Allowance
Allows the court to set aside a reasonable amount of money in lieu of no homestead up to $45,000. Can only ask for this if the decedent doesn’t have a home at the time of their death.
If they do have a homestead, allowance max is $30,000.

Family Allowance
Up to a year of living expenses minus the surviving spouses separate property gets us to our allowance amount. The estate is all tied up in administration that’s why the statute was passed to account for an allowance until the administration is done. Half comes from her share of the community prop., the other comes from the decedent’s portion of the community prop.

Presumption of community property in Texas. All of this (the character of personal or community property) can be changed with marital agreements.) Both ways are allowed in Texas. Both spouses have to sign or it’s not valid. Management rights: do not get distracted by property that has only one spouse’s name. It’s still community property.

So know:
Personal Property; Homestead; Family Allowance; before beneficiaries get to take.

Question 68

A Widow’s Election:

Answer 68

(not a good planning technique) Put’s the surviving spouse to an election. She can either go along with what the husband says in the will, or elect for community property in Texas law.

Question 69

Migrating Couples:

Answer 69

What happens when a couple moves from a community property state to a common law property state like New York? Well common law treats it half and half. The difference is what happens when you move from CL into CP jurisdiction.
- The state in which you’re domiciled at the time of death controls the disposition of your property at death.
We treat it as separate property if there’s a home in another state.
Texas law considers whatever they brought in from New York as his property. Widow would get nothing if he had a will leaving all to his children.
We only apply quasi-community property concepts on divorce, not death in Texas.
She’d still be entitled set aside property and allowances.

Question 70

Pretermitted Children (255.051-255.056)

Answer 70

Rights of children omitted from the will, specifically children unintentionally omitted from the will. Texas protects the latter.

Analysis:
o If there is a pretermitted child (someone born or adopted after the will), the next question is “Is the child mentioned or provided for in the will, or otherwise provided for by the decedent?”
1. If yes, then stop.
a. Can be mentioned in generic disinheritance clause: “I don’t intend for any heirs at law to take any of my estate.”
b. Can be mentioned as general “My children” (My children will equally divide…)
c. Contingent beneficiary – another mechanism of non-probate means where decedent has provided for the child (life insurance beneficiary, trust, etc.)
2. If no:
a. If other children are provided for in the will, then share with your siblings. If child 1 is left something in the will, and child 2 comes along later, the two must share what is left to child 1.
b. If no other children provided for in the will, the pretermitted child takes intestate share of probate estate not devised to pretermitted child’s other parent. (i.e. the share of probate estate devised to ANYONE other than child’s other parent. Means you have to assume parent died single, even if they were married when they died)
i. EXCEPTION: You can’t reduce the surviving spouse’s share by more than ½ (applies when surviving spouse is not pretermitted child’s other parent)
o NOTE: Codicils executed to a will after pretermitted children are born means the child is no longer pretermitted and cannot take! They take zero.

Example of multiple children receiving gifts in will and pretermitted child’s share

1. $10,000 B: $5000 C born after execution of the will.
   a. Put it all in a pot, and figure out that C gets 1/3 or $5000. So then you have to decide what portion A will give and what portion B will give. They give proportionately based on what they get in the will. So you figure out what proportion they were getting originally and multiple it by the amount C is getting to decide what C gets from each person.
   i. A is getting 2/3 originally = 2/3$5000 = A gives $3,333.34
   ii. B is getting 1/3 originally = 1/3$5000 = B gives $1,666.67
   iii. C gets $5000 or 1/3 of the total amount.

Question 71

Revocable Trusts

Answer 71

A trust is not a legal entity – it is a relationship.
Beneficiary has equitable title to the trust property.
The trustee is charged with managing the trust and they have legal title. The settlor creates the trust (if it’s an irrevocable trust they’re out, they no longer have a role.)

Notary block – if the trust holds real property, the notary block will allow the transfer to be recorded in deed records.

If settlor designates themselves as trustee, it has to be in writing in Texas.

Pour-Over Will – a will that says “transfer everything I own at death to the revocable trust.”
for things not included in the trust like clothes, jewelry, etc. This probate issue is addressed by the pour-over will by placing content in the trust.
1) Incorporation by reference (3 elements). If trust provisions are not in existence at the time the will is drafted, this causes a problem.
2) Acts of Independent Significance – Look I have a live trust! But you have to fund the trust during your lifetime to make it a live trust, so there’s a problem here too.

Texas recognizes gratuitous designations to named beneficiaries that are not part of decedent’s probate estate (cuts down on probate administration)

Trusts allow for dispossession immediately at death of settlor by trustee.
With trusts, you can state what law to apply, you just need to show a nexus with that jurisdiction. Do this to avoid RAP since some jurisdictions have abolished it. Delaware and Alaska are trust havens. Estate taxes don’t matter one way or another. Tax bill is exactly the same.

Question 72

Doctrine of Merger

Answer 72

where no independent trustee enforces a fiduciary duty, legal and equitable title merge and beneficiary owns it in fee simple. If the settlor is serving as trustee and the beneficiary, there’s a conflict. You don’t have a trust.
exception: spendthrift trusts.

Question 73

Two ways to create an inter vivos trust

Answer 73

If the settlor transfers property to another person to hold the property as trustee, then

1) Unless it’s real property, the settlor can make an oral statement.
2) Or, put it in writing, with the signature of the settlor.

Question 74

Inter Vivos Trusts and Creditors

Answer 74

Spend-Thrift Trust – spend-thrift provision prevents the beneficiary from voluntarily assigning their interest in order to get immediate payment for their interest by virtue of predator interest in trust. So, normally creditors can’t go after the trust assets if you can’t pay your bill.
Most jurisdictions, including Texas, recognize that the spend-thrift trust provision can’t protect the settlor’s interest, only third-party beneficiaries. 112.035

Thus, creditors can get to everything in an inter vivos trust, even post-settlors death. Not sure that you can satisfy debts of the estate, but definitely debts of the settlor before their death. This is the modern, prevailing view. Although it appears Texas would go this direction. Huge public policy against sheltering assets in this manner.

life insurance policies, retirement plans, and college savings plans are exempt from creditor’s claims. JTWROS is not exempt, predecedent’s share is still available (113.252).

Question 75

Life Insurance - important takeaways

Answer 75

A will cannot override the insurance policy – contract controls. You have to remove named beneficiaries by way of amending the contract
However, upon divorce, by statute, former spouses’ status as beneficiaries is revoked.

Question 76

Pension Plans

Answer 76

o Employers pays certain amount to an account monthly. A few allow you to designate anyone you know as beneficiary upon your death, but most only allow a spouse.
o Now, most go for 401K so they know exactly what they’re paying out.
o Contribution plan – You and your employer contribute to your plan.
o Defined Benefit Plan – defined payment employee gets each month after they retire.

Question 77

Totten Trust

Answer 77

o Substitute for jurisdictions who did not recognize PODs. Ability to withdrawal depends on whether or not the trust is revocable or irrevocable.

Question 78

JTWROS

Answer 78

o Texas: no extrinsic evidence to determine JTWROS
o Language must use explicit language designating JTWROS according to recent statute overturning Texas Supreme Court decision.