INTERPRETATION OF WILL Flashcards
Lapse.
The general rule is when a beneficiary predeceases the testator, the beneficiary’s gift will lapse and fall to the residuary estate. However, most states have implemented an anti-lapse statute which will save the gift if:
(1) the predeceasing beneficiary is a close relative of Testator, and
(2) leaves a surviving issue who will take beneficiary’s share.
Ademption by Extinction
Generally, a specific devise or bequest adeems by extinction, or fails when the property specifically devised no longer exists at the time of the testator’s death. (specific gifts).
A gift may be partially adeemed (owner of large tract of land and conveys small portion, beneficiary takes what is left). Not to general or demonstrative legacies.
EXCEPTION: If a guardian or conservator is appointed for the T after the will is executed and bequeathed property is sold by the guardian, the beneficiary is entitled to the sale proceeds at least to the extent they have not been expended for T’s care.
Advancement / Ademption by Satisfaction
Property that is given inter vivos (while alive) to an heir by a decedent may be treated as an advancement of the heir’s share in the estate if there is a contemporaneous writing by the decedent OR acknowledgement in writing by heir. At common law, a substantial gift to a child was presumed an advancement. Now, a lifetime gift is presumptively not an advancement unless shown to be intended as such.
Abatement
Abatement is the process by which certain gifts are decreased when assets of the estate are insufficient to pay them in full. The order of abatement for omitted children/spouses/domestic partners is:
(1) Intestate property (1a) and residuary property (property not in will);
(2) general legacies (pro-rata)(General devises, such as cash gifts);
(3) demonstrative legacies (pro-rata) (cash gifts from a specific account, stocks, bonds, or securities);
(4) Specific gifts;
(5) Items that qualify for the estate tax marital deduction.
{note: watch for omitted child/spouse!}
Exoneration
The discharge of any encumbrances on specific bequeathed property using residuary estate. At common law, if T makes a specific gift of property that is subject to a mtg or lien on which the T is personally liable, the beneficiary is entitled to have the lien exonerated.
Ambiguity
A patent ambiguity is when a word is vague on the surface, and a latent ambiguity is when a word can have more than one meaning.
Changes made to Face of Will after Execution
Only two ways a testator can make changes to a will are to write a new will OR by a codicil, which changes only part of the will. Words added to a will AFTER signed and witnessed are discarded!
Revised Uniform Simultaneous Death Act (RUSDA)
A person cannot take as an heir or will beneficiary unless he survives the decedent. Under the RUSDA and absent a will provision to the contrary, if a person dies under circumstances where there is insufficient clear and convincing evidence to prove that such person is to have survived the other by 120 hours (5 days), the property of that person is distributed as though he or she predeceased the other person. If the will contains a provision, “If he survives me,” if this clause is not present, Anti-Lapse will apply and would bypass the other decedent.
Jointly held property passes as though each co-owner survived the other, however RUSDA theoretically severs the right of survivorship in cases of jointly held property and would instead pass as though they were tenants in common.
Basically, spouse is treated as though they died before T,.
Specific devise
A gift of a particular item of property distinct from all other objects of the testator’s estate. (see Ademption)
General Devise
A general devise is a gift of a specified sum of money.
Demonstrative Devise.
A demonstrative devise is a gift of a specified sum of money from an identified source.
Residual Devise.
A residuary clause in a will deals with the the amount of the estate remaining after the payment of all specific, general and demonstrative bequests and all debts and expenses
Increases
Stock dividends or splits paid during the testator’s lifetime go to the beneficiary if the testator owns the stock at the time of death. If after testator’s death, if specific devise, then all increase goes to the beneficiary, but if general devise, increases do not!
Class Gifts.
Absent a contrary provision in the will, if a will makes a gift to a group of persons described as a generic class AND some members of the class predecease the T, the members who survive the T will take in equal shares. The class closes at the time a distribution to the class must be made, later born are excluded except if they were in gestation.
Disclaimer
A beneficiary can disclaim an interest, which results in the interest passing as though the disclaiming party predeceased the decedent. It must be in writing, is irrevocable, and filed within nine months of the decedent’s death or the beneficiary’s 21st birthday.
