Problems associated with testamentary gifts Flashcards
What is an ex. of a specific devise or bequest?
A gift of specifically described property: :I devise Backacre to my son John”
What is a demonstrative legacy?
A gift of a general amount from a specific source “I give the sum of my $25,000 to be paid from the proceeds of the sale of my Shell Oil stock to Sally”
What is a general legacy?
“I bequeath $10,000 to my mephew Ned
What is a residuary gift?
“I give all the rest and residue of my estate to Betty”
What is an intestate property?
If the will does not make a complete disposition of the estate because the will, poorly drafted, does not contain a residuary clause
Absent a contrary will provision, how are debts and administration expenses paid out?
- Intestate property
- Residuary assets
- The general legacies
- Specific bequests.
Is there any distinctions made between real and personal property when debts/expenses are paid out?
No.
Terry executes a will that provides “I leave Blackacre to my son John, and my residuary estate to my wife” A year later, Terry sells Blackacre for cash and uses the sale proceeds to buy Whiteacre. Terry dies, and his will is admitted to probate. What does John take?
Ademption applies, and John takes nothing
what may testator bequeath?
Only what he actually owns. Where a will makes a specific gift of property, and the property is not owned by the testator at death.
Henny’s will contains this provision: “I give the sum of $25,000, to be paid out of the proceeds of sale of my Shell Oil stock, to Sally” One year before her death, Henny sells all of her Shell Oil stock and uses the sale proceeds to buy Exxon stock. Does ademption apply to demonstrative or general legacies?
What does Sally get?
No. ONLY applicable to specific legacies.
$25,000
What if Henny owned any Shell Oil stock at her death?
Executor would be under a duty to sell it first to raise the $25000
Same facts as earlier, except that Terry sold Blackacre for $10,000 cash and a $90,000 note secured by a mortgage on Blackacre. When Terry died, the balance on the note was $65,000. What does John take under Terry’s will?
Nothing! Sales contract was fully performed.
What does the IL statute on ademption say about “equitable conversion”?
If testator had entered into a contract for sale of property BEFORE the contract was fully performed, John would take remaining payments under the contract.
What are the exceptions to the doctrine of ademption?
- Wills executed before T became incapacitated: specific devisees have a right to general legacy equal if T becomes crazy or sells things via fraud.
- Can only get sale price of specific gifts if they can be traced, and weren’t sold in order to pay for T’s care,
- If T didn’t have the opportunity to change the will: ex. T gifts his car, he dies in a car crash and its totalled. B would get car’s insurance $.
When are bequests of stock or other securities a specific bequest?
When they are specifically described and the T owns them. “my 100 shares of IBM stock to A”
