Week 11 (26) Flashcards
Does real property count as a specific gift?
Yes, always
What was In re Estate of Anton about?
Facts?
Issue?
Holding? Wrinkle?
Rationale?
Ademption by extinction
Mary executes a will giving daughter Gretchen and son Robert duplex, and residue to other daughter Nancy and Robert. Nancy becomes attorney in fact after Mary’s car accident. Nancy sells Mary’s duplex and other assets.
Is there ademption?
No; Gretchen gets half of the proceeds of the duplex from the remainder. In cases where specific devises are removed from the estate as a result of an involuntary act, the devisee is only entitled to the proceeds which have not been expended on the support of the testator.
Because the testator did not voluntarily sell her assets, including the duplex, because she was
T executes a will bequeathing “my Ford car” to A and later sells the Ford and buys a Rolls-Royce, is A entitled to the Rolls?
No; just the fair market value at the time of distribution
Aunt Fanny Fox has a collection of Chinese snuff bottles. Snuff bottles were first made in China around 1650 when the First Manchu emperor, Kangzi, began to inhale snuff (powdered tobacco) brought by European traders. Sniffing snuff quickly became popular, and thousands upon thousands of small snuff bottles, each with a tiny spoon, were made to carry around in a pocket. Some snuff bottles were carved from jade, agate, and semi-precious stones; others were made of amber, ivory, and glass, sometimes with a scene painted inside. Ordinary Chinese snuff bottles of the eighteenth and nineteenth centuries can be found today for $800 or so, very good ones for perhaps $3,000; exceptional bottles may fetch $50,000 or more. Since each bottle is unique, each is individually priced in accordance with its quality of workmanship, rarity, and particular appeal to collectors’ tastes. Aunt Fanny bought her bottles from the 1950s through the 1970s, one at a time, as she ran across one catching her eye. She kept no records as to costs, and the bottles were not insured. Aunt Fanny’s will devises her snuff bottles to Wendy Brown. At Aunt Fanny’s death, the snuff bottles are not found in her house. No one knows how many bottles there were. Zoe Preston thinks there were 60 or more; Aunt Fanny only part of her collection at any one time. Wendy recalls seeing “about 20” in Aunt Fanny’s display cabinet. Aunt Fanny might have given the bottles away, or sold them, or her nurses may have taken them during her long illness. No one knows for sure.
What result?
Presumption is that it is adeemed; Wendy needs to prove that the will intended to give her the bottles: not tough
What amount? Maybe talk about at least 60 bottles at 800 each, at least $48,000
Do stock splits bring about ademption?
What statute?
Get original amount or later amount?
No
21132
Later amount of stock; if company split 3 stocks into 6, get 6
What happens if someone gives you a car or home with payments due?
What statute?
What to do with it?
How is this different from debt?
Won’t pay off the mortgage from the estate, unless will specifically says to; will owe those monthly payments
21131
Sell it
Debt is repaid from the estate
If the estate has shrunk for some reason, and will gives money to people that just isn’t there, what gifts are not transferred and inwhat order?
What statute (and its label)?
What about after all is paid off?
What’s important to realize about this?
What’s the economic reasoning for this order?
- Property not disposed of by the instrument. (goes intestate)
- Residuary gifts.
- General gifts to persons other than the transferor’s relatives.
- General gifts to the transferor’s relatives.
- Specific gifts to persons other than the transferor’s relatives.
- Specific gifts to the transferor’s relatives.
21402: Order of abatement
Proportionally reduce; “pro rata reduction”
Don’t give pro rata away to everyone; pay off in a list, then pro rata reduction
Specific gifts are more likely to have disparate value to beneficiaries; don’t want lost value in the market
Can you inherit debt?
No
What is ERISA?
What does it require?
the federal law that pre-empts any state law about survivorship on pensions
requires that spouses of survivorship rights of pension plans
What do spouses have a right to in wills in CA?
What rationale?
Outside CA?
Nothing
Surviving spouse already has half of the community property
States have different statutes that guarantee some amount of the deceased spouse property to the surviving spouse, usually before AND during marriage property
What about spousal/forced shares?
What do we have instead?
We don’t have them in CA
Community property
Must a spouse give their half of the community property to their spouse when they die (in their will) in CA?
No; they can give it to whomever
What happens in most SP states, with regard to forced shares?
1/3 of the entire property (before and during marriage, as a result of labor or not) to the surviving spouse
What are migrating couples?
couples who move from a SP state to a CP state and domicile
When will we interfere when a spouse has been omitted?
What statute?
What do we give the omitted spouse?
What does this look like?
How is it different from this?
When they are married after the will has been written, and the will has not been updated
21610
Give omitted spouse 1/2 of the CP and QCP
what would happen in the intestacy
never get more than 1/2 of the SP, which you could get intestacy; other half of SP is the estate to give to others
What are the exceptions to 21610? (3)
What statute?
- The decedent’s failure to provide for the spouse in the decedent’s testamentary instruments was intentional and that intention appears from the testamentary instruments.
- The decedent provided for the spouse by transfer outside of the estate passing by the decedent’s testamentary instruments and the intention that the transfer be in lieu of a provision in said instruments is shown by statements of the decedent or from the amount of the transfer or by other evidence.
- The spouse made a valid agreement waiving the right to share in the decedent’s estate.
21611
How do we satisfy the share of the ommitted spouse? (2)
Which statute?
- From residue
- Pro-rata; take from anyone becauase spouse comes first; If don’t want to sell specific gifts, beneficiaries contribute money to residue
21612
What is a pretermitted heir problem?
Examples of these heirs? (2)
a will was executed before the heir existed
Children and spouses
What was In re Estate of Prestie about?
Facts?
Issue?
Holding?
Rationale?
What about in CA?
Spouse Omitted from Premarital Will
Testamentary plan prior to marriage and death; will doesn’t mention spouses; trust omits her
Is she an omitted spouse?
Yes, gets her share of CP and SP
Statute only mentions wills
Trusts count as testamentary instruments, so spouse wouldn’t get anything
What is the question with omitted spouses?
Did the testamentary instrument mean to provide for spouse? If not, then omitted
When is a child not “omitted,” and therefore does not take? (3)
What statute?
What if a child is omitted?
What statute?
Relationship between two stautes?
Any of the following:
- The decedent’s failure to provide for the child in the decedent’s testamentary instruments was intentional and that intention appears from the testamentary instruments.
- The decedent had one or more children and devised or otherwise directed the disposition of substantially all (most of) the estate to the other parent of the omitted child.
- The decedent provided for the child by transfer outside of the estate passing by the decedent’s testamentary instruments and the intention that the transfer be in lieu of a provision in said instruments is shown by statements of the decedent or from the amount of the transfer or by other evidence.
21621
(Except as provided in Section 21621, if a decedent fails to provide in a testamentary instrument for a child of decedent born or adopted after the execution of all of the decedent’s testamentary instruments) the omitted child shall receive a share in the decedent’s estate equal in value to that which the child would have received if the decedent had died without having executed any testamentary instrument.
21620
21621 lists exceptions to 21620
When T executes her will, she has two living children, A and B. Her will devises $7,500 to each child. T then has another child, C. T dies.
What would C take and where would it come from?
Statutes?
1/3 ($5,000) pro rata from other beneficiaries ($2,500 each)
21620 and 21623(a)(2)
When T executes her will, she has two living children, A and B. Her will devises $10,000 to A and $5,000 to B. T then has another child, C. T dies.
What would C take and where would it come from?
Statutes?
What to do on exam?
1/3 ($5,000) pro rata from each (A - 3333.33 and B - 1666.66)
21623(a)(2) and 21620
Don’t do math, just say “reduce pro rata”
In 1983, Rene executed a will providing for his three children, each by name. In 1984, Rene had a fourth child, a daughter Patricia. In the summer of 1986, Rene executed a codicil making minor changes to his will, but neglecting to add Patricia. In December 1986, Rene died.
Is Patricia entitled to a pretermitted child share? Why or why not?
Yes; Don’t republish will with codicil, because goes against intent of testator - no evidence of child being horrible; Patricia would take as an omitted child
What are the two rights in property?
What does a trust do with regard to these rights?
Why is this done? (2)
legal title (law) and right to enjoy that property (equity)
splits up these rights; someone has title but not right to enjoy the property and someone has no title but has a right to enjoy that property
- have a lot of property; want it distributed efficiently
- avoid probate
Is a trust a way to avoid state tax?
No; have to pay the same taxes
What are two ways to create a trust?
- Inter vivos (during life)
- In a will (at death)
What is a benefit of an inter vivos trust?
it’s revocable before trustor’s death
Who is the person who owns legal title to the trust’s property?
trustee
Who is the person who gets equitable enjoyment of a trust’s property?
the beneficiary
