Wills and Estates

Question 1

Intestate Succession

Answer 1

Any property not passing by a valid will or by operation of law is governed by a State’s applicable intestacy statute.

Question 2

Typical Intestate Succession Rules If Decedent…?

Answer 2

− Leaves only a surviving spouse→spouse will receive the entire estate.

− Leaves a surviving spouse and issue:
▪ Most States→spouse and issue will each receive certain %.
▪ UPC→spouse receives the entire estate if ALL issue are from that spouse.

− Does NOT leave a spouse→decedent’s issue.

− Does NOT leave spouse or issue→surviving parents.

▪ If no surviving parents→issue of parents (siblings & their issue).

Distribution of Assets (Most States)
→Assets pass by the Per Capita at Each Generation approach.

Question 3

Validity of a Will

Answer 3

A will is valid if it complies with the applicable State law.

UPC→a written will is valid if complies with the law of the place:
a) where executed; OR
b) of testator’s domicile, abode, or nationality at the time of (i) death or (ii) signing the will.

Question 4

Most States→Requires that a will be:

Answer 4

(1) in a writing,
(2) signed by the testator, AND
(3) witnessed by at least 2 individuals.

Question 5

UPC→Requires that a will be:

Answer 5

1) In writing;
2) Signed by the testator (or by someone in testator’s presence and by testator’s direction); AND
3) Either: (a) signed by at least 2 witnesses (within a reasonable time after witnessing testator sign the will); or (b) notarized.

Question 6

When Witnesses Sign “Within Testator’s Presence”:

Answer 6

Majority View & UPC→if within the range of the testator’s senses.

Minority View→if within the testator’s line of sight.

Question 7

Strict & Substantial Compliance

Answer 7

Common Law→Will is INVALID if it does not meet State law requirements.

Some States→Will is VALID if decedent substantially complied with requirements.

Question 8

UPC Harmless Error Rule→An improperly executed will is valid if:

Answer 8

1) proven by clear and convincing evidence; AND
2) that decedent intended the writing to be his will.

Question 9

Doctrine of Integration

Answer 9

A document will be integrated into a will if the Testator:
1) intended it to be part of the will; AND
2) the document was physically present at the will’s execution.

*May be proven by extrinsic evidence or witness testimony.

Question 10

Interested Witnesses

Answer 10

Common Law→A will must be witnessed by 2 disinterested witnesses (not receiving a benefit under the will).

Modern View (All States)→A will is VALID even if witnessed by an interested witness.

− *BUT, the gift to that witness is purged unless:
a) the interested witness is an heir – gift is reduced to lesser of (i) intestate share or gift under prior will, or (ii) gift under current will); OR
b) if another disinterested witness was present so that there were still 2 disinterested witnesses.

Question 11

Codicil

Answer 11

An instrument made after a will is executed that modifies, amends, or revokes a will.

− To be valid it MUST satisfy the same will execution formalities.

− If a codicil republishes a will→the will is deemed executed on the same date as the codicil.

− It CANNOT republish an invalid will (but it can cure an interested witness issue).

Question 12

Holographic Will

Answer 12

Is a handwritten will (or alteration to a will) that is NOT WITNESSED.

− Only some states recognize holographic wills. Those states require the writing to be subscribed by the testator (signed at the end).

− In states that recognize holographic wills, a valid holographic codicil revokes an earlier will (to the extent it conflicts).

Question 13

Incorporation by Reference

Answer 13

A bequest through an unattested memorandum is valid if it meets requirements of incorporation by reference.

Question 14

Incorporation by Reference Most States

Answer 14

→A document or writing will be incorporated by reference if:
1) It was in existence at the time the will was executed;
2) It was sufficiently described in the will; AND
3) Testator intended to incorporate it into the will.

Question 15

Incorporation by Reference UPC

Answer 15

→ A bequest of tangible personal property (other than money) will be incorporated if:
1) signed by testator; AND
2) the item & devisees are described with reasonable certainty.

*The document DOES NOT have to be in existence at the time of will execution.

Question 16

Acts of Independent Significance

Answer 16

Are acts or events with significance outside of the will-making process.
− Can be used to fill in any gaps of a will.

Question 17

Revocation by Physical Act

Answer 17

A will is revoked by physical act if:
1) the testator intended to revoke the will; AND
2) it is burned, torn, destroyed, or cancelled by the testator (or someone at his direction).

Common Law→words of cancellation are valid ONLY IF they come in physical contact with the cancelled words of the will (i.e. written over).

UPC→words of cancellation are valid written anywhere on the will (no physical contact is required).

Question 18

Revocation by Subsequent Will or Codicil

Answer 18

Testator may revoke a will by executing a subsequent will or codicil.

− BUT, the revocation is valid only to the extent that the previous will conflicts with the new will UNLESS the new will expressly revokes the previous will in its entirely.

Question 19

Dependent Relative Revocation Doctrine

Answer 19

Cancels a previous revocation that was made under a mistaken belief of law or fact.
− Applies when → Testator would NOT have revoked the original will or bequest but for the mistaken belief that another will he prepared would be valid.
− Courts typically apply doctrine only when there’s a sufficiently close identity to the revoked bequest & the bequest in the invalid subsequent will.

Question 20

Revival of an Earlier Will

Answer 20

Common Law→Automatically revived if a subsequent will was revoked.

Modern View→Revival permitted only when:
a) Will is revoked by physical act and testator intended its revival; OR
b) Will is revoked by a subsequent instrument and that will is later republished by a subsequent will or codicil.

UPC → Automatically revived BUT ONLY IF the will was partially revoked by a subsequent instrument (unless no testator intent to revive).

Question 21

Contractual Wills

Answer 21

Contracts to execute mutual wills are enforceable.

− To be enforceable→it MUST expressly state that the parties intend their wills to be a binding contract. There must be a specific reference to the contract on which the joint wills are based.

− If breached→court will impose a Constructive Trust in favor of original intended beneficiaries.

*The execution of joint will or mutual wills DOES NOT create a presumption of a contract not to revoke a will.

Question 22

Will Takes Effect at Time of Death

Answer 22

A will takes effect and is construed at the time of testator’s death.

For distribution purposes, the will is treated as if it was executed immediately before the death. A beneficiary listed in a will DOES NOT have any interest in the estate property prior to the testator’s death.

Question 23

Per Capita at Each Generation

Answer 23

Steps to divide assets:
1) Divide the estate into as many equal shares as (i) surviving descendants in the nearest generation, and (ii) deceased descendants in that same generation who left surviving issue (if any).
2) Each surviving descendant in the nearest generation is allocated one equal share.
3) Remaining shares (if any) are combined and then divided in the same manner among the surviving issue of the next generation of descendants.
4) Repeat for each generation until all assets are distributed.

Question 24

Modern Per Stirpes (Per Capita by Representation)

Answer 24

Steps to divide assets:
1) Divide the estate into as many equal shares as (i) surviving issue in the nearest generation, and (ii) deceased descendants in that same generation who left surviving issue (if any).
2) Each surviving descendant in the nearest generation is allocated one share.
3) Remaining shares of each deceased member of that generation (who leaves surviving issue) drop down and are divided in the same manner among their then living issue.

Question 25

Per Stirpes

Answer 25

Steps to divide assets:
1) Start with the first generation of which there are living takers.
2) Each living and non-living person in that generation is entitled to one share.
3) Each share going to a non-living taker drops down and is split equally among their issue.

Question 26

Generically Described Property

Answer 26

Applies to property owned at the time of the decedent’s death matching the description in the will (i.e. a gift of “my boat”).

− The gift applies to whatever item is owned at the time of testator’s death regardless of the specific item owned when the will was executed (i.e. a different model boat).

Question 27

Ambiguity in a Will

Answer 27

When a will is ambiguous, courts allow extrinsic evidence to resolve the ambiguity.

− The court may receive any competent evidence that bears on the testator’s intent.

Question 28

Advancements / Satisfaction Common Law

Answer 28

→Gift to heirs during testator’s lifetime were considered advancements on that heir’s intestate share of the estate.

− The amount of the gift would be deducted from the heir’s share of the estate.

Question 29

Advancements / Satisfaction UPC

Answer 29

→NOT deemed an advancement unless:
a) the will provides for a deduction; OR
b) a writing indicated that the property was in satisfaction of a devise or that its value will be deducted from the value of devise.

Question 30

Simultaneous Death RUSDA
*RUSDA = Revised Uniform Simultaneous Death Act

Answer 30

→If no proof by clear and convincing evidence that one person survived the other by 120 hours (5 days), then the property is distributed as if that person predeceased the other person.

− It’s presumed that each person outlived the other when distributing assets.

− When property is held as joint tenants→rights of survivorship are severed, and the property passes as if held by tenancy in common.

Question 31

Residue of a Residue Approach

Answer 31

Common Law→No residue of a residue rule.

− Any residuary shares of a decedent’s estate found invalid would pass via intestacy.

Modern View→Invalid residuary shares of a decedent’s estate go to the other residuary beneficiaries.

− BUT, this rule only applies if an anti–lapse statute does not create substitute taker for a beneficiary who fails to survive the testator.

Question 32

Conditions that Prohibit Marriage / Require Divorce

Answer 32

The following trust/will provisions are VOID against public policy:
a) prohibiting a first marriage; and/or
b) requiring a divorce.

*Will be treated as if the restriction was not imposed.

BUT, a restraint on marriage will be upheld if:
a) it’s a restraint on re-marriage; OR
b) the purpose is to take care of a person’s daily needs until they are able to obtain such support through marriage.

Question 33

Anti–Lapse Statute

Answer 33

→A lapsed gift will vest in the issue of a predeceased beneficiary if:
1) that beneficiary is a specified descendant of the testator (specified by statute); AND
2) the beneficiary leaves issue who survive the testator.

UPC→Anti-lapse rule applies to gifts to issue (i.e. children, grandchildren), stepchildren, grandparents, and grandparent’s issue (i.e. siblings).

Question 34

Ademption

Answer 34

When a gift fails by extinction.

Common Law→A specific gift adeems if it cannot be identified or is not owned at the time of testator’s death (intent is irrelevant).

Most States→A specific gift is adeemed ONLY IF the testator intended the gift to fail. If no intent, the beneficiary is entitled to:
a) any property acquired as a replacement for the specific gift; OR
b) a monetary devise equal to the value of the gift.

Question 35

Stock Split & Dividends

Answer 35

A beneficiary of securities (stock) is entitled to any additional shares acquired by testator as a result of a stock split or dividend.

Question 36

Exoneration at Common Law

Answer 36

→A specific devise of real property DID NOT pass subject to the mortgage, and the mortgage was paid from the estate.

Question 37

Exoneration Modern View

Answer 37

A devise of real property assumes the mortgage (unless specifically stated otherwise).

Question 38

Abatement

Answer 38

If the debts of the estate are greater than the assets to cover all gifts made, the gifts will abate (be reduced).

− Creditors of the estate ALWAYS have priority to estate assets over the beneficiaries.

Question 39

Order of Abatement

Answer 39

1) Property passing by intestacy
2) Residuary gifts
3) General gifts
4) Specific gifts

*Each category must be fully abated before moving onto the next one. Abatement within each category is in proportion to the amount of property each beneficiary would receive.

Question 40

Slayers Statutes

Answer 40

If a beneficiary feloniously and intentionally kills the decedent→he/she forfeits all gifts, benefits, and entitlements under a will or intestacy.

− A conviction after appeal is conclusive.

− May be based on a preponderance of evidence proven during a probate or related court proceeding.

− Durable Health Care Directive→Withholding medical treatment is NOT considered to be felonious and intentional.

Question 41

Disclaimer

Answer 41

Renouncing a legal right to inheritance.
An Effective Disclaimer MUST:
1) be declared in writing;
2) describe the interest or power disclaimed;
3) be signed by the person making the disclaimer; AND
4) be delivered or filed.

Question 42

Disclaimer Timing

Answer 42

Common Law→must be made within a reasonable time.

Some States→must be made within 9 months.

UPC→may be made at any time (so long as disclaimer is not barred – barred if a person accepts or transfers interest).

Question 43

If disclaimed, the property:

Answer 43

a) Passes according to the applicable terms of a will/trust (if any); OR
b) As if the person predeceased the testator (the gift lapses unless an anti–lapse statute applies).

Question 44

Testamentary Provisions Revoked Upon Divorce

Answer 44

In all States, a final divorce decree revokes bequests or appointments of property to a former spouse.

− Some States→revoked if divorce proceedings are pending.

*All revoked provisions are treated as if the former spouse predeceased the testator.
Generally, bequests and fiduciary appointments in favor of a former spouse’s relatives remain intact.

− Under the UPC→they are revoked upon
divorce.

Question 45

Prenuptial Agreement

Answer 45

Waiving rights to each other’s assets upon divorce in a Prenuptial Agreement DOES NOT apply to voluntary gifts or bequests (i.e. in a will or trust).

Question 46

Conditional Will

Answer 46

Is a will that takes effect only upon the occurrence of some uncertain event.

− If the condition is not satisfied, the will is rendered inoperative and void.

To determine if a will is conditional, the court will look at the testator’s intent, which MUST be clear from the language of the will.

− A mere statement of motive for making the will is NOT enough.

Question 47

Types of Gifts

Answer 47

Specific Gift = specifically identified.

General Gift = nonspecific, can be satisfied from any of the funds remaining in the estate.

− If it’s unclear whether general or specific→court considers testator’s intent.

Question 48

Demonstrative Gift

Answer 48

= a hybrid – it’s a general gift from a specific source that the gift should come from (i.e. money from a specified bank account).

Question 49

Gift of Stock Shares

Answer 49

→ may be general or specific (depending on language and intent).

− Specific Gift→if the testator owns the stock shares at the time of execution or if it’s stock in a closely held corporation.

Question 50

Class Gift

Answer 50

Is a gift to a group of persons described collectively.

− Class generally closes when testator/settlor dies.

− Rule of Convenience→class is closed when any member of the class is entitled to possession of the gift.

− An adopted child inherits the same as a natural child.

Question 51

Gifts to Predeceased Class Members depends on the language used:

Answer 51

− If individual members are named (i.e. Tom, Mary, & Joe”) → gift will lapse, unless an anti– lapse statute applies.
− If named as a group→gift is divided among the other members (unless the will states otherwise or an anti-lapse statute applies).

Question 52

Inheritance Rights of Children

Answer 52

Generally, a child has NO inheritance rights if a parent leaves the child out of the will (except pretermitted children).

A child intentionally omitted from a will is NOT entitled to a share of decedent’s estate.

− BUT, if a portion of the will fails, then the child may still be entitled to their intestate share (unless the will intentionally disinherits the child).

Question 53

Legal Definition of Children

Answer 53

Common Law→only biological, full-blooded children were entitled to inherit.

Modern View→includes any child, including adopted children.

− Exception #1→non-marital children inheriting from a father must establish paternity.

− Exception #2→adopted-out children (a child given up for adoption) are generally NOT entitled to inherit.

Question 54

Inheritance by Equitable Adoption

Answer 54

A child may be informally adopted through words or conduct.

− If a person takes a child in and assumes parental responsibilities, equity holds the person as having formally adopting the child.

− Some States→also require that decedent had promised/agreed to adopt the child.

Question 55

Spouse’s Elective Share

Answer 55

Many states have enacted statutes giving a surviving spouse the right to take a statutory share of the deceased spouse’s estate (instead of taking under the will).

Question 56

Amount of Elective Share

Answer 56

→varies by state, and is typically one-third (1/3) of the net probate estate.
Net Probate Estate = Gross Probate Estate less Creditor Claims & Expenses (but not taxes).

− Some states include certain non-probate assets and lifetime transfers in the gross probate estate.

− Most states allow the spouse to claim their elective share against assets of a revocable trust.

The elective share is in addition to any statutory family exemptions→family residence, exempt personal property, and family allowance.

Question 57

Pretermitted Children

Answer 57

A child born or adopted AFTER the execution of a will is entitled to an intestate share of the estate UNLESS intentionally omitted from the will.

− Some States→a child is NOT entitled to a share if decedent: (a) provided for the child outside of the will; OR (b) left all (or substantially all) of the estate to the child’s other parent.

Question 58

A child living at the time of execution is NOT entitled to a share UNLESS the child was omitted because decedent:

Answer 58

a) did not know of the child’s existence; OR
b) believed the child to be dead.

Question 59

Testamentary Capacity

Answer 59

Testator must be capable of knowing and understanding the:
1) Nature and extent of his property;
2) Natural objects of his bounty (relatives/friends);
3) Disposition he is making; AND
4) Have the ability to connect above elements into a coherent plan.

*Mental capacity is presumed, unless proven otherwise. *Appointment of a conservator or guardian does not automatically establish a lack of testamentary capacity.

Question 60

Undue Influence

Answer 60

When a person exerts influence that overcomes a testator’s free will and judgment.
− A will is invalid to the extent executed under undue influence.

Question 61

Undue Influence is established when:

Answer 61

1) Testator had a weakness that made him susceptible to influence (physical, mental, financial);
2) Wrongdoer had access and opportunity to exert the influence;
3) Wrongdoer actively participated in the drafting the will; AND
4) An unnatural (unexpected) result occurred.

Question 62

Common Law Presumption→Undue Influence established if:

Answer 62

1) A confidential relationship (between testator and wrongdoer);
2) Wrongdoer actively participated in the drafting of the will; AND
3) An unnatural result occurred.

Question 63

Fraud

Answer 63

Fraud is established when:
1) a person knowingly makes a material misrepresentation of fact;
2) with intent to induce reliance; AND
3) induces reliance to the testator’s detriment.

*A will is invalidated to the extent affected by the fraud.

Question 64

Fraud in the Inducement

Answer 64

→deceit regarding facts related to the instrument (i.e. property or beneficiaries).

Question 65

Fraud in the Execution

Answer 65

→deceit regarding nature of the document being signed (i.e. that the document was something other than a will).

Question 66

Standing to Challenge a Will

Answer 66

Standing exists if that person:
a) is a beneficiary;
b) should be a beneficiary; OR
c) would be financially benefited if the decedent died without a will.

Question 67

No-Contest Clause

Answer 67

Penalizes an interested person for contesting the will or instituting other proceedings relating to the estate.

− Valid in Most States, BUT courts will not enforce the clause if probable cause exists for instituting proceedings to challenge a will.

Question 68

A No-Contest Clause DOES NOT apply when:

Answer 68

a) A good basis for the challenge exists plus either (a) fraud, or (b) a subsequent will
revoked the will being probated;
b) The contest is on behalf of a minor or incompetent;
c) The contesting party alleges that the court does not have jurisdiction; OR
d) Merely asking the court to interpret/construe the will’s terms.

Question 69

Modification of a Will Due to Mistake

Answer 69

Most Courts→permit a modification to conform with the testator’s intent if there is clear and convincing evidence of a mistake.

UPC→court may modify a will if there is clear and convincing evidence of a mistake EVEN IF it’s an unambiguous provision (but extrinsic evidence is not allowed).

Question 70

Joint Bank Account

Answer 70

Co-tenants of a joint bank account have a right of survivorship→automatic entitlement to the funds upon the death of the other person.

− Convenience Account Exception→the right of survivorship may be overcome by showing the account was set-up only for the convenience of the parties (i.e. to pay someone’s bills).

Question 71

Totten Trust

Answer 71

A bank account with a named beneficiary.

− If a beneficiary survives the account holder, the funds automatically vest to the beneficiary.

Question 72

Totten Trusts are Revocable when the Creator:

Answer 72

a) Withdraws all funds;
b) Delivers a signed, written, and acknowledged revocation to the bank (must name the bank and a new beneficiary); OR
c) Has a provision in his will that (i) contains an express direction concerning the account, and (ii) it specifically names the beneficiary & the bank.

Question 73

Life Insurance Beneficiary

Answer 73

− Policyholder has the power to change beneficiaries during their lifetime.

▪ Exception→Need beneficiary’s consent if it’s an irrevocable beneficiary.

− A beneficiary change is generally NOT permitted through a will or testamentary instrument; it must be changed on the policy directly.

Question 74

Inter Vivos Gifts

Answer 74

Are gifts made during the donor’s lifetime.
A valid inter vivos gift occurs when:
1) a donor with intent to make a gift,
2) delivers the gift (may be constructive by giving means of control/ownership of the gift); AND
3) the donee accepts the gift.

*Delivery of real property requires delivery of the deed.

Question 75

Invasion of Non-Probate Assets to Pay Creditors

Answer 75

If a decedent’s estate is inadequate to pay creditors, those who receive non-probate assets may be liable to pay the decedent’s creditors up to the value of the asset.

− Two or more transferees are severally liable.

− A creditor is generally NOT allowed to attach
inter vivos gifts (gifts made by the decedent prior to death).

Question 76

Personal Representative

Answer 76

A personal representative (i.e. executor) must handle all the matters associated with probate.
If decedent DOES NOT name an executor, the court will appoint one in the following order of priority:
1) Surviving spouse who is a devisee 2) Another devisee
3) Surviving spouse
4) Other heirs
5) Any creditor (if 45 days have passed since death)

Question 77

Durable Health-Care Power of Attorney

Answer 77

Gives a designated agent the power to make health care decisions in the event of the principal’s incapacity.

− Must be→(1) in a signed writing; AND (2) witnessed or notarized.

− An agent’s power is NOT limited unless stated otherwise.

Question 78

Advanced Directive (Living Will)

Answer 78

Specifies the patient’s preferences for treatment or non-treatment in the event of the patient’s incapacity.
− Must be→(1) in a signed writing; AND (2) witnessed or notarized.

Question 79

Insulation of Agent’s Liability

Answer 79

A person is insulated from civil & criminal liability for health–care decisions made in good faith under a Durable Health-Care Power of Attorney.

Question 80

Family Consent Laws

Answer 80

An adult may designate any individual to act as a surrogate to make decisions by personally informing the supervising health care provider.

When NO designation is made, these family member(s) may act as surrogate when a patient lacks capacity (in order of priority):
1) spouse (unless legally separated)
2) adult child
3) parent
4) adult sibling
5) if none of the above→an adult who has exhibited special care and concern, is familiar with patient’s personal values, and is readily available.

*If there are multiple members in the same class, then a majority must agree on a health-care decision.