Wills and Trusts Flashcards
Probate
● Orderly judicial system for transferring property at death.
● Probate is required when the estate exceeds $150,000.
○ Gross Estate: FMV of all of decedent’s property at the time of his death
○ Net Estate: value of what is left after subtracting the total amount of any debts owed on the property’s gross estate at time of death.
● Property that does NOT pass through probate:
○ Joint tenancy
○ property in inter vivos trusts.
○ Community property (or SP) that passes outright to a surviving spouse.
Will Definition
- A will is a revocable instrument intended to provide for the disposition of one’s property at death.
Will - Validity
o Must be in writing
o Signed by testator (or directs someone to sign) in front of two witnesses simultaneously present
Line of sight doctrine
Nickname could be okay if well known nickname and witnesses present
CA also adds direction of testator and a conservator clause
o Acknowledged as a testamentary document before two witnesses
Must be 18+ and mentally capacities
UPC – within reasonable time, OR acknowledged by T before a notary
CA conscious presence
o UPC Harmless Error Doctrine
Treated as executed if proved by clear and convincing evidence that the Decedent indented to constitute a will
o CA Substantial compliance
Regarding the witness requirement, can be satisfied if clear and convincing evidence that T intended to create a will
Will - Lack of Capacity
Capacity to make a will requires an understanding or recollection of:
(1) the nature and extent of one’s property;
(2) the natural objects of one’s bounty;
(3) the disposition one is making of that property; and
(4) an orderly distribution scheme.
Substantial Compliance
CPC allows for substantial compliance if the proponent of the will established by clear and convincing evidence that, at the time the testator signed the will, the testator intended the will to constitute the testator’s will.
Wills - Interested Witnesses
UPC is unconcerned if a witness receives a bequest under a will
Unless there are at least two other subscribing witnesses to the will who are disinterested witnesses, the fact that the will makes a devise to a subscribing witness creates a presumption that the witness procured the devise by duress, menace, fraud, or undue influence
This presumption shifts the burden of proof to the witness to rebut.
This presumption does not apply where the witness is a person to whom the devise is made solely in a fiduciary capacity
* Look for an argument that the testator actually created an obligation not a benefit on the beneficiary
Test 1 for Undue Influence
- Susceptible to undue influences
- Opportunity to assert influence
- Disposition to unduly procure an improper favor
- Unnatural disposition caused by the influence
Test 2 for Undue Influence
o Confidentiality and
o suspicious circumstances
Fraud in the Inducement
o when a testator is deceived by a misrepresentation that is intended to influence the testamentary disposition and the testator would not have made such disposition if the misrepresentation had not occurred.
Fraud in Execution
o Misrepresents the character or contents of the instrument signed by T, which conflicts with T’s intent
Supernumerary
- Interested witness’ participation does not raise a presumption that the witness procured the devise by menace, fraud, duress or undue influence.
Remainderman
Such a codicil can bestow a life estate to a surviving beneficiary, and can designate another beneficiary as the remainderman after that life terminates. It can supersede a provision in an earlier will without specifically mentioning the earlier will because the Probate Court will read the valid testamentary documents together.
remainderman, that is, he will receive the house in fee simple absolute after beneficiary dies
Holographic Wills
If valid, then incorporates the provisions of earlier drafts
Requirements
* Shows intent to adopt earlier predated document
* Distinctive Handwriting
* Intentionally provides for order distribution
* Dated
* Signed (initials could be sufficient)
A later document cannot republish a prior document that itself is invalid as a testamentary document, but such a document can be incorporated by reference.
* Alternatively, proponents of the will can argue that this is a valid handwritten codicil that republishes the 2000 will and cures any errors in it.
Material provisions
* Traditionally, must be entirely handwritten
* CA and UPC must at least have material provisions handwritten
* Material provisions are not in handwriting or vice versa
* This hybrid character may be resolved by incorporation by reference.
* Assuming that the 1994 will is authenticated, adequately described, and presently existing (even though previously revoked), this outside typed document may then be “incorporated” into the 1998 will under the mix-and-match approach and used to ascertain the material provisions.
Revocation
CA allows for a duplicate original to be probated.
If original will was last in the possession of the testator and cannot be found, there is a rebuttable presumption that the will was revoked by a physical act
* But this does not apply if original will was given to someone else to hold.
Photocopy can substitute for will if provided clear and convincing evidence of testator’s testamentary plan
Revocation by a post-it note might not be enough since it can be detached or removed and is not an adequate act of destruction under CPC.
Written Revocation
- The writing expressly revoking the prior will must be valid
- If it satisfies the requirements for a holographic will or holographic codicil, in which case the express revocation technique could be effective.
Physical Revocation
- A will also may be revoked if the testator has the intent to revoke and either himself or through another destroys the will.
- If someone other than the testator is directed to destroy the will, the destruction must be done in the testator’s presence.
Revocation by presumption
- The testator is presumed to have revoked his will where the will is lost and cannot be found, only if the will was last in the testator’s possession.
- Can be rebutted by: natural disaster resulting in lost will.
Termination by opreation of law
- In many jurisdictions, a bequest to an ex-spouse is terminated by operation of law.
- Resulting Trusts: A resulting trust is an equitable reversion that arises by operation of law whenever an express intentional trust fails or does not completely dispose of the trust property. When this happens, the undisposed property goes back to the settlor in a resulting trust.
- Constructive Trusts: A trust created through the court’s power as a remedy for unjust enrichment. The constructive trust requires the unjustly enriched person to transfer the property to the intended party.
Revival
Under most Wills Acts, will provisions must be in writing; only oral death-bed wills have a slight chance of validity in some jurisdictions.
Evidence of informal revival by oral declarations is generally inadmissible.
While revival of a prior will is not automatic, where there is evidence of the testator’s intent to revive the prior will, the 1994 will can be revived under the terms of Section 6123, here in its entirety since that is what the evidence shows T wanted.
No contest clauses in will
CA provides that frivolous challenges are likely to result in forfeiture.
* Direct contests: Forgery, improper execution, lack of capacity, menace, duress, fraud, undue influence, revocation, and/or disqualification of a beneficiary that is a fiduciary.
Wills - Incorporation by reference
CA provides broadly that a writing in existence when a will is executed may be incorporated by reference if the language of the will manifests this intent and describes the writing sufficiently to permit its identification
Exception: for tangible personal property valued at a total of $25k or less ($5k per item), then the document does not have to be existence at the time the will is executed.
It can be in writing and signed. If the writing is not signed or in the testator’s handwriting, extrinsic evidence can be used to establish the testator’s intent
Wills - Integration
It can occur when it is clear that two or more separate writings are intended by the testator to comprise his or her will
The documents must be coherent in nature and intended to be read together
Wills - Election
If testator invades CP interests to a spouse, then can have standing to claim an election in that CP interest (like a house being willed to daughter instead of spouse)
If the elector has been expressly provided for by a trust (instead of the will) that may defeat his/her eligibility to force an election.
If he/she does elect against the will ,that would mean that he/she forfeits his community property right in the residence
She can claim all the community property and one third of Testator’s separate property
Modification by Interlineation
Traditional common law – mistake would invalidate the gift
Under the transitional approach, the court would simply strike the incorrect language
Modern rule, the court would reform the will to achieve its approach
In general, revocation and substitution of gifts by interlineation will only be valid if the new gift is less than the original gift.
In addition, the interlineation is only partial and does not convey T’s intent in handwriting along with the other terms –
* “OK” and the date are too ambiguous.
* Since the interlineation is incomplete and increases the gift, the act is improper in California, which requires that the entire provision be handwritten, not just parts of it, and the gift fails.