Wills and Trusts Flashcards
Community Property
When a spouse dies with a will, s/he may transfer 1/2 of CP (her/his half) and all of SP by will.
Conflict of Law
ONE OF: CA / STATE OF EXEC / T DOMICILE AT EXEC OR DEATH
A will is valid in CA if it is executed in conformity with:
(1) CA law,
(2) Law of the place where executed, or
(3) law of state where testator was domiciled at execution or death.
Valid Will
CAPACITY - INTENT - SIGN - WRITING - 2 WITNESSES w/ UNDERSTANDING
Valid will requires:
(1) Testator w/ capacity (18+ and sound mind)
(2) Present testamentary intent
(3) Signature
(4) Writing
(5) Joint presence of two witnesses who understand the instrument is a will.
Holographic will requires:
(1) Testator w/ capacity (18+ and sound mind)
(2) Present testamentary intent
(3) Signature
(4) Material terms of will are in testator’s handwriting
Interested Witnesses
COMPETENT - REBUTTABLE PRESUMPTION OF UNDUE INFLUENCE - NO REBUT, INTESTATE
In California, interested witnesses are competent (do not automatically invalidate will).
However, unless there are two other disinterested witnesses, there is a rebuttable presumption that the interested witness procured the devise by undue influence.
If presumption not rebutted, witness takes as if decedent died intestate.
Intestate Share
(IF ONE CHILD OR PARENTS OR PARENTS ISSUE: SPOUSE 1/2 AND HEIR 1/2)
(IF MORE THAN ONE CHILD OR ISSUE OF CHILD: SPOUSE 1/3 and HEIRS 2/3)
CP: To spouse
SP:
If survived by one child or parent (or either’s issue) => Spouse 1/2 and heir 1/2
If survived by >1 child or multiple lines of issue
=> Spouse 1/3 and heirs 2/3
Resulting Trust
(FAILED TRUST - INCOMPLETE DISPOSITION OF TRUST - RETURN TO SETTLOR(‘S ESTATE) - SETTLOR’S LIKELY INTENT - PREVENT UNJUST ENRICHMENT)
When (A) trust fails or (B) incomplete disposition of trust property, court may create a resulting trust.
Resulting trust requires the holder of the property to return it to the settlor or settlor’s estate.
Purpose of the Res-trust is to achieve the settlor’s likely intent.
Primary aim is to prevent unjust enrichment.
Pretermitted Child and Omitted Child
(BORN OR ADOPTED AFTER EXECUTION - BORN BEFORE EXECUTION BUT LEFT OUT - DECEDENT MUST BE UNAWARE OF OMITTED CHILD / BELIEVE OMITTED CHILD DEAD)
Exceptions
(OUTSIDE TRANSFER IN LIEU - CHILDREN + LEFT SUBSTANTIALLY ALL ESTATE TO OTHER PARENT OF P-CHILD / O-CHILD - LEAVING OUT INTENTIONAL ON FACE OF INSTRUMENT)
Pretermitted means born or adopted after execution of all testamentary instruments (will or revocable trust).
Pretermitted receive are presumed to receive intestate shares.
Omitted children means born before execution of will or Rev-trust, but left out.
Omitted children + { Decedent unaware of child’s existence / believes child dead} = presumed to receive intestate shares.
EXCEPTIONS
(1) Decedent provided for child by transfer outside of the will or Rev-trust in lieu of provision in either;
(2) When will or Rev-trust executed, decedent had >= 1 children and left substantially all of estate to other parent of pretermitted/omitted child.; or
(3) Failure to provide was intentional and intent appears on face of will or Rev-trust.
Testamentary Trust
IN WILL / INCORPORATED BY REFERENCE INTO WILL
Testamentary trust occurs when terms of trust are containing in writing in a will or document incorporated by reference into will.
Trust Requirements
CAPACITY - INTENT - BENEFICIARY - PUBLIC POLICY PURPOSE - TRUSTEE
(1) Settlor with capacity (18+ and sound mind)
(2) Present intent to create trust
(3) Trust property
(4) Beneficiary to enforce trust
(5) Trust purpose consistent with public policy
(6) Named or court appointed trustee
Charitable Trust
Requires:
(1) Stated charitable purpose (i.e., poverty, education, religion, health, government), AND
(2) exist for benefit of community, or class of persons with varied members (can’t just help one kind of person?).
Cy Pres
(CHARITABLE TRUSTS + ILLEGAL / IMPRACTICABLE / IMPOSSIBLE PURPOSE + CONSISTENT WITH SETTLOR’S INTENT => ALTERNATIVE CHARITABLE PURPOSE)
(IF ABOVE EQUATION NOT MET, COURT MAY SUBJECT TRUST RES TO RESULTING TRUST FOR BENEFIT OF SETTLOR’S ESTATE)
Under cy pres doctrine, court may modify a trust’s purpose if:
(1) trust is charitable;
(2) original purpose is illegal / impracticable / or impossible to perform;
(3) the alternative purpose is charitable;
(4) the alternative purpose is as near as possible to the settlor’s original, primary purpose
(5) settlor not opposed to alternative purpose.
If an alternative charitable purpose cannot be selected (i.e., settlor didn’t want alternative), court may subject trust property to resulting trust.
