Wills & Decedents' Estates Flashcards
The issue is whether the trustee may distribute trust funds for the son’s hospital bill, child support, and loan for the computer-gaming system.
A properly created trust requires a settlor to transfer trust property into trust, appoint a trustee (although a trust will not fail for want of a trustee), provide instructions regarding the distribution of the trust assets, and select beneficiaries. A settlor can create a trust where the distributions of trust assets will be determined by the trustee based on his or her discretion. In this case, the trustee has wide discretion to make distributions if it is in line with the trust instrument. However, at all times, the trust instrument controls how the trustee should act. Where a settlor has created a trust for the support of the beneficiary, and left the distribution to the determination of the trustee, the trustee must act in good faith and must distribute trust assets for necessaries and governmental obligations. Medical care is generally considered a necessary. [child support, hospital bill = yes; gaming system = no]
The issue is whether the trustee abused his discretion in refusing to distribute trust funds to the son.
A discretionary trust is created when the settlor provides instructions to the trustee to disburse funds based on the trustee’s discretion. While the trustee has wide discretion in determining asset distribution, the trustee must act in good faith when making distributions. A trustee can be held to abuse his or her discretion when the trustee acts on his discretion, but bases that discretion on personal resentment of the beneficiary or other unreasonable reason. In this way, the trustee can violate the trust instrument, which controls the trustee’s actions at all times.
The issue is whether the son’s creditors may obtain orders requiring the trustee to distribute trust funds.
A trust with a spendthrift provision makes the trust assets inalienable. Therefore, the beneficiary cannot touch the trust property, and neither can most creditors unless a distribution is made. However, an exception to this rule is where the beneficiary of the trust has obligations such as child or spousal support. In that case, the government creditor can touch the trust property and withdraw directly from the principle without waiting for a distribution. Another exception is where the trust is a discretionary trust and the trustee abuses his discretion by not making a distribution when one is due.
Here, the settlor created a trust with a spendthrift provision. This made the trust’s principle assets inalienable and untouchable by most creditors until a distribution is made. However, the government can require the trustee to pay their claims against the son for child support from the trust’s assets. Furthermore, as discussed above, the trustee should have made a distribution to the son, if the trustee had been acting in good faith, for the son to pay the hospital bill. Because the trustee failed to act in good faith by rejecting the son’s request, the hospital may be able to require the trustee to pay their claims based on the trustee’s abuse of discretion in not making the distribution.
The issue is whether the probate court will follow the law of State A, which does not recognize holographic wills, or the law of State B, which does.
When an individual dies testate, the state law which will govern the distribution of their will is the state where the testator was domiciled when the testator died. Domicile is determined by an individual’s presence within the state and their intent to remain, which can be shown by ownership of property in the state.
The issue is whether Testator’s will was a properly executed holographic will.
In order for a will to be properly executed, a testator must have present intent to execute a will, must have testamentary capacity, and must comply with the required formalities. A testator has present intent to create a will if they execute a will with the intent to presently execute the document, not to create the will in the future. A holographic will is generally defined as a will in which the material portions are written in the testator’s own handwriting and which is signed. The State B statute additionally requires the will to be dated in order to be valid.
The issue is whether the will, which did not distribute property to Testator’s son Robert, should be interpreted to provide any devise to the omitted child.
A probate court should follow the terms of the will and distribute the testator’s property accordingly. The UPC and most courts attempt to limit the possibility of an accidental disinheritance by allowing for a child who is born after the execution of a will to take in equal share to the other children included in the will. However, if a child was born before the execution of the will, the probate court should follow the face of the will and omit the children from distribution unless it is clear that the omission was accidental.
The issue is whether the will leaves half of Testator’s estate to Martha, John’s former wife, or to Nancy, John’s current wife.
When interpreting a will, a court is only permitted to consider extrinsic evidence when the terms of a will are ambiguous. Upon a finding of ambiguity, a court may consider both direct and circumstantial evidence in an effort to best determine the intent of the testator.
Under the general rule of construction, a will “speaks” as of the time of death. Courts are reluctant to disturb the plain meaning of a will regardless of mistake. However, if there is an ambiguity, courts allow extrinsic evidence to resolve it. Traditionally, courts distinguished between patent and latent ambiguities; however, many states no longer make this distinction.
The issue is what effect Martha’s death has on the distribution of the will, and whether her children are entitled to her shares.
Under common law, if a beneficiary died before the testator, the gift failed and went to the residue unless the will provided for an alternate disposition. Almost all states have enacted anti-lapse statutes providing for alternate disposition of lapsed bequests. Under most statutes, if the gift was made to a relation of the testator within a specific statutory degree, and the relation predeceased the testator but left issue, then the issue succeeds to the gift, unless the will expressly states the contrary. State B, however, has a broad anti-lapse statute that is not limited to a testator’s relations. Instead, if any beneficiary under a will predeceases the testator, that beneficiary’s surviving issue can take the deceased beneficiary’s share unless the will provides otherwise.
The issue is whether either Mary or Grandchild has standing to contest Testator’s will.
Only directly interested parties who stand to benefit financially may contest a will. Intestacy statutes generally favor the decedent’s surviving spouse and issue. Under intestacy laws, an intestate’s children take to the exclusion of their own descendants.
The issue is whether Testator’s will can successfully be contested on grounds of lack of mental capacity.
In order to validly execute a will, Testator must have “mental capacity.” A testator has mental capacity if she knows (1) the nature and extent of her proprty; (2) those persons who are the natural objects of her bounty; (3) the disposition the testator is attempting to make; and (4) the interrelationship of these items in connection with the testatmentary plan formulated in the will. All persons are afforded the presumption that they have mental capacity. The burden of proving that the testator lacks mental capacity rests on the contestant of the will.
The issue is whether Testator’s will can successfully be contested on grounds of lack of due execution.
At common law, strict compliance with the formal requirements of wills is required. Governing state law provides that a will is properly executed if the testator signs the will in the presence of two witnesses after having (a) declared the instrument to be her will, and (b) requested the witnesses to act in such capacity.
A minority of jurisdictions and the UPC have granted courts the power to probate a non-compliant will in situations when there is clear and convincing evidence that the decedent intended for the document to serve as her will and has substantially complied with the statutory formalities. Under this approach, if the execution of a will substantially complies with most of the formalities, or at least the most important of them, the will is valid.
The issue is whether Testator’s will complies with state law for a validly executed will.
A holographic will is in a testator’s handwriting, signed by the testator, and need not be witnessed.
The issue is whether a Testator can change her life insurance beneficiary in her will.
A beneficiary of a life insurance policy takes by virtue of the insurance contract. The proceeds are not part of the decedent’s estate, unless they are payable to the estate as beneficiary. Life insurance policies typically provide that proceeds will only be paid to a beneficiary named on an appropriate form filed with the insurance company; other possible methods of changing a beneficiary are thus viewed as being excluded by the insurance contract. However, some courts have upheld a beneficiary change by will if the insurance company does not object.
The issue is whether the memorandum is incorporated into the will by reference.
A will may incorporate by reference another writing not executed with testamentary formalities, provided the other writing meets three requirements: (1) it existed at the time the will was executed; (2) the testator intended the writing to be incorporated; and (3) the writing is described in the will with sufficient certainty so as to permit its identification.
The issues are whether the $40,000 bequest to Husband lapsed, and the order in which the bequests will abate.
Under common law, if a beneficiary died before the testator or before a point in time by which he was required to survive under the will, the gift failed and went to the residue unless the will provided for an alternate disposition. Today, almost all states have anti-lapse statutes that provide for the alternate disposition of lapsed gifts. Under the majority of the statutes, if the gift was made to a relation of the testator within a specific statutory degree, and the relation predeceased the testator but left issue, then the issue succeeds to the gift, unless the will expressly states the contrary.
[Husband predeceased T and is survived by his daughter from a previous marriage; however, H does not fall w/in anti-lapse statute b/c he is not related to T by blood. Thus, H’s daughter takes nothing and the $40,000 bequest to H passes to the residuary estate.]
Gifts by will are abated, i.e., reduced, when the assets of the estate are insufficient to pay all debts and legacies. If not otherwise specified in the will, gifts are abated in the following order: (1) intestate property; (2) residuary bequests; (3) general bequests; and then (4) specific bequests. Abatement within each category is pro rata.
[T did not indicate an order, residuary bequest to Son abates and Son receives nothing; T left $25,000 to Church, Library, and School but bank account only has $60,000, so C, L, and S will be reduced pro rata to each receive $20,000]
