Wills & Estates Administration Flashcards
A valid will determines the distribution of the decedent’s _____________.
Estate.
This includes all of the real and personal property owned by the decedent at death that is NOT subject to disposition under a non-testamentary arrangement.
An intestate decedent is one who dies without ________.
A will.
T/F - The laws of intestacy determine the distribution of an intestate decedent’s estate OR that portion of the estate of a decedent that is not effectively disposed of by will.
True.
T/F - Non-probate assets do not form part of the decedent’s estate.
True.
These are governed by non-testamentary arrangements (or non-probate transfers).
Includes contracts, revocable trusts, financial accounts, life insurance policies, and certain deeds.
An estate is subject to a process called ___________.
Administration.
Who are the parties involved in a will?
1) Testator - makes a valid will;
2) Personal Representative (PR) - in charge of managing a decedent’s estate;
3) Executor - the PR if the decedent names a PR in her will;
4) Administrator - PR if the decedent dies intestate or fails to name a PR in her will;
5) Devisees - those entitled to receive property under a will.
6) Heirs - those entitled to receive an intestate decedent’s estate under the laws of descent and distribution.
7) Issue - Decedent’s descendants, which include children, grandchildren, great-grandchildren, etc. who trace their ancestry directly through the decedent.
How are adopted children treated?
General Rule - Children adopted by the decedent or her descendants are ALSO treated as descendants of the decedant.
What are non-probate transfers? Examples?
These are “will substitutes.” They do not need to comply with the execution formalities required of wills. These are NOT part of the decedent’s probate estate–not subject to the costs and delays of probate administration.
EXAMPLES:
1) Revocable Trusts;
2) Bank and Brokerage Accounts;
3) Contracts; and
4) Life Insurance Policies.
What is a revocable trust?
Trusts where the settlor, during her life, can revoke the trust and reclaim trust property if she so desires.
When the settlor dies, the assets are distributed (or retained in trust) according to the terms of the trust, rather than according to the settlor’s will.
What date is important for revocable trusts? Is there an exception to the rule tied to this date?
If a WRITTEN REVOCABLE TRUST is created ON OR AFTER SEPTEMBER 1, 2005 - A provision benefiting a spouse of the settlor of the trust is GENERALLY REVOKED by operation of law if the settlor and each spouse divorce after the trust is created.
The spouse is treated as having disclaimmed his or her interest.
SAME RULE APPLIES to a provision benefiting a RELATIVE of the spouse if the beneficiary is NOT also a relative of the settlor.
EXCEPTION: Automatic revocation upon divorce does NOT occur if otherwise provided by:
1) Court order;
2) An agreement between settlor and spouse; OR
3) The express terms of a trust executed before divorce.
What are Bank and Brokerage Accounts?
Can be established WITH SURVIVORSHIP provisions. The funds in these accounts pass outside of the probate process. Account holder must have SIGNED AN AGREEMENT providing that the funds will pass to the survivor upon the account holder’s death.
Merely holding an account designated by the institution as a join tenancy or as a joint account is NOT enough to confer survivorship rights on another. NEED SURVIVORSHIP LANGUAGE.
How are contracts used to avoid probate?
Any form of an enforceable contract, such as a loan, pension account, or partnership agreement, can provide for the transfer of amounts owned by (or due to) one party to another upon the death of the first party.
How are life insurance policies used to avoid probate?
They are a means for transferring property at death outside the probate process. MUST make sure that a named beneficiary is qualified to take the proceeds upon the death of the insured (otherwise, proceeds are paid to the insured’s estate).
A life insurance policy designation of an insured’s spouse as the beneficiary is GENERALLY REVOKED by operation of law in Texas if the insured and beneficiary later divorce.
What property is subject to the Laws of Intestacy?
The laws of descent and distribution determine the distribution of:
1) An intestate decendent’s estate; AND
2) The portion of the estate of a testator that is not effectively disposed of by will.
ONLY the estate is subject to descent and distribution, NOT assets governed by non-probate transfers.
If a decedent leaves behind a surviving descendant AND a surviving spouse, what are more remote relatives of the decedent entitled to?
NOTHING.
How do you determine if someone “survives” the decedent?
By STATUTE in Texas, a person is genereally treated as having survived the decedent ONLY if she survives the decedent BY AT LEAST 120 HOURS.
What happens if spouses die within 120 hours of each other?
1/2 of the CP is treated as if the husband died first, and 1/2 of the CP is treated as if the wife died first. The 120-hour rule does NOT apply if it would result in escheat of the estate (to Texas).
How is CP of the decedent distributed upon a decedent’s death?
In all but ONE case, the SS is entitled to receive distribution of the decedent’s 1/2 of the CP.
SPECIAL CASE - If the decedent is survived by BOTH an SS AND AT LEAST ONE DESCENDANT WHO IS NOT ALSO A DESCENDANT OF THE SS (ex: child from previous marriage), the descendants of the decedant are entitled to receive distribution of the decedent’s 1/2 share of the CP.
How is a decedant’s separate property distributed if intestate?
1) SS AND ALSO SURVIVING DECENDANTS - SS receives 1/3 of the D’s separate personal property and a life estate in 1/3 of the D’s separate real property. Rest go to the descendants of D.
2) SS BUT NO SURVIVING DESCENDANTS - SS receives ALL of the D’s SPP and at least 1/2 of the D’s SRP. If D has surviving parents, siblings, or descendants of those, then the other 1/2 of D’s SRP goes to them. If none alive, ALL SRP goes to SS.
How is property distributed from an intestate decedent if there is no Surviving Spouse?
In the following ORDER:
1) Decedent’s children. If a child failed to survive the decedent but left descendants who did survive, those descendants take the deceased child’s share by REPRESENTATION.
2) If No Surviving Descendants - Estate passes to the decedent’s parents in equal shares, if both survive. If only one survives but a sibling is alive, then the parent takes 1/2 of the estate and the other 1/2 is distributed to surviving siblings (or their descendants). If no siblings (or sibling descendants) but one parent survives, then the surviving parent takes EVERYTHING.
3) If no surviving parent - Estate goes to any siblings or their descendants.
4) If no surviving parents or siblings (or their descendants) - The estate is divided into two halves (MOIETIES) with 1/2 going to the Maternal side of the dededent’s family and the other 1/2 going to the Paternal side.
5) If no heir on the paternal side - Moiety passes to the maternal side under Texas case law. Likewise, if no heir on the maternal side, moiety passes to the paternal side.
6) If no heirs on either paternal or maternal sides - Estate escheats to the State of Texas.
How exactly is property distributed in Moiety?
Each 1/2 on the Maternal and Paternal sides is distributed as follows:
1) To the decedent’s grandmother and grandfather (on each side), in equal shares (1/4 each).
2) If only one grand parent on either maternal or paternal side survives - the surviving grandparent on that side takes 1/2 of the other GPs share (total of 3/8) and the other half (1/8) goes to that GP’s descendants. If no descendants, then surviving GP takes all of that GP’s share (for a total of 4/8 (1/2) of the original estate.
3) If neither grandparent survives the decedent - The 1/2 of the estate that went to them passes to their descendants who survived the decedent.
4) If neither grandparent survives with no descendants - the 1/2 moiety of the estate is distributed to the next nearest lineal ancestor (ex: GREAT GRANDPARENTS) and their descendants in the same fashion. Rinse and repeat.
Explain maternal inheritance rights of children.
A child born biologically to a woman is generally her child for purposes of inheritance. The child inherits FROM AND THROUGH her mother, and the mother and her kindred inherit from and through the child.
Explain paternal inheritance rights of children.
For the purposes of inheritance, a child is considered the child of his biological father under the following circumstances:
1) Child is born to a married couple (or any other circumstances listed in the TFC);
2) Adjudicated Father;
3) Adoptive Father; OR
4) Acknowledged Father.
Child inherits FROM AND THROUGH her father, and the father and his kindred inherit from and through the child.
What are the inheritance rights of adopted children?
A child who is adopted generally inherits:
1) From and through her adoptive parents, who also inherit from and through the child.
2) From and through her natural parents as well, BUT THEY DO NOT INHERIT FROM OR THROUGH SUCH CHILD.
EXCEPTION: An adopted child does NOT inherit from or through her natural parents if the decree terminating the parent-child relationship so specifies.
What is the effect of a person being adopted as an adult?
Inherits from and through the adoptive parents, but NOT from and through her natural parents.
What are the inheritance rights of a child absent a formal adoption?
Child may still have some of the rights of an adopted child for purposes of inheritance if she can establish ADOPTION BY ESTOPPEL, sometimes called “equitable adoption.”
How is Adoption by Estoppel established?
1) Intestate decedent “foster” parent must have made an AGREEMENT with the child’s natural parents (or those in a similar position to adopt the child);
2) Intestate decedent must treat the child AS HIS OWN; AND
3) Also requires child’s performance of services to the adoptive parent(s) consistent with a parent-child relationship;
The effect of this is that the child can inherit ONLY from the adoptive parent and THOSE IN PRIVITY WITH HIM.
What limitations are in place on the right to inherit by Half-Blood Collaterals?
TEXAS: Collateral relatives of the half-blood take ONLY 1/2 of the amount of an estate to which they would be entitled were they relatives of the whole blood.
However, if the surviving whole-blood sibling dies without any descendants, then the half-blood sibling takes all.
What does “taking by representation” mean? What is the Texas rule regarding taking by representation?
A decedent’s heirs may consist of a multi-generational class of people that take the estate through representation of their parents.
TEXAS FOLLOWS PER CAPITA WITH REPRESENTATION
What is Per Capita with Representation?
Also known as “modern per stirpes.” Here are the steps:
1) First, find at least one person surviving the decedent who is a member of the closest generation entitled to share in the decedent’s estate.
2) Then, the living persons in that generation receive one share of the decedent’s estate. Also, each deceased member of that same generation who leaves a surviving descendant receives a share as well. The share of the deceased member passes to that member’s surviving descendants.
What are advancements? What is the hotchpot?
Common Law Advancements - lifetime gifts to a child by a decedent was PRESUMED to be a pre-payment, or advancement, of the child’s inheritance. The child bore the burden of proving that the gift was intended as an outright gift rather than as an advancement.
TEXAS STATUTORY LAW DOES NOT FOLLOW THE COMMON LAW PRESUMPTION.
HOTCHPOT: When a gift constitutes an advancement for purposes of determining the intestate distribution of the decedent’s estate, a hypothetical hotchpot is computed by: The portion of the estate (if any) to which the child receiving the advancement is entitled is determined by first computing her share of the hotchpot under the laws of descent and distribution.
1) IF the advancement is LESS than her share of the hotchpot, she receives the difference.
2) IF the advancement is MORE than her share of the hotchpot, she receives NOTHING.
EXAMPLE: Estate = 250k. Three kids (A, B, and C). C receives an advancement of $50k. Total estate = 300k with the included advancement (this is the hotchpot). Each child is entitled to $100k (1/3). C’s advancement is $50k less then her share of the hotchpot. Thus, C is entitled to the difference ($50k).
Explain Texas Advancements.
If a decedent dies intestate as to all or a portion of her estate, property the decedent gave during her lifetime to a person who, on the date of the decedent’s death, is the decedent’s heir, OR property received by the decedent’s heir under a non-probate transfer, IS AN ADVANCEMENT against that heir’s intestate share ONLY IF ON OF THE FOLLOWING IS TRUE:
1) The decedent declared in a CONTEMPORANEOUS WRITING that the gift or transfer is an advancement;
2) The heir acknowledged IN WRITING (no need to be contemporaneous) that the gift or transfer is an advancement; OR
3) The decedent’s contemporaneous writing or the heir’s written acknowledgment otherwise indicates that the gift or transfer is to be taken into account in computing the division and distribution of the decedent’s intestate estate.
What if the recipient of an advancement pre-deceases the decedent?
IF the recipient of an advancement does NOT survive the decedent, the property advanced IS NOT TAKEN INTO ACCOUNT, UNLESS the decedent’s contemporaneous writing provides otherwise.
What are the requirements of creating a will?
1) Testamentary Intent (all wills require this);
2) Testamentary Capacity (all wills require this);
3) Writing (all wills in Texas must now be in writing);
4) Compliance with formallities
Explain Testamentary Intent.
T must intend to make a testamentary disposition by the specific document that T is executing. Does NOT require that T realize the document is a “will” for purposes of law.
T does NOT have testamentary intent if T intends the document to make a PRESENT GIFT or a FUTURE LIFETIME GIFT.
EXCEPTION: If the document in question does not purport to make a testamentary disposition but simply appoints an executor or a guardian of T’s children as of T’s death, it can be valid as a will even though T lacks any intent to effectuate a testamentary disposition by that document.
What are the formalities that a will must comply with?
1) Must be SIGNED by T or someone who signs for T AT T’S DISCRETION AND IN T’S PRESENCE. Any mark intended to serve as the signature of T will suffice. Can appear anywhere on the document, but failure to sign at the end may raise an issue as to whether T’s name was intended as a signature. NO REQUIREMENT THAT T SIGN IN FRONT OF A WITNESS.
2) ATTESTATION - if not a holographic will, the will MUST be attested by TWO WITNESSES. The witnesses must subscribe their names to the will IN THEIR OWN HANDWRITING AND IN T’S PRESENCE.
What is a self-proved will?
A will may be made self-proved under:
1) Two-step method (traditional) - involves executing a self-proving affidavit in addition to the will; OR
2) One-step method (new) - Requires inclusion in the will of certain language and adherence to an execution ceremony.
IF SELF-PROVED, there is no need for witnesses to appear in court to testify concerning the will’s due execution for admission to probate.
Is a will required to be dated?
No literal requirement, but it is good practice to do so. Can help if later wills are made.
What does it mean to have testamentary capacity?
Requires that T meet an age (legal capacity) requirement and a mental capacity requirement (testamentary capacity).
AGE OR AGE SUBSTITUTE: At the time of execution T must be 18, or be (or have been) married, OR be a member of the U.S. armed forces.
MENTAL CAPACITY: At the time of execution, T must be of SOUND MIND. This means that T must have been capable of understanding the following:
1) The act that T is engaged in;
2) The nature and extent of T’s property;
3) The persons to whom T intended to devise the property and the natural objects of T’s bounty;
4) The mode of distribution among his devisees; AND
5) Sufficient memory to mentally collect these elements, perceive their relation to one another, and form a reasonable judgment concerning them.
NOTE: EVEN IF T HAS SOUND MIND, IF THE WILL IS A PRODUCT OF AN INSANE DELUSION, THE WILL CAN BE CONTESTED (may be limited to the portions affected by the insane delusion).
What are the requirements to be a valid witness?
1) AGE - Must be at least 14 years of age.
2) PRESENCE - Must subscribe their names IN T’S CONSCIOUS PRESENCE. This means that T (unless blind) could have seen the attestation from T’s actual POSITION OR SLIGHTLY ALTERED POSITION. NO REQUIREMENT THAT THE WITNESSES SIGN OR ATTEST IN EACH OTHER’S PRESENCE
3) NO NEED FOR AWARENESS - Need not know that the document they are attesting is a will.
What is the effect of a witness who is a devisee?
Interested Witnesses - An interested witness (devisee) does NOT render the will invalid. May mean that the bequest to the witness is void.
DEFAULT RULE: A bequest to an interested witness is VOID.
EXCEPTION: A bequest to an interested witness is NOT void:
1) If the will can be “otherwise established,” such as by the testimony of a disinterested witness to the will (a drafting attorney, fiduciary, or creditor of the testator is not an interested witness unless she is also a legatee under the will);
2) If the interested witness’s testimony can be CORROBORATED by a “disinterested and credible person” (not another witness) who testifies to the truth of the witness’s testimony; or
3) To the extent of its value not exceeding the share of the estate to which the interested witness would have been entitled had there been no will (i.e., the intestate share–the gift cannot exceed the value of that share).
What is a holographic will? What are the rules regarding their establishment?
A holographic will is one made ENTIRELY IN THE HAND-WRITING OF THE TESTATOR. Including typewritten “surplusage” does not negate the validity of a will that is otherwise valid as a holograph.
SURPLUSAGE THAT IS TYPEWRITTEN MUST NOT BE NECESSARY TO COMPLETE THE WILL.
Filling in blanks on a pre-printed will form by hand is UNLIKELY TO CONSTITUTE A VALID HOLOGRAPH; critical language is likely to be typewritten in these forms.
A HOLOGRAPHIC WILL NEED NOT BE WITNESSED.
TO BE ENFORCEABLE - All of the other requirements of a will must be met (intent, capacity, T’s signature, writing).
Can an informal document such as a personal letter qualify as a holographic will?
Yes if the elements are all met.
Can a holographic will be self-proved? How?
Yes, if T attaches to the will an affidavit stating that:
1) The document is a will;
2) T was 18 years of age when T executed it (or that T met the age-substitute requirements);
3) T was of sound mind; AND
4) T has not revoked the will.
How are type-written wills self proved in Texas?
THE TWO-STEP METHOD - An affidavit treated as distinct from the will is attached to the will. It is SIGNED BY T AND THE TWO WITNESSES TO THE WILL BEFORE A NOTARY, who then notarizes the affidavit. The affidavit recounts facts establishing prior due execution of the will. This method requires that T publish the will.
If either T or the witnesses failed to sign the will, but did sign the self-proving affidavit, the signatures on the affidavit will be treated as though they were on the will itself (HOWEVER THE WILL WILL NOT BE SELF PROVED IF THIS HAPPENS).
THE ONE-STEP METHOD - The will is self-proved through execution before a NOTARY of a single document that includes both the traditional form of a will and two clauses recounting facts sufficient to establish due execution. One clause is signed by the T; another clause is signed by the two witnesses; and notary present at execution signs and affixes her seal to the document. T and the witnesses sign only one time. THE ONE-STEP METHOD REQUIRES THE WITNESSES TO SIGN IN EACH OTHER’S PRESENCE AND THAT T SIGN IN THE PRESENCE OF BOTH WITNESSES AND A NOTARY.
Does Texas have any statutory curative doctrines such as substantial compliance or harmless error to remedy defects in the execution of a will?
NO.
What are codicils? What are their requirements?
These are writings that AMEND a previously executed will.
Requirements for executing a valid will apply to codicils. A signed holographic codicil is valid as a typewritten codicil executed with will formalities.
A valid holographic codicil can amend a type written will and vice verse.
A codicil RE-PUBLISHES THE WILL that it modifies IF republication is consistent with T’s intent. This means that the will, as modified by the codicil, is treated as having been executed as of the DATE OF THE CODICIL. Date is important in determining whether a child qualifies as a pretermitted child.
Explain Contracts concerning wills.
IF executed ON OR AFTER SEPTEMBER 1, 1979: a contract to make or not to revoke a will or devise can be established in two ways:
1) By an enforceable written agreement (ex: premarital agreement); OR
2) By provisions of a will stating that a contract does exist and stating the material provisions of the contract.
Merely referring to a contract in a will and supplying extrinsic evidence of the terms of the contract is NOT enough under Texas law.
Mere execution of a joint will or reciprocal will does NOT by itself suffice as evidence of the existence of a contract.
What is a joint will? What is a reciprocal will?
Joint Will: A single document executed by two people as the will of each one.
Reciprocal Will: Separate wills that have been executed by different people (typically a husband and wife) but that contain provisions that reflect one another.
What if a contract concerning a will is breached?
The intended beneficiary must sue the estate of the breaching decedent in contract and seek remedial relief.
How can wills be revoked?
There are THREE METHODS:
1) SUBSEQUENT WRITING - Can be done by a valid new will, codicil, or declaration of revocation. Can be whole OR partial (usually by codicil), express OR implied. INCONSISTENCIES BETWEEN ORIGINAL WILL AND CODICIL ARE RESOLVED IN FAVOR OF THE CODICIL (the inconsistent provisions of the will are REVOKED). Subsequent writing must meet all will requirements.
2) PHYSICAL ACT - Requires that the will has been destroyed or cancelled. Destruction includes burning, obliterating, or tearing. Cancelling a will includes making a mark intended to negate the entire will. MUST BE WHOLE / CANNOT BE PARTIAL. There must be INTENT to revoke, and must be performed BY T or by someone T causes to perform the act IN T’s PRESENCE.
3) OPERATION OF LAW - A provision in a will in favor of a person who was T’s spouse at the time of execution is effectively revoked by operation of law if T and spouse later divorce, UNLESS the will expressly provides otherwise. T’s spouse is treated as if pre-deceasing T. Same rule applies to relatives of T’s former spouse, UNLESS that person is also T’s relative. Can also occur in the case of many devisees and the presence of pretermitted children. The provision is void, but the REST OF THE WILL IS STILL VALID.
What if a will was last seen in the possession of T but not found after his death?
There is a PRESUMPTION that the will has been VALIDLY REVOKED BY T.
NOTE: Does not apply if the will was not last seen in the POSSESSION OF T.
This is a REBUTTABLE presumption and can be rebutted by:
1) Evidence that a person other than T fraudulently destroyed the will; OR
2) Evidence that T recognized a will’s continued validity and continued her affection for the devisees under the will.
Can a lost will be probated?
If the presumption that it was validly revoked has been rebutted, then a lost will can be probated if the proponent of the will can prove both of the following:
1) The cause of the will’s non-production. Must satisfy the court that the will can’t be produced by any reasonable diligence; AND
2) The contents of the will. YOU NEED SUBSTANTIAL PROOF to meet this requirement. Must include the testimony of a credible witness who has read the will or a copy, has heard the will read, OR can identify a copy of the will.
What is the effect of a codicil being revoked? What rule does Texas follow with regard to revoking subsequent wills?
Revocation of a codicil to a will DOES NOT REVOKE the will itself, not does it revoke prior codicils. If the sole codicil to a will is revoked, the will is effective as ORIGINALLY WRITTEN.
Revocation of a will that has been amended by codicil REVOKES BOTH the will and the codicil.
Texas follows the NO-SURVIVOR RULE: A revocation of a subsequent will does NOT revive a previous will that the subsequent will once revoked. Prior will remains revoked UNLESS RE-EXECUTED with the required formalities OR is republished by codicil.
What is Dependent Relative Revocation (DRR)?
If T revokes a will based on a MISTAKEN ASSUMPTION AS TO THE VALIDITY OF AN ALTERNATE DISPOSITION of property, the revocation may be nullified IF: Doing so results in a disposition that BETTER EFFECTUATES T’S INTENT than the disposition of T’s estate that would result from the revocation itself.
This is the exception to the No-Survivor Rule. Requires specific circumstances.
What is abatement? What is the order of abatement?
Reduction of testamentary gifts necessary to pay the expenses and claims of creditors of T’s estate, or to fund other testamentary gifts. Bequests and devises abate in the following order, UNLESS T’s will provides for a different scheme:
1) Property not disposed of by will, but passing by intestacy;
2) Personal property of the residuary estate (whatever is left in the estate);
3) Real property of the residuary estate;
4) General bequests of personal property (general bequests first, then demonstrative legacies coming from a specific source);
5) General devises of real property (unclear definition);
6) Specific bequests of personal property (described with particularity such that it is distinguished from T’s other property, and T intended for beneficiary to receive that particular item rather than cash or other property from his general estate);
7) Specific devises of real property.
What if a creditor doesn’t present its claim to a PR?
Then there is no abatement to satisfy that debt. Rather, the lien remains classified as a preferred debt and lien against the specific property securing the debt.
The specific property securing the debt of a secured creditor passes to the devisee SUBJECT TO THE DEBT. However, a will can change this result by specifically stating that the devise passes without being subject to the debt.
A general provision for payment of debts in the will does NOT change this result (does not “exonerate” the lien).
IF the secured creditor instead elects to have its claim treated as a MATURED SECURED CLAIM to be paid in due course of administration, it will be paid that way.
What if a PR is unable to collect from the devisees an amount sufficient to pay the debt?
PR must sell the property and apply the sales proceeds in payment of the debt.
What does abatement not apply to?
ESTATE TAXES
PR of T’s estate must charge EACH PERSON interested in the estate that portion of the total estate tax assessed against the estate that applies to that person’s interest. Can be altered by T’s will.
What is ademption?
Property that is specifically devised or bequeathed that is not in T’s estate as of T’s death. That property is considered to have “adeemed.”
EFFECT: Beneficiary TAKES NOTHING.
Is there any exception to ademption?
Texas courts won’t apply ademption when T’S INTENT AS EXPRESSED IN THE WILL indicates that T does not intend for a specific bequest or devise to adeem.
How is stock treated under the rule of ademption?
Unless T’s will provides otherwise, a devise of securities that are owned by T when she executes the will also includes: Securities subsequently acquired by T by way of stock split, stock dividends, a reorganization, a redemption, an exchange, a merger or another form of corporate reorganization.
What is the difference between ademption by satisfaction and ademption by extinction.
Extinction - Property doesn’t exist anymore in the estate.
Satisfaction - Property is no longer in the estate because it was given ahead of time to the intended beneficiary.
When do we have ademption by satisfaction?
IF:
1) T’s will provides for deduction of the lifetime gift;
2) T declares in a CONTEMPORANEOUS WRITING that the lifetime gift is to be deducted from or is in satisfaction of the devise; OR
3) The devisee acknowledges in writing that the lifetime gift is in satisfaction of the devise.
What is lapse? How does Texas handle it?
Lapse - If a devisee of any gift other than a residuary gift fails to survive T, her gift lapses and falls into the residuary of T’s estate.
TEXAS ANTI-LAPSE STATUTE - If a devisee is:
1) A descendant of one of T’s parents; AND
2) The devisee fails to survive T (or is treated as not surviving T under the 120-hour rule); THEN
3) THE GIFT DOES NOT LAPSE IF: The descendants of the devisee survive T by 120 HOURS. Those descendants take the gift in place of the named devisee.
IF the descendants consist of MULTI-GENERATIONAL CLASS, more remote descendants take their shares by representation (per capita with representation (modern per stirpes) method that applies in intestacy).
T/F - The Texas Anti-Lapse Statute does not save gifts that terms of the will require the devisee to outlive T in order to take.
True
What types of gifts does the Texas Anti-Lapse Statute apply to?
1) Residuary devises, general legacies, specific devises, and demonstrative gifts.
2) Class gifts, except in the case of a class member who was deceased at the time of the execution of the will.
NOTE: If there are two or more residuary devisees under T’s will, and one of the residuary devises fails, the remaining residuary devisees share the failed gift, UNLESS the anti-lapse rule applies.
