Wills & Trusts Flashcards
Wills - ROADMAP
1) Execution
2) Capacity
3) Which Instrument Applies?
4) Components
5) Interpretation
6) Intestate Succession
7) Pretermitted Spouse/Child
8) Bars to Succession
Wills - EXECUTION
1) Testator’s Signature (by his hand or at his direction)
2) W Signatures
- At least 2 Ws being present at the same time must witness T’s signature or acknowledgment
- Deaths after 1/1/09 - will not made in strict compliance can still be admitted if C+CE shows T intended the doc to be his will at the time he signed it
Wills - INTERESTED WITNESSES
- One who receives a benefit in a will over and above what he would’ve received in intestacy
- Presumption of undue influence invalidates gift to him but NOT entire will
Wills - HOLOGRAPHIC INSTRUMENTS
No Ws required
Valid if T’s signature and all material provisions are in his handwriting:
- declaration as will
- dispositive clauses
- naming of executors
- attestation clause
- date
Wills - UNDUE INFLUENCE - COMMON LAW PRESUMPTION
There is a presumption of UI where:
1) beneficiary in a confidential relationship to T,
2) participates in some way in procuring a gift,
3) that is an unnatural bequest favoring B
Wills - UNDUE INFLUENCE - STATUTORY PRESUMPTION
There is a presumption of UI where B is the attorney, caregiver, or drafter OR is in a fiduciary relationship w/ T and transcribes the instrument
Wills - STANDARD UNDUE INFLUENCE
Undue influence is shown where (1) UI was exerted on T, (2) the effect of which was to overpower his free will and mind, (3) resulting in a will that would not have been executed but for the influence
FACTORS:
1) T was susceptible to UI
2) B had opportunity to exercise UI
3) B had disposition to influence T
4) Gift to B was unnatural
Wills - INSANE DELUSION
Bequest is invalid ONLY where it would not have been made but for the delusion
Wills - FRAUD
IN THE EXECUTION
- concerning character/content of instrument
- invalidates will
IN THE INDUCEMENT
- concerning facts that influence motivation
- will is still valid IF T would have still made it if true facts were known
Wills - MISTAKE
IN THE EXECUTION
- concerning character of document
- invalidates will
IN THE INDUCEMENT
- concerning facts that influence motivation
- No relief unless fact AND alternative disposition but for mistake appear on face
- 2015 CA SC held that even an unambiguous will can be reformed if C+CE (1) will contains mistake in expression of intent and (2) of T’s actual intent
Wills - REVOCATION
1) Subsequent will that expressly states revocation OR employs a contrary dispositive scheme
2) physical act w/ intent to revoke
3) Operation of law - divorce or termination of domestic partnership
Wills - REVIVAL
When W2 revokes W1 and W2 is later revoked itself:
- by PHYSICAL ACT, W1 is revived only if from either the circ’s of revocation OR T’s contemporaneous or subsequent declarations, it is evident that T intended W1 to be revived.
- by SUBSEQUENT INSTRUMENT, intent to revive must be clear on instrument itself
Wills - DEPENDENT RELATIVE REVOCATION
When T revokes all or part of a will on the mistaken belief that a new disposition, made concurrently, is valid, the ct will give effect to the revoked portion if it is consistent w/ what it believes to be T’s intent
Wills - CODICIL
- Alters, amends, etc a will
- Requires same formalities
- Admissible to probate by itself
- To the extent will is unchanged by codicil, it is deemed to speak as of the date of the codicil
Wills - INTEGRATION
Will consists of all papers/writing actually present at time of execution and that T intended to constitute his will
Intent and presence are presumed where papers are physically connected OR there is an internal sense of connection shown by provisions running from one page to the next
Wills - INCORPORATION BY REFERENCE
1) Incorporated writing must be in existence as of the date of execution of the will
2) Will must show T’s intent to incorporate the writing, and
3) the writing must be sufficiently described in the will
Wills - ACTS OF INDEPENDENT LEGAL SIGNIFICANCE
Cts may resolve ambiguities in an instrument by reference to non-testamentary acts of T effectuated during his lifetime
-Must have significance apart from impact on will
Wills - SPECIFIC GIFTS
Gift of a particular item of property, distinct from all others in the estate.
- Increase goes to B
- Ademption - B no longer entitled to gift if:
- –extinction: gift no longer owned by T at death
- –satisfaction: T gives B substitute gift during lifetime
Lapse: if B predeceases T, gift lapses and falls to residue absent applicable anti-lapse statute.
CA Anti-Lapse: applies if predeceased B: (1) is kindred of T or his spouse AND (2) left surviving issue
INTESTATE SUCCESSION
Surviving spouse gets decedent’s share of CP, AND:
- all of SP if no issue, parent, sibling, or issue of deceased sibling
- 1/2 SP if 1 child, 1 issue of deceased child, or no children but 1 parent/sibling
- 1/3 SP if 2+ children, 1 child + 1 issue of deceased child, or 2+ issue of deceased children
Lineal descendent’s take per capita by right of representation. Estate is divided into shares based on nearest generation w/ living descendants of T.
Wills - PRETERMITTED SPOUSE
A spouse omitted from a pre-marital will receives her intestate share of T’s estate, UNLESS:
1) the omission was intention, as shown in the will,
2) she is provided for in transfers outside the will, OR
3) she made a valid agreement waiving her interest in the estate
Wills - PRETERMITTED CHILD
A child born/discovered after executed and omitted from will received her intestate share, UNLESS:
1) the omission is intentional, as shown in the will,
2) the child is provided for in transfers outside the will, OR
3) T had other children and left his estate to the other parent of the omitted child
Wills - BARS TO SUCCESSION
B is barred from taking under the will if he:
1) feloniously and intentionally kills T,
2) commits elder abuse of T, or
3) unsuccessfully brings a will contest where there is a no-contest clause
Trusts - FORMATION
1) Settlor
2) Trustee
3) Intent
4) Trust Property
5) Delivery
6) Beneficiaries
7) Valid Trust Purpose
Trusts - SECRET TRUST
Where a will makes a gift absolute on its face to a named B, but in reliance on B’s promise to hold the gift in trust for another, to prevent unjust enrichment of the named B, cts will allow the intended B to introduce extrinsic evidence of the agreement.
If agreement can be proven by C+CE, ct will impose a constructive trust compelling the secret trustee to comply w/ the terms of the secret trust
Trusts - SEMI-SECRET TRUST
Where a will makes a gift explicitly in trust but fails to name a beneficiary, the trust fails.
Named trustee holds the property as a resulting trustee in favor of T’s estate.
Trusts - CHARITABLE TRUST
One that’s purpose is considered to benefit the public.
CY PRES DOCTRINE
Where a settlor has a charitable trust but the specific charitable use is no longer possible, the ct must decide whether he had:
-Specific charitable intent (resulting trust)
OR
-general charitable intent (finds nearest possible use)
Trusts - SPENDTHRIFT TRUST
One in which B can’t alienate his interest .
Assignee can’t compel trustee to pay him directly unless:
- IRS
- Person enforcing child/spousal support judgment
- Supplier of necessaries
Trusts - DISCRETIONARY TRUST
One in which trustee has discretion whether to pay or withhold benefits.
Before trustee exercises discretion, creditors can’t reach the trust.
If trustee elects to make payments and has notice of an assignment or attachment, he must pay the creditor directly absent a spendthrift.
Trusts - SUPPORT TRUST
Trustee is required to pay only so much of the income or principal as is necessary for B’s support.
B’s interest is non-assignable.
Trusts - TERMINATION
By settlor - power to revoke is presumed unless expressly irrevocable
By beneficiaries - all must agree AND must not interfere w/ a material purpose of the trust
Trusts - TRUSTEE’S FIDUCIARY DUTIES
“CAP MAILED”
1) Care
2) Allocation
3) Prudence/Diversification
4) Make property productive
5) Administer
6) Impartiality
7) Loyalty
8) Earmark
9) Delegation
Trusts - DELEGATION
Must exercise reasonable care, skill, and caution in:
1) selecting agent
2) establishing scope and terms of delegation
3) periodically reviewing agent’s action
Trustee remains liable for delegate’s wrongful acts
Trusts - DUTY OF CARE
Trustee must manage investments as a prudent investor would, exercising reasonable care, skill, and caution
Care - diligence and efforts
Skill - capabilities
Caution - element of conservatism in managing trust
Trusts - DUTY OF LOYALTY
Trustee cannot purchase trust property or sell to trust on his own account or that of a related person w/o ct approval
Trusts - DUTY TO ALLOCATE
Trustee must follow Uniform Principal and Income Allocation Act
INCOME
- cash to income unless capital gain or liquidation
- stock and capital gains to principal
- insurance proceeds to principal unless loss of business income
- patents, copyrights, royalties, and leases - 90% principal, 10% income
EXPENSES
- ordinary - all to income
- trustee/atty/acct - 50/50
- principal on debt, estate taxes, enviro cleanup - all to principal
Trusts - REMEDIES FOR TRUSTEE’S BREACH
1) Surcharge for losses from breach and cannot offset w/ gains from another breach
2) Rescission of improper transaction
3) Injunction to stop improper transaction or compel trustee to perform duties
4) Removal of trustee
