Wills, Trusts, and Estates

Question 1

Intestate Succession

Answer 1

Any property that does not pass by will upon the decedent’s death will be distributed according to the state’s applicable intestacy statutes

Question 2

If the decedent is survived by ONLY a spouse:

Answer 2

The surviving spouse will inherit the entire estate.

Question 3

If the decedent is survived by a spouse AND descendants:

Answer 3

the surviving spouse will inherit one-half or one-third of the decedent’s estate with the surviving descendants inheriting the rest.

Question 4

If the decedent is NOT survived by a spouse:

Answer 4

the decedent’s surviving descendants will inherit the entire estate equally

Question 5

Intestate Succession - If the decedent is not survived by a spouse or descendants:

Answer 5

the decedent’s surviving parents will inherit the entire estate equally

Question 6

A will is valid if:

Answer 6

Specific formalities by state law must be met

Generally must:

• be in writing
• signed by the testator
• signed by at least two witnesses

Question 7

Witness Signature Requirements

Answer 7

Witnesses must sign the will in the testator’s presence within a reasonable amount of time after witnessing the signing of the will.

Under the traditional view - W signs the will in the testator’s presence if she signs it within T’s line of sight.

Under modern view - W must sign within T’s range of senses (i.e. she can be down the hall if they can hear each other)

Question 8

Interested Witnesses

Answer 8

Under common law, the signing of the will must be witnessed by two disinterested witnesses (people who don’t benefit)

Most states have abolished common law rule and allow interested witnesses to validly witness the signing of the will.

Question 9

Holographic Will

Answer 9

A handwritten will that is not witnessed.

Most states do not recognize them.

Only valid if the testator signs it personally.

Question 10

Incorporation by Reference

Answer 10

In most states, a document or writing may be incorporated into a will by reference if:

1. The testator intended to incorporate the document into the will,
2. The document was in existence at the time the will was executed, and
3. The document is sufficiently described in the will.

Question 11

Codicil

Answer 11

A codicil is a supplement or addition to a will that is made after a will is executed.

It can explain, modify, amend, or revoke provisions of an existing will.

It must satisfy the same formalities as a will in order to be valid.

Question 12

Revocation by Physical Act

Answer 12

3 physical acts can revoke a will:

1. Subsequent Written Instrument (expressly or implied by inconsistency)
2. Cancellation (burning, tearing, destroying with intent to destroy)
3. Partial Revocation (marks of cancellation)

Question 13

Dependent Relative Revocation

Answer 13

Under DRR, the valid revocation of a will may be ignored if the will was revoked under the testator’s mistaken belief of law or fact that the testator could revive an earlier will.

ONLY applies when the court can determine that the testator would have preferred the disposition in the revoked will over the disposition resulting from a finding that the testator died intestate.

Question 14

Revival under common law

Answer 14

The revocation of a subsequent will automatically revives the prior will.

No intent requirement.

Question 15

Revival under the modern view

Answer 15

Most states permit the revival of a revoked will if:

1. It is evident that the testator intended the revoked will take effect as executed; OR
2. The testator republishes the revoked will with a subsequent will or codicil that complies with the statutory formalities for execution.

Question 16

Anti-lapse statute

Answer 16

Under an anti-lapse statute, devises will vest in the descendants of the predeceased beneficiary if the predeceased beneficiary:

1. is a blood relative of the testator; AND
2. has descendants who survive the testator

Question 17

Doctrine of Ademption

Answer 17

If the subject matter of a specific devise is not in the estate at the time of the testator’s death, the devise to the beneficiary adeems or fails

Question 18

Elements of a valid express trust

Answer 18

1. The settlor has intent to create the trust
2. There is trust property (res)
3. An ascertainable beneficiary exists
4. The trust has a trustee; AND
5. All parties comply with the requisite formalities (i.e. SoF)

Question 19

Testamentary Trust

Answer 19

A trust created by a will.

Must be executed with the same formalities of a will.

Question 20

Revocable/Irrevocable Trust

Answer 20

Under the common law (majority view), a trust is irrevocable UNLESS the settlor expressly retains the right to revoke or amend the trust.

Under the Uniform Trust Code (minority view), a trust is revocable unless the trust expressly provides otherwise.

Question 21

Pourover Provision

Answer 21

A provision in a will that devises property to a previously existing trust

It does not create a trust - it transfers property to a trust already in exists

Note: it cannot devise property to a testamentary trust

Question 22

Cy Pres Doctrine

Answer 22

If the charitable purpose becomes:

• unlawful, impracticable, or impossible;
• no alternative charity is named in the trust; and
• the court finds that the settlor had general intent

then court will apply cy pres to modify/terminate the trust

Trust property will be distributed in a manner consistent with the settlor’s general charitable intent

Question 23

Spendthrift Trusts

Answer 23

Contain provisions designed to protect beneficiaries from their own carelessness.

Serves two main functions:

• Beneficiary is not permitted to sell or assign his beneficial interest and
• the beneficiary’s creditors cannot reach the beneficiary’s beneficial interest

Question 24

Fiduciary Requirements of Trustees

Answer 24

Trustee must:

1. Manage the trust property exclusively for the benefit of ALL the trust’s beneficiaries; and
2. Administer the trust in good faith pursuant to the terms and purposes of the trust.

Duty to administer, loyalty, report, separate trust property/keep records, etc.

Question 25

Deviation

Answer 25

Trustees and beneficiaries can request that the court permit a deviation from administrative provisions in the trust instrument.

Court will permit a deviation if the purposes of the trust:

1. Have been satisified
2. Have become unlawful; or
3. Are impossible to carry out.

Question 26

Living Will

Answer 26

A document in which you specify which life-prolonging measure you do and do not want to be taken if you become incapacitated.

Question 27

Durable Power of Attorney

Answer 27

Document that allows someone to designate an agent to act on his behalf in the event that he becomes incapacitated.

An agent is immunized from civil liability for health care decisions that are made in good faith.

Agent must make a healthcare decision in accord with the principal’s instructions or other known wishes.

If no instructions, then in the principal’s best interest.

Question 28

Execution Requirements for Advance Health Care Directives

Answer 28

Both a living will and POA must be:

1. Signed
2. In Writing
3. Witnessed by at least two people

Question 29

Family Consent Laws

Answer 29

Allows close relatives to act as a surrogate decision maker for an incapacitated patient if there is no authorized agent acting under a durable POA.

Order listed by statute. Typically:

1. Spouse
2. Adult Child
3. Parent
4. Adult sibling

[if multiple members in the same class, a majority of those members must agree on the decisions]

Question 30

Life Insurance

Answer 30

A contract made between a policyholder and an insurance company.

It usually prohibits the change of a beneficiary under the policy by execution of a will.

Some courts will let a policyholder change a beneficiary by will if the insurance company doesn’t object.

Question 31

Remedies for a Breach of Trust

Answer 31

1. Suspending or removing a trustee
2. Decreasing compensation
3. Compelling a trustee to perform trust duties
4. Compelling payment of damages

Question 32

Resulting Trust

Answer 32

Trust implied or imposed by law, most often when an express trust fails for some reason

(e.g., beneficiary is dead, trust is unenforceable or void)

Settlor usually becomes beneficiary and trustee conveys title back to settlor (or settlor’s estate)

Question 33

Termination of Trust

Answer 33

Generally, trusts terminate automatically at the expiration of a specified trust term

or when its purposes have become accomplished, unlawful, impossible, or contrary to public policy

Question 34

Termination of private trusts by settlor

Answer 34

Settlor can modify or revoke unless the terms expressly prohibit modification/revocation

Question 35

Termination of private trusts by beneficiaries

Answer 35

Beneficiaries can modify or revoke upon the consent of the settlor and all beneficiaries

Without settlor consent: All beneficiaries can consent to modify/revoke if doing so would not frustrate a material purpose of the trust

• Note that “all beneficiaries” includes unborn/unascertained beneficiaries, which can preclude obtaining required unanimous consent

Question 36

Constructive Trust

Answer 36

Not a trust, but an equitable remedy used in cases to rectify unjust enrichment or wrongful conduct

Court imposes constructive trust on property in wrongdoer’s possession