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This document summarizes key concepts regarding health care decision making and advanced directives. It discusses the constitutional right to make one's own health care decisions, including refusing treatment. It defines the three main types of advanced directives - instructional directives, proxy directives, and hybrid directives. It also discusses criticisms of advanced directives and circumstances where there is no advanced directive, such as the Terri Schiavo case.
This document summarizes key concepts regarding health care decision making and advanced directives. It discusses the constitutional right to make one's own health care decisions, including refusing treatment. It defines the three main types of advanced directives - instructional directives, proxy directives, and hybrid directives. It also discusses criticisms of advanced directives and circumstances where there is no advanced directive, such as the Terri Schiavo case.
This document summarizes key concepts regarding health care decision making and advanced directives. It discusses the constitutional right to make one's own health care decisions, including refusing treatment. It defines the three main types of advanced directives - instructional directives, proxy directives, and hybrid directives. It also discusses criticisms of advanced directives and circumstances where there is no advanced directive, such as the Terri Schiavo case.
Person has a consttutona rght to make decsons regardng heathcare,
ncudng rght to refuse medca treatment. Cruzan o If persons wshes are uncear, state may assert nterest n favor of preservng fe Basic Point of ADs: heath care generay requres nformed consent these gve advance consent. 3 TYPES OF ADVANCED DIRECTIVES Inst!ctiona" Di#cti$#s (aka vng w or medca drectve) o Speces ether generay or va hypothetcas how one wants to be treated n end-of-fe stuatons or f ncompetent o Works ke a w o Ex. DNR or do not resusctate Po%& Di#cti$#s (aka Durabe Power of Attorney) o desgnates an agent to make heath care decsons for the patent H&'i( Di#cti$#s o drects treatment preferences & desgnates an agent to make substtuted decsons o Ex. DNR otherwse, ask Bob. o Anaogous to a trust Citicis)s of ADs (appy to nstructona devces) o Rarey competed (ony 25%) o Furnsh tte nfoendess possbtes for T to prepare for; cant account for a o Poor understandng of Ts decson o Preferences change over tme o Conct wth doctors dutes to prevent harm to ncapactated patents Do ADs suggest socety vaues persona autonomy over a drs duty to preserve fe? AL AD a**"i#s +,#n: D#fa!"t R!"# s patent has capacty to make decsons. Inca*acit& )!st '# s,o+n Ti--#: Attendng physcan determnes decarant no onger understands, apprecates, & can drect medca treatment AND 2 physcans personay examne & dagnose patent w/ termna ness or n|ury OR permanent state of unconscousness. o Doesnt appy f pregnant or mentay o Must be n wrtng, sgned, dated, & 2+ dsnterested wtnesses at east 19 years od o Wtnesses cant Sgn for decarant or be an apponted proxy Be reated by bood, adopton, or marrage 1 Be entted to nhertance by ntestacy or by w Be drecty nancay responsbe for decarants medca care A"t#nati$# to AD. Durabe power of attorney whch takes ahect f non termna ness /HAT IF THERE0S NO ADVANCE DIRECTIVE. Responsbty for an ncompetent patents decsons regardng heath care usuay fas to the patents spouse or next of kn, sub|ect to the states nterest n preservng fe Decson makers are hed to the s!'stit!t#( 1!(-)#nt standard2+,at *ati#nt +o!"( +ant. Patents autonomy s the prmary concern. o Aternatvey, coud ask whats n the *ati#nt0s '#st int##st (ob|ectve) A"a'a)a0s S!o-at# Hi#ac,& guardan spouse adut chd parents sbng next coset kn commttee B3SH $4 SHIAVO (p.459)- Patent (ncapactated) had no AD R!"#: Executve authorty to stay a court order voates the separaton of powers doctrne H#"(: FL statute authorzng governor to stay remova of nutrton & hydraton unconsttutona. o usurps the |udcarys power because guardanshp court found by C&C evdence patent was n a persstent vegetatve state & woud cease fe-proongng measures f she were competent o aw had no standards. ddnt say how ong t shoud reman n ehect Facts: Theresa n vegetatve state for 8 years. Husband pettoned guardanshp court to remove fe-proongng measures & parents opposed. ALs AD woudve heped ths stuaton b/c t becomes ehectve when attendng dr decares patent s no onger abe to drect hs medca treatment. PHYSICIAN ASSISTED S3ICIDE Oregon ony state that aows. Must have: o Incurabe dsease key to produce death n 6 months o Make mutpe requests o Notfy next of kn o Survve two watng perods (15 days; 2 days) 2 DISPOSITION OF THE BODY ASK: what would the decedent want? COTTINGHAM (handout) Facts: sons w expressy stated he wanted to be cremated; mom opposed. H#"(: The drecton (n the w) s #asona'"#, *actica", & ca*a'"# of *#fo)anc#. If testator unambguousy expresses n hs w how hs body s to be dsposed of, the court must honor hs wshes. Not#: dggng body up 2 years ater to cremate s reasonabe (hgh degree of deference). THE PO/ER TO TRANSFER PROPERTY AT DEATH HODEL $4 IRVING (pg. 3)- Loo5 at "i)its on i-,ts to (#$is# t,o!-, "#ns of Hodel R!"#: A tota" a'o-ation of the rghts of descent & devse cannot be uphed. o Indvduas have the rght to tans)it property NOT to in,#it property BUT Not absoute (.e. estate tax) Facts: Act deprved Indans of the rght to dspose of ther fractona nterests n and w/out compensaton. H#"(: the escheat provson of Act ehected a takng of Ps decedents property Not#: 100% estate tax s unconsttutona R!"# a**"i#s to #a" 6 *#sona" *o*#t& Amended statute aowng devse to escheatabe fractona nterest to any other O of undvded fractona nterest was unconsttutona b/c mted devse to a sma group (N4, p.9) DEAD HAND CONTROL When a decedent condtons a gft to a benecary upon the benecary behavng n a certan way R#st4 3( 78948 (pg.27)- favors freedom of dsposton o Donors ntenton s gven ehect to the maxmum extent aowed by aw In$a"i( if "prohbted or restrcted by an overrdng rue of aw" can0t consi(# #asona'"#n#ss of donors decson T#sta)#nta& con(itions a# $a"i( 3NLESS o $io"at#s *!'"ic *o"ic& absoute restrants on marrage voate fundamenta rght to marry. E%c#*tions: parta restrants on marrage w/ reasonabe restrants are vad o Factos: age of ntended benecary & tme frame of ntended condton/restrcton tempora/regous requrements vad. See Shapra Regous requrements 3 separaton or dvorce Controng factor s the decedents domnant ntent. Are they encouragng separaton/dvorce OR provdng support n the event of separaton/dvorce? Promotng famy strfe Property destructon drectve o :!(icia" #nfoc#)#nt of t,# con(ition +o!"( constit!t# stat# action $io"atin- constit!tiona""& *ot#ct#( f!n(a)#nta" i-,ts SHAPIRA $4 3NION NAT0L BANK (pg.28)- restrcton on nhertance va marrage ok H#"(: The court must honor the testators ntenton wthn the mtatons of aw & pubc pocy. o enforcng condtons ddnt consttute sumcent state acton o gfts condtoned on a benecary marryng wthn a partcuar cass/regon consttutes a parta restrant on marrage, whch s #asona'"#; $a"i(; 6 not a-ainst *!'"ic *o"ic& Cf. Rest. cant consder reasonabeness R!"#: restrctons upon marrage as a condton of in,#itanc# are consttutona, vad, & enforceabe Facts: decedents w condtoned hs sons nhertance on marryng a |ewsh gr whose parents are both |ewsh wthn 7 years or ese the money woud go to the state of Israe. S,o!"( T ,a$# a i-,t to (#sto&. o Po: autonomy; preventng pontess snce T can destroy whe ave o Con: prevents waste; soceta good TRANSFER OF DECEDENT0S ESTATE (pg.38) F!nctions of Po'at# Po*#t& o provdes evdence of transfer of tte to new owners (cears tte & makes marketabe) o protects credtors by provdng procedure for payment of debts o dstrbutes decedents property to those ntended after credtors pad o promotes naty (credtors have tme bar to e cam; cuts oh w contests) Non*o'at# *o*#t& - passes under an nstrument other than a w. o |ont tenancy property o fe nsurance o contracts w/ POD (payabe on death) provsons o nterests n nter vvos trusts (cf. testamentary trusts created by w probate) PROFESSIONAL RESPONSIBILITY SCOPE OF DRAFTING ATTORNEY0S RESPONSIBILITY 4 TORT THEORY CONTRACT THEORY COMMO N LA/ <AL= attorney ony owes duty of reasonabe care to the c"i#nt (testator) but not to ntended benecares 3 rd party benecary contracts arent recognzed. S## Ro'inson o B3T prvty f atty does t for free MODER N Ma1oit & attorneys duty extended to int#n(#( '#n#>ciai#s based on reasonabe foreseeabty of n|ury to them. S## Si)*son nonparty can sue for breach of contract f they quafy as a 3 rd
party benecary. Once cent dentes who he wshes property to go to, benecares acheve 3 rd party benecary status. S## Si)*son SIMPSON $4 CALIVAS (pg.58) Facts: "homestead" term used n w ambguous. Son sued hs deceased fathers attorney who drafted w. H#"(: An ntended benecary states a COA by peadng sumcent facts to estabsh that an attorney has neggenty faed to ehectuate the testators ntent as expressed to the attorney H#"(: Where a cent has contracted w/ an attorney to draft a w & the cent has dented to whom he wshes the estate to pass, that ntended benecary may enforce the terms of the contract as a 3 rd party benecary o But see ROBINSON V4 BENTON (handout)- common aw rue R!"#: A benecary who snt n prvty cannot assert a cam aganst the attorney who prepared the w of hs deceased her. Facts: attorney faed to destroy w before testators death as she nstructed E%c#*tion to CL !"#: -at!ito!s !n(#ta5in-s where a awyer freey draft a w, courts w mpose a duty to 3 rd party benecares. Encourages experenced awyers to undertake serous |ob of draftng ws. A $4 B (pg. 64)- conct of nterest (duty of condentaty v. duty to nform of matera fact) R!"#: A awyer may dscose condenta nformaton about 1 cent to another cent f the matter s an exceptona case wth a compeng reason for dscosure H#"(: aw rm can dscose condenta nformaton of one co-cent to another co-cent gven the wfes need for the nfo & the rms rght to dscose t o rm ddnt earn of egt chd n condenta communcaton from hm o earned about chd through ts representaton of mom n paternty acton so husbands expectaton of nondscosure may be ess 5 o sprt of "Waver of Conct of Interest" etter supported rms dscosure reed on RPC 1.6(c), whch permts awyer to revea condenta nfo to extent he reasonaby beeves necessary to rectfy cents fraud. Facts: coupe used aw rm for estate pannng but ast name entered n computer wrong so when. A paternty acton was ed aganst the husband but the conct wasnt caught. Husbands egt chd coud take wfes property under her w so attorney wanted to know f he coud dscose hs chd to the wfe. (!t& of con>(#ntia"it& to c"i#nt #%t#n(s '#&on( c"i#nt0s "if#2 INTESTACY P#sona" Po*#t& ? governed by statute where decedent domced at tme of death R#a" Po*#t&2 governed by statute where property s ocated S3RVIVING SPO3SE@/HO A3ALIFIES. Vad marrage ceremony requred. Exceptons: o Co))on "a+ )aia-# -must ve together for a requste amount of tme & act ke theyre marred (not a |x aow). AL #B!i#)#nts: capacty; present mutua agreement to permanenty marry; pubc recognton of reatonshp as a marrage & pubc assumpton of marta dutes & cohabtaton o Sa)#2s#% )aia-#s: Aowed n CT, Iowa, Mass, NH, VT, & D.C. Some |x may aow ci$i" !nions wth same states rghts as marred coupes. D#f#ns# of Maia-# Act- marrage s for heterosexua. States arent requred to recognze same-sex marrages entered nto n another states. o P!tati$# S*o!s#s: exst where the coupe goes through what at east one party beeves s a vad marrage ceremony, but for some reason marrage s vod/vodabe. R!"#: as ong as 1 party reasonaby beeves n good fath the marrage s vad, they quafy as spouses for purposes of most ntestate schemes o L#-a""& S#*aat#( S*o!s#s: st quafy under ntestate dstrbuton statute o S*o!sa" A'an(on)#nt: may be dsquaed n some states S!$i$in- S*o!s# 3PC (favors SS) AL On"& #"ati$# (no ssue/parent of decedent) 100% 100% On"& 5i(s fo) t,#i )aia-# 100% $50k + 6 baance D#c#(#nt ,a( 5i(s o!tsi(# )aia-# $150k + ntestate estate S*o!s# ,a( 5i(s o!tsi(# )aia-# $250k + N/A S3RVIVAL REA3IREMENT 8= Did the claimant actually survive the decedent? C= Did the claimant legally survive the decedent? CL: to quafy as an her, party must prove by a preponderance that he survved the decedent by a msecond 3SDA: where there s no s!Dci#nt #$i(#nc# as to who survved whom, the party camng the rght to take s to be treated as havng predeceased the decedent. Amended USDA to show by C&C survvorshp by 120 hours. o :AN3S $4 TARASE/ICE (pg. 80)- smutaneous death/nsurance proceeds Facts: coupe took cyande aced Tyeno H#"(: Sumcent proof to show wfe survved husband (apped USDA) AL: same thng coud happen here b/c nsurance statute smar to anguage S!$i$os,i* must be proven by a preponderance by the party whose cam depends on survvorshp. /,#n (o#s (#at, occ!. CL: rreversbe cessaton of crcuatory & respratory functons Mo(#n: rreversbe cessaton of tota bran actvty 3PC 8C9 ,o! a**oac,: to quafy as taker, must prove by C6C that he survved decedent by 5 days & f not, you predecease o AL: doesnt appy 5 day requrement f property woud escheat to the state (ony stuaton where n-aws woud take) SHARES OF DESCENDANTS G#n#a" R!"#s: Issue of predeceased chdren take by representaton If a parent takes, ther ssue do not Absent adopton, ony bood reatves quafy as hers son/daughter-n-aws & stepchdren typcay dont quafy En-"is, P# Sti*#s Mo(#n P# Sti*#s <AL= P# Ca*ita at Eac, G#n#ation <3PC= /,## is t,# #stat# >st (i$i(#(. Frst generaton Frst generaton wth taker ALIVE Frst generaton wth taker ALIVE Ho+ )an& s,a#s is t,# 1 share each party ave; one 1 share each party ave; one 1 share each party ave; one share 7 #stat# (i$i(#( into at t,at -#n#ation. share each party dead but survved by ssue share each party dead but survved by ssue each party dead but survved by ssue Ho+ to t#at (o**in- s,a#s. Drop by boodne Drop by boodne Drop by poong SHARES OF ANCESTORS 6 COLLATERAL RELATIVES If decedent des ntestate wth no spouse & no ssue, property "ows up" o Fist2Lin# Co""at#a"s- decedents parents & ther ssue o S#con(2Lin# Co""at#a"s- decedents grandparents & ther ssue AL: If no ssue/parent/sbng to each materna & paterna grandparents f vng or aunt/unce f grandparent deceased. If no survvng grandparent/aunt or unce pass to reatves on the other sde n same manner? /HO A3ALIFIES AS DESCENDANTSFISS3E. M!st #sta'"is, a *a#nt2c,i"( #"ations,i* Chd born to a marred coupe s presumed to be chd of that coupe POSTH3MO3SLY BORN CHILD (p.115): conceved whe dad ave; born after he ded o Presumed to be chd of predeceased husband f wfe gves brth wthn CG9 (a&s of husbands death (3nifo) Pa#nta-# Act = 300 days) o If chd born 280+ days after husbands death, '!(#n on c,i"( to estabsh hes the chd of predeceased husband o AL: f conceved before death & born afternhert as f theyd been born n decedents fetme ADOPTION o GENERAL R3LE <AL=: severs parent-chd reatonshp b/t natura parents & chd and estabshes parent-chd reatonshp b/t adoptng parents & chd STEPPARENT EHCEPTION: doesnt modfy nhertance rghts b/t adopted chd & natura parent marred to adoptng stepparent adopted chd & adoptng parent can nhert both from & through each other natura parent cant nhert from & through the chd, BUT chd can nhert from & through natura parent who waved hs parenta rghts HALL $4 VALLANDINGHAM (pg. 97)- adopted by stepparent; no nhertance R!"#: Because an adopted chd has no rght to nhert from the estate of a natura parent who des ntestate, the same chd may not nhert through the natura parent by way of representaton. 8 H#"(: Dened 4 chdren the rght to nhert through ther nat!a" *at#na" !nc"# when these chdren were adopted by ther stepfather after the death of ther natura father & the remarrage of ther natura mother o 3PCFAL: woud aow nhertance ELLIS $4 /EST (handout)- adopted by grandparents; court nvoked SoP (Schavo) Facts: kds sought ntestate share of materna great- grandmother H#"(: Kds dened nhertance va ntestate successon from genetc reatves b/c adopted by paterna grandparents, NOT spouse (strct nterpretaton of statute) AL R!"#: An adopted person s the chd of an adoptng parent & not of the natura parents uness adopted by the spouse of a natura parent for the purposes of ntestate successon. (broader than Ha statute) 3PC A(o*tion '& R#"ati$# of Pa#nt: chd retans rght to nhert from & through both natura parents (kds woud take under ths statute) o AD3LT ADOPTION GENERAL R3LE: adopted aduts are treated the same as adopted chdren for nhertance purposes MINARY (pg. 103)2 +i"" (queston of decedents ntent, NOT ntestate rues) R!"#: Adopton of an adut for the purpose of brngng that person under the provsons of a preexstng testamentary nstrument, when he ceary wasnt ntended to be so covered, shoudnt be permtted Facts: husband adopted hs wfe & after he ded, she camed to be a benecary of the trust whch husbands mom had set up n her w to her "then survvng hers" accordng to aws "then n force n KY" /,&. Athough adopton techncay fe w/n statute, adopton thwarted the remote ancestors ntent. o AL: adut adopton of over = ncest. Aow f dsabty, etc. Cant adopt heathy adut uness ts by a husband & wfe. o Not#: adopton s rrevocabestuck f reatonshp turns sour o EA3ITABLE ADOPTION ? contact!a" $4 #B!ita'"# t,#o& D#>nition: natura parents transfer custody of chd to someone who promses to adopt but who fas to compete paperwork to compete ega adopton Doctin#: Equty treats the chd as a chd of adoptve parent for purposes of dstrbutng ntestate property G#n#a" R!"#s: 9 Chd can nhert from but NOT through the adoptve parent adoptve parent has NO nhertance rghts from the chd doesnt ahect chds nhertance rghts wth natura parents O0NEAL $4 /ILKES <*-4 89I=- ma|orty foowed strct contractua approach (AL) R!"#: A reatonshp ess than that of a ega guardan wont gve one the authorty to enter nto an adopton contract & any such contract s thus nvad. H#"(: chd not entted to nhert from "adoptve" father b/c aunt who gave her up for adopton ddnt have ega authorty to do so. Facts: chd born out of wedock; mom ded & dad never recognzed her Diss#nt: <8= chd fuy performs; <C= abandon contract aw cton & adopt estoppe argument f parents ed chd to beeve egay adopted CHILD BORN O3T OF /EDLOCK o CL: chd of no one. No nhertance rghts. o Mo(#n: automatcay has parent-chd reatonshp wth nat!a" )ot,# & can nhert from & through her T&*ica""& #B!i#s *oof of *at#nit& subsequent marrage of natura parents fathers acknowedgment ad|udcaton of paternty durng dads fetme by preponderance ad|udcaton of paternty after dads fetme by C&C o See House for AL rue HO3SE $4 CAMPBELL (handout)- chd born out of wedock H#"(: reatonshp of parent & chd estabshed for purposes of ntestate successon Facts: chd born out of wedock. Mom sued for wrongfu death of mnor daughter; dad brought decaratory sut estabshng hs rghts as dad so he coud get part of settement. AL Pat#nit& R!"#: Chd born out of wedock s chd of mom. Aso a chd of the dad f: o Subsequent marrage o Paternty s ad|udcated before death of dad OR o estabshed after hs death by C&C. o Inehectve uness: father has openy treated chd as hs AND hasnt refused to support the chd (faure doesnt = refusa) DISCLAIMERS (p.152) 10 o R!"#: dscamant treated as *#(#c#asin- (#c#(#nt. Tme mt s 9 months after donee turns 21 or 9 months after nterest s created, whchever s atest. Dscamers reate back to decedents tme of death (uness Federa tax) o /,& +o!"( *a#nts (isc"ai). avod taxes avod credtors (not aowed n AL) o E%c#*tions: Inso"$#nt '#n#>ciai#s cannot (isc"ai) to a$oi( c#(itos <AL= F#(#a" Ta% Li#ns (p.155) D&# $4 3S- son, soe her va ntestacy, tred to dscam nterest b/c he had debt. Court hed dscamer nvad statng he "exercsed domnon over the property" & determned who woud receve f he ddnt. o BL: can0t a$oi( f#(#a" ta%#s M#(icai( #"i-i'i"it& (p.156) R!"#: can dscam but shoud notfy govt of nhertance even f you dont dscam. Medcad coud ask for rembursement & t coud dsquafy you. o (p.154, N2)- O has 2 chdrenA & B. B des, eavng one chd, C. O des ntestate. A has 4 chdren & dscams. Resut? C takes and As kds take 1/8 th each. 3PCFAL R!"#: the dscamed nterest passes to descendants of dscamant ADVANCEMENTS (p.133) o CL: defaut s gfts are advancements. C,i"( ,as '!(#n to *o$# it0s a -ift to '&*ass !"#. Presumpton decedent woud want kds to nhert equay. coege tuton doesnt quafy. What happens f gft s treated as an advancement? Hotc,*ot accountng (p.134) If Chd 1 of 3 receves $10k nter vvos & estate s worth $50k, add to make $60k. Chd 1 takes $10k & other 2 kds take $20k each. If Chd 1 gets $40k nter vvos he doesnt partcpate & other 2 spt $50k. o 3PC 6 AL: defaut s gfts are NOT an advancement. Grantor must sgn a contemporaneous wrtng (or grantee acknowedges) statng ts ntended to be an advancement. Not#: wrtng voates w formates. DISINHERITANCE o CL: coudnt dsnhert uness you totay get rd of property va w 11 o 3PC: authorzes negatve w; treats reatve whod normay take va ntestacy as *#(#c#asin- t,# T POSTH3MO3SLY CONCEIVED CHILD (artca nsemnaton) o KHABBAE (handout)2 AL woud probaby go ths way R!"#: posthumousy conceved chd w NOT nhert. NH int#stac& stat!t#: to "ssue" of the decedent equay; ater mentons "survvng ssue" /,&. egsatures |ob & woud sow the admnstraton of estates AL: 6 month tme mt to e probate cam, so probaby decdes ths ssue o /OOD/ARD (p.118)- apped for SS survvors benets R!"#: A posthumousy conceved chd w be consdered ssue f theres a genetc reatonshp between the chd & decedent; proof decedent consented to the concepton of the chd; AND consented to support of any resutng chd. /,&. baance state nterests of (1) best nterests of chd; (2) ordery admnstraton of estate; (3) reproductve rghts of parent o 3PC (p.125): Posthumousy conceved chd nherts from deceased parent f <8= durng fe parent consented to posthumous concepton n wrtng OR proven by C&C AND <C= chd n utero not ater than 36 months OR s born not ater than 45 months after parents death. o REST4: chd must be born w/n reasonabe tme after decedents death & crcumstances ndcate decedent woudve approvedcear case f chd born from decedents frozen sperm. MINORS RECEIVING PROPERTY (greatest east court supervson requred) o G3ARDIANSHIP (p.137) R!"#: guardan doesnt have tte to property & requres contnua court supervson. Termnates at 18. o CONVERSVATOR ony requres once a year court approva o C3STODIANSHIP ony have to go to court when theres a compant. o TR3STEE provdes maxmum exbty. Book suggests ts for arge estates; Vars says most use ths now b/c t doesnt have to be compcated. SLAYER STAT3TES o MAHONEY (p. 145)2 ntestacy; no sayer statute n ths |x 12 R!"#: Lega tte passes to sayer but equty hods sayer to be a constructve trustee for hers or next of kn of the decedent. On"& a**"i#s if int#ntiona" )!(#. H#"(: b/c crmna court ddnt determne whether mansaughter was vountary or nvountary, remanded Cf. AL: has sayer statute so probate court coud hear the matter In |x w/ no sayer statutes, 3 dherent approaches: "#-a" tit"# *ass#s to sayer n spte of crme "#-a" tit"# (o#sn0t *ass to sayer b/c equtabe prncpe that no one shoud be permtted to prot by hs own fraud or take advantage/prot as a resut of hs own crme. ega tte passes to sayer but equty hods hm to be a const!cti$# t!st## for the hers/next of kn of the decedent |court adopts| o S"a&# !"# (o#s NOT a**"& +,#n unntentona murder Insane (cant form ntent) If sayer had vested nterest before kng occurs o Rationa"#s: Decedents ntent (see Wsconsn) Deterrng Murder Mora |udgment o Ot,# cont#%ts +,## s"a&# !"# a**"i#s: /i""s E%c#*tion in /isconsin: uphods provsons n ws aowng person to take even f they ked the testator Assist#( s!ici(#s: OR s the ony state to authorze physcan asssted sucde Non*o'at# tansf#s (fe nsurance, |ont tenancy) o Is convcton for ntentona murder concusve? Ma,on#& convcton snt concusve (ms-2 types); court retred to see f ntent AL 6 3PC: yes, but convcton not requred o AcB!itta" NOT (#cisi$#: b/c burden of proof s hgher n crmna cases, cv court w determne by a preponderance f murder was ntentona. /,o ta5#s if s"a&# (o#sn0t. generay, treat sayer as predeceasng4 /ILL CONTESTS P#son ,as stan(in- if t,#&0"" ta5# in t,# a's#nc# of t,# cont#st#( (oc!)#nt 13 o Cf. Contngent benecary of revocabe nter vvos trust when settor has capacty, cant sue b/c no dutes to benecares; ony duty to settor. Can sue f settor acks capacty SoL fo +i"" cont#st is J )ont,s. POSSIBLE CHALLENGES: o Lack of menta capacty o Undue nuence o Insane deuson o Fraud o Duress o Faure of Formates o Tortous Interference wth Expectancy TESTAMENTARY CAPACITYneeded for ALL ACTS (revocaton, amendments, etc.) To be competent to make a w, at the tme of executon/revocaton the testator must be 18 & 84 ca*a'"# of 5no+in-K & understandng n a genera way: C4 the nature & extent of hs property 34 the natura ob|ects of hs bounty (named or potenta benecares) L4 the dsposton he s makng of that property & M4 reatng these eements to one another & formng an o(#"& (#si# regardng the dsposton of the property *actua knowedge not requred /HO HAS B3RDEN OF ESTABLISHING CAPACITY. Ma1oit& (AL): once proponent ohers PFC w duy executed (amdavt sgned by wtnesses), rebuttabe presumpton the testator had capacty & burden s on cont#stant to prove a ack thereof (C6C or *#*on(#anc#). /i"son4 Minoit&: Contestant must show evdence to rebut presumpton of santy, then burden of proof shfts to the *o*on#nt of the w to prove capacty by a preponderance. /as,'!n Pof4 R#s*onsi'i"it&: attorney cant draft w for ncompetent person but can rey on hs own |udgment n determnng the cents capacty /ASHB3RN - foows mnorty burden rue (on proponent) H#"(: testator acked capacty so w nvad. o agreed testatrx had Azhemers 1 year after executng w & ts progressve o anecdota evdence- testators ntent uncear & uctuated o dherence n ora statements & w provsons o 2 ws w/n 3 weeks w/ very dherent dspostons /ILSON- ma|orty burden rue (on contestant) H#"(: Testator had capacty to make w R!"#: Eccentrcty or strange beefs dont mean that a person s ncapabe of makng a w, provded the person can form a ratona desre regardng the dsposton of hs property. 14 o Dementa & conservatorshps dont automatcay mean you ack testamentary capacty o Pp cvy commtted w/ menta ness have capacty unt proven otherwse? INSANE DEL3SION fase beef that testator adheres to aganst a evdence & reason to the contrary o must ahect the dsposton Breeden o Provson specc; strke provson resutng from ID (cf. capacty-entre w fas) o Burden s on contestng party STRITTMATER (p.169)- neurotc femnsm (frnge beef at the tme1947) H#"(: Struck w. Decedents paranoac condton, especay her nsane deusons about maes, ed her to eave estate to NWP. /,at constit!t#s an ID can c,an-# o$# ti)# BREEDEN (p.171) Facts: coke head eft everythng to hs drug deaer; former w had eft some $ to famy not frends. Famy camed ID & ncapacty. Turned out frend was FBI nformant. H#"(: Suhered from an nsane deuson but t ddnt materay ahect the w. Hs nsane deusons werent reated to the benecares. o had testamentary capacty b/c appeared to have motor functons. HONIGMAN (p.178) Facts: T thought wfe cheatng on hm & eft her statutory mnmum to defeat forced share. H#"(: T suhered from nsane deuson (ong, happy marrage). Assumed causaton by puttng burden on proponent to show an unnatura dsposton wasnt a product of I-D. Pat& ass#tin- t#stato s!N##( fo) an insan# (#"!sion ,as '!(#n 6 )!st s,o+: T#stato s!N##( fo) an insan# (#"!sion o Ma1oit&: deuson s nsane even if theres some factua bass for t f a ratona person n testators stuaton coudnt have drawn the concuson reached by the testator o Minoit&: f any factua bass for testators deuson, not nsane. AL: not nsane deuson f some bass (T shoud be aowed to make bad decsons) Insan# (#"!sion ca!s#( +i"" *o$isions o Ma1oit&: But for the nsane deuson, the testator woudnt have dsposed of hs property as he dd |more protectve of testators ntent| 15 An nsane deuson nvadates a w ony f the deuson materay ahected the dsposton of the w. B##(#n o Minoit&: nvad f dspostve provsons mght have been caused or ahected by the testators nsane deuson |ow|. Honi-)an 3ND3E INFL3ENCE E%ists +,#n#$# T0s int#nt is o$#co)#O s!'stit!t#( int#nt4 <8= drect evdence (show Ts w was overcome; rare) or <C= burden- shftng approach ALABAMA2 presumpton of U.I. arses when cont#stant 84 theres a condenta reatonshp b/t favored benecary & testator; C4 nuence of the benecary s domnant & controng n that reatonshp; & 34 theres undue actvty by the benecary n procurng the executon of the w o A substanta gft by w to a person who s one of the wtnesses to the executon of the w woud tsef be a s!s*icio!s cic!)stanc#, and the gft coud be chaenged on grounds of undue nuence LAKATOSH B3RDEN SHIFTING APPROACH: Proponent proves formates of executon have been foowed Cont#stant camng U.I. must show by C&C to shft burden: 84 condenta reatonshp b/t nuencer & testator C4 person en|oyng such reatonshp receved the buk of the estate; AND 34 testator was of weakened nteect If successfu, '!(#n s,ifts to *o*on#nt to dsprove UI by C6C o Grantee of transacton must show by C&C that he acted n good fath throughout the transacton & the grantor acted freey, ntegenty, & vountary R#st.: requres con>(#ntia" #"ations,i* + s!s*icio!s cic!)stanc#s to shft burden (p.185) o Extent donor weakened/susceptbe to UI o Extent to whch aeged wrongdoer partcpated o Whether donor receved ndependent advce from atty/dsnterested party o Whether nstrument prepared secrety or qucky o Whether donors atttude changed toward others b/c reatonshp w/ wrongdoer o Whether dscrepancy b/t prevous nstruments o Whether contnuty of purpose w/ former ws setted ntent o Whether dsposton s such that a RP woud regard t unnatura/un|ust/unfar LAKATOSH H#"(: Roger used PoA for hs own benet; faed to rebut presumpton of UI. 16 Facts: T befrended by Roger, younger man. He convnced her to gve hm PoA. He spent $128k of her money on hmsef. She revoked PoA but ddnt change w. /,#n is a con>(#ntia" #"ations,i* #sta'"is,#(. Fi(!cia&: arses from a setted category. Usuay b/t donor & hred professona (attorney, trustee, etc.) R#"iant: must estabsh a reatonshp based on speca trust &condence (nanca advsor/customer or doctor/patent) Do)inant2S!'s#$i#nt: donor subservent to aeged wrongdoers nuence. Ex. hred caregver/ donor or adut chd/ patent GIFTS TO ATTORNEYS Vas: draftng atty who s benecary shoud aways shft burden b/c atty s n best poston to create evdence on ssue of UI Ma1oit&: presumpton of UI when draftng atty receves a s!'stantia" gft unless atty s reated or marred to the cent o Most |x requre C&C that gft was truy testators ntent Minoit&: gfts to draftng attorneys create an i#'!tta'"# *#s!)*tion of UI. E%c#*tions: o attorney reated or marred to testator Li**# OR o w revewed by an ndependent atty who advsed testator about potenta for UI to make sure gft was free & vountary act of testator. Mos#s 4 LIPPER- dsnherted grandkds; draftng atty & son takes under w; NON2B3RDEN SHIFTING APPROACH Facts: T dsnherted grandkds; son drafted w & s benecary of buk of estate. H#"(: Contestants showed a (1) condenta reatonshp; (2) opportunty; (3) motve; BUT faed to show (4) causaton R!"#: To nvadate w based on UI, must show contro was exercsed over Ts mnd to overcome her free agency/w & substtute the w of another to cause the T to do what she woudnt otherwse have done but for such contro /,&. had #cita" expanng dsnhertance. Court doesnt care what Ts reasons are so ong as ther her own. Probems w/ rectas: o n same document theyre tryng to support o testamentary be possbe MOSES - non-draftng attorney/over creates presumpton of U.I. Facts: oder woman eft buk of estate to her attorney/over who dd NOT draft w H#"(: w nvad b/c T ddnt get ndependent advce about eavng property to nonreatves S,ift#( '!(#n so"#"& 'Fc !n!s!a" #"ations,i*4 17 ETHICAL CONSIDERATIONS (p.201) Attorney sha not prepare nstrument gvng atty or hs reatve any s!'stantia" gft from a cent except where cent s reated to donee. Before cent makes gft to atty, get detached advce from ndependent atty Disci*"in#? dsbarment, suspenson, or sanctons o Vas-even as reatve, better oh gettng ndependent counse. If w gves equa shares to everyone (ncudng you) probaby ok. o Boo5# (p.201)- found no UI but suspended nonreatve draftng atty b/c ddnt get ndependent advce for cent. Vas-wrong resut; dont sancton f no mproprety NO CONTEST CLA3SES If benecary under the nstrument sues contestng the nstrument, benecary oses whatever he s takng under the nstrument G#n#a" R!"#: vad but narrowy construed & not enforceabe n certan stuatons. Acton to construe w generay not a w contest. A# no cont#st c"a!s#s #nfoc#a'"#? o Ma1oit&F3PC: enforce uness probabe cause to support the w contest o Minoit&: unenforceabe regardess of evdence supportng the cam f cam s forgery, revocaton, or msconduct by one actve n procurement/executon of w. Li**# Probem: you have to be a benecary under the w for the no- contest cause to be n ehect (she eft contestants nothng but ncuded cause) FRA3D (see pg. 208) Testator s deceved by )is#*#s#ntation whch was made wth: 84 int#nt to (#c#i$# the testator AND o AL Fa!(!"#nt known to be fase OR duty n aw of the decarant to know & te the truth as when the duty arses by reason of condenta reatons (const!cti$# fa!() C4 *!*os# of inP!#ncin- t#sta)#nta& dsposton o msrepresentaton doesnt requre actua words be spoken 34 ca!sation B!(#n: typcay on contestant; burden shftng extremey rare AL (Ma|.): In a fraud cause, no presumpton arses from the fact that a condenta reatonshp exsts & the burden s on the P to pead & prove the fraud. o Cf. n other states, presumpton of fraud arses w/ condenta reatonshp 18 FRA3D IN THE IND3CEMENT (p.208)- msrepresentaton causes the T to execute or revoke a w, to refran from executng/revokng a w, or to ncude partcuar provsons n the wrongdoers favor. o Ex. H persuades O not to execute a devse n favor of A by promsng O that H w convey property to A. At the tme, H has no ntent to convey property to A. FRA3D IN THE EHEC3TION (p.208)- occurs when a person ntentonay msrepresents the character or contents of the nstrument sgned by the T whch doesnt carry out Ts ntent. o Ex. O w/ poor eyesght asks H to brng her w. H brngs a document that s NOT Os w & knowng t wasnt & O sgns t beevng t s hs w. Estat# of Cason (p.208) Facts: marred 1 year but hubby aready marred so not egay. Left estate to her husband Fa!(. o "#n-t, of )aia-# o ti)in- of +i"" #%#c!tion mmedatey after marrageprobaby based on ega reatonshp P3CKET (p.209)- fraud & UI Facts: nurses hred to take care of T convnced her reatves were wastng $, etc. W favored nurses. T had Azhemers. H#"(: P#s!)*tion of Fa!( 6 3I: o condenta reatonshp (nurse/patent & PoA) + o encouragng decedents fase beef (famy was gong to put n home; spendng $) N!s#s (i(n0t #'!t *#s!)*tionO famy won & w nvadated RELATIONSHIP BFT FRA3D 6 3ND3E INFL3ENCE. Fa!( can s!**ot 3I '!t t,#&0# not a s!'s#t of #ac, ot,# D3RESS Duress f wrongdoer threatened to perform or performed a wrongfu act that coerced the donor nto makng a donatve transfer that the donor woudnt otherwse have made speces of UI; Duress s UI usng a partcuar method (threat or act of wrongfu conduct) LATHAM- Restatement foows Facts: W probated & dstrbuted. Ps aeged T wanted to execute new w but D prevented ts executon/revocaton new w & murdered her & sought constructve trust R!"#: Remedy of constructve trust s avaabe where fraud prevents testator from revokng an od w & the w has aready been probated 19 TORTIO3S INTERFERENCE /ITH AN EHPECTANCY Li)it: theory cannot be used when chaenge based on testators menta ncapacty coud provde *!niti$# damages NOT a w contest so doesnt trgger no-contest cause SoL doesnt begn to run unt party dscovers/shoudve dscovered the msconduct so "escape route" f probate has been cosed SCHILLING (p.215) Facts: caretaker (D) wated unt w probated unt she tod brother hs sster ded To 'in- ci$i" action fo TI; P )!st s,o+: o exstence of an expectancy o ntentona nterference w/ that expectancy through tortous conduct o causaton o damages can0t '# *!s!#( if a(#B!at# #"i#f a$ai"a'"# in *o'at#4 E%c#*tion: f Ds fraud snt dscovered unt after probate b/c of tortfeasor BATCHELOR (handout)- TI not #co-niQ#( in AL; ths s dssent Facts: Ts 2 nd husband angry at atty for brngng w to hospta for executon; ded ntestate Diss#nt: shoud re-thnk TI b/c ths case (1) brought w/n 15 months; (2) atty & accountant can testfy; (3) ony mpcates w formates-ts wrtten but not executed |no SoF concern| In ths case, decedents ntent woud be advanced by aowng TI cam Not#: atty abe for mapractce here for faure to get sgnature EHEC3TION OF /ILLS F3NCTIONS OF /ILL FORMALITIES Do they efectuate Ts intent at an acceptable administrative cost? E$i(#ntia& o Increases reabty & unformty when presented to court Rit!a" o Convnces court transferor deberatey ntended to ehectuate a transfer Pot#cti$# C,ann#"in- o Courts know whether ts a w or not Hi#ac,& of /i""s Fo)a"iti#s P#f##nc#: wrtng; sgnature; attestaton 3PC (p.228) 84 wrtng; 20 C4 sgned by testator OR n Ts name by another n Ts conscous presence AND by Ts drecton; AND 34 sgned by 2 ndvduas who sgned w/n a reasonabe tme after ndvdua wtnessed either a= one of 3 choces; OR the sgnng of the w OR Ts acknowedgment of sgnature OR Ts acknowedgment of w; OR '= acknowedgment by T before nota& or other authorzed ndvdua by aw AL REA3IREMENTS 84 Wrtng C4 Sgnature (aows proxy by Ts drecton & n hs presence) 34 Attestaton by 2 wtnesses who each wtnessed T ether (1) sgn OR (2) acknowedge hs sgnature or the w. (AL mpcty aows deayed attestaton) o Cf. a($anc# (i#cti$#- must be sgned n the presence of 2+ wtnesses OR vad where executed or where T domced, had abode, or was a natona at ether death or executon. MEANING OF RPRESENCES IN /ILL EHEC3TION (p.233) Lin# of Si-,t T#st: satsed f the T s capabe of seeng the wtnesses act of sgnng. o T doesnt have to actuay see wtnesses sgn but must be abe to f he were to ook (swve char) Excepton: bnd person test asks f he was abe to see, woud he be abe to? Conscio!s P#s#nc# T#st: wtness n presence of T f T through sght, hearng, or genera conscousness of events, comprehends that the wtness s n the act of sgnng. o N(c) p.234- Bank teer sgnedT was n drve-thru & coud see teer but coudnt see pen & paper. Court dened vad wtness sgnature b/c not n conscous presence STEVENS- when s wtness n presence of T? Facts: wtnesses ddnt sgn n presence of T & T ddnt sgn n wtnesses presence. T dsabed & went to bank to have w sgned. Argued for s!'stantia" co)*"ianc#. H#"(: w nvad b/c none of the partes sgned n front of each other R!"#: : A decedents sgnature must be n the presence of 2 competent wtnesses, both of whom acknowedge the decedents sgnature n the presence of each other. 21 o /a(# #%c#*tion: If wtness acknowedges hs sgnature on a w n physca presence of second wtness & T, w propery wtnessed o Woudve faed n AL too MEANING OF RSIGNAT3RES IN /ILL EHEC3TION (p.234) Sgn n any way you ntend to sgn (X); another person can sgn for you o Computer sgnature n cursve font s vad; what about e-ma sgnature? G#n#a" R!"#: T must sgn/acknowedge BEFORE wtnesses sgn uness a part of a snge transacton GROFFMAN (p.228)- no doubt Ts ntent reected n w; but struck t Facts: T ddnt make/acknowedge sgnature n presence of 2 wtnesses at sa)# ti)#. Each wtness separatey sgned the w n a dherent room. R!"#: T must ether <8= acknowedge pror sgnature OR <C= sgn w '#fo# 'ot, +itn#ss#s at t,# sa)# ti)# o Resut dherent n AL b/c both wtnesses saw T sgn or acknowedge & no requrement that wtnesses have to be smutaneousy together n AL or UPC MOREA(p.239)2 - nterested wtnesses Facts: needed 3 dsnterested wtnesses but 2 took under w - son & frend. Ct. sad son ddnt "benet" from w b/c w not advantageous snce he stood to take more va ntestacy H#"(: w uphed R!"#: Requrement that a wtness have nothng to gan by admsson of the w to probate s met f the wtness receves ess from the w than he woud receve f the w werent admtted to probate o Cf. 3PC 6 AL: no requrement wtness be dsnterested BUT nterested wtness who gets substanta devse s a suspcous crcumstances for UI purposes o CA: f nterested wtness takes under w, rebuttabe presumpton of UI, fraud, or duress arses P!-in- stat!t#s: o CL: voded any gft to nterested wtness but w was vad o To(a&: wtness forfets ony the extra benet ahorded to the wtness by the w (.e. cant take more than he woud va ntestacy) TAKEA/AY: never et an nterested wtness sgn :ACK $4 DORAN Suggested substanta compance w/ emancpaton but not for ws act Needed 3 wtnesses but ony had 2. Court took strct approach. C3RATIVE DOCTRINES S/ITCHED /ILLSsgnature probem 22 PAVLINKO0S ESTATE Facts: spouses accdentay sgned the others w. Both dead & wfes brother tred to submt Heens w sgned by Vas (no reformaton); Vass w sgned by Heen acks hs sgnature. H#"(: w nvad b/c Heens w cant be probated as w of Vas & s a nuty R!"#: A w must be sgned by the testator SNIDE(p.250) Facts: Harvey & Rose executed substantay dentca ws; accdentay sgned the others. Rose pettoned to reform Harveys w & admt t to probate (ohered one he sgned). Resduary cause the same. R!"#: a w be admtted to probate athough the decedent mstakeny executed a w ntended for hs spouses sgnature & vce versa Possi'"# Fi%#s: Wave sgnature requrement & admt w spouse int#n(#( to si-n |ceaner remedy| Admt & reform w act!a""& si-n#( by the decedent |Snde adopts & Pavnko dssent| S!--#st#( R!"#: +,## C Ts at 8 c##)on& si-n #ac, ot,#0s +i""s '& )ista5# *o'at# +i"" NOTE: s ookng at 4 corners of 2 ws consstent w/ no extrnsc evdence rue? S3BSTANTIAL COMPLIANCE 6 SELF2PROVED /ILLS ? See aso Stevens A w may be admtted to probate f proponent shows by C6C t substantay compes w/ the stat!to& #B!i#)#nts. o Does the technca noncompance mpcate any of w formates ratonaes? If so, probaby not substanta compance. RANNEY- wtnesses sgned 2-step sef-provng amdavt & not w Facts: ony Russe sgned hs actua w. Wtnesses sgned sef-provng amdavt on separate page. W notarzed & a pages staped together H#"(: admtted w b/c substantay comped w/ formates. /,&. Rgd nsstence on tera compance often frustrates these purposes (overstate) BUT fundamenta goa of w formates s to advance Ts ntent Ho+ co!"( t,is ,a$# '##n a$oi(#(. use attestaton cause OR use 1- step sef provng SELF2PROVED AFFIDAVITS C2STEP: appends a separate amdavt to end of w; wtnesses (sometmes T) sgn the amdavt n addton to sgnng the w tsef then amdavt notaiQ#( 82STEP: testator & attestng wtnesses sgn once w/ the amdavt anguage foded nto the attestaton cause then w s notaiQ#(. 23 o amdavt provdes sworn evdence of due executon (no wtnesses requred at probate) B#n#>t: no one can ever chaenge executon AL aows for both types. The sgnature s rrebutabe. Other requrements are presumed but rebuttabe. A($anta-#s of S#"f2Po$#( /i"" o Sgnature requrement s concusvey presumed o other requrements of executon are presumed but rebuttabe o w probated w/out further proof uness theres fraud or forgery DiN##nc# in Att#station C"a!s# $4 S#"f2Po$in- o Att#station: prma face evdence T vountary sgned the w n wtnesses presence o S#"f2Po$in-: attestaton functons + permts probate w/out requrng wtnesses appearance DISPENSING PO/ER <a5a ,a)"#ss #o= Not a**"ica'"# if no +itin- (estabshes permanence) Si-nat!# is a")ost n#$# #%c!s#( (naty) F#B!#nt"& !s#( to fo-i$# +itn#ss #oO usuay adopted by statute b/c courts see as |udca expanson Do#sn0t #B!i# T to 5no+ t,# (#>nition of a +i"" o Not#: Adoptng dspensng power s amost equvaent to permttng hoographc ws. 3PC 7 C2M93@Ha)"#ss Eo If the *o*on#nt estabshes by C6C that (#c#(#nt int#n(#( (oc!)#nt to consttute () hs +i"", () parta/compete #$ocation of the w, () addton to or an a"t#nation of the w, or (v) parta/compete #$i$a" of formery revoked w or of a formery revoked porton of the w. HALL- w uphed; harmess error Facts: |m & Betty sgned |ont draft w & t was notarzed but NO WITNESSES R!"#: Athough a w generay requres 2 attestng wtnesses, a document may be vadated f *o*on#nt shows w/ C6C evdence that (#c#(#nt int#n(#( the document to be hs +i"" R3CKER- dssentng AL opnon; AL has NOT adopted dspensng power Ma1oit&: document s a w & doesnt compy. 1 notary but ddnt have 2 wtnesses Diss#nt: document can be construed as a deed & compes w/ deed requrements. o notary serves same functon as havng 2 wtnesses o ctes UPC & says AL shoud adopt dspensng power 24 What about substanta compance? See |ack v. Doran (mssng 1 wtness not ok) AL ,as NO s!'stantia" co)*"ianc# o (is*#nsin- *o+# NOTARIEED /ILLS What f a notary but not wtnesses? Probated under dspensng power. UPC 2-502(a)(3): sgnature by 2 wtnesses OR a notary HOLOGRAPHIC /ILLS AL- not aowed uness vad n another state where executed R!"#: must be wrtten by the Ts hand (,an(+itt#n) & si-n#( by the T + int#nt o Some |x requre a date o Si-nat!#: can be sgned anywhere, but f not at end, may doubt whether T ntended name to be a sgnature. Need assurance dsposton s na (.e. sgnature at the top w/ resduary cause at bottom probaby ok). o E%t#nt of Han(+itin- R#B!i#(: Ma1oit&: entrey wrtten, sgned, & dated |very strct| 0JI 3PC: "sgnature & matera provsons" Sti5#s *int#( *otions 6 on"& -i$#s #N#ct to ,an(+itt#n t#%t Most (is*ositi$# "an-!a-# n##(s to '# ,an(+itt#n 0I9 3PC: "sgnature & matera portons" are n Ts handwrtng. |Preprnted anguage "gve/devse/bequeath" shoudnt dsquafy nstrument as hoographc w| a""o+s #%tinsic #$i(#nc# to #sta'"is, T int#nt <inc"4 *#*int#( t#%t= "#ss ,an(+itin- #B!i#( KIMMEL0S ESTATE Facts: etter stated "f enny thng happens.property goes to..keep ths etter & ock t up" H#"(: etter s vad hoographc w o etter s t#sta)#nta& n character o The si-nat!#, "Father" sumcent compance w/ Ws Act o Puttng t n ma suggests naty CONDITIONAL /ILLS (p.272)- Vars: professonas never use condtona ws Ma1oit&: condton s a statement of the nducement for the executon of the w, whch can be probated upon death from any cause. o Vas: vad uness condton ceary reated to benecary (.e. f I de n maara, I want a my $ to go to the Maara research fund) Minoit&: Condton must be fued for w to be probated 25 o "f partcuar contngency stated n a paper, as condton upon whch t sha become ehectve, has never occurred, t wont be admtted. Ki))#" ESTATE OF GONEALEE- how much must be handwritten? preprnted form Facts: Decedent made own w by ng n banks on a preprnted form n hs own handwrtng. SIL saw hm sgn the ed-n form, but no one wtnessed t |cf swtched ws|. Wtnesses sgned 2 nd form whch he ntended to out before he ded. Iss!#: Can the w form ed n by Gonzaez be admtted to probate? Ho"(in-: Yes. "Ts handwrtten words may be read n the cont#%t of the preprnted words." Evdence of testamentary ntent appears n preprnted porton of the w form. Preprnted words were ntroductory statements . R!"#: Preprnted anguage n bank w forms may be used to estabsh the context of handwrtten ws. ESTATE OF K3RALT Facts: T dyng n hospta sends etter to hs over. "I have the awyer vst..to be sure you nhert MT property.if t comes to that." R!"#: When a document evnces a present testamentary ntent, the court w honor the Ts ntent. o Intent that document consttutes the Ts w can be estabshed by extrnsc evdence H#"(: 97 etter to Shannon (D) demonstrate a present testamentary ntent to modfy the terms of the vad forma 94 w. Court admtted etter as vad codc REVOCATION OF /ILLS Can revoke by <8= inst!)#nt or by <C= act o No ora revocaton o Codc ony revokes to the extent ts nconsstent wth the orgna document AL #$ocation #B!i#)#nts: o subsequent w (expressy or by nconsstency) OR o burnng/tearng, canceng, obteratng, or destroyng +F int#nt to #$o5# by T or another person n her presence & by Ts consent & drecton. If act by another person, need at east 2 wtnesses. 3PC R#$ocation AL R#$ocation Aows parta revocaton by act Doesnt aow parta revocaton by act o cant cross out 1 gft o f use whteout & no testmony as to who takes ntestacy States that act need not No statement on touchng words 26 touch words (BUT foows UPC) No wtness requred Act by another needs wtnesses Nether requre revocaton by act to touch words of the w S#B!#ntia" /i""s (p.287) 2003 a to A; 2008rng to B & car to C o 08 construed as codc 2009destroys 08 codc. o Go back to orgna w. Codc supersedes ony to extent ts nconsstent. 2009destroys 2003 w. Was codc meant to stand aone? o G#n#a" !"#: (#sto&in- +i"" (#sto&s a"" co(ici"s too int#stac& A +i"" )a& '# #$o5#( '&: ACTO o PHYSICAL DESTR3CTION CLFMa1: destructve act must ahect some part of wrtten porton of the w Mo(#nF3PC: destructve act must ahect some part of w o /RITING AS REVOCATION BY ACT CL: wrtng ddnt quafy as revocaton by act b/c ddnt touch any of the wrtten portons of the w as requred by CL THOMPSON 3PCFAL: canceaton not requred to touch any of the words on the w but must be on the actua w somewhere. Ma%+#""-AL /RITINGO o E%*#ss o Inconsist#nc&: subsequent w dsposes of decedents property n nconsstent way w/ pror w. Ts ater ntent contros. PRES3MPTIONO o HARRISON $4 BIRD2 If a w was ast n Ts possesson & cant be found at Ts death, rebuttabe presumpton arses that T revoked the w by act. HARRISON $4 BIRD(p.287)- dupcate w probem; revocaton by presumpton Facts: atty kept orgna & she got copy. Tod atty she wanted to revoke & he tore t up & maed t to her but attys revocaton was nvad b/c he ddnt do t n Ts presence. At death, found etter from atty but ddnt nd peces of w. H#"(: presumed T had revoked her w. R!"#: When a persons w snt found among her ehects at death, a presumpton of revocaton arses. Presumpton s rebuttabe by ether a preponderance or C&C. 27 o Weak presumpton. To overcome, any evdence there wasnt ntent to revoke s sumcent. o Not#: must be evdence w was n Ts possesson SPLIT RE: /HAT EFFECT DOES REVOCATION OF A D3PLICATE HAVE ON OTHER COPIES. Revocaton by act/wrtng revokes a dupcate orgnas Revocaton by presumpton does NOT revoke a dupcate orgnas uness none are found Revocaton by presumpton DOES revoke a dupcate orgnas, even f some arent n her possesson. Haison THOMPSON Facts: Ts atty wrote "vod" on back of w & codc & T sgned. R!"#: wrtng words of canceaton on the back of a w nsumcent to revoke w; words of canceaton must actuay touch words of the w. o 3PC/AL: no requrement words of canceaton touch words of the w Ma%+#"" (AL) (N2, p.293)- Ts atty wrote canceed on top margn of the w & T sgned. H#"(: vad revocaton; other courts uphed ths as vad hoographc revocaton. o Cant be hoographc w revocaton b/c not n Ts handwrtng o Cant be revocaton by wrtng b/c no w formates o Dis*#nsin- *o+# a**"i#s to #$ocationf C&C document ntended to be revoked the attempted revocaton woud be ehectve(p.293) DEPENDENT RELATIVE REVOCATION Revocaton based on mstake s nehectve f T ntends. As5: Woud the T have revoked the w f he had known the truth/subsequent event? DRR on"& a**"i#s if: o Aternatve pan of dsposton that fas (.e. another w) OR o Where mstake appears n the terms of the revokng nstrument OR o mstake s estabshed by C&C P4 CIG; NC T gves $1k to nephew. T crosses out & substtutes $1500, wrtes ntas & date. o f hoographc ws aowed -Probaby woud fa. depends on how much |x requres to be handwrtten (most requre enough to dscern testamentary ntent). o AL- hed get $1000 attempted parta canceaton not aowed. Snce we can see what orgna w was, court w honor t o |x aows parta revocaton by physca act- $1k canceed; handwrtng snt sumcent w/codc b/c not wtnessed. UPC-consders context of wrtng so may be vad hoographc. Hed get $1k under DRR b/c canceaton premsed on mstake $1500 woud be ehectve. 28 o what f T crossed out & put $500 nstead? Most courts woud gve $1k. LACROIH $4 SENECAL- mstake= nterested wtness sgned codc Facts: W (named P as soe her & resdue to nephew, to Seneca). Codc (revoked resduary cause & cared nephews name but same dsposton). Senecas husband was wtness to codc H#"(: athough codc nvad, -a$# #N#ct to oi-ina" +i"". Act of revokng 1 st w was due to mstake so revocaton nvad. o 3PC 6 AL: no requrement wtness be dsnterested, BUT coud create suspcous crcumstance f they take a substanta porton /,&? when new w fas, presume T woud prefer orgna w over ntestacy ESTATE OF ALB3RN- DRR appes to revvas of ws too; adopts mnorty rue* Facts: T revoked w #2 w/ ntent of revvng w #1, but under aw ddnt revve w #1 H#"(: Apped DRR b/c revocaton based on mstaken assumpton w #1 woud be revved. Probated 2 nd w b/c foow mnorty revva w. REVIVAL (p.304) Sc#naio: w #1; W #2 (revokes 1); then revokes #2. What happens to #1? o CL: 1 st w vad b/c doesnt take ega ehect unt Ts death so 2 nd never truy revoked 1 st o Ma1oit&F3PC: #1 s revved if T so int#n(s o Minoit&*: #1 not revved uness re-executed OR repubshed by ater nstrument AL- combo of ma|orty & mnorty b/c t "i)its +,## &o! can "oo5 fo #$i(#nc#. You can ook at crcumstances of revocaton of 2 nd w OR Ts contemporaneous attested & executed wrtng that he ntended 1 st w to take ehect. NO ora statements. He gve statute. REVOCATION BASED ON CHANGES IN FAMILY CIRC3MSTANCES AL: o Maia-#: doesnt revoke a w; new spouse gets ntestate share Cf. Eic5son- subsequent marrage revokes w, UNLESS w states otherwse. o Di$oc#: revokes any w devse n favor of the former spouse 3PC: revokes gfts to spouse & reatves thereof; appes to nonprobate transfers SCOPE OF A /ILL INTEGRATION: R!"#: pages physcay *#s#nt at ti)# of #%#c!tion that T int#n(s to be part of w are ntegrated 29 o Not#: number & stape pages; have T nta each page (shows ntent) o GonQa"#Q: no ntegraton b/c T ddnt ntend both w forms to be hs w REP3BLICATION BY CODICIL Executng a codc "reexecutes" and "repubshes" the underyng w IF T int#n(s o Ony appes to pror vady executed w (must have a 3 formates but coud repubsh a w thats nvad due to an nterested wtness or purgng statute) o See p.309, case 1 (purgng statute & dsnterested wtnesses ok b/c repubshed) :OHNSON $4 :OHNSON- ncorporaton by reference? Facts: snge page nstrument ohered for probate - typed, handwrtten. Typed porton ddnt compy w/ W Formates. Handwrtten porton vad hoographc w. Handwrtten sad "ths w sha be compete." shows ntent to ncorporate typed porton. H#"(: Vad codc ncorporated the nvad w by reference. R!"#: a vad hoographc codc repubshes the w no matter what defects may have exsted n the executon of the earer document. o Can ,o"o-a*,ic +i"" inco*oat# t&*#( inst!)#nt. Probaby no; maybe f t was separate INCORPORATION BY REFERENCE A w can ncorporate by reference a document that wasnt executed w/ formates IF: o Document n +itin-; o int#nt in +i"" to ncorporate; o (#sci'#s the document w/ #asona'"# c#taint& AND o document beng ncorporated was in #%ist#nc# at tme w executed. P must show by *#*on(#anc# that document exsted at ws executon changes made after w executon nvad unless repubcaton by codc 3PC: docs made after executon ok f sgned S## a"so acts of in(#*#n(#nt si-ni>canc# (octin# SIMON $4 GRAYSON (p.315)- a facts as descrbed the same, except dherent date Facts: T eft $4k to be pad as drected by me n a etter found n my thngs dated 3/25/32. Found etter dstrbutng the $4k but t was dated 7/3/33. H#"(: even though date dscrepancy t was the document T ntended to ncorporate. Vad b/c T executed codc on 11/25/33, whch repubshed the w. 30 R!"#: must be #asona'"& c#tain the document n queston s the one referred to by the T n the w CLARK $4 GREENHALGE- does "memo" ncorporate notebook too? Facts: T dsposed of persona property by a "memo" her named executor knew about. T made notebook AND memo namng benecares. Notebook tted "st to be gven T 79." Memo made n 72. D argued w had ntent to ony ncorporate memo. H#"(: w broad enough to ncorporate notebook and memo. Notebook n exstence at tme w executed b/c T executed codcs afterwards. NOTE: ct confused dspostve & testamentary ntent; good case for dspensng power ACTS OF INDEPENDENT SIGNIFICANCE (p.323)- excepton to exstence requrement 7C2M8C: A w may dspose of property by reference to acts & events that have si-ni>canc# a*at fo) t,#i #N#ct !*on t,# (is*ositions made by the w, whether they occur before or after the executon of the w or before/after the Ts death. The executon or revocaton of another ndvduas w s such an event. Locked v. unocked drawer? Safety depost box? 3PC 7 C2M83: S#*aat# /itin- I(#ntif&in- D#$is# of Tan-i'"# P#sona" Po*#t& (p.316) Does NOT appy to money; AL has not adopted Must be +itt#n, si-n#( by the T & descrbe tems wth #asona'"# c#taint& CONTRACTS RELATING TO /ILLS CONTRACTS TO MAKE A /ILL Most have to be n wrtng (SoF); exceptonquantum merut. Good fath = mmutabe rue of a contract 3PC 7 C2M8L: Contacts Conc#nin- S!cc#ssion Contracts to make a w/not to revoke a w or to de ntestate may ony be estabshed by: o provsons of a +i"" statng matera provsons of the contract o an #%*#ss #f##nc# n a w to a contract & extrnsc evdence provng contracts terms o +itin- si-n#( '& (#c#(#nt evdencng the contract 3PC 6 AL: executon of |ont or mutua ws does NOT gve rse to a presumpton of a contract not to revoke *43CJ: 84 "and my fathfu vaet, Sdney whom I promsed to remember n my w. H Sdney." o Sdney doesnt have a cam. "remember n my w" ambguous. 31 C4 T contracts w/ A to gve everythng to A n exchange for As care. A breaches & T rescnds but doesnt change hs w. Can A take? o Even though there was a breach, A w take everythng. Onc# contact in +i""; a**"& t,# "a+ of +i""s <t!)* contacts=4 34 A des. B (roommate) aeges A promsed to eave B estate n exchange for hs care. B has typed document sgned by A w/ 1 wtness devsng to B. o UPC 2-514 (contracts concernng successon) B takes. Consderaton = substtute for w formates. L4 W promses her husband, H, she care for hm n consderaton go H devsng her Backacre. o f ts a contract to spouse-aready have ega duty to care for spouse so no consderaton, spouse woudnt take CONTRACTS NOT TO REVOKE A /ILL :oint /i"": one nstrument executed by 2 persons as the w of both (probated when each T des). Uncommon. M!t!a" /i"": separate ws of 2+ persons that contan smar or recproca provsons o Ma1: executon of |ont or mutua w does NOT gve rse to a presumpton of a contract B3T w/ |ont ws some courts nd an mped contract /,at if s!$i$in- s*o!s# #)ai#s. o Ma1: contract stands & remarred spouse cannot revoke o Min.: contract vod on pubc pocy grounds VIA $4 P3TNAM (p.329)- contract not to revoke breached by changes n famy crcumstances Facts: husband/wfe made mutua ws n favor of each other, resdue to kds. Wfe ded; he remarres but doesnt provde for 2 nd wfe. Wfe sought pretermtted share but chdren cam theyre 3 rd party benecares H#"(: 2 nd wfe s favored over kds b/c of pubc pocy favorng marrage & pretermtted spouse statute |statute overrode contractua w|. Mnorty rue*o"ic& t!)*s contact4 o Cf. Ma1: 3 rd party benecares preva over omtted spouse (p.333,N2) P#t#)itt#( S*o!s# a**"i#s +,#n *#son )ai#s aft# )a5in- +i"" 6 s*o!s# s!$i$#s4 Do#s NOT a**"& +,#n: o Waved by prenup o Spouse provded for n w (even f ony gves $1; protect Ts ntent NOT spouse) o Intentonay eft spouse out H3MPHREYS (handout)-mutua ws/kds from pror marrages. Contract not to revoke Facts: spouses executed contractua ws n favor to each other w/ resdue to a of ther chdren (both had kds outsde of marrage). 32 Husband ded & wfe gave about $50k of estate to ony her chdren. Wfe made ots of gfts to her kds ony. H#"(: wfes gfts to her kds were not n good fath & unreasonaby arge o T#st s,o!"( '#: were gfts desgned to avod contract? R!"#: contract to eave ones property by w gves the promsor freedom to dspose of t nter vvos n -oo( fait,; BUT such gfts must be #asona'"#, not testamentary n ehect, & not made for the purpose of defeatng the contract to devse CONTSTR3CTION OF /ILLS GOALS: <8= Advance Ts ntent; <C= mnmze transacton costs What extrnsc evdence can you use to show benecary s ntended/foreseeabe? o A"+a&s: surroundng crcumstances (w contests) o A)'i-!it&: extrnsc evdence not contradctng w (AL-ony atent ambgutes) o G#n#a""& n#$#: drect decaratons of Ts ntent MISTAKEN OR AMBIG3O3S LANG3AGE IN /ILLS (p.335) Ta(itiona" R!"#s o No extrnsc evdence (pan meanng rue) o No reformaton E%c#*t: can reform to correct tax mstakes Pat#nt A)'i-!iti#s: appear on the face of a w o R!"# <AL=: no extrnsc evdence aowed even f w fas & ntestacy resuts E%. f you dspose of your entre estate to 2 peopentestacy Lat#nt A)'i-!iti#s: manfests tsef when the terms of the w are apped o R!"#: ora decaratons of ntent to the scrvener are admtted n most |x o C T&*#s: EB!i$ocation: w ceary descrbes the person/thng & 2+ persons/thngs t the descrpton. Extrnsc evdence admtted. P#sona" 3sa-# E%c#*tion: extrnsc evdence admtted to show that T meant to refer to someone other than the person w/ the ega name n w (T used a nckname). Li)it#( to t,# i(#nti>cation of *#o*"#4 o Mrs. Moseey exampe (p.340) no *#son o t,in- #%act"& >ts t,# (#sci*tion; '!t CT *#sons *atia""& (o Ex. p. 341- T devsed to "Mr. & Mrs. Wende Rchard Hess, or survvor, presenty resdng at 17 Barbara Crce." Then, Wende & Genda marred; dvorced; he remarred Verna & sod house. 33 Verna argued no ambguty. Court admtted extrnsc evdence & 1 st wfe took. Not#: most |x dont adhere to dstnctons n types of ambgutes; AL does MAHONEY $4 GRAINGER- pan meanng Facts: w provded for "hers at aw" whch was Ts aunt. Atty tested T meant for 1 st cousns to take. H#"(: no ambguty n w & no reformaton-aunt takes, despte Ts cear ntent. FLEMING $4 MORRISON (p.356)- extrnsc evdence case NOT mstake case Facts: T tes atty to draft w n favor of P so shed seep w/ hm. Ended up gettng a 3 wtnesses requred, but ddnt te 2 nd two wtnesses t was a fake H#"(: w nvad b/c T acked ntent to make a w ARNHEITER (p.343)- admtted extrnsc evdence but ddnt reform mstake; msdescrpton Facts: T sad to se "304 Harrson Ave." Ddnt & never owned that property. H#"(: Court cant correct mstake; however, struck number of the street so "Harrson Ave." eft. B/c ony owned 1 property on that street Mis(#sci*tion Doctin#: Where a descrpton of a thng/person conssts of severa partcuars & a of them dont t any one person/thng, ess essenta partcuars may be re|ected provded the remander of the descrpton ceary ts. ESTATE OF GIBBS (p.344)- mstake; admtted extrnsc Facts: Robert "|" nstead of Robert "W." Ts ddnt know "|." H#"(: Detas of dentcaton whch are hghy susceptbe to mstake shoudnt be accorded such sanctty to frustrate otherwse ceary demonstrated ntent. Where such detas of dentcaton are nvoved, courts shoud receve evdence tendng to show that a mstake has been made & shoud dsregard the detas when the proof estabshes to the hghest degree of certanty that a mstake was made. Mista5#s of O)ission (p.354) tested omsson due to computer error & T ddnt ntend to change benecares. H#"(: awarded nephew resdue. Set up dentca trust for kds. No evdence of hostty towards 4 th chd. Changed trust. T gves "estate n trust to A; on As death, t goes to B & C." A predeceases T. Ct-ntent was to benet B&C n the aternatve to A so gve t to them athough w doesnt say t. REFORMATION TO CORRECT MISTAKES 3PC 7 C2G9M (p.351) (2008 verson ncorrect). 34 The court may reform the terms of a governng nstrument, even f unambguous, to conform to the terms of the transferors ntenton f t s proved by cear and convncng evdence +,at t,# tansf#o0s int#ntion +as and that the terms of the governng nstrument were ahected by a mstake of fact or aw, whether n expresson or nducement. o Not#: Restatement aows reformaton to acheve a tax ob|ectve CL: no EE to correct mstakes & no reformaton ERICKSON V4 ERICKSON (p.345)- marrage revocaton/scrvenors error (aka ega error) Iss!# 8: Shoud tra court have admtted extrnsc evdence regardng Ts ntent that hs w woudnt be revoked automatcay by hs subsequent marrage? H#"(: No. Iss!# C: Dd Ts w provde for the contngency of hs marrage? o H#"(: No, B3T shoud admt evdence of a scrveners mstake. R!"#: If a scrveners error has msed the T nto executng a w on the beef t be vad notwthstandng the Ts subsequent marrage, extrnsc evdence of that error s admssbe to estabsh the ntent of the T. If scrveners error & ts ehects on the w are estabshed by C&C evdence, sumcent to estabsh a provson has been made for contngency. AL: coudve come out the same way b/c no EE needed MARTINDALE V4 BRIDGFORTH (handout)- mstake & fraud case Facts: argued (1) haf-sster reatonshp bass for devse & snt haf-sster |mstake| & (2) fraud n the nducement |but haf-sster ddnt know of w so no causaton| R!"#: A w maybe reformed for mstake n the draftsman fang to express the rea ntent of the T. But the mere mstaken opnon of the T as to some outsde fact whch may nduce the bequest s not a recognzed ground of contest |dcta|. o A mstaken noton on the part of the wfe, that her husband ntended to convert to hs own use the property composng her separate estate, whch nduced her to make a w excudng hm from a partcpaton n her property, does not avod such w." R!"#: In AL, cant reform w for a mstake. But, court w possby reform for a scrveners error when no EE needed. DEATH OF BENEFICIARY BEFORE DEATH OF TESTATOR G#n#a" R!"#: anyone takng from decedent must survve the decedent (testate or ntestate, but w may expressy opt out of survva requrement) CL: If benecary des before T, gft fas & passes va ntestacy SPECIFIC OR GENERAL DEVISE If gft fas resdue. If no resdue ntestacy. RESID3ARY DEVISE 35 If gft of soe resduary benecary fas ntestacy CL RNo R#si(!# of t,# R#si(!#S: If gft of 1/2 resduary benecary fas ntestacy, NOT other taker Mo(#n <AL=: when gft fas, remanng resduary taker(s) spt t CLASS GIFT If 1 member of cass des survvng cass takes. o AL ant-apse statute appes VOID GIFT Gfts to a dog (negbe taker) OR someone aready dead when w executed vod o AL ant-apse appes to a person dead at executon ANTI2LAPSE STAT3TES G#n#a" R!"#: For statute to appy, must: o Lapse (must actuay (i# or be t#at#( as *#(#c#asin- T) Dscamer, smutaneous death, sayer statute, dsnhertance o Predeceased benecary meets the statutory degree of #"ations,i* to t,# T 3PCFAL must be grandparent or nea descendent of grandparent of T. Do#sn0t a**"& to s*o!s#s o Predeceased benecary ,as iss!# who s!$i$# the T they take 3PCFAL: 5 day survvorshp requrement o Unless the w expressed a contrary ntent. T woud prefer gft to go to devsees ssue than fa. Presumpton ony rebuttabe by express contrary ntent n the w. /o(s of S!$i$os,i* Ma14: overrde statutes appcaton 3PC: words of survvorshp are not, n the absence of addtona evdence, a sumcent ndcaton of an ntent contrary to the appcaton of ant-apse statute. ESTATE OF R3SSELL (p.359)- vod gft to dog; no ROR Facts: T eft vady w, whch ncuded dsposton to her dog. P a-!#s gft to dog vod so she takes by ntestacy (no resdue of resdue rue). H#"(: gft to dog s vod & t apses. Apped no ROR rue, P (her) takes va ntestacy. o Cf. coud nd ts an unambguous dsposton - 50% to Chester, 50% to dog. No EE. E%a)*"#s (pg. 364, N4): T devsed her entre resduary estate to son A & to daughter B. B predeceases T, eavng a chd C. At Ts death, what happens to Bs share? o CL-Bs apses & goes to ntestacy. A- (1/2 + V) , C V No ROR !"#: A woud get from w; other apses & passes by ntestacy so s spt between A & C. 36 ROR a'o-at#(, A takes 100%. o Antapse- A- , C- R3OTOLO $4 TIET:EN (p.367)- does contngency precude antapses appcaton? Facts: w had provson statng "to Haze.f she survves me." Haze ded 17 days before T. Haze, step-daughter, covered by ant-apse statute. H#"(: Words of survvorshp aone do NOT negate operaton of antapse statute (adopted UPC approach/mnorty rue). /,&. Antapse shoud be apped beray; ws use boerpate anguage & no express gft-over o B!(#n is on t,os# cont#stin- A2L a**"ication Cas# I (p.366) - T devses Backacre "to my son Sdney f he survves me" & resdue to hs wfe, Wma. Sdney des n hs fathers fetme, eavng a daughter Debby. Issue: do words of survvorshp evdence an ntenton that Debby shoudnt be substtuted for Sdney? o Ma1oit&: express survvorshp requrement states an ntent that antapse shoud NOT appy & that Debby NOT be substtuted for her father o 3PC: words of survvorshp not a sumcent expresson of contrary ntent & antapse statute appes substtutng Debby for her father. /,## not c"#a +,#t,# T int#n(#( c"ass -ift; "oo5 to: D#sci*tion of B#n#>ciai#s: o f referred to coectvey cass gft. o If referred to by name not cass gft. D#sci*tion of Gift: o If gft descrbed n aggregate cass. o If referred to n dstnct shares not cass Co))on C,aact#istics: o If benecares a share a common characterstc cass Even f share a common characterstc, f others not ncuded n the cass share the same one, no cass. See Dawson o If no common characterstc no cass O$#a"" t#sta)#nta& sc,#)#: o If theres a gft to mutpe ndvduas w/ an express survvorshp requrement, faure to ncude t n another gft to mutpe ndvduas ndcates T ddnt ntend atter to be a cass Counterargument: T thought t was so obvous t was a cass gft no express survvorshp requrement needed o Determne who takes faed gft f not a cass. Anayze s T woudnt want that person to take property based on entre testamentary scheme. R#stat#)#nt foc!s#s on ,o+ t,# '#n#>ciai#s a# (#sci'#(: 37 o M!st '#: Descrbed by group abe, and Intended to take as a group. Ony by a group, rebuttabe presumpton a gft s a cass gft Ony by name, not a cass gft Both group abe & ndvdua names rebuttabe presumpton not a cass gft DA/SON $4 Y3C3S (p.376)- cass gfts /i"": Devsed nterest n farm to her nephew, Stewart & other to her nephew Gene. Gene predeceased T. Resduary cause went to 2 frends or the survvor of them. Antapse statute ddnt appy b/c t requred the predeceased to be a descendant of the T. C"ass -ift. NO4 o Descrbed two nephews by names o Gft made n separate shares o Other neces/nephews on hubbys sde not ncuded o Resduary cause had express survvorshp requrement Facts: T sad she thought the farm shoud go back to her husbands sde of the famy R!"#: The anguage of a devse that names 2 ndvduas does not desgnate a cass. H#"(: despte express ntent to gve farm to hubbys sde, not a cass gft so Genes share apsed & fe to resduary cause. o Not#: f t were a cass, saved gft goes to other members of the cass CHANGES IN TESTATOR0S PROPERTY AFTER EHEC3TION OF /ILL ADEMPTION BY EHTINCTION Ony appes to s*#ci>c devses. La+ fa$os -#n#a" (#$is#s. ASK: <8= what type of devse s t? <C= f specc, s t adeemed? o S*#ci>c: ")& car" AL D#f4: "a bequest of a partcuar artce or specc part of the testators estate whch s so descrbed and dstngushed from a other artces or parts of the same as to be capabe of beng dented o D#)onstati$#: "$50 from my savngs account" o G#n#a": "$50" o R#si(!a&: whats eft over T/O THEORIES OF ADEMPTION BY EHTINCTION 1. IDENTITY <CL=: f a speccay devsed tem snt n Ts estate as hs death, gft s extngushed o Mo(i>#( I(#ntit& a**oac,: exempts property that was transferred nvountary &/or transfer made w/out Ts knowedge and consent OR destroyed contemporaneousy w/ Ts death. Anton 38 2. INTENT <3PC=: f a speccay devsed tem snt n Ts estate as hs death, benecary may be entted to the repacement for, or cash vaue of, the orgna tem, IF benecary can s,o+ T int#n(#(4 o Not#: ths aways takes $ away from other benecares 3. AL: foows dentty theory uness ts a securty (ntent) IN RE ESTATE OF ANTON (p.381)- sod dupex to pay for T adempton? No. Facts: T devsed of her nterest n her dupex to her deceased husbands daughter (Gretchen) & the remanng to her boogca son. Got n bad wreck & had to se property to pay for her care. Step- daughter argues she cant se the dupex & wants the proceeds of the sae. Mo(i>#( Int#ntion a**oac,: dentty rue wont be apped to cases where speccay devsed property s removed from the estate through an nvountary act as to the T. o R!"#: Must have (1) knowedge of transacton nvovng specc devse; (2) reaze ts ehects; (3) opportunty to change w o Not#: f tme to change w adempton; dherent resut under UPC o Not#: f adeemed, Nancy woud take proceeds b/c she s the resduary benecary H#"(: The sae of dupex by an attorney n fact dd NOT resut n adempton of the bequest. Da)a-#s: Gretchen shoud receve of the proceeds not used to support the T ($52k) |NOT of saes prce as she requested|. o 3PC: shed get of saes prce- 7 C2J9J<'= 3PC 7 C2J9J Nona(#)*tion of S*#ci>c D#$is#s (p.387) <a=<J= A specc devsee has a rght to .a *#c!nia& (#$is# equa to the vaue |of an absent specc devse| to the extent ts estabshed that o adempton woud be nconsstent w/ Ts pan OR o T ddnt ntend devse to adeem. OTHER ADEMPTION EHCEPTIONS (p.386-87) C,an-# in fo); NOT s!'stanc# o Ex. rea estate cash. Property s st there, so take cash. o Ex. "my 100 shares of Tgerta stock." Merges w/ Lon Corp. H#"(: corporate merger/ reorganzaton s ony a change n form, not substance o Pa5# <AL=: Hed that 1 CD ddnt adeem when spt nto 2 dherent CDs. Change n form. Aowed EE to show T dd ths to ncrease gft to benecary (unke AL). If T devses Backacre to A & ses t & buys Whteacre w/ the proceeds s A entted to Whteacre? (p. 388, N1) 39 o 3PC: A takes |206(a)(5)- rea/persona property owned by T at death whch T acqured as a #*"ac#)#nt for speccay devsed rea/tangbe persona property| o AL ( statute): A wont take b/c AL foows dentty theory. AL <Pa5# =: change n form? Possbe argument. T eft A a "Ford car." Sod & bought a Ros-Royce. Does A take the Ros- Royce? (p.388, N1) o 3PC: s ths a repacement? Matt,#+s: does former wife get value of 150 shares? o Facts: T gave former wfe 150 shares of stock. T owned 150 shares at tme of w executon, but Ltton (arge, pubcy-hed co.) redeemed shares before death (co. bought shares back). Is gft adeemed or does she take cash vaue? A(#)*tion No A(#)*tion S*#ci>c (#$is# List +F s*#ci>c (#$is#s O+n#( #%act"& 8M9 s,a#s S#ction CCJ G#n#a" o (#)onstati$# (#$is# C,an-# in fo) Co*4 c,an-#( it Not R)&S stoc5 La+ fa$os -#n#a" STOCK SPLITS (p. 390) If T devses 100 shares of stock & they spt 3-to-1 so he has 300 at death, does devsee take 100 or 300? o CL: S*#ci>c - 300 G#n#a"- 100 ALF3PC: No dstncton b/t specc & genera devsesdevsee takes 300 uness contrary to Ts ntent. N2, pg. 388. Mssng snuh bottes. o CLFAL: adempton; takes nothng. o 3PC 206(a)(6) have to show T ddnt ntend for devse to adeem. P#s!)*tion is sti"" a(#)*tion. SATISFACTION OF GENERAL DEVISES (p.390) Generay appes to pecunary bequests. Not#: f specc bequest s gven nter vvos adempton by extncton NOT satsfacton CL: ony apped b/t parent & chd; presumpton of satsfacton f monetary gfts gven AFTER ws executon Mo(#n: ook at Ts ntent-was fetme gft ntended to reduce gft? 40 o 3PCFAL: assume NO satsfacton unless contemporaneous wrtng (cf. advancement) EHONERATION OF LIENS (p.391) What happens f w makes a specc devse of and thats sub|ect to mortgage that T was personay abe for? o CL E%on#ation of Li#ns: property passes free & cear of mortgage presumed T wanted debt pad out of the resduary o 3PC: property passes encumbered by mortgage ABATEMENT Appes when estate acks enough to cover a devses made n the w. O(# in +,ic, #stat# is #(!c#(: <8= resduary <C= genera <3= specc/demonstratve o 3PC: f testamentary pan defeated by usua order of abatement, shares of dstrbutees abate as may be necessary to gve ehect to Ts ntent By w, T gves a car to A, $100 from savngs account to B, $100 each to C & D, and the resdue to E. T des w/ $150. Who takes what? o A gets car (specc) o $100 from savngs account (demonstratve) - not abated. B takes $100 o $100 to C & D (genera). Both get $25 each o E gets nothng NONPROBATE TRANSFERS (p.393) CL /i"" S!'stit!t#s: fe nsurance, |T, possessory estates/future nterests, & nter vvos trusts (never substtuted ws-reated doctrnes) Lke w b/c #$oca'"# !nti" (#at, 6 a)'!"ato& (ony take ahect when you de) Is fe nsurance functona equvaent of a w? Dherent than a w b/c pocy hoder has no contro over assets & pay premums. Aternatve purposes for fe nsurance than w. INTER VIVOS TR3STS2 ducary dutes unwavabe C#ation of R#$oca'"# T!st: o DEED OF TR3ST w/ 3 rd party trustee What f 3 rd party trustee oots trust whe settor ave & competent. N.2, p.407 Wams can sue trustee rrespectve of settors competence o DECLARATION OF TR3ST: settor=trustee I#$oca'"# TESTAMENTARY TR3STS- aways rrevocabe; created by wmust meet formates! 41 FARKAS $4 /ILLIAMS (p.398)- decaraton of trust; present nterest Facts: decedent ded ntestate. Purchased stock 4x n hs name as trustee for D. Aso sgned 4 separate decaratons of trust. In each trust, he reserved fetme benets & power to revoke trust. P argued trust nvad b/c testamentary & no ws act formates H#"(: nter vvos trust vad b/c some nterest passed nter vvos to D even though trusts were revocabe. Aternatvey, process decedent went through adequatey served Ws Act formates o Contngent benecares coud sue f trust mshanded Cf. w benecares coudnt sue R!"#: retenton of the power by the trustee to se/redeem stock does NOT render the trust testamentary. It s vad. LINTHIC3M $4 R3DI (p.403)- trust contests; no present nterest Facts: Settor executed w & revocabe trust. 2 years ater, new w & amended trust. P camed amended trust product of ncapacty or UI. H#"(: P had no standng to sue over trust amendments. Court sad ony "nterested persons" can petton & they had no present nterest n the trust, so no standng. R!"#: benecares under revocabe trust have no standng to contest amendments to the trust b/c a benecares nterest s contngent & unenforceabe durng settors fetme. BUT may chaenge settors capacty through guardanshp statutes. /ILL S3BSTIT3TES 6 S3BSIDIARY LA/ OF /ILLS IN RE ESTATE OF ATKINSON (p.407)- POD certcates nvad Facts: decedents certcates of deposts where n hs name, POD to hs 3 daughters from prevous marrage. Wdow excuded from w who eected to take her spousa share. Ds argued deposts werent part of estate snce passed automatcay at death. H#"(: snce POD documents had no w formates & shoudve been ncuded n estate b/c they were testamentary o CL: POD provson nvad w/out Ws Act formates uness ts a fe nsurance pocy o Mo(#n: POD provsons vad w/out W Formates o AL: tte to POD certcate of depost determned by contract aw, NOT ws ESTATE OF HILLO/ITE (p.409)- POD partnershp agreement vad Facts: deceased husband partner n nvestment cub. Terms of partnershp agreement ncuded express POD cause payabe to hs wfe. Executors chaenged POD cause H#"(: vad contact w/ POD cause. Wfe takes (apped modern trend) REVOCATION OF A TR3ST G#n#a" R!"#: where trust sets out an express, partcuar method, ony that method of revocaton s vad. 42 IN RE ESTATE 6 TR3ST OF PILAFAS (p.414)- revocabe trust; subsdary ws aw nappcabe Facts: decedent executed nter vvos trust & w. Trust revocabe by nstrument n wrtng devered to the trustee. Decedent expressed ntent to revse documents. At death, coudnt nd w/trust. Omtted famy members argued for revocaton by presumpton. H#"(: presumpton of revocaton does NOT appy to revocabe trust b/c coudnt be revoked by physca act. o Cf. R#st4: trusts may be revoked absent any contrary provson n trusts terms f C&C settor ntended to do so Ths case: no C&C & f terms of trust are excusve revocaton method, cant appy STATE ST4 BANK 6 TR3ST CO4 $4 RESIER (p.416)- credtors can reach revocabe trust assets Facts: decedent created revocabe mandatory nter vvos trust w/ power to receve fetme benets. Conveyed stock of 4 corporatons to trust; w eft resdue to trust. Got $75k unsecured oan by representng stock ownershp but ded 4 months ater & nsumcent assets to pay bank. Iss!#: Can assets of trust be used to pay debt owed by the settors estate? H#"(: yes. Credtors may reach assets owned by trust over whch settor had contro over at the tme of hs death, but must exhaust probate estate rst. /,&. Vio"at#s *!'"ic *o"ic& fo in(i$i(!a" to ,a$# #stat# to "i$# on '!t not an #stat# to *a& ,is (#'ts /,o"# "if# ins!anc# Pocy- can cash t out T#) "if# ins!anc#- cant cash t out. If you de, pays xed amount to desgnated benecary (cheaper). COOK $4 EA3ITABLE LIFE INS3RANCE SOCIETY (p.420)- dvorce doesnt revoke nonprobate Facts: purchased fe nsurance & named wfe as benecary. Dvorced, remarred & had son. Ded 14 years ater w/out changng fe nsurance benecary. Made hoographc w eavng wordy possessons to "my wfe & sons" (ncuded fe nsurance) Iss!#: Can he change benecary desgnaton by w when nsurance co. requres a change by wrtten notce? H#"(: No. Ex-wfe takes due to pubc pocyequty heps the vgant, not the azy. Do#s (i$oc# #$o5# "if# ins!anc# (#si-nation in fa$o of #% s*o!s#. o 3PC <Min4=: Yes. (N2, p.422) o AL <Ma1=: No-ony appes to w desgnatons POD *o$ision cannot '# a"t##( '& +i"" 43 S3PER/ILLS (p.422) a w that permts the changng of w substtutes terms. o Vas: not a good dea; the advantage of nonprobate s avodng probate & here you must go through probate ENGELFHOFF $4 ENGELHOFF (p.426)- ERISA preempts dvorce revocaton- ex-wfe takes. Facts: decedents benets ncuded fe nsurance & penson pan. He named wfe as benecary but they dvorced & 4 months ater he ded. Both covered by ERISA. WA statute sad dvorce automatcay revokes nonprobate benecary desgnaton n favor of ex-spouse. ERISA preempts f they reate to EE benet pan. H#"(: ERISA preempted WA statute b/c t (1) controed benecares and (2) nterfered w/ natonay uned pan of admnstraton. Ex-wfe takes. M3LTIPLE2PARTY BANK 6 BROKERAGE ACCO3NTS (p.423) 3 types: :oint 6 S!$i$o acco!nt- both have power to draw; survvor takes at death P4O4D. acco!nt- benecary has no power to access account durng depostors fe, but takes money at death (|ust ke a w) A-#nc& acco!nt-agent has power to draw durng depostors fe but no rght at death VARELA (mstress/D) $4 BARNACHEA (cheater/P) (p.423) Facts: P (atty) moved n w/ D, pad a expenses, & sted her on account as |T. D wrote hersef $280k check & deposted n her own account. P sued to sette ownershp of account H#"(: P & D hed as |T. P faed to rebut the presumpton he ntended to gve D an equa nterest n ther |ont bank account R!"#: when a |ont bank account s estabshed wth the funds of one person, a gft of the funds s presumed. Presumpton rebuttabe w/ C&C evdence. o Not#: credtors have rghts to 100% of the funds snce |T has rghts to use a the money R,o(# Is"an( (p.435, N1) - ony state that doesnt aow EE to rebut presumpton of |T acct 3PC N#t Conti'!tion R!"#: ownershp of |T s n proporton to net contrbutons, uness C&C evdence of dherent ntent (p.435, N2) o Credtor of 1 spouse can attach up to amount of hs/her contrbuton PO3R2OVER /ILLS (p.443) W w/ express cause sendng assets nto a trust (w references trust) 3 ways to vadate a trust as part of a w: 44 o Inco*oation '& #f##nc#: any document n exstence sumcenty dented n the w, so subsequenty executed or amended trusts NOT ncorporated nto w Trust doesnt have to be funded at the executon o Acts of In(#*#n(#nt Si-ni>canc#: trust nstrument doesnt have to be n exstence when the w s executed, but trust must have assets n t before Ts death Trust must be funded; fundng = rea word sgncance Amendments are vad o 3PC (p.445): ony requrement s to sumcenty dentfy document n w Why change ncorporaton requrement for trusts but NOT ws? Fath n trusts-athough no w formates, st condent t promotes Ts ntent Makng a trust very forma; usuay attorneys draft o 0J9 3TATAFAL (p.444-45): (1) trust must be n exstence at ws executon & (2) reasonaby dentfy trust n w. Amendments to trust after ws executon are vad. Trusts can be moded oray CLYMER $4 MAYO (p.445)- trust revoked by dvorce Facts: decedents unfunded trust named husband. Dvorced & 3 years ater ded w/out changng trust. Trust was to be funded by penson pan? P chaenged trust b/c (1) unfunded & (2) revoked by dvorce H#"(: o unfunded trust vad b/c pour-over w executed before Ts death. Aternatvey, trust dd have property n t (rght to receve nsurance & penson pan proceeds). o Ex-husbands nterest revoked by dvorce even though statute ony apped to ws snce the w & trust were ntegray reated components of a snge testamentary scheme; trust had no sgncance unt Ts death. :OINT TENANCIES IN REALTY (p.447) Each |T has equa nterest; cant devse nterest by w (can sever by nter vvos conveyance) Rght of survvorshp Credtor of a |T must seze nterest durng |Ts fe. Lose abty to attach after tenant des (ther nterest n the property extngushed at death) PLANNING FOR INCAPACITY IN RE ESTATE OF K3RRELMEYER (p.449) Facts: husband named 2 durabe power of attys; whe he was ncompetent, wfe created trust & transferred Cearwater property (nconsstent w/ ws terms). Son chaenged trust argung power to make trust nondeegabe 45 o "I authorze my attorney to execute & dever trust nstruments" H#"(: durabe power of atty authorzed wfe to create trustpower to create trusts are deegabe. On remand, found wfe ddnt breach ducary dutes. Not#: wfe coudnt have rewrtten w b/c cant deegate executng a w (ws powers nondeegabe; trust powers are deegabe) D3RABLE PO/ER OF ATTORNEY (p.448-49) Power contnues unt prncpa des; even through ncompetency o Cf. trust powers contnue after settors death Trustee hods tte to property; durabe power of atty doesnt Trusteeshp generay preferred Here (pannng for ncapacty=concern over nanca ahars, not medca decson) o Cf. attorney-n-fact termnates when ndvdua ncapactated RIGHTS OF THE S3RVIVING SPO3SE COMM3NITY PROPERTY- husband & wfe own a acqustons from earnngs durng marrage n equa, undvded shares. Spouses = economc *atn#s. Upon death, decedent can transfer & survvng spouse aready owns the other . Excudes a gfts & nhertances durng the marrage. SEPARATE PROPERTY (CL/AL)- husband & wfe own separatey a property each acqures. Stress ndvduas autonomy over her earnngs. Survvng spouse takes eectve sharencudes premarta property. o ELECTIVE SHARE- spouse can take under w OR renounce w & take a fractona share of decedents estate (typcay ony appes to probate estate; GA doesnt have). Iss!#: shoud nonprobate property be consdered as part of the "estate?" AL: NO. You coud ehectvey dsnhert spouse w/ nonprobate transfers. Excepton for usory trusts. 3PC: yes Po"ic&: (1) survvng spouse contrbuted to the decedents acquston of weath & deserves to have a porton of t (*atn#s,i* theory; ); (2) provde survvor adequate s!**ot2 typcay 1/3 rd . IN RE ESTATE OF CROSS (p.484)- spouse/Medcad recpent shoud take eectve share Facts: husband ded testate eavng 100% to hs son. Survvng spouse 80 years od, ncompetent, & vng n home pad for by Medcad. Court apponted commssoner to see about eectve share. H#"(: Athough Medcad payng, ncompetent survvng spouse shoud take an eectve share b/c Medcad rues state the non-utzaton of avaabe ncome renders recpent negbe. 46 TEST: what woudve survvng spouse had done for her nanca benet had she been competent to make decson hersef? o Stat!t# sai( co!t )a& #"#ct fo s!$i$in- s*o!s# on"& if n#c#ssa& fo s!**ot consi(#in- t,# tota"it& of cic!)stanc#s TESTS RE: /HICH NONPROBATE TRANSFERS ARE S3B:ECT TO ELECTIVE SHARE. ILL3SORY TRANSFER TEST: focuses on the a)o!nt of int##st the deceased spouse #tain#( n the property. o ask whether nter vvos property arrangement that permts the property to avod probate s reay an nter vvos transfer OR whether deceased spouse retaned such an nterest n the arrangement that the transfer s more testamentary o If property transfer s deemed "usory" st vad but s ncuded n cacuatng eectve share AL: f settor reserves substanta nterest or unbrded contro over trusts management that snt for benet of benecary, trust may be found to be usory Fa5as- non-usory b/c there was an mpedment to revocaton I""!so&: ora revocaton or havent gven up any contro CONTROL TEST: See Suvan S3LLIVAN $4 B3RKIN (p. 488)-survvor wants trust assets ncuded n probate estate Facts: Wdow sought to ncude husbands nter vvos trust assets nto estate determnng her eectve share. Coupe separated @ hubbys death. P camed trust nvad as testamentary. o Husband sgned (##( of t!st, transferrng rea estate to hmsef w/ ncome & power to revoke. At death, trustee drected whom to gve property to. Sgned by notary. o /i"": dsnherted wfe & eft resdue to trust. H#"(: deed of trust vad & wfe had no nterests n trust BUT created new rue: N#+ R!"#: assets of nter vvos trust are now "estate of deceased" IF created durng the marrage & spouse aone had contro over assets. Ob|ectve test (ntent doesnt matter). o Mini)!) n#c#ssa& conto" is on"& o$# +,## *o*#t& -o#s <(#si-natin- '#n#>cia&= Vas2coudve been rrevocabe trust & decson woudve been the same BONGAARDS $4 MILLEN (p.492)- trust created by 3 rd party Facts: deceased was fe tenant of trust her mother created w/ mted power of appontment over the remander. 10 days before death, gave 47 sster the remander. Dsnherted husband camed hs eectve share & wanted to ncude apt n the estate. H#"(: trust created by 3 rd party whch decedent spouse had a genera power of appontment over s NOT part of the "estate" when cacuatng eectve share. CALC3LATING ELECTIVE SHARE (p.497) UJI 3PC a!-)#nt#( Estat#: probate estate + nonprobate/gratutous nter vvos transfers made (!in- t,# )aia-# o Any transfers where deceased spouse retaned the rght to possesson/ncome from property o Any transfers where deceased spouse retaned power to revoke/appont o Any |T w/ anyone other than survvng spouse o Gfts to 3 rd partes w/n 2 years of the deceased spouses death over $3k per donee/year o Property gven to survvng spouse ether nter vvos OR nonprobate 0I9 3PC: 1/3 of augmented estate (outned n statute) x V 'as#( on "#n-t, of )aia-# o After 15 years, spouse gets 50% o Goa: brng n ne communty property AL: Eectve share gets "#ss# of <8= probate estate mnus survvng spouses own estate OR <C= 1/3 of decedents probate estate o If decedents estate s $100k & survvng spouses separate estate s $100k she gets $0 o If D has $100k & separate estate $50,000 $33,333 o Survvng spouse has $0. $33,333 o Is AL support or partnershp theory? Knda both. More support snce ony takes esser amount. AL s mted to PROBATE assets w/ excepton of usory transfers "|I|f the settor reserves a substanta nterest or unbrded contro over management of the operatons that s not for the benet of the purported benecary, the trust may be found to be usory." REECE $4 ELLIOTT (p.503) - waver of eectve share va prenup Facts: P wants antenupta agreement nvad. Husband ded ntestate. H#"(: husbands faure to dscose vaue of stock does NOT render agreement unenforceabe. o Both had ndependent counse (some |x requre) & created a st of ther assets o Wasnt msed o Had opportunty to ask questons but faed to do so R!"#: prenupta agreement enforceabe so ong as partes entered t $o"!ntai"& & 5no+"#(-#a'"& 48 o Kno+"#(-#W *o*on#nt of agreement must prove that a f!"" 6 fai (isc"os!# of the nat!#; #%t#nt; 6 $a"!# of the partys hodng was provded OR dscosure unnecessary b/c spouse aready knew Opportunty to ask = knowedge o 3PC: cont#stant ,as '!(#n; presumes agreement s vad o AL *#n!*: +itt#n (oc!)#nt after fai (isc"os!#. Presumptvey nvad. Po*on#nt ,as '!(#n to show: adequate consderaton, far, |ust, & equtabe OR free, vountary, & competent ndependent advce & fu knowedge of nterest and ts approxmate vaue SPO3SE OMMITTED FROM PREMARITAL /ILL S*o!s# O)itt#( fo) P#)aita" /i"" (p.515) o CL: premarta w revoked upon marrage or marrage + brth of chd o To(a&: omtted survvng spouse takes ntestate share IN RE ESTATE OF PRESTIE (p.516) - communty property state; sought spousa share Facts: marred; dvorced; made w & trust; ex-wfe cared for hm; amended trust to provde for Mara; remarred; wfe sought her ntestate share on grounds hs w revoked b/c marrage. Son argues trust amendment rebutted presumpton of ws revocaton H#"(: Amendment to a trust whch provdes for the spouse s nadmssbe to rebut the presumpton of a ws revocaton b/c ddnt strcty fa nto statutes provsons /,&. Statute sad w s revoked uness: o provson made for spouse n marrage contract OR o spouse provded for n w OR o dsnhertance cear. No other evdence to rebut presumpton of revocaton aowed. 3PC: aows EE to show ntent to dsnhert CL: ntent must be n document tsef E"#cti$# s,a# sometmes ncudes nonprobate assets (based *!'"ic *o"ic&; 2 ratonaes) P#t#)itt#( s*o!s# never ncudes nonprobate assets (presumed int#nt T wanted to provde for spouse) OMMITTED CHILD No forced share for a chd n any state except LA (but you can dsnhert for |ust cause) GRAY $4 GRAY (p.528)- AL case Facts: 81 executed w whe marred to Mary (had kds outsde marrage); 3 years ater had son, |ack; dvorced but ddnt change w. Dvorce agreement set up trust for |ack (wfe treated as predeceasng due to dvorce & takes nothng). 49 H#"(: |ack not an omtted chd. Stat!t#: f T fas to provde for c,i"( in +i"" t,at +as 'onFa(o*t#( AFTER +i"", omtted chd gets ntestate share UNLESS: o Appears from the face of the w t was ntentonaO o when w executed T had 1+ chdren AND devsed substantay a estate to other parent of omtted chd |NO TS INTENT|; OR o T provded for chd by transfer outsde the w & ntent the transfer be n eu of testamentary provson s proven Ca"$in Coo"i(-# (p.527) Facts: "not unmndfu of my son.I gve my estate to my wfe" H#"(: ehectvey dsnherted chd Not#: not needed n AL b/c statute ony appes to chd born after w executedmght need smar anguage to dsnhert chd ave at ws executon f statute protected. KID/ELL $4 RHE/ (p.536)- does chd omtted n trust get share? no Facts: settor created revocabe nter vvos trust namng daughter as successor trustee. Conveyed and to trust. Ded ntestate. P (admnstrator) argued that pretermtted her statute shoud appy to w substtute H#"(: pretermtted her statute does NOT appy to revocabe nter vvos trust; statute ony mentons ws. S## Heath Ledger Hypo TR3STS (revew p.393-98) Trust s a >(!cia& #"ations,i* w/ respect to i(#nti>a'"# *o*#t& arsng as a resut of a manfestaton of an int#ntion to create reatonshp & sub|ectng trustee to (!ti#s to hod t for benet of benecares o S#tt"o creates trust t!st## hods ega tte & s a >(!cia& for one or more '#n#>ciai#s who hod equtabe tte T!st## )!st ,a$# acti$# (!ti#s to *#fo): "o&a"t& 6 *!(#nc# T!st##0s Ro"#s: (1) nvestment; (2) admnstraton; (3) dstrbuton REA3IREMENTS FOR A TR3ST (p.541-55) 84 P#s#nt int#nt to create a trust o Focus s on functon rather than formdid settlor transfer property to another to hold or manage for the benet of another? AL Cas#: transfer to trust "whch w be set up" does NOT create trust. Faed for ack of present ntent. BUT you can have empty trust f you have pour-over w (ony excepton to property requrement) No )a-ic +o(s but watch for *#cato& "an-!a-# (wsh, hope, recommend) 50 No +o(s #B!i#( to )a5# t!st to c,ait& in AL: f you make a gft to a chartabe corporaton, they automatcay hod t n trust (even f bequest s made n a w). C4 Trust must be funded wth dentabe property (res) o EXCEPT: nter vvos trust + pour-over w 34 Identabe benecary o EXCEPT: chartabe trust (AG can enforce) or unborn benecary o Note: vod trust for pet coud be unenforceabe honorary trust L4 Wrtng generay f res s and or trust s testamentary o Ora trusts requre C&C evdence; generay ony persona property (AL) o Excepton to Land: agreement to gve back and f condenta reatonshp o Excepton to Testamentary: secret ora trust AL adopted UTC. Pi$at# T!sts (p.543): ** o R#$oca'"# T!sts: "perfect w substtutes"; avods deays, costs, & pubcty of probate o T#sta)#nta& Maita" T!sts: federa tax aw aows deducton for marta property; no estate taxes payabe at death. o T!sts fo Inco)*#t#nt P#sons o T!sts fo Minos: avods guardanshps, etc. o Disc#tiona& T!sts: exbty & sheds assets from credtors S#"#ction of T!st##: professona (hgher fees) or persona L3H $4 L3H (p.557) Facts: w eft rea estate n resdue for grandchdrens benet & sad not to se unt theyre 21 H#"(: W manfested ntent to create trust hed for the benet of her grandchdren o Rs,a"" '# )aintain#(S 6 Rs,a"" not '# so"(S Not#: ddnt name trustee, but thats not essenta trust eement. Court named executor as trustee. TR3STEE0S D3TIES (p.550) LOYALTY: must admnster trust soey n the nterest of the benecares; sef-deang s sharpy mted PR3DENCE: trustee hed to ob|ectve standard of care n managng trust property. Must be mparta b/t casses of benecares, cant co-mnge trustees own assets w/ trust; duty to nform & account to the benecares. :IMINEE (daughter/P) $4 LEE (father/D) (p.558)- Facts: P sued to compe accountng for assets she aeges D hed n trust for her 51 P c"ai)s trust arose when 2 dherent gfts made for her benet o Grandmother purchased 3S Sa$in-s Bon( n ther names or Ps moms for her educaton D cashed savngs bond & nvested proceeds n Bank stock. Regstered as D, Custodan under Laws of Oregon for P o XM99 for her educaton deposted nto savngs account |ont savngs account cosed & proceeds nvested n Bank stock; took as custodan P c"ai)s gfts created trusts whch survved Ds nvestment nto stock D a-!#s purchase as custodan expanded hs powers (coud use money for thngs outsde of educaton; ct re|ected) D a-!#s amount he dsbursed to P for educaton shoud be credted aganst constructve trust (ct. agrees) H#"(: gfts to P created a trust whch survved the transfer nto Bank stock. P entted to constructve trust or equtabe en on the stock. Aso entted to dvdends. D s personay abe but can deduct mones spent for purposes of Ps educaton. 3NTHANK (p.569)- necessty of trust property Facts: 3 days before death, wrote etter sayng hed make payments for as ong as he ves; struck survvorshp & wrote n the margn: "I bnd my #stat# to make the $200 monthy payments." P camed notes n margn were a decaraton of trust. H#"(: No ntent to make trust AND "estate" snt property b/c ts too ambguous. Not#: Vars thnks f he used "property" nstead of "estate" the trust coud stand o Courts are more wng to reform trusts coud say "my probate estate" IDENTIFIABLE BENEFICARIES (p.578) R!"#: a trust must have one or more ascertanabe benecares. o There must be someone to whom the trustee owes ducary dutes. o Prvate trust benecares may be unborn OR unascertaned when trust s created. E%c#*tion to R#B!i#)#nt: chartabe trusts . State Attorney Genera can enforce trust so ts vad absent an dentabe benecary. Unborn benecares (as ong as someone has standng to enforce the trust). CLARK $4 CAMPBELL (p. 579)- dentabe benecares Facts: /i"" created trust under whch a of hs persona property was to be dstrbuted to hs "fi#n(s" that hs trustees, n ther soe dscreton, chose. A remanng property shoud be sod & added to resdue of estate. 52 Argued t created gft (precatory statement); court sad cear ntent to make a trust Argued t created a power of appontment; No-trustees cant gve away the property o Po+# of a**oint)#nttrust w/ no dutes; power of appontment has mtess dscreton/power. Its bascay desgnatng someone to make a decson. Vars thnks thats what the T ntended. An&on# can ,a$# a *o+# of a**oint)#nt4 Co!"( '# s#tt"o; '#n#>cia&; #tc4 Ho"(in-: "Frends" doesnt quafy as ascertanabe group. Athough w ceary attempted to create a prvate trust, t fas. Benecares may be desgnated as a cass but "frends" has no accepted meanng. Trust fas. R!"#: A bequest to an ndente person or group s nvad. Mai"&n Mono# Cas# (N2, p.582) "t beng my (#si# that he dstrbute these, n hs so"# (isc#tion, among my frends, coeagues & those to whom Im devoted" /,& not a t!st: doesnt say trust; frends/coeagues too ndente; precatory IN RE SEARIGHT0S ESTATE (p. 582)- honorary trust for dog Facts: Searght ded & eft $1k to Forence Hand at rate of $.75 cents/day to take care of hs dog. If money remaned at dogs death, t shoud be pad to person on st he provded Ho"(in-: Trust n favor of dog created an honorary trust whch s enforceabe where trustee appes trust corpus to purpose of trust and trust o Cf. 3TCFAL: you can set up egay enforceabe trust for your pet Honoa& t!st NOT "#-a""& 'in(in- (p.587)- transferee snt under a ega obgaton to carry out settors stated purpose, but f transferee decnes, she hods the property upon a #s!"tin- t!st & the property reverts to the settor or the settors successors o Li)its: f t voates pubc pocy (waste/destructon/encouragng crme); RAP o T#st: s t reasonabe, caprcous, or does t voate pubc pocy? o To c#at# sti"" n##( )an(ato& "an-!a-# ORAL TR3STS (p.595) Inter vvos ora decaraton of trust w/ *#sona" *o*#t& must have C&C evdence of ora trust (n AL) nter vvos trusts of #a" *o*#t& must have a wrtng b/c Statute of Frauds o Excepton H#i'"# $4 H#i'"# - (p.596) Mother thnks shes gong to de so she makes son |T. She recovers from cancer & wants to dspose of property on her own. Asks son to convey hs nterest & he refuses. The court w force hm to convey back hs nterest. 53 o AL cas#: nvoved 2 bros (1 ved n AL; other n N|). Famy property estate n AL. Bro n A had heath probems & was about to go to war (knew hed potentay de soon). Made w gvng estate n AL to frend w/ ora nstructons to convey property to brother n N|. Reason- property hed my someone n unon state woud escheat to state (coudnt gve drecty to hs brother b/c war tme rues). Frend ddnt transfer property; brother n N| sued & got the property. t#sta)#nta& t!stmust meet Ws Act formates SECRET $4 SEMI2SECRET TR3STS (p. 595) S#c#t T!st: bequest s made to a benecary thats absoute on ts face, but the decedent & benecary have prevousy oray agreed that the property be hed n trust for a desgnated, but secret, purpose S#)i2S#c#t T!st: where a bequest s made n a w that appears to create a trust w/ the benecary as trustee but the purpose of the trust or ts benecares arent dented IN RE ESTATE OF FO3RNIER (p. 589)- ora/secret trust Facts: deceased asked coupe to hod $400k for hm & to gve t to one of hs ssters when he ded. Sster asked for decaratory |udgment an ora trust was created H#"(: ora trust was created & the sster shoud take a. Coupes ncentve to e=C&C. o D gave sster $100k satsfacton? No. Sbng to sbng, not parent to chd Bndng on ws NOT trusts Not n wrtng R!"#: An ora trust may be estabshed by C6C evdence that the condtons for creaton of a trust are met (sa)# as AL). E*i"o-!# (N1, pg. 592) - Fangan pettoned probate court for a new tra after ndng document (unsgned note) that was dated 1 year after Fourner gave hs frends the money. It sad the money shoud go to Fangan, Fourner, & Kng. (Kngs named crossed out but Vars guesses they dont aow parta revocaton by act). OLLIFFE $4 /ELLS(p. 593)- sem-secret trust Facts: Mrs. Donovan ded eavng a w n whch she gave resduary estate to Reverend Wes (D) to "dstrbute the same n such manner as s hs dscreton sha appear best cacuated to carry out the wshes whch I have expressed to hm" o Benecares ndente o Court wont aow extrnsc evdence o If shed sad "I gve t a to Bob" but shed tod Bob to gve t to X. thats be a secret trust & td be vad. 54 D camed Donovan oray expressed wshes to use resdue for chartabe purposes H#"(: Sem-secret trust nvadno extrnsc evdence aowed. RIGHTS TO DISTRIB3TIONS FROM THE TR3ST F3ND MANDATORY TR3ST: Trustee has no dscreton to make trust dstrbuton; credtors can reach trust assets DISCRETIONARY TR3ST: trustee has dscreton to make trust dstrbutons o P3RE: Ex. devse to T as trustee to dstrbute ncome & prncpa to A as determned by Ts absoute dscreton. Benecary has no rght to receve payments Credtor cannot compe dstrbuton but may be abe to cut oh dstrbutons (f you make payment you have to pay drecty to credtors; but trustee usuay stops payng). o SPRINKLE: o SPRAY: trustee must dstrbute a the ncome currenty but has dscreton as to who gets t & n what amounts. o S3PPORT: purpose s speced; make dstrbutons as s necessary for benecarys support & mantenance CL: credtors cant force dstrbuton except credtors for necessary support (food, cothng, sheter) S## UTC chart beow for modern rue SPENDTHRIFT (p.614): o Ex. the nterest of benecares n prncpa or ncome sha not be sub|ect to cams of credtors & )a& not '# $o"!ntai"& OR in$o"!ntai"& antcpated, aenated, or encumbered or |ust use words "spendthrft trust" o Probaby mapractce not to ncude spendthrft provsons MARSMAN $4 NASCA (p.598)- dscretonary support trust Facts: Trust provded mandatory ncome + dscretonary support prncpa for Cappy. Cappy remarres & deeds house to new wfe. Needed money & trustee asked hm to expan why n wrtng he ddnt respond & trustee ddnt foow up. Cappy ddnt have enough $ to pay for house so Say pad expenses n exchange for house. H#"(: ducary dutes mped even where trust says theyre dscretonary o Trustee had a duty to nqure nto the needs of the benecary & dstrbute funds when needed. Askng for nanca needs not enough shoudve foowed up. o Hs dscretonary powers NOT absoute "prudence & reasonabeness furnsh the standard of conduct" o Snce nnocent purchaser for vaue had the house, mposed constructve trust on amounts whch shoudve been gven to Cappy 55 Shoud trustee ook at other ncome when makng dstrbutons? (N2, P.605) o Mas)an- trusts terms drected trustee to consder "varous sources for support" o Rest. 2d- no; o Rest. 3d- yes. EHC3LPATORY CLA3SES: generay uphed but construed narrowy (p.607) Mas)an: presumed vad uness breach of trust made o In bad fath; or o Intentonay/reckess ndherence to the benecarys nterests Burden on Margaret, NOT attorney 3TCFAL: cause drafted by the trustee in$a"i( as abuse of ducary or condenta reatonshp !n"#ss the trustee proves the excupatory term s fai under the crcumstances & ts contents were adequatey co))!nicat#( to t,# s#tt"o. o burden on draftng attorney to show adequate dscosure & farness. o 3PC: f ndependent counse advce, sumcent to show no abuse SCHEFFEL $4 KR3EGER (p.616)- tort/spendthrft trust Facts: B had mandatory nterest n ncome; dscretonary n prncpa. H#"(: A |udgment tort credtor may NOT attach a |udgment debtors nterest n a spendthrft trust |apped states statute| o 3TC: same outcome R!"#: Spendthrfts enforceabe uness benecary s aso the settor OR assets were frauduenty transferred nto the trust. SHELLEY $4 SHELLEY (p.618)- chd support/amony & spendthrft trusts Facts: Son (owed amony & chd support) had mandatory & dscretonary nterest n prncpa. H#"(: Persons nterest n the spendthrft trust ncome was sub|ect to the cams of hs chdren & former wves. Chdren can reach trust prncpa because trustee had dscreton to provde for them. 3TC@/HO CAN COLLECT TR3ST F3NDS. Disc#tiona& T!sts (p.612) No dstncton b/t support & dscretonary S*#n(t,ift T!sts (p.620) If court order Spouse, former spouse, or chd Can get amount UP TO amount that trustee abused hs dscreton o Credtors prefer b/c you can cut dstrbutons oh & force benecary to sette Chd, spouse, former spouse w/ court order; OR |udgment credtor provded servces to protect benecarys nterest n trust (atty) government P4 J83 56 T devses property to X n trust to pay ncome & prncpa to A as X determnes s "necessary for As comfortabe support & mantenance." A s nsovent. X refuses to make dstrbutons to A. B (genera credtor of A) sues X argung t abuses hs dscreton not to make dstrbutons to A. o CL: B oses, uness B provdes "necessares" aka food & housng o 3TC 7 M9L: oses uness credtor s a chd, spouse (former), & ony to the extent that the trustee abused hs dscreton MODIFICATION 6 TERMINATION OF TR3STS (p.641) En-"is, !"#: trust can be termnated at any tme f a benecares are aduts & consent. After settors death, trust s regarded as benecares property, not as the settors. Can change trust regardess of ts terms. 3S G#n#a" R!"#: f settor & a benecares consent, an rrevocabe trust may be moded or termnated. o B#t+##n s#tt"o 6 '#n#>ciai#s; +,o is in c,a-# in t,# 3S? Settor C"a>n (octin# (defaut rue; you can opt out): If settor s dead & a"" '#n#>ciai#s cons#nt, cant termnate or modfy trust f td be contrary to a )at#ia" *!*os# of the settor. o S!**ot: cant be termnated f contnuay supportng o Dscretonary o Trusts mandatng the benecary doesnt receve an nterest unt X age o S*#n(t,ift: cant be termnated b/c youre protectng the benecary from hmsef 3TC: modes & says thats not the presumed matera purpose EB!ita'"# D#$iation Doctin#: permt trustee to devate from admnstratve terms of a trust when compance woud defeat or substantay mpar the accompshment of the purposes of the trust on accounts of unantcpated changed crcumstances. o Devaton must be necessary to accompsh the purpose of the trust. o Admnstratve=anythng other than dstrbuton o P!"itQ# stoc5 (p.644) - court aowed admnstratve changes where the trust estate was n |eopardy. Trust prohbted seng the stock but the osses were substanta to the court aowed t. 3TC 7 L8C FAL (p.645): The court may modfy/termnate because of cic!)stanc#s not antici*at#( '& t,# s#tt"o modcaton/termnaton w f!t,# *!*os#s of t,# t!st4 To the extent practcabe, modcaton must be made n accordance w/ the s#tt"o0s *o'a'"# int#ntion4 o Sma uneconomc fees can be termnated? UTC- mght not need unanmty f court decdes ts n everyones best nterests. A"a Co(# 7 8I23B2L88<'=4 A non-chartabe rrevocabe trust may, upon consent of ALL the benecares, be: (C"a>n standard) o t#)inat#( f the court concudes that the trust snt necessary to acheve any matera purpose of the trust; OR 57 o )o(i>#( f the court concudes that modcaton snt nconsstent w/ a matera purpose of the trust. Cons#nt: f not unanmous, non-consentng benecares woud be adequatey protected & otherwse compes wth the statute (p.657) IN RE TR3ST OF ST3CHELL (p.643)- Rest. 2d. Facts: asked to modfy trust to avod dsabed chd becomng dsquaed for pubc assstance when he receved trust funds H#"(: No modcaton because the ony purpose was to make trust more advantageous to the benecares. No statute; apped Restatement 2d. But snt makng a change to benet a benecary a fundamenta purpose of every trust? IN RE RIDDELL (p.645)-modcaton/ speca needs trust; Rest. 3d Facts: Chdren, Donad & Nancy, both 35+. Nancy had psychoogca dsorders & coud never ve ndependenty. Raph (trustee) moved to modfy trust. Wanted to consodate trust nto "speca needs" trust for Nancy b/c trust proceeds woud ether be (1) sezed by the state to pay Nancys medca bs or (2) Nancy woud msmanage H#"(: Aowed modcaton. Found (1) Nancys speca need=unantcpated crcumstance; (2) modcaton woud further purposes of trust; (3) modcaton not aganst pubc pocy R!"#: equtabe devaton aows the court to modfy admnstratve or dstrbutve terms f: o crcumstances unantcpated by the settor arse AND satsed f crcumstances have changed snce trusts creaton OR f settor unaware of crcumstances when trust estabshed o f the devaton w further the purposes of the trust. Sub|ectve process of attemptng to nfer reevant purpose of a trust. Devaton aowed f necessary to ehectuate the trusts prmary purpose S*#cia" N##(s T!st Act: Congress permtted creaton of speca needs trust to aow dsabed persons to contnue to receve govt assstance for ther medca care (p.649, N2)- T devsed fund worth $120k n trust to X to pay A & B $100/month for ther ves, remander to charty, C. Trust corpus grew to $3.5 mon. A, B, & C asked to termnate trust, pay $150k each to A & B, remander to C. does baoonng vaue n trust assets |ustfy trust modcaton as change n crcumstances? o CL- no. o New aw-probaby yes b/c settor probaby woudve wanted to gve more. o Dherent facts- Putzer/admnstratve change. What f t were foreseen? What f he wanted stocks not be sod regardess so no 58 unforeseen crcumstances. Shoud we aow change? CL: no. UTC: Yes or ese waste. o spendthrft trust, dscretonary & support trust purposes are but n. f you termnate, wont satsfy ther purposes. Deayed en|oyment trust (no $ unt 21). IN RE ESTATE OF BRO/N (p.653)- Rest. 2d. Facts: S#tt"o0s t!st t#)s: provde coege educaton for chdren of hs nephew. Trust termnates when ast chd receved hs educaton & trustee, n hs dscreton, determnes purpose of trust has been accompshed. Income from trust & prncpa as necessary used to pay for nephews wefare & hs wfes. Upon ther death, remander to hs then vng chdren equay. Trustee pad for the nephews kds coege, determned educaton compete, & began dstrbutng ncome to fetme benecares Lfetme benecares pettoned for trusts termnaton argung that the soe remanng purpose was to mantan ther festye & remanderman agreed to termnate. Iss!#: does the matera purpose of the trust reman to be accompshed? Ho"(in-: Yes. Termnaton cannot be accompshed b/c matera purpose of the settor remans unaccompshed. Trust had 2 purposes: o Provde educaton for nephews chdren (ths done; Vars dsagrees) o Assure fetme ncome for benecares through the mgt & dscreton of the trustee. REMOVAL OF A TR3STEE (p.659) CL: ony for cause. Court may remove trustee who s (is,on#st or who has engaged n a s#io!s '#ac, of t!st. Trustees chosen by the settor are ess easy removed. 3TC 7 Y9J: Court may remove trustee f: (p.660) o serous breach of trust; o ack of cooperaton among co-trustees; o untness, unwngness, or persstent faure of the trustee; o substanta change of crcumstances or unanmous benecary request + best nterests of a benecares & not nconsstent w/ matera purpose of the trust. Gves settor of rrevocabe trust standng to remove D!ti#s of S!cc#sso T!st##s: not personay abe to benecary for a breach of pror trustee uness successor unreasonaby fas to dscover & rectfy pror breach DAVIS $4 34S4 BANK NAT0L ASS0N (p.660) Iss!#: Was P entted to have trustee removed? Ho"(in-: Yes. Change n trustee aowed even f no wrongdong. o Reduce fees amost 24%; DE has more tax benets 59 o New trustee coser to benecares & s famar w/ ther stuaton T!st## R#)o$a" Stat!t# <7 Y9J<L==: f requested by a quaed benecares & o serves best nterest of a benecares; o not nconsstent w/ matera purpose of the trust; o sutabe co-trustee/successor trustee s avaabe & wng to serve A!a"i>#( '#n#>cia&: one who woud be a permssbe dstrubutee on the date of the petton OR f the trust ended on that date Vit!a" R#*#s#ntation: dad & kds have s!'stantia""& i(#ntica" int##sts that a#n0t in conPict o Aternatve to guardan ad tem o UTC: aows for representaton n tgaton & transactons; aows parent representaton even f nterest not smar as ong as theres no conct TR3ST ADMINISTRATION: THE FID3CIARY OBLIGATION Fducary aw rests on: o the care norm (duty of prudent admnstraton) and o the oyaty norm (duty to admnster the trust for the benet of the benecary) & o subsdary rues to appy these two: duty to keep & dscose records; to coect, segregate, earmark, & protect trust propery; enforce & defend cams; to be mparta among mutpe benecares Sef-deang totay barred, even f economcay advantageous P. 671- Rea estate agent workng w/ 5% commsson w fa to spend extra $10 ehort to ncrease sae by $100. Why? Agent woud ose $5. UTC 815-16 dene trustees powers A)#ica: settor as the prmary prncpa. o Cf. Engand - benecares are prmary prncpas. N3, p.674 - Trust gves trustee power to se Backacre f necessary to support A. Trustee ses to B who has notce of the trust & beeves sae s necessary to support, but t snt. Does B take Backacre free of the trust? o Mo(#nF3TC: B gets t free & cear as good fath purchaser (pad vaue for t). o What f B ddnt know trust exsted? Mo(#nF3TC: st takes free & cear of trust f n good fath? CL: 3 rd party deang w/ trustee was requred to nqure whether the trustee had the power to engage n transacton D3TY OF LOYALTY trustee must act SOLELY for benet of benecary. Sef-deang strcty prohbted. Sef-deang no further nqury but wavabe Duty to avod concts of nterests. 60 W executor has same ducary dutes as trustee HARTMAN $4 HARTLE (p.675)- wfe of co-executor bought house; sef- deang Facts: Daughter (P) brought sut camng the sae of the farm was frauduent & that Ds voated ther ducary dutes by seng farm to the wfe of one of the executors. Farm sod at aucton to wfe of one of co- executors. Iss!#: Does seng trust property to executors wfe voate hs ducary duty? Ho"(in-: Yes. A trustee may not purchase trust property for hmsef (or spouse) w/out authorzaton from the court so trustee must dsgorge of any benets. o R#)#(&: Snce nnocent purchasers now own property, must take prots from resae & dvde them amongst 5 chdren. IN RE GLEESON0S /ILL (p.676)- no further nqury rue Facts: executor hed over on ease after andowner ded & apponted hm. Gave estate more money + share of crops. H#"(: Trustee cannot dea n hs ndvdua capacty w/ the trust property. Cobrook must account for a mones receved by hm personay by vrtue of hs hodover tenancy. R!"#: trustee voates duty of oyaty by hodng over NO F3RTHER INA3IRY R3LE FOR SELF2DEALING (N1, p. 677) If trustee engages n a transacton nvovng sef-deang, trustee s abe. o Good fath, benets, & farness are rreevant o Da)a-#s: dsgorgement of benets Benecares can hod trustee accountabe for any prot made on the transacton can compe trustee to restore property to trust or repay the purchase prce. T!st##0s D#f#ns#s: o settor authorzed t; o benecares consented after fu & far dscosure & trustee acted n good fath & transacton far to a benecares IN RE ROTHKO (p.679)- conct of nterest/ breach of duty of oyaty Facts: Settor eft 3 frends as co-executors. 2 sef-deaed (sod pantngs to a gaery n whch they had an nterest n) whe 3 rd stood by & et t happen. H#"(: To -#t "ia'i"it&; &o! ,a$# to s,o+ conPict of int##st T not fai OR not in t,# '#st int##st of t,# #stat# o Chaengers have burden to show conct of nterest & unfar 61 o A($ic# fo) co!ns#" is NOT a saf# ,a'o4 Law rm dented conct but sad court woudnt rue n advance (probaby mapractce). o Aso '#ac, of (!t& of *!(#nc# (must be ob|ectvey reasonabe) - terms of contract so unfavorabe a RP woudnt have agreed to them. Dd t n 3 weeks, ddnt get ndependent apprasa, mons of doars at stake, etc. A**#ciation Da)a-#s: typcay awarded when duty to retan property so reward current vaue. o Here, no duty to retan property but awards apprecaton b/c the pantngs cannot be returned & they had egregous concts of nterest CO2TR3STEES Ta(itiona" "a+: trustees must act unanmousy uness trust nstrument provdes otherwse o Snce co-trustees must act |onty, co-trustee s 1oint"& "ia'"# for wrongfu acts of co-trustee to whch she consented to or by her neggence through nactvty or wrongfu deegaton, she has enabed the co-trustee to commt R#st4 3(4: )a1oit& can act f 3+ trustees. Even f unanmty snt requred, a co-trustee st has a duty to take reasonabe steps to prevent a breach of trust by her co-trustees. D3TY OF PR3DENCE (p.688) Trustee has a duty to admnster trust w/ such sk & care as a person of ordnary prudence woud use n deang w/ hs own property. o O'1#cti$# stan(a( of ca#what woud a reasonabe person do? o Functon of trust changed from preservng property managng property. Histoica""&: |udca st of "safe" or permtted nvestments. Any nvestment not on the st per se not prudent. o Constraned prudent man rue: prncpa preservaton; ducary hodng funds for nvestment may nvest the same n such securtes as woud be acqured by prudent persons of dscreton & ntegence n such matters who are seekng a reasonabe ncome & the preservaton of ther capta. Bars specuatve ntestments o CL: each nvestment s vewed separatey. If 1/100 nvestments s napproprate, trustee s abe for oss n that one nvestment. Mo(#n *otfo"io t,#o& <3nifo) P!(#nt In$#sto Act=: trustee must: o Baance rsk & return, o dversfy, o deegate o focus s on tota return 3 t&*#s of is5s (p.697) 2 nd & 3 rd s what dverscaton s geared towards mnmzng. 62 o Ma5#t Ris5- ahects a nvestments. Reects genera economc & potca condtons. Unavodabe. o In(!st& Ris5s: specc to rms n partcuar ndustry/ndustry groupng o Fi) Ris5: easest to avod. Factors that touch fortunes of the ndvdua rm. Ex. n book of Exxon & BP. IN RE ESTATE OF :ANES (p. 702 )- adequate dverscaton Facts: 71% of the $2.5 mon n stock was n Kodak; stock steady decned. Iss!#: Does a trustees faure to dversfy the stock hed n trust consttute a breach of ducary duty? Ho"(in-: Yes. Kodak stock not good for od wdow w/ heath probems because t had sma dvdends. o Proper measure of damages was "the vaue of the capta that was ost"the dherence b/t the vaue of the stock at the tme t shoudve been sod & ts vaue when utmatey sod + nterest. o Market Index- B#n#>cia& Cons#nt Aa Code 19-3B-1009 Trustee s NOT abe to a benecary for breach of trust f the benecary cons#nt#( to the conduct, reeased the trustee, or rated the transacton 3NLESS: o Benecary was nduced by mproper conduct of the trustee; OR o Benecary ddnt know of the matera facts & the trustee had actua knowedge of the facts Not#: not specc to dverscaton; genera provson appcabe across the board. FIRST AL BANK $4 SPRAGINS (handout)- duty to dversfy Facts: 70% of trust assets hed n bank stock. Trust authorzed nvestment "#-a("#ss of an& "ac5 of (i$#si>cation." Trust aso sad: "none of these powers sha be exercsabe f to exercse the power woud (#f#at )& int#ntion regardng my Trust Estate" H#"(: trustee acted mprudenty by mantanng a portfoo that contaned an nordnate amount of the Banks stock n voaton of sound mgt practces, despte authorzaton n the trust for the trustee to manage trust portfoo regardess of any ack of dverscaton. o Duty of prudence may be atered by terms of the trust o Trust can speccay overrde the duty to dversfy BUT o Terms of a trust preva over any provson of ths chapter #%c#*t Duty of trustee to act n good fath & n accordance w/ the terms & purposes of the trust & the nterest of the benecares (very smar to Spragns anguage) The requrement that at rust & ts terms be for the benet of ts benecares. 63 Vars doesnt reay know f duty to dversfy s defaut/mandatory. He sad to overrde t, you need to say "I want to keep 70% n Kodak stock" Not#: dverscaton snt an absoute requrement; consder a crcumstances P. 1 p.720- 1990, T conveys 1500 shares of Enron stock n trust to X. Trust may be revoked by wrtten nstrument devered to X. T nstructs X n wrtng to retan Enron stock. 2001, Enron es for bankruptcy & stock prce drops to $0. 2002, T sues X for breach of duty of prudence argung that X shoudve dversed or at east warned T of danger. o Instructons to trustee mmunze hm from abty. If addtona benecares, theyd have standng. o Sinc# it0s a #$oca'"# t!st; (!ti#s on"& to s#tt"o. If there was fu & far dscosure to benecares, they coudnt sue. DELEGATION (p.721) CL: trustee NOT permtted to deegate matters that the trustee coud reasonaby be requred to personay perform. o Cant deegate to co-trustee N#+ R!"#: permts deegaton sub|ect to a duty oh care, sk & cauton n seectng, nstructng, & montorng the agent. o Lmted to nvestment & management functons; cannot deegate dstrbuton 3TCFAL: trustee may deegate to a co2t!st## any functon uness terms requre them to perform t |onty. Trustee may revoke prevous deegaton uness rrevocabe. (19-3B-703(e)) o Uncear f st have duty to seect/montor/nstruct. (N1, p.723)- 1999, T devses fund n trust to X for the benet of A. At As suggeston, X deegates responsbty for managng nvestment portfoo to Y, reputabe advsor. Y, at As suggeston, nvests excusvey n technoogy stocks. 2000, technoogy bubbe bursts & vaue of fund coapses. A sues X for mproper deegaton to Y. X says he doesnt second guess someone he puts n charge of somethng at tra. o Breach b/c fai"#( to )onito. Instructng not cear but probaby so. Seectng ok b/c t was a reputabe rm. If fu & far dscosure to A, ts bndng. o If trustee fas to sue the agent, benecares can sue the trustee. Some precedent aowng a drect sut of benecares aganst agent. o Deegaton may be requred f you ack expertse (breach of prudence f you dont) D3TY OF IMPARTIALITY: mpcated when 2+ benecares R!"#: In nvestng, managng, & dstrbutng the trust property, the trustee must strke a baance b/t the benecares, gvng due regard to ther respectve nterests. 64 o Doesnt mean equatymust treat a benecares equtaby. .e. f 2 benecares of a support trust & one s dsabed, trustee can gve dsabed person more $$. o Snce ts hard to determne, some courts aow breach ony f substanta dsadvantage for one of the benecares. HO/ARD $4 HO/ARD (p. 726)- duty of mpartaty wavabe Facts: Trust sad support of survvng spouse shoud be preferred over rghts of remanderman. Waves duty of mpartaty. Son (remanderman) a-!#s court erred n fang to consder Marcenes other assets n admnsterng & makng nvestment decsons for the trust b/c she coud use funds for settors stepchdren whch he eft out. Ho"(in-: A trustee owes a duty to remander benecares & ncome benecary, but those dutes must be carred out n ght of any preference expressed n the trust nstrument. Court ddnt err n fang to consder her other sources of ncome. N2, p.729- commony trust ncome snt enough to support survvng spouse. Courts deny request to nvade prncpa uness trust s construed to contan an express/mped power to nvade t OR a remander benecares consent (dmcut f mnors, etc). Trustee cannot pck sdes durng tgaton b/t benecares Trustee can defend hs decson to nvade prncpa on the grounds ts what settor woud want; cant get court approva n advance on ths ssue. EA3ITABLE AD:3STMENT St dstngush b/t ncome & prncpa but trustee can abe t dherenty Trustee can reaocate recepts to ncome/prncpa f the trustee concudes that wse nvestng woud otherwse ead to unfar resuts AL: adopted equtabe ad|ustment but you have to opt n; ot,# 1% ts the defaut CAN0T 3SE IF TR3STEE IS A BENEFICIARY 3NITR3ST ncome benecary s entted to % of tota vaue of trust assets each year. Modern portfoo theory to the extreme. IN RE MATTER OF HELLER (p.731)- untrust; trustee aso benecary Iss!#: Can untrust appy retroactvey; may nterested trustees eect under t? Ho"(in-: Yes. A untrust eecton by an nterested trustee w be sc!tiniQ#( +it, #%ta ca# but theres no prohbton aganst t. Trustee owes duty of oyaty to benecares & snt reeved of duty b/c hs nterests agn w/ nterests of other benecares. o Even f there werent other remanderman st woudnt be a breach b/c settor antcpated structura conct by namng same person as trustee & benecary. 65 o So no sef-deang, thus no appcaton of no further nqury rue D3TY TO COLLECT 6 PROTECT TR3ST PROPERTY (p. 736) R!"#: trustee has duty to protect & coect trust property wthout unnecessary deay. o Defaut rue but not mandatory o T#sta)#nta& t!st: coect assets from executor as prompty as crcumstances permt. Duty to benecares to examne property tendered by executor to ensure ts what trustee ought to receve. D3TY TO EARMARK TR3ST PROPERTY (p.737) To earmark property s to desgnate t as trust property rather than the trustees own Ma1FAL: trustee SL for any oss even f the oss wasnt caused by faure to earmark N#+ Vi#+: trustee abe ony f oss resuts from the faure to earmark & snt abe f the oss resuts from genera economc condtons. o E% Pat# La+&#s S!4 Co*4- trustee wrongfuy purchases property n hs own name rather than trusts name then successor trustee ses property at a oss. Is 1 st trustee SL for whoe oss? AL- no even though strct appcaton of rue woud hod hm abe. o s there a good reason to put stock n your name nstead of |ohn smth as trustee? Buyers mght wak away from the atter. Ma|orty rue makes no nqury nto reasonng for faure to earmark. If trustee deposts $ n a persona account & the bank fas s trustee responsbe for ost of trust assets? Ma|orty: yes o What f he knew bank woud fa? Trustee abe b/c breach of duty of prudence D3TY NOT TO MINGLE TR3ST F3NDS /ITH THE TR3STEE0S O/N (p.737) Trustee guty of breach of trust f trustee commnges the trust funds w/ hs own, even f trustee doesnt use the trust funds for hs own purposes. /,&. Assets become more dmcut to trace & sub|ect to rsk that persona credtors of trustee can reach them. O"( $i#+: Trustee SL even though oss woudve occurred w/out commngng N#+ Vi#+: abe ony to extent the commngng caused the oss D3TY TO INFORM (p.738) Trustee has duty to nform benecares of the exstence of the trust & sgncant deveopments pertanng to the admnstraton of the trust & to respond prompty to a request by a benecary for nformaton reasonaby reated to the benecarys nterests n the trust FLETCHER $4 FLETCHER (p.739) 66 Facts: Settor created 3 separate trustsone for son & hs 3 kds. Son wants fu copy of trust. Trustee argues settor wanted terms kept condenta. H#"(: Benecary has a rght to a copy of the entre trust to ensure trust s beng admnstered propery & to ehectvey protect hs nterests. R!"#: n absence of a drecton to the contrary, a trustee must dscose trust nformaton about the trust to benecares. Benecary s aways entted to such nformaton as s reasonaby necessary to enabe hm to enforce hs rghts under the trust or to prevent/redress breach of trust. Not#: drecton that terms be secret coud NOT overrde ths rue (mped) AL: |T|o enabe the benecares to take acton to protect ther nterests, the trustee may be requred to provde advance notce of transactons nvovng rea estate, cosey-hed busness nterests, and other assets that are dmcut to vaue or to repace. Are benecares entted to nfo thats attorney-cent prveged? Courts are spt. o Rggs-yes because the benecary, not the trustee, s techncay the attys cent Facts: memo wrtten BEFORE tgaton began was prepared for benet of trust benecares :ACOB $4 BARTON (handout) Facts: |ames camed Een msmanaged trust by pacng her persona nterests above her ducary dutes & '& )a5in- i)*o*# *a&)#nts to t!st##s0 atton#&s4 :a)#s so!-,t (isco$#& of att&s #co( of t,#i 'i""in-s Iss!#: s benecary entted to nfo thats protected by atty-cent prvege or work product doctrne? Ho"(in-: generay no. Here, to extent awyers work concerns ths dspute, ther cent s the trustee NOT the benecary. If entres n bng records revea protected nfo, ther producton cannot be compeed. RILEY $4 BRADLEY (handout) Benecary s equtabe owner Corporatons property- treated n equty as owned by stockhoders BUT no prvty b/t them & attorneys empoyed by corporaton R!"#: no prvty b/t benecary & attorney empoyed by trustee Not#: must have prvty to sue so no prvty ks argument benecary can be a cent; but Vars st thnks ts an open queston & mapractce prvty may be dherent from condentaty prvty. ALA CODE 7 8C2C828J8 Attorney cant testfy about prveged matters D3TY TO ACCO3NT 67 If benecares sgn oh on actons after trustee propery dscoses, the trustees are mmune from abty unless (1) they commt constructve fraud whch was (2) reasonaby dscoverabe Imped: o Benecary has a duty to revew accountngs o Trustee duty to undertake reasonabe ehorts to ensure accuracy of accountngs NAT0L ACADEMY OF SCIENCES $4 CAMBRIDGE TR3ST CO4 (p.745)-duty to account Facts: Income benecary receved $106k from trust after remarrage dsquaed her. Remander benecary ddnt ob|ect to annua accountngs. Not#: remander benecares coud probaby drecty sue her estate for $ too Iss!#: Is a trustee abe for msrepresentatons made n accounts of the trust? Ho"(in-: Yes. By payng Forence, Bank represented to Academy that she remaned unmarred. Representatons techncay frauduent & Bank made no ehort to see f she remaned unmarred. R!"#: A trustee has a duty to make reasonabe ehorts to ensure that accurate representatons are made n any accountng under a trust Const!cti$# Fa!( R!"#: when a person makes a representaton as f from hs own knowedge & such representaton snt true, a party who rees on the representaton & s damaged by ts reance s entted to seek redress for fraud. BL: f theres a way to gure t out, youre abe. Not dscoverng or teng the truth when youre requred to do so. Ex. attorney doesnt te you somethng about the purchase of rea estate. ABOLISHING THE ATTESTATION REA3IREMENT FOR /ILLS T,#o&: Abosh attestaton requrement for ws but keep as requrement for sef-provng ws As5: Does the formaty promote the prmary goa of our system of testatonehectuatng the ntent of the Tat an acceptabe admnstratve cost. A-!)#nts: 84 W substtutes common & dont requre attestaton C4 W substtutes aow courts to reform & correct mstakes but dont reform ws 34 Hoographc ws ncreasngy aowed & dont requre L4 Attestaton not protectve anymorefraud commtters foow rues M4 Physca revocaton doesnt requre attestaton J4 Substanta compance/harmess error Y4 Aow nterested wtnesses now 68 G4 W contest grounds do a better |ob of dstngushng b/t good & bad ws Po'"#): Smth v. Neson-refused probate of a w b/c ony had 1 wtness nstead of 2. o Even more common for ws that are party handwrtten/party prnted to be dened. 69