Per Capita with Representation i. Make first division at first generation where there is a live taker ii. Dropping shares drop by bloodline

Transcription

1 INTESTACY Intestacy statutes determine wh receives a deceased prperty wner s prperty if the wner dies withut a valid will r will substitute. Persnal prperty is typically distributed under the laws f the state in which the D was dmiciled at death Real prperty is typically distributed under the laws f the state in which the prperty is lcated UPC lks t the law f the designated individual s dmicile fr the gverning intestacy statute Intestacy statutes are nt based n individual situatins, they are based n what a typical D wuld want UPC: 1. Surviving Spuse 100% if n issue r parents; r 100% if all D s issue are als issue f surviving spuse and surviving spuse has n ther issue; r $200, % f rest if n issue but surviving parent; r $150, % f rest if all issue are als issue f surviving spuse and surviving spuse has ther issue; $100, % f rest if ne r mre issue are nt issue f surviving spuse 2. Issue Equally per capita at each generatin 3. Parents Equally 4. Issue f Parents Equally 5. Grandparents/issue 50% t paternal grandparents r survivr; therwise t their (Desn t g beynd issue equally; 50% t maternal grandparents r survivr; 2 nd line cllaterals) therwise t their issue equally; If n surviving grandparents r issue n ne side, all t the ther side Inheritance is limited t issue f grandparents 6. Escheat t State 100% Cmmn Law: 1. Surviving Spuse 2. Issue generally either by per stirpes r per capita with representatin 3. Parents 4. Issue f Parents 5. Grandparents 6. Issue f grandparents 7. Next-f Kin 8. Escheat t State Methds f Distributin: ISSUE With first divisin give ne share t each party wh is alive and ne share t each party is wh dead but survived by issue Per Stirpes i. ALWAYS make the first divisin f the D s prperty at D s children (whether there are any live takers r nt) ii. Drpping shares drp by bldline 1

2 Per Capita with Representatin i. Make first divisin at first generatin where there is a live taker ii. Drpping shares drp by bldline Per Capita at each Generatin i. Make first divisin at first generatin where there is a live taker ii. Drpping shares drp by pling cmbine them and distribute them equally amng the eligible takers at the next generatin COLLATERALS prperty flws up t cllaterals when there is n surviving spuse r issue Parentelic Apprach starts with D s immediate family and then mves ut alng cllateral lines, starting with the clser lines and mving t the mre remte until there is a line with a live taker Degree f Kinship Apprach cunt the degrees f relatinship between the D and the relative, and thse relatives f the clsest degree take t the exclusin f thse f a mre remte degree. Determining Degree: cunt frm D up t the clsest cmmn ancestr and then dwn t the live relative Children Brn ut f Wedlck UPC 2-114(c): Persn is presumed t be bilgical child f anther if parent penly treated the child as his/her wn Cmmn law: Child brn ut f wedlck is cnsidered a child f n ne child cannt inherit frm r thrugh either natural parent, and neither natural parent can inherit frm r thrugh the child Artificial Cnceptin: Unifrm Parentage Act If a wman is artificially inseminated with the sperm f a man wh is nt her husband, the husband is deemed the child s father if the husband cnsented. Adptin UPC 2-114: Adptin creates a parent-child relatinship between the adpted child and the adpting parents. Adptin severs the parent-child relatinship between the natural parents and the child EXCEPTION: When adptin is by a step-parent: (1) the adptin des nt affect the parentchild relatinship between the adpted child and the natural parent wh is married t the adpting stepparent (2) The adptin establishes a parent-child relatinship between the adpting stepparent and the child, with full inheritance rights in bth directins (3) The child can still inherit frm the natural parent f the same gender as the adpting stepparent, but the natural parent lses his/her right t inherit frm his/her child. Cmmn law: Stranger t adptin rule adpted child culd nt inherit frm a stranger t the adptin Majrity f states have ablished this rule Adult adptins are typically treated the same as adptins f children Stepchildren UPC: expressly excludes stepchildren Majrity: d nt prvide fr stepchildren t inherit frm r thrugh their stepparents and vice versa. Fster children Fster children generally receive nthing when their fster parents die intestate 2

3 Equitable Adptin permits a fster child in certain instances t inherit frm the fster parent as thugh the child had been legally adpted Usually requires clear and cnvincing evidence either (1) the fster parent agreed t adpt the child r (2) the fster parent tried t adpt the child but failed t cmply with the legal requirements fr sme reasn Generally des nt allw the child t take thrugh the adptive parent(s), the adptive parent(s) t take frm the child, r cut ff inheritance frm birth relatives r their right t inherit frm the child Half Blds UPC 2-107/Majrity: Treats whle blds and half-blds the same Cmmn Law: Only whle bld relatives are entitled t inherit Disinheritance UPC 2-101(b): D can disinherit an heir by executing a will that expresses such an intent, even if sme r all f the D s prperty passes thrugh intestacy. The heir is treated as if he/she predeceased the D If the heir is survived by issue, they take unless the will expressly disinherits them as well. Cmmn Law: D can nly disinherit by executing a valid will that dispses f all f the D s prperty s that nthing passes thrugh intestacy If the will expresses an intent t disinherit but sme r all f the D s prperty is distributed thrugh intestacy and the heir qualifies t receive a share, the heir takes Advancement whether an inter vivs gift D made t an heir shuld cunt against the heir s share f the D s prbate estate UPC 2-109: Inter vivs gifts d nt cnstitute an advancement unless a writing indicates that the dnr intended the gift t cnstitute an advancement. If dnr creates the writing, the writing must be made cntempraneusly with the inter vivs gift If the dnee creates the writing, the writing may be made at any time If dnee predeceases D, the advancement des NOT cunt against the share f the dnr s estate ging t the dnee s issue unless the writing expressly prvides s Inter vivs gift is valued as f the time the dnee receives pssessin r enjyment f the prperty, whichever ccurred first Cmmn law: Presumptin that the gift cnstitutes an advancement that cunts against the dnee s share f D s estate Htchpt: All inter vivs gifts t heirs are added back (n paper) int D s prbate estate t create the Htchpt. Then the htchpt is divided equally amng the decendent s heirs. Any advancement received by a child is cunted against that child s share f the htchpt. If the advancement exceeded the child s share, the child des nt have t repay the estate If the dnee predeceases D, the advancement dctrine applies t the share f the dnr s estate ging t the dnee s issue. Hmicide UPC 2-803: killer shall nt take frm his/her victim killer is treated as if he/she predeceased D May allw children f killer t take under anti-lapse statute Cmmn law: persn shuld nt prfit frm his wn wrngding 3

4 Disclaimer General Rule: Disclaiming party is treated as if he/she predeceased D WILLS Functins frmalities serve: Evidentiary slid evidence f the existence and cntent f the D s directins Witnesses might either misremember r deliberately lie abut alleged statements f intentin by T T is unavailable t testify r clarify ther evidence cncerning his/her intentin Cautinary sme indicatin that T arrived at these directins with adequate awareness Prtective attempts t assure that the cntents and the executin f the will were the prduct f T s free chice Channeling facilitate a substantial degree f standardizatin in the rganizatin, language and cntent f mst wills, s they can be prepared and administered in a fairly rutine matter. Types f Wills Frmal Written Signed Witnessed Hlgraphic Handwritten Signed Nt witnessed UPC 2-502; 2-503: substantial cmpliance is required curt is authrized t prbate will if: Clear and cnvincing evidence shws that T intended this dcument t cnstitute his/her will Clear and cnvincing evidence shws that the will substantially cmplies with will frmalities Cmmn law: required strict cmpliance with will frmalities any deficiency rendered will invalid Signature Requirement Identifies the will with T Shws finality Anything T intends as his r her signature UPC: T is nt required t sign at the end f the will (may cut against signatry intent if T des nt); May be signed by anther fr T in T s presence and at T s directin Cmmn law: T is required t sign at the end f the will Witness Requirement Witnessing element can be brken dwn int three requirements: 1. Will must be witnessed by required number f witnesses 2. Witness must attest t ne f three acts: a. T s signing the will b. T acknwledging his/her signature previusly placed n the will c. T acknwledging the will 3. Witness must sign the will 4

5 Witnesses serve tw functins: Observatry Signatry Mst states and UPC require tw witnesses UPC: any persn generally cmpetent t be a witness may act as a witness t a will Sme states have minimum age requirements fr witnesses UPC 2-205: witness des NOT have t be disinterested party Cmmn law: witness must be disinterested Remedies: Invalidate entire will Vid interested witness gift Purge the interested witness excess interest under the will Presence UPC: dispenses with presence requirement witness must sign the will within reasnable time perid f witnessing ne f the three permissible acts by T Sme States: require witness sign the will in the presence f T Line f sight test parties were in each ther s presence nly if they literally culd see each ther Cnscius presence test requires a general awareness (thrugh all f ne s senses) f what is ccurring Self Prving Will will that has attached t it an affidavit executed under ath by the attesting witness which states that all the required testamentary frmalities were satisfied when the will was executed UPC: recgnizes self prving wills Presence f affidavit creates rebuttable presumptin as t mst executin requirements but creates cnclusive presumptin as t signature requirements Signature attached t self prving affidavit attached t a will is cnsidered a signature affixed t the will Hlgraphic Wills N witnesses are necessary 3 main issues with hlgraphs: 1. Date Requirement Helps determine which will was mst recent if mre than ne is fund Helps determine if T was cmpetent when will was written UPC: N date requirement Many States: Date requirement 2. Requirement that hlgraph be entirely in T s handwriting UPC requires nly that the signature and material (dispsitive, administrative) prtins f the will be in the T s handwriting States define material differently Sme states: entire hlgraph in T s writing 3. Testamentary intent as ppsed t drafts r idle thughts Dcument need nt be labeled will, but use f the wrd helps t shw testamentary intent UPC: Allws testamentary intent t be shwn thrugh extrinsic evidence Sme States: Require the dcument ffered fr prbate shw testamentary intent withut resrt t extrinsic evidence 5

6 WILL CONTESTS A persn must have standing t challenge a will A persn has standing if he/she has a pecuniary interest if the cntest succeeds mere expectancies r mral interests are insufficient Will cntests must be brught within the applicable statute f limitatins Prpnent must prve: Frmalities: Frmal will Hlgraphic will Testamentary capacity Extent f prperty Objects f bunty Understd will Cntestants can challenge a will based n : Lack f capacity Legal Testamentary Fraud Undue influence Failure t cmply with frmalities Revcatin Typically, the burden f prf is prepnderance f evidence Sme curts requiring clear and cnvincing evidence when insane delusin, undue influence r fraud is alleged Testamentary Capacity A cntestant alleging lack f testamentary capacity may claim that Tt: Was nt f the age required t execute the will Was f unsund mind, r Suffered frm an insane delusin a false belief adhered t against all reasn that affected the will s prvisins. UPC specifies that any individual 18 r lder wh is f sund mind may make a will If either f these tw elements is nt satisfied, a will is entirely vid, causing the T s prperty t pass either under a prir will r by intestacy Sund Mind Test (nt a high standard): 1. Did T understand the nature and extent f his/her prperty 2. Did T knw the persns wh were the natural bjects f his/her bunty 3. Did T understand the dispsitin made under his/her will Even if the T is rdinarily f unsund mind, T s will is valid if executed during a lucid interval A duly executed will is ften said t raise a rebuttable presumptin f a sund mind. Being placed under a guardianship r cnservatrship may give rise t a rebuttable presumptin f unsund mind. 6

7 Insane Delusins T establish a claim f insane delusin, the cntestant must prve: 1. T suffered frm a false belief (delusin) 2. That belief was insane (T adhered t the false belief against all reasn), and 3. The belief affected dispsitin f T s prperty under the will The first tw elements alne will nt invalidate a will An insane delusin differs frm a mere false belief in that a T wh suffers frm an insane delusin will nt change his belief even when cnfrnted with evidence t the cntrary, whereas a T perating under a false belief will change his pinin nce presented with cnvincing evidence demnstrating the belief is incrrect. A mere mistaken belief r an errneus r unjust cnclusin is nt an insane delusin if there is sme fundatin in fact r sme basis n which the mental peratin f the maker f the will may rest, even thugh the basis may be regarded by thers as whlly insufficient A significant break frm past wills r dispsitins may suggest an insane delusin An insane delusin invalidates nly the prtin f the will that is affected by the T s false belief Incapacity Capacity is ften determined frm: Expert testimny Testimny frm will s witnesses A fact finder might cnsider an unnatural dispsitin as evidence f incapacity A dispsitin which seems unnatural n its face may be upheld when a reasn fr the dispsitin appears Sudden changes in a T s wishes are viewed with suspicin Cnversely, the fact that a disputed will is similar t prir wills helps t refute claims f incapacity A cnservatr r guardian can be appinted fr smene wh is incapacitated Cnservatr takes care f prperty Guardian takes care f a persn Undue Influence when ne influences the T t the extent that the will expresses the influencer s intent, nt T s intent. Elements: Susceptibility Opprtunity Mtive Causatin Presumptin f Undue Influence arises when: Cnfidential relatinship between T and defendant Defendant was favred in will Undue activity in prcurement Other factrs a curt may cnsider: Age r cnsideratin f health and mental vigr f T Nature r degree f relatinship between T and beneficiary Opprtunity fr exerting an undue influence Naturalness r unnaturalness f will Whether T had independent advice. 7

8 Duress is an extreme frm f undue influence and requires an unlawful threat Fraud The cre element f a fraud claim is that sme deceptin has been practiced n T. Fraud requires: 1. Misrepresentatin be made t T 2. Intent t deceive T 3. T in fact be deceived 4. As a result, T des smething the T therwise wuld nt have dne Tw Types f Fraud: Fraud in the executin invlves an intentinal misrepresentatin as t either the character r the cntents f the instrument itself Fraud in the inducement invlves an intentinal misrepresentatin f facts utside the instrument which causes the T t d smething he r she therwise wuld nt have dne Prmissry fraud lack f present intent with regard t a prmise f future actin e.g. stp sleeping with wife s sn Evidence f the prmisr s subsequent failure t keep the prmise is nt enugh t prve prmissry fraud plaintiff must demnstrate prmisr had n intentin f keeping prmise when prmise was made Fraud invalidates nly that prtin f the will that is affected by the fraud If the result f the deceiver s fraud is that a T fails t write a new will r fails t revke an existing will, the nly remedies available are t seek mney damages r t impse a cnstructive trust n the D s heirs r devisees in favr f the beneficiaries wh wuld have taken but fr the fraud Remedies 1. Cnstructive trust if part f the will is ineffective 2. Intestacy if entire will is invalid Aviding Will Cntests 1. N-Cntest Clause clause in will that says if a beneficiary under the instrument sues cntesting the instrument, the beneficiary lses his/her devise If a will cntest succeeds, the n cntest clause is invalidated with the rest f the will UPC 2-517; 3-905/ Majrity refuse t enfrce a n cntest clause if there is prbable cause t supprt the will cntest Minrity n cntest clause is enfrceable even if prbable cause existed fr the cntest Antemrtem Prbate (Living Prbate) a curt prceeding during the T s life t establish that the will was prperly executed and that the T had testamentary capacity and was free f undue influence at the time the will was executed Trust nt prbated Have T evaluated by dctrs Have T list all relatives nt included in will Republicatin by Cdicil whenever T executes a valid cdicil t a prir valid will, the cdicil is said t republish the underlying will, subject t any changes made by the cdicil. As a general rule, the legal effect f the republicatin is t treat the will as thugh is had been re-executed as f the date f the cdicil. The nly requirement fr republicatin is that the cdicil refer in sme manner t the underlying will. 3 caveats t general rule: 8

9 1. A will can be republished nly if it still is physically in existence. 2. A will can nly be republished if it was published (validly executed in the first place). If the underlying will is nt valid, the cdicil is nt a cdicil but its wn freestanding will May be pssible t give effect t testamentary wishes expressed in invalid will thrugh incrpratin by reference 3. Republicatin by cdicil will nt cause the underlying will t be treated as thugh it had been reexecuted as f the date f the cdicil if ding s wuld lead t a result that the T prbably wuld nt have wanted. Curative effect: if there were prblems in the riginal will executin ceremny that d nt affect its validity in whle (e.g. interested witness r undue influence as t part f will), these prblems may be cured by republicatin by cdicil. As lng as the prblem is nt present when the cdicil is executed, the cdicil s executin is deemed t re-execute and republish the underlying will, thereby curing the pssible prblem Incrpratin by Reference a valid will can incrprate by reference a dcument that was nt executed with will frmalities as lng as: 1. the will expresses the intent t incrprate the dcument 2. the will describes the dcument with reasnable certainty, and 3. the dcument being incrprated was in existence when the will was executed If the dcument changes ver time, nly the dcument as it existed at the time the will was executed is incrprated by reference (unless the will is re-executed by republicatin by cdicil) UPC essentially waives this requirement s lng as the dcument nly dispses f T s tangible persnal prperty If the separate writing cnstitutes a valid hlgraphic will, incrpratin by reference is unnecessary Acts f Independent Significance will may dispse f prperty by reference t acts utside f the will (the referenced act can cntrl either wh takes r hw much a beneficiary takes) as lng as the referenced act has significance independent f its effect upn T s prbate estate The referenced act can cntrl wh takes and hw much withut T having t execute a cdicil Valid act f independent significance: When T executes her will her daughters are nt married but she includes a prvisin: I give $1,000 t each f my sn in laws. Act f marriage has its wn independent significance apart frm the act that als permits the new sn-in-law t receive $1,000 under T s will Invalid act f independent significance: I leave $10,000 t each f the persns I will identify in a letter I will leave fr my executr T later writes a letter identifying 2 persns The letter des nt have its wn independent significance apart frm its effect upn wh takes under T s will REVOCATION T can revke will by: 1. Subsequent will Must cmply with all the required frmalities fr executing a will May revke in whle r in part Expressly Implicitly by incnsistency Cdicil partially revkes r amends a prir will Must be executed accrding t will frmalities 9

10 Revcatin f a cdicil des nt revke the underlying will. Revcatin f a will revkes all cdicils theret. 2. Physical Act UPC: permits partial revcatin by physical act Many states: d nt permit partial revcatin by physical act UPC: destructive act must affect sme part f the will Cmmn law: destructive act must affect sme part f the written prtin f the will The accidental destructin f a will DOES NOT result in revcatin If T crsses smething ut n a will and writes smething new, the questin may nt be whether the will was partially revked by a physical act but, is the devise a hlgraph Under either methd, T must: Have intent t revke Cmply with the required frmalities f revcatin Pssess the mental capacity t revke Free frm fraud r undue influence 3. Presumptin When a will which was in T s pssessin cannt be fund, r is fund in a mutilated cnditin, after T dies, curts generally presume that the T intended t revke the will Nrmally when a will cannt be fund and the fact-finder determines that it was nt revked, a cpy f the will is prbated r ther prf is used t establish its cntents 4. Operatin f Law Divrce UPC 2-804: divrce autmatically and irrebuttably revkes all prvisins in T s will in favr f the ex-spuse, unless the will expressly prvides therwise Applies t will substitutes Revkes prvisins in favr f ex-spuse AND prvisins in favr f exspuse s relatives Traditinal: divrce revked will but Revcatin did nt apply t will substitutes Revcatin nly applied t ex-spuse Revival and Dependent Relative Revcatin Fur Methds can be used t revive a revked will: 1. Re-executin T and required number f witnesses sign r re-sign previusly revked instrument 2. Republicatin by Cdicil executin f cdicil t will #1, despite the executin f an intervening will #2 that revked will #1 3. Revival by Revcatin f the Revking Instrument earlier will is revived nly if the curt cncludes frm the evidence that the testatr revked the latter instrument with the intent t revive the earlier ne Sme States: dn t recgnize RRI and require T t re-execute will #1 UPC 2-509: If first will was whlly revked by the secnd, presumptin against revival. Burden is n prpnent f first will t establish that T intended t revive it. If first will was partially revked by the secnd will, presumptin is that the revked part is revived. Burden is n the challenger t demnstrate T did nt intent t revive the revked part. 10

11 4. Dependent Relative Revcatin even if a will is validly revked (in whle r part), it may be pssible t prbate the will if the revcatin was (1) based upn a mistake (f fact r law) and (2) if it appears the testatr wuld nt have revked if the testatr had knwn the truth Requirements: i. T s will must have been revked ii. Revcatin must have been induced by sme mistake n the part f T iii. Revival f the revked will must be in accrdance with T s mst likely desires under the circumstances DRR is mst cmmnly applied in three circumstances: Defective new will States that d nt recgnize RRI Crss-ut and substitutin CONTRACTS RELATING TO WILLS Persn arguing that there is a cntract pertaining t the will must prve the fllwing thrugh evidence OUTSIDE the face f the will: Offer Acceptance Cnsideratin Pruss v. Pruss mutual exchange f prmises t devise prperty accrding t the will is valid cnsideratin t supprt a mutual irrevcable will cntract Tw situatins give rise t a claim that T entered int a cntract during life: 1. T cntracted t make a will in smene s favr UPC: Cntract must be evidenced by sme writing signed by T 2. Tw Ts enter int a cntract nt t revke the wills they have executed Under the law f wills, the surviving spuse cannt be prevented frm revking his r her will and executing a later will that can be admitted t prbate. Hwever, the beneficiaries wh are damaged can sue fr breach f cntract. Elective Share Rights vs. Cntractual Rights Majrity: enfrces the terms f the cntract nt t revke and let the cntract beneficiaries take befre the spuse Minrity: prtect new surviving spuse and let the new spuse take first by viding the cntract nt t revke under the thery it vilates public plicy by discuraging/restraining the right t marry Can beneficiaries prevent T frm transferring assets in a manner incnsistent with the cntract? Generally nt. The prperty the beneficiaries are entitled t receive an interest in is the prperty f the surviving T at the time f his death. Since he has nt died, the plaintiffs cannt prve what prperty he wned at the time f his death. And since they cannt prve that, they can hardly prve that he breached any cvenant t give them a percentage f the prperty he wned at his death. Remedy cnstructive trust Jint Wills UPC: Executin f a jint will des nt create presumptin f a cntract nt t revke the will Sme curts: Infer the existence f a cntract nt t revke when tw spuses execute a jint will 11

12 Mutual Wills Separate wills executed by spuses at the same time with reciprcal prvisins. UPC/Majrity: Executin f mutual wills des nt indicate a presumptin f a cntract nt t revke State Restrictins n Testamentary Freedm 1. Required Frmalities 2. Rule Against Perpetuities 3. Creditrs Rights 4. Spuse Elective Share (cf. mitted spuse) a. Pre-nuptial agreement can defeat elective share Prtectin f the Family Pretermitted Heirs Generally there is NO requirement that a parent leave prperty t his/her children Why might a parent disinherit a child: Child is s successful, parents decide t split estate between ther children Child is a spendthrift Parents spent significantly mre n child thrughut child s life and want t try and even things ut at their death Based n the idea that failure t mentin a child in a will was an versight, s the mitted child shuld get a share f the estate in rder t fulfill T s true intent. Pretermitted heir statutes differ n several pints: 1. Are all children cvered, r nly thse brn/adpted after the will was executed? UPC (and many thers): cver nly children wh were brn after the will was executed, unless T believed the child was dead Based n idea that if child brn befre will was executed was mitted, T must have intended t d s because it is very unlikely the T frgt abut the existence f a child when executing the will When, after the executin and subsequent birth f a child, a T executes a cdicil t the earlier will, the child is n lnger regarded as after-brn Sme States: cvers children brn befre and after will was executed [NM] 2. Is the statute limited t children, r are mre remte descendents included? UPC (and many thers): Only prtect mitted children Minrity: Statutes extend beynd children [NM] 3. What evidence is admissible t rebut presumptin f unintentinal disinheritance? UPC: Must appear frm the will that the missin was intentinal unless T prvided fr the child by transfer utside the will which was intended t be in lieu f a testamentary prvisin. This intent can be shwn by the T s statements r inferred frm the amunt f the transfer r ther evidence. Massachusetts apprach: Curt may cnsider extrinsic evidence Missuri apprach: Curt may nly cnsider the language f the will itself 4. What des a pretermitted heir take? UPC: Only allws pretermitted child t take a share equal t that f his/her siblings, whse shares abate t make up the pretermitted heir s share UNLESS the will devised all r substantially all f the estate t the ther parent f the 12

13 mitted child and that ther parent survives T and is entitled t take under the will Majrity: Pretermitted heirs receive their intestate share NOTE: Pretermitted heir statutes d NOT apply t will substitutes Supprt Rights f Surviving Spuse If will was executed befre the marriage, spuse can: Elect against the will Argue marriage revked the will Prperty distributed thrugh intestacy Prperty distributed under elective share statute Prve status as mitted spuse t get intestate share If will was executed after the marriage, spuse can: Elect t take under the D s will Spuse is limited t prperty devised under the will plus prperty passing t the spuse by way f will substitutes Elect t take against the will Spuse receives the elective share fixed by statute, in lieu f what he/she wuld have taken under the D s will Omitted Spuse UPC 2-301: spuse wh marries T after T has executed his/her will is entitled t intestate share. EXCEPTIONS: Bars the spuse where the will is made in cntemplatin f marriage Intent nt t prvide fr the spuse may be manifested in the will itself including language that prvisins applies t any subsequent marriages (express disinheritance wuld NOT preclude a claim t an elective share) Bars mitted spuse frm taking prperty which T s premarital will leaves t children f a prir marriage Thery: failure t prvide fr spuse in this situatin is nt likely t be an versight (Spuse can still claim an elective share) Bars spuse if it appears T made a transfer t the surviving spuse utside the will in lieu f testamentary bequest Sheer magnitude f transfer may serve as evidence transfer was made in lieu f testamentary bequest Sme states: T s marriage has n effect n a will Spuses need n ther prtectin than the elective share Cmmn law: Omitted spuse presumptin arises where (1) T marries after executing his/her will and (2) dies withut revising/revking will Presumptin can be rebutted (1) failure t prvide fr the new spuse was intentinal and intent appears frm will; (2) testatr prvided fr the spuse utside f will in lieu f testamentary transfer intent shwn thrugh extrinsic evidence NOTE: Elective share is typically smaller than intestate share spuse wuld receive under mitted spuse statute 13

14 Elective Share If a spuse elects against the will, the remainder f the prperty is distributed as if the surviving spuse had died (minus whatever the surviving spuse tk in his/her elective share) Under UPC 2-202, size f elective share is primarily based n the length f the marriage Spuse s wn assets are taken int accunt Spuses have a limited perid in which t chse whether r nt t take the elective share 9 mnths after D s death r within 6 mnths after the prbate f the D s will, whichever cmes last UPC: Includes bth prbate and nn-prbate prperty when cmputing the elective share Sme states: Only cnsider prbate prperty, hwever curts will examine whether an inter vivs transfer was illusry r testamentary such that the prperty shuld be included in determining the elective share: Illusry transfer Inter vivs transfers may be fund t be illusry r testamentary when they diminish the prbate estate t the extent that there is nthing left fr the surviving spuse t elect against while allwing the transferr t retain dminin and cntrl ver the assets placed in trust Intent t defraud examines whether D, when making the transfer which reduced f defeated the surviving spuse s share, intended t defraud the surviving spuse r his/her marital right in the estate Present dnative intent transfer must intent t presently make a real gift t the transferee UPC: Reduces the spuse s statutry share by the value f any devise t the spuse e.g. elective share = $150,000; devise = $100,000; spuse gets devise + $50,000 Sme states: Require the spuse t chse between the elective share and any devise (cannt receive bth) If the surviving spuse is legally incmpetent, a cnservatr must decide whether t take an elective share n the spuse s behalf Spuse can waive his/her claim t an elective share UPC 2-213: Surviving spuse s elective share rights may be waived whlly r partially, befre r after marriage, by a written cntract, agreement r waiver signed by the surviving spuse. A waiver is nt enfrceable if the surviving spuse prves that: He/she did nt execute the waiver vluntarily It was uncnscinable when executed If, befre executin f the waiver, the surviving spuse: Was nt prvided fair and reasnable disclsure Did nt vluntarily and expressly waive any right t disclsure Did nt have actual r cnstructive knwledge f the D s prperty r financial bligatins Cmmunity Prperty In cmmunity prperty states, each spuse wns 50% the cmmunity prperty Nrmally spuse gets 50% f cmmunity prperty and whatever is devised t him/her 14

15 Cnstructin and Interpretatin Primary Rule: seek and give effect t T s intentin Initially sught frm fur crners f will Extrinsic evidence is intrduced in sme circumstances Unlimited inquiry int T s intent is undesirable because: Spawn endless litigatin Make interpretatin f dcuments cstly, time cnsuming and unpredictable frustrate free transferability f prperty Clarifying T s subjective intent thrugh ral testimny might be viewed as adding language t the will withut fllwing required frmalities Ask yurself WHY the extrinsic evidence is being ffered: If it is being ffered t help determine the validity f a will, the extrinsic evidence is admissible If it is being ffered t help cnstrue an admittedly valid will, the curts are reluctant t admit such evidence absent an ambiguity Cmmn law: Plain Meaning Rule dcument that is clear and unambiguus must be read and implemented as written EXCEPTION: Persnal Usage particular term has an unusual meaning peculiar t the particular dnr Generally this means that a curt will nt allw a party t argue that T used a wrd in a way different frm its cmmnly excepted meaning UNLESS the wrd as used in the dcument renders the dcument ambiguus HOWEVER if strng and credible evidence f T s actual intent exists, curts try t carry ut that intent Legal terms in a will are given their specialized meanings unless there is evidence that the T, especially if the T was nt an attrney, used the terms in a different manner Nn-legal terms are given their plain and rdinary meanings Restatement (Third) Prperty Dnative Transfers rejects the plain meaning rule Bth the text f a dcument and relevant extrinsic evidence may be cnsidered t determine the dnr s intent Ambiguity Patent unclear n its face; n extrinsic evidence is necessary t realize that there is an ambiguity Latent cnveys a sensible meaning n its face but cannt be carried ut withut further clarificatin Mdern Trend: allw extrinsic evidence t reslve either type f ambiguity Cmmn law: extrinsic evidence was admitted t reslve latent ambiguities but nt patent ambiguities Cnstruing vs. Rewriting As lng as the extrinsic evidence clarifies the express language in the will, the extrinsic evidence is admissible and the curt uses it t help it cnstrue the ambiguity in the will HOWEVER, if the extrinsic evidence is incnsistent with the language in the will r requires the curt t add wrds t the will r rewrite the will, the curt des nt admit the extrinsic evidence. 15

16 If T s intentin cannt be determined, ne r mre rules f cnstructin will be applied. The rules effectuate what the curt believes the T wuld have wanted had the T pndered the issue. If neither extrinsic evidence nr a rule f cnstructin reslves a particular cnstructin questin, then the attempted dispsitin fails it will pass as part f the residuary estate Mistakes in Drafting and Executin Drafter s Errrs Restatement (Third) f Prperty Dnative Transfers: Allws fr the crrectin f mistakes A dnative dcument, thugh unambiguus, may be refrmed t cnfrm the text t the dnr s intentin if the fllwing are established by clear and cnvincing evidence: That a mistake f fact r law, whether in expressin r inducement, affected specific terms f the dcument; and What the dnr s intentin was Cmmn law: Parl evidence f intent cannt be admitted t supply a pssible defect r missin in a will ccurring thrugh mistake r inadvertence whether f the testatrix r scrivener Extrinsic evidence is nt admissible fr the purpse f shwing an intentin nt expressed in the will itself, nr fr the purpse f prving a devise r bequest nt cntained in the will. Curts will ften refrm trusts t crrect mistakes Curts disagree re: whether refrmatin shuld be permitted if the will s dispsitive prvisins are drafted crrectly but the lawyer inadvertently hands smene else s will t the T wh signs the wrng will e.g. husband and wife sign each ther s wills Mistake in the Inducement Will r trust accurately reflects the intentin f the T r settlr but that intentin is the prduct f mistake f fact r law General Rule: a mistake f law r fact, in the absence f fraud r undue influence, will nt defeat the prbate f a will, even thugh T wuld/might have made a different will if there had been n such mistake inducing T t make the will. HOWEVER if T is fraudulently induced t execute a will, the will is invalid t the extent its prvisins are shwn t have been affected by the fraud Restatement (Third) Prperty Dnative Transfers: mistakes in the inducement may be refrmed if clear and cnvincing evidence establishes: A mistake f fact r law affected specific terms f the dcument and What the dnr s intentin was Rules f Cnstructin re: Identity f Beneficiaries Lapse: Gifts t a Named Individual If will is silent abut survivrship, rdinarily each devise is cnsidered t be cnditined n the beneficiary s surviving the T. If a beneficiary fails t satisfy the cnditins f survivrship, the devise t that beneficiary lapses. What happens when a gift fails: Specific gifts: falls t the residuary clause, if there is ne, therwise t intestacy General gifts: falls t residuary clause, if there is n, therwise t intestacy Residuary gift: if it fails cmpletely, it falls t intestacy if it fails partially: 16

17 UPC and many states reject Cmmn Law Rule the lapsed share f ne f multiple residuary devisees passes nt t the T s heirs but t the remaining residuary devisees Cmmn Law Rule N Residue f a Residue if the residuary clause names mre than ne residuary devisee and a residuary devisee dies befre the T, the lapsed share f ne f multiple residuary devisees passes by intestate successin t the T s heirs. Saving Failed Gifts 2 dctrines are used t try and save failed gifts: 1) Anti-Lapse Statutes designed t prevent failure f a devise thrugh peratin f the nrmal lapse rules State anti-lapse statutes vary as t the categry f beneficiaries prtected by the statute Sme have enacted brad anti-lapse statutes that apply t all beneficiaries regardless f their relatinship t the T UPC wrds f survivrship are nt, in the absence f additinal evidence, a sufficient indicatin f an intent cntrary t the applicatin f the anti-lapse statute Wrds f survivrship + Extrinsic evidence that the T did NOT intend fr the antilapse statute t apply, can defeat this prvisin Majrity where the T uses wrds f survivrship indicating an intentin that the devisee shall take the gift nly if he survives the T, the anti-lapse statute des nt apply Mdern trend treat vid and lapsed devises the same and apply anti-lapse statutes t bth Cmmn Law the law distinguished between a devise t a beneficiary wh was already dead when the will was written (vid) and a devise t a beneficiary wh was alive when the will was written but died befre the T (lapse) Under this thery, anti-lapse statutes wuld nt apply t vid devises UPC Anti-lapse; Deceased Devisee; Class Gifts includes a number f innvative features: The anti-lapse prvisins cver devises t a stepchild f the T, as well as devises t a grandparent r descendant f a grandparent f the T. If the T names an alternate taker wh is unable t take fr any reasn, the anti-lapse rules may apply t the riginal devise The anti-lapse prvisins extend nt nly t devises, but als t appintments made in a T s will under a POA Framewrk: 1. Has the gift lapsed under cmmn law? a. Is there an alternate taker in the language f the dcument? 2. Is there an anti-lapse statute? a. Wh des it cver? i. Lineal descendants ii. All beneficiaries b. Wh is the alternate taker under the anti-lapse statute? 3. Des it apply, generally? a. Are there wrds f survivrship? 4. Class gift? 2) Class Gift grup f beneficiaries described by their relatinship t the T r t each ther by sme cmmn characteristic, rather than being listed by name 17

18 Where it is nt clear whether T intended a gift t multiple individuals t be a class gift, curts cnsider fur factrs: i. Hw did the T describe the beneficiaries Where the reference is t the beneficiaries cllectively, that argues in favr f finding a class gift Where the T identifies each beneficiary by name, that argues against finding that the T intended the gift t be a class gift ii. Hw did the T describe the gift Where the gift is described in the aggregate, that argues in favr f finding that the T intended the gift t be a class gift Where the gift is described in distinct shares, that argues against finding a class gift iii. D the beneficiaries share a cmmn characteristic If all the beneficiaries share a cmmn characteristic, that argues in favr f finding a class gift If there are thers wh share the cmmn characteristic and they are nt included in the gift, sme curts have cncluded this argues against finding a class gift If there is n cmmn characteristic, that argues against finding a class gift iv. What is the T s verall testamentary scheme whether in light f everything else the T tried t d with his/her prperty, it makes mre sense t find a class gift Alternate takers if the failed gift is nt a class gift, is there anything in the testamentary scheme that indicates the T wuld nt want the alternative taker t take the prperty in questin. If s, that argues in favr f finding a class gift Mdern Rule: Anti-lapse statute applies t deceased class member s gift In rder fr anti-lapse statute t apply, class member must be cvered by statute and die leaving issue wh survive the T If either cnditin is nt met, cmmn law rule applies Cmmn Law: Deceased class member s share remains in class N residue f residue rule des NOT apply t residuary class gifts Share f deceased class member passes t residuary ONLY if: N class member survives Anti-lapse statute cannt be applied t any deceased class member N cnsensus regarding whether gifts t an individual and a class shuld be cnstrued as ne class r an individual and a class Sme curts will divide prperty equally amng individual and members f the class Sme curts may give individual ½ f prperty and the class members share the ther ½ Simultaneus Deaths Where there is insufficient evidence as t wh survived whm, the prperty is dispsed f as if the beneficiary predeceased T UPC 2-104; require that the beneficiary shw by clear and cnvincing evidence that he/she survived the T fr 120 hurs Cmmn law: Beneficiary need nly have survived T fr a millisecnd Framewrk: 1. Did the claimant actually survive T? Based n fact pattern 2. Did the claimant legally survive T? Did the claimant meet the statutry survival requirement 18

19 Rules f Cnstructin re: Changes in Prperty After Executin f a Will What s t be dne abut changes in the T s prperty depend n the type f gift invlved: Specific gifts gift where the T has a specific item in mind when he/she makes the gift. The T intends fr that specific item, and arguably nly that specific item t satisfy the gift Gift is typically mdified by the wrd my General gifts gift f general pecuniary value that is satisfied by using any item that fits the general descriptin f the gift Demnstrative gifts general gifts frm a specific surce Treated as general gifts fr cnstructin purpses Residuary gifts gives away all f the T s prperty that has nt therwise been given away N special language is necessary Ademptin by Extinctin T makes a specific gift in his r her will and thereafter the item in questin is transferred. What if anything shuld the beneficiary take? UPC 2-606: Nn-Ademptin Statute Mnetary equivalent f any item that is transferred/lst/destryed if beneficiary can establish this was T s intent When T wns prperty at death that was acquired t replace prperty that was a specific gift in his/her will, the beneficiary f the specific gift gets the replacement prperty Cmmn law: where T makes a specific gift f an item and thereafter the item is transferred, an irrebuttable presumptin arises that the T intended t revke the gift T s intent is irrelevant Extrinsic evidence is nt admissible Frm and Substance Rule a substantial change in the nature r character f the subject matter f a bequest will perate as an ademptin but a merely nminal f frmal change will nt Frmal: mving an accunt frm ne bank t anther, exchanging stck in ne cmpany fr stck in anther fllwing a merger f tw cmpanies Substantial: clsing savings accunt and using the prceeds t acquire certificates f depsit Cnservatr/Pwer f Attrney Exceptin if the prperty subject t the specific gift was transferred during cnservatrship by an agent acting under a durable pwer f attrney fr an incapacitated individual, the ademptin dctrine des nt apply The beneficiary receives the general pecuniary value f the specific gift Stcks/Accessin Stck split UPC 2-605/Mdern trend: rejects the specific vs. general gift analysis allws beneficiary f specific devise and general devise t take additinal shares Cmmn law: if gift f stck is specific, beneficiary takes additinal shares. If gift f stck is general gift, beneficiary des nt take additinal shares additinal shares pass t residuary Stck Dividend UPC 2-605/Mdern trend: treat stck splits and stck dividends alike beneficiary is entitled t stck dividends Cmmn law: Specific beneficiary was nt entitled t receive stck dividends 19

20 Satisfactin if, after executing a will, the T makes an inter vivs gift t a beneficiary under the will, the issue is whether the inter vivs transfer shuld cunt against the beneficiary s testamentary share f the estate UPC 2-609/Mdern trend: reverses the cmmn law presumptin inter vivs gifts made t a beneficiary under the will are presumed nt t be in satisfactin absent a writing expressing such an intent Writing can be the will, a writing by the T at the time f the inter vivs gift, r a writing created by the dnee anytime Cmmn law: presumptin that T intended life time gift t cunt against beneficiary s share under the will Exneratin f Liens UPC 2-607/Mdern trend: reverses the presumptin Presumes that the T intended the beneficiary t take the prperty subject t the accmpanying debt General clause in will t pay all the T s debts is nt enugh t vercme the UPC/mdern trend presumptin express reference t the debt in questin is necessary Cmmn law: presumptin that beneficiary is t take devised prperty free and clear f any debt Abatement if the T gives away mre in his/her will than he/she has t give, the dctrine f abatement prvides fr which gifts are t be reduced first UPC prperty abates in fllwing rder: 1) Prperty nt dispsed f by will 2) Residuary devises 3) General devises 4) Specific devises LIFETIME TRANFSERS if smene gave smething up d gift analysis Dn t need same frmalities with gifts as with wills because dnr is nrmally there t testify as t what ccurred whereas T is dead Requirements fr Making a Valid Gift: 1. Present dnative intent n the part f the dnr 2. Delivery f the prperty t the dnee, and 3. Acceptance f the gift by the dnee Prmises require cnsideratin A persn cannt give prperty which she expects t inherit; transfers f an expectancy are effective ONLY if supprted by cnsideratin In mst states, if the validity f gift is challenged after dnr has died, the dnee must prve by clear and cnvincing evidence that the requirements fr a gift were satisfied Dead Man s Statutes In the trial f any actin in which any party sues r defends as the representative f a deceased persn, n adverse party r persn directly interested in the actin shall be allwed t testify n his r her wn behalf t any cnversatin with the deceased r t any event which tk place in the presence f the deceased. Statute is narrwly cnstrued nly testimny that might impair the estate f the D is excluded, i.e. testimny that wuld have the effect f reducing the estate f the D 20

21 This may bar the dnee s testimny regarding the purprted inter vivs gift Capacity A gift is valid if the dnr: Has capacity Acts under his/her wn free will Mental capacity t make a gift requires the transferr: Understand the nature and extent f his/her prperty Knw the natural bjects f his/her bunty Understand the dispsitin f prperty the transferr is making Sme curts require greater mental capacity t make a gift than a will Gift can be challenged under: Undue influence Cnfidential relatinship may give rise t rebuttable presumptin f undue influence If the dnr is dependent n and makes an imprvident gift t the dnee that strips the dnr f all r virtually all his assets, a presumptin arises that the dnr did nt understand the cnsequences f his act. In this cntext, the dnee must shw the dnr had the benefit f cmpetent and disinterested cunsel. When the dnr is nt dependent n the dnee, hwever, independent advice is nt a prerequisite t the validity f an imprvident gift even thugh the relatinship between parties is ne f trust and cnfidence. Dnative intent must be sme indicatin that transferr meant t make a vluntary gratuitus transfer f an interest in the prperty t the transferee Delivery is an ambiguus act nly cnstitutes a gift if dne with dnative intent Inherent ambiguity justifies use f extrinsic evidence t establish whether there was dnative intent Gifts f future interests are permissible if the dnee can establish the dnr had a present dnative intent t transfer a future interest If the dnr intended the gift t have n effect until the dnr s death, the gift is an invalid testamentary transfer A prmise t make a gift is generally unenfrceable n cnsideratin In rare instances, a dnee s detrimental reliance may transfrm a hllw gift prmise int an enfrceable prmise Delivery divests dnr f dminin and cntrl ver prperty Must ccur during dnr s lifetime Purpse is t prevent: impulsive gifts mistakes fraud perjury evidentiary dnee s pssessin supprts the claim f gift Curts are usually less strict abut delivery requirement and ften uphld gifts n the basis f: 21

22 Cnstructive delivery dnr delivers smething that gives the dnee access t the place where the prperty is lcated Symblic delivery dnr delivers smething symblic f the prperty, e.g. written instrument f gift Curts tend t excuse delivery in situatins where it was impssible r very difficult The same physical facts may r may nt cnstitute delivery depending n intent Delivery requirement is flexible and shuld be cnstrued in light f its purpses Delivery can be made by a third persn. If third persn fails t deliver gift: If third persn is wrking n behalf f the dnee, gift is valid because the dnr has surrendered dminin and cntrl If third persn is wrking n behalf f dnr, gift is invalid because dnr has nt surrendered dminin r cntrl Pssessin f a deed by a grantee generally creates a presumptin f delivery Pssessin f a deed by the grantr creates a presumptin f nndelivery Acceptance prperty cannt be frced upn a dnee Because peple generally want t acquire prperty, acceptance f beneficial gift is usually presumed If dnee des nt want gift, dnee can disclaim it Types f Gifts 1. Cnditinal Gift Persn wh asserts that gift was made n a cnditin has the burden f establishing the cnditin Curt can apply a fault r n fault test t determine wh keeps the cnditinal gift N fault dnr recvers gift Fault dnr nly recvers gift if dnee unjustifiably breaches cnditin, agreement is terminated by mutual agreement 2. Gifts Causa Mrtis Gift made in cntemplatin f death Dnr must fear death is imminent Revcable Gift MUST be f persnal, nt real prperty Other requirements fr gift must be met Hwever, delivery standard is lwer than fr regular gift, especially if dnr s intent is clear If third persn makes delivery n behalf f dnr, may questin f did dnr relinquish dminin and cntrl may arise (nly if dnr s intent is unclear) If dnr survives peril that induced dnr t make the gift: Majrity view gift is autmatically revked Minrity view revcable at dnr s discretin Restatement if gift is nt revked within reasnable time right f revcatin is eliminated; gift causa mrtis is effective if dnr dies r an unrelated cause, prvided the dnr was still in imminent fear f death frm riginal peril Majrity f curts hld that suicide will nt supprt a gift causa mrtis 22