MICHIGAN WILLS AND DECEDENTS' ESTATES PROFESSOR JULIA BELIAN UNIVERSITY OF DETROIT MERCY SCHOOL OF LAW

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1 MICHIGAN WILLS AND DECEDENTS' ESTATES PROFESSOR JULIA BELIAN UNIVERSITY OF DETROIT MERCY SCHOOL OF LAW CHAPTER 1: INTESTATE SUCCESSION A. Intrductin When faced with a prblem invlving a decedent whse prperty needs t be transferred t ther parties: Lk fr any nn-prbate dispsitive and apply them if valid; then Apply an analysis f the f the will, cnstructin f its prvisins; and If there is n will, mve t the cncerning intestate successin. Exam Tip 1: In Michigan, Wills is tested in the essay prtin f the Bar Exam. B. Intestacy and Intestate Successin 1. Generally Any decedent wh dies withut a will is said t have died "intestate." Thse wh have a right t decedents' prperty at their death are defined by. The steps fr identifying thse wh take under intestacy: Identify what share the spuse will get if there is a ; Determine what share will pass t the decedent's ("issue"); If n descendants, cnsider what shares will pass t. 2. Spuse's Share The spuse will always get sme dllar amunt ff the tp and will get sme fractin f the remaining. In MI and ther states that generally fllw the Unifrm Prbate Cde (UPC), the dllar amunt ff the tp is keyed t (at a statutry rate). Because that amunt changes, n particular number is the right number.

2 If the estate is fairly small, the dllar amunt ff the tp may cmprise the entire estate. In MI, the dllar amunt ff the tp can be between $ t $150,000 r mre. The spuse's share (bth the dllar amunt ff the tp and the fractinal share f the remaining estate) can vary accrding t certain key facts: Whether the decedent left any / issue / descendants; Whether any f remaining descendants were f: Just the decedent; The decedent and the surviving spuse; r Just the surviving spuse. 3. Descendants' Shares Once yu have determined the spusal share, next lk t the shares f any descendants. Prperty passes frm decedents t their descendants in a particular way that accrds t (i) the generatinal level f the descendant and (ii) which f the decedent's family tree in which they belng. Per Capita at Each Generatin: MI's intestate statute fllws the at each apprach (als knwn as "per capita with representatin"). 1) First, at which generatin d we begin the prcess? In MI, the prcess will begin at the first generatin belw the decedent that has any. 2) Next, the estate int (i) ne share fr each member f the generatin, then living, and (ii) ne share fr each member f that generatin that leaves issue, then living. "Then living" means living at the time f the death. 3) Distribute the shares t the living members f the generatin. 4) Take the shares f the deceased members f the first generatin and them t make a new, larger share. 5) Drp the new share dwn t the generatin and divide it amng the descendants f the predeceased members f the starting generatin Themis Bar Review, LLC MI Wills and Decedents' Estates

3 "Bundle and Drp" Distribute the shares t the members f the generatin Then take the shares f the deceased members f the starting generatin, them tgether, and the new share dwn t the next generatin. Divide amng the next generatin whse parents predeceased the decedent. N member f the next generatin takes if his received a share. 4. Cllateral Heirs If there are n descendants f the decedent wh receive a share, the decedent's cllateral heirs take under the "up, ver, and dwn apprach": 1) G frm the decedent t their, if alive; 2) If nt alive, g and t the parents' ther descendants siblings, nieces, nephews. 5. Other Issues Invlving Intestacy a. Wh is a Surviving Spuse? Under MI law, a surviving spuse is smene wh was married t the decedent at the time the decedent died. Smene wh is legally frm their spuse at the time the spuse dies is nt cnsidered t be a surviving spuse fr purpses f taking an intestate share f the spuse's estate. b. Wh are Descendants? "Descendant" includes a decedent's children, children, and children that were in gestatin but nt yet brn at the time the decedent died. "Descendant" des nt include a decedent's. c. Rules Barring a Party frm Receiving Their Share Generally, there are nly tw reasns in Michigan why smene wuld NOT be allwed t take their intestate share: The heir may his share; Statute: If the heir tk the life f the decedent, the heir may nt receive his share. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 3

4 CHAPTER 2: COMPONENTS OF A WILL When a will is executed, there may be a questin as t which dcuments are part f the will that will cntrl the transfer f the decedent's prperty. A. Integratin All dcuments present at the time the testatr the will that were intended t be part f the will are, in fact, part f the will. It is nt required that the testatr sign every f the will. B. Incrpratin by Reference Smetimes, a will may reference anther dcument that is nt part f the will. D these dcuments have testamentary effect? Only dcuments executed in accrdance with the frmalities required under the wills can cunt as a will and have testamentary effect. Example 1: "Give away my prperty as I have set frth in a letter t my brther." Is this kay? Answer:. The dctrine f incrpratin by reference allws certain dcuments int the will if: The dcument must actually be in at the time the will is executed; and The dcument must be in the will with sufficient t knw which dcument is intended. C. Tangible Persnal Prperty By statute, a testatr may dispse f certain tangible persnal prperty by reference t a writing. The list f takers des nt have t be in existence at the time the will is executed. The testatr may make t a list that will dispse f tangible persnal prperty. That list may be created r amended at any pint after that. "Tangible persnal prperty" nly. May nt dispse f real prperty, cash, mney, r securities. D. Cdicils A cdicil is a testamentary instrument that amends, adds t, r revkes smething in a -executed will. A cdicil may amend a will s cmpletely that it amunts t a cmplete will itself. If a cdicil references an earlier will, read the tw Themis Bar Review, LLC MI Wills and Decedents' Estates

5 Republicatin: The cdicil republishes the will as f the date f its. The will gets a brand new date. E. References t Events Exam Tip 2: This cncept is highly tested n the MI Bar Exam and ften cmes up in situatins invlving spuses and decedents wh have been mitted frm a will. Smetimes, a will may make a reference t an event that des nt have any testamentary assciated with it. Example 2: cllege first." "I leave my prperty t whichever f my children graduates frm A will may refer t utside the will in rder t determine certain dispsitive prvisins f the will, as lng as thse acts have significance entirely apart frm and f the will itself. F. Pwers f Appintment Definitin: A right t determine prperty shuld g Example 3: A will says that particular prperty shuld be distributed t "whmever child B shall appint." When May the Pwers be Exercised? Inter Vivs Pwer f Appintment: The testatr may say that the pwer f appintment can be exercised by the dnee f the pwer at any time, including the dnee's. Testamentary Pwer f Appintment: The testatr may say that the pwer f appintment shall be exercised in a valid will that makes t the pwer f appintment. It cannt be exercised until the appintee. Scpe f the Pwer f Appintment General Pwer f Appintment: A pwer f appintment allws the dnee f the pwer t appint t take the prperty. General pwers f appintment typically exist when the pwer allws the dnee t appint the prperty t: The dnees themselves; The dnee's ; The dnee's ; r Creditrs f the dnee's estate. Special Pwer f Appintment (Limited Pwer): Any pwer f appintment that cannt g t the dnee's self, estate, creditrs, r creditrs f the dnee's estate MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 5

6 Exercising the Pwer f Appintment Generally, pwers f appintment must be exercised by explicit reference in a dcument. Hwever, it is pssible, depending n hw the pwer is drafted, fr the dnee f the pwer t exercise it by. If the pwer, the pwer f appintment will usually cntain instructins as t what shuld happen t the prperty. G. Prbate Estate The prbate estate includes any prperty wned by the decedent at the time f his, except fr prperty that passes accrding t a instrument. This "nn-prbate" prperty can include: Trusts accunts Other types f accunts designating a beneficiary at the time f the hlder's death Life plicies The persn named as beneficiary will receive the prperty, nt a persn designated in the decedent's will. CHAPTER 3: EXECUTION OF WILLS A. Executin f Wills Generally A will is a legal instrument, executed by the testatr t f the testatr's prperty upn death. Because f its unusual nature, certain precautins must be taken with regards t a will's executin in rder t ensure that the testatr's intent is carried ut. B. Testatr's Requirements fr Valid Will Executin Capacity: Testatrs must have, meaning they are able t knw and understand: a. The and extent f their prperty; b. The f the natural bjects f their bunty; c. What srt f prvisins they are making in the will; and d. The interrelatinship amng the abve three requirements Themis Bar Review, LLC MI Wills and Decedents' Estates

7 The test is whether testatrs is able t these things, nt whether they actually understd them. Mere frgetfulness r a lack f f particular details des nt cnstitute a lack f capacity. Testatrs Must Have Testamentary Intent: The intent t make a will at the time the will is executed This des nt mean that a will is invalid because certain prperty did nt g in the way set frth in the will. If the testatr executed the dcument as a r as part f a fraud, that wuld undermine the requirement f testamentary intent. C. Frmal Executin f Wills Testatr Must Sign a Writing (i.e., n ral wills) Any will qualify, s lng as the testatr intended that the mark be a signature. Example 4: Testatr can mark an X as a signature. As lng as he intended that t be his signature, it qualifies as a valid signature. Executin Must Be Witnessed MI requires a will t have witnesses. Requirements f Witnesses Each witness must witness either (i) the testatr actually the will, r (ii) the testatr the signature r the will t the witness Witnesses d NOT need t knw the f the will. Witnesses d NOT have t be in the will. Witnesses are NOT required t in the f the testatr and each ther. The testatr des nt have t sign in the presence f each witness, s lng as the testatr acknwledges his signature in the presence f each witness. Example 5: In MI, Testatr signs his will in his hme (by himself). He then walks next dr t his neighbr and says, "This is my signature. Wuld yu please be a witness t it?" The neighbr then signs the dcument as a witness. Testatr then ges t a secnd neighbr and asks her t be a secnd witness. The secnd neighbr signs the will as a witness. This is a valid executin as lng as the witnesses sign the will within a reasnable amunt f time. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 7

8 Attestatin Clause The witnesses may simply sign the will, r there may be an attestatin clause in which the witnesses what they have witnessed. An attestatin clause, while helpful, is nt required in a will. Self-Prving Affidavit D. Hlgraphic Wills In MI, a will may als include a self-prving affidavit, a statement that is a separate instrument frm the will itself, in which the testatr and witnesses swear t the happening f all f the events t which they may have t testify when the will is ffered t prbate. A self-prving affidavit is nt required, but it des ffer evidence t the curt that the will was prperly executed. Exam Tip 3: Will executin is ne f the mst frequently tested areas f Wills n the MI Bar Exam. Hlgraphic wills are in MI. Exam Tip 4: If a will des nt meet the requirements f frmal executin fr an attested will (i.e., a witnessed will), yu must analyze whether the will qualifies as a hlgraphic will. Generally, a hlgraphic will is entirely in the testatr's wn. MI has relaxed this requirement and requires that nly the prvisins and the signature be in the testatr's wn handwriting. The testatr must and the will. E. Statutry Wills A frm that has been authrized by act f the t be incrprated int the MI Cde The frm can be printed ut and filled in by a testatr. Because it cnfrms t the statutry frm it is valid, even thugh it may nt cmply with all f the frmal requirements f an attested r hlgraphic will. F. Harmless Errr Even thugh a particular dcument may fail t satisfy the frmal requirements fr a valid attested r hlgraphic will, it can still be admissible as a valid will, prvided that the prpnent f the will can ffer evidence that that the testatr that this dcument be a will Themis Bar Review, LLC MI Wills and Decedents' Estates

9 It is nt sufficient t prve that the dcument reflects the testatr's desires regarding hw the testatr's prperty shuld be distributed at death. CHAPTER 4: REVOCATION; WILL CONTRACTS A. Revcatin f Wills Exam Tip 5: Revcatin f wills is a highly tested subject n the MI Bar Exam. 1. In General N matter hw a will is revked, the testatr must have capacity t revke it. A will may be revked by: revcatin in a writing act Implicatin by subsequent incnsistent will Operatin f 2. Revcatin by Physical Act The statutes prescribe certain physical acts which, if dne t a will while the testatr has the intent t revke, will serve t revke a will. Prescribed acts include: Burning Cancelling Obliterating In MI, it is nt necessary fr the act f revcatin t tuch the f the will. 3. Revcatin by Express Writing This is usually dne by way f a will. Example 6: Testatr's will expressly states, "This is my last will and testament. I hereby revke all prir wills and cdicils made by me." This revkes all prir wills and cdicils. Althugh a revcatin can be part f a subsequent will, the revcatin will nt have any effect if the subsequent will is nt a will. Hwever, in MI, the rule applies t revcatin. As lng as the prpnent can prve, with MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 9

10 evidence that the testatr intended t revke the will, the revcatin shuld be effective. 4. Revcatin by Implicatin If a testatr executes ne will and subsequently executes anther that gives away the same prperty, the instrument revkes the prir will by, even if there is n express revcatin within it. 5. Revcatin by Operatin f Law Under the law, certain events can cause a will t be cnsidered revked (in whle r in part). Omitted Spuse: If the testatr marries having validly executed a will, there may be a surviving spuse wh was nt mentined in the will. The spuse has a claim t an share. There may be a revcatin f the will the terms are altered t satisfy the surviving spuse's rights. Omitted Children: Similarly, the testatr may execute a will and then have children. There are tw ways t handle this prblem under MI law: If, at the time the will was executed, the testatr had and then a child is brn later, the child has a right t his intestate share. If, at the time the will was executed, the testatr had children and then had mre later, the mitted child r children are entitled t a share f the amunt that was left t the ther children in the first will. Example 7: Testatr's will leaves "half f my estate t my children, A and B." Later, Testatr's child, C, is brn. C will get ne-third f the ne-half f Testatr's estate that was riginally left t A and B. 6. Presumptins as t Revcatin If a will is accidentally destryed r is unable t be lcated after the decedent's death, there are presumptins f revcatin that can be vercme: If a will was last knwn t be in the testatr's presence, pwer, and cntrl and it is when the testatr dies, there is a presumptin that the testatr it with revcatry intent. If an instrument has been mutilated, there is a presumptin that, as lng as the testatr had f the instrument, the mutilatin was a prper revcatry act Themis Bar Review, LLC MI Wills and Decedents' Estates

11 The presumptins must be vercme by smene wh is arguing that the will is still admissible. 7. Duplicate Original Wills What if nly ne f thse riginal cpies is destryed? The destructin f ne duplicate riginal will in effect revkes f the wills. 8. Revcatin f Cdicils The revcatin f any will revkes any cdicils t that will. Example 8: Testatr executes a will in 2008 and executes a cdicil amending the will in Testatr then revkes the 2008 will. The 2009 cdicil is autmatically revked as well. Hwever, if smething is labeled as a "cdicil," but actually makes a cmplete alternative dispsitin f the testatr's estate, then arguably, that is its wn cmplete subsequent will. 9. Divrce The new will arguably revkes the prir will by. In this case, destructin f the prir will is irrelevant. When the testatr is married at the time the will is executed and subsequently that spuse (r the marriage is annulled), the prtins f the will that relate t the frmer spuse are. If the will gives everything t the spuse that is nw a frmer spuse, it may nt mean that all f the administrative prvisins f the will have been revked. ERISA Prgrams: The law preempts all law. If the prperty invlves prperty that falls under this categry, apply federal law rather than MI law. Prperty held as tenants becmes prperty held as tenants upn divrce. If the parties are married, then divrce, then remarry, there is nt a presumptin that the prvisins f the testatr's will regarding the spuse have been revked. Lk t the status that they share at the time f the testatr's death. 10. Incidental Writings n the Face f the Will MI recgnizes revcatin by physical act. A line drawn thrugh a prtin f the will may perate t revke that prtin f the will. Revcatin by physical act requires that the act be dne by the testatr with revcatry intent. A line thrugh sme prvisin f the will, withut mre, may meet this test, but still be hard t prve. Lk t certain presumptins f law r additinal facts. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 11

12 B. Will Cntracts 1. In General Exam Tip 6: A favrite situatin f the MI bar examiners invlves the cmbinatin f a partial revcatin by physical act and a hlgraphic cdicil. The testatr may change part f the will by putting a line thrugh the prtin f the will the testatr wants t change. The testatr may then write the substitute prvisin (the amendment) in the margin r between the lines. The line thrugh the prtin f the will intended t be revked will serve as a partial revcatin by physical act. The handwritten ntatin is a hlgraphic cdicil. If all that has changed is ne wrd, dllar amunt, name, etc., there may be a questin as t whether the cdicil has all material prvisins in the testatr's handwriting. Additinally, the testatr must and date the hlgraphic cdicil. Remember that this is a tw-step prcess: a) Was the mark intended t serve as a revcatin by physical act? b) Did the rewritten prtin f the will cnstitute a valid will r cdicil? Will cntracts primarily arise in cnnectin with revcatin. Example 9: Tw spuses enter int an agreement stating that each f their wills will cntain specific prvisins and that neither f them will revke the will. This agreement is as binding as any cntract. If parties have entered int a cntract nt t revke their wills, executing a new will wuld be a f cntract. It wuld nt, hwever, invalidate the new will. T be valid, will cntracts must fllw the general rules f law. Under MI law, a cntract related t a will can be prven by: 1) A prvisin in the will that states that there is a cntract and references an dcument that sets frth the terms f the cntract; 2) An reference in the will t the f the cntract; r 3) An entirely separate writing, by the decedent, that sets frth the terms f the cntract. Whever was suppsed t get the benefit f a will cntract that has been breached may bring a claim fr in a curt f general jurisdictin and receive caused by the breach Themis Bar Review, LLC MI Wills and Decedents' Estates

13 2. Mutual Wills When tw peple have mutual wills, the wills are, but their prvisins are (i.e., "mirrr wills"). The fact that tw peple have mutual wills is nt enugh t shw that thse tw peple had a agreement regarding thse wills. 3. Jint Wills One dcument dispses f the prperty f tw peple. Bth peple execute that dcument as their wn will. When the first party dies, that dcument will be admitted t as the will f the decedent. When the secnd party dies, the dcument will again be admitted t prbate as the will f the secnd party. CHAPTER 5: CHANGES AFTER WILL EXECUTION A. Changes Regarding Intended Beneficiaries 1. Lapse and Anti-Lapse Statutes Lapse: If a beneficiary dies befre the testatr, the gift lapses under cmmn law. The prperty that is the subject f the gift falls int the f the estate. Anti-Lapse: Mst states, including MI, have enacted anti-lapse which usually create a different result than the cmmn law lapse situatins. Anti-lapse statutes nly apply t devises t smene wh was (i) a grandparent, (ii) a lineal descendant f a grandparent, r (iii) a step-child f the testatr. Example 10: Gifts t a testatr's sibling r parent wuld be prtected by the anti-lapse statute. Gifts t spuses are nt cvered by the statute. If the anti-lapse statute des apply, the substitute taker will be a f the beneficiary wh has predeceased. The descendant will take under MI law, nt under the predeceased beneficiary's will. The testatr's will can designate the taker. If this is the case, anti-lapse des nt apply. Anti-lapse nly applies if the testatr has nt prvided alternative plans fr dispsal f the prperty in the case f the intended beneficiary's death befre the death f the testatr. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 13

14 Example 11: B's will leaves prperty t her brther, "A, as lng as he survives me," but des nt state what will happen t the prperty if A predeceases her. In such a case, the gift will cme under the anti-lapse statute; the gift will g t. 2. Class Gifts A class gift is a devise t a f peple defined by a characteristic and the membership f the grup is fluid (i.e., it can increase, decrease, r change). Example 12: A gift t "Jhn, Harry, and Sally" is nt a class gift, whereas a gift t "my nieces and nephews" is a class gift. Nrmally, if a member f a class the testatr, that class member's share will g t the ther surviving class members. If a predeceased class member is smene wh wuld be cvered by the anti-lapse statute (i.e., a grandparent, lineal descendant f a grandparent, r step-child), MI's anti-lapse statute will apply and prvide a substitute taker. 3. Residuary Gifts The residue is what is in an estate after all f the ther devises have been distributed. Under cmmn law, surviving residuary takers are nt allwed t take the predeceased member's share. It wuld vilate the "n residue f the residue" rule. Under MI law, the residuary takers are treated as just anther type f. The members f the residuary class will receive the share f any predeceased member f the class. But, if the predeceased taker is cvered by the statute, the statute will apply and the descendants f the predeceased class member will take his share. B. Changes in the Testatr's Prperty 1. Ademptin by Extinctin Example 13: Testatr wns a Rlex watch. In his will, he makes a specific gift f the watch t Tm. Testatr dies, but the Rlex watch cannt be fund. What happens? Des Tm get nthing? With regard t gifts, if the prperty is there when the testatr dies, the devisee gets it. If the prperty is nt there, the devisee des nt get it. If the prperty has left the testatr's estate, the gift f that prperty has Themis Bar Review, LLC MI Wills and Decedents' Estates

15 2. Ademptin by Satisfactin This ccurs when the prperty is n lnger in the testatr's estate because he gave the prperty t the devisee early. Similar t advancements under intestacy, ademptin by satisfactin requires: 1) A cntemprary ; 2) Executin by the ; and 3) Indicatin that a lifetime gift f mney was meant t satisfy a mnetary gift under will. 3. Nn-Ademptin Statutes Under a nn-ademptin statute, a devisee wh was suppsed t receive a gift may have the right t receive a gift, even if the designated item t be received is n lnger in the testatr's estate. This is mst ften applied t devises. Example 14: Testatr leaves her car t B, but then sells the car. Des B get anything? B may have a right t smething, particularly cash that was received frm the sale f the car. 4. Increases in Stck The beneficiary f stck has a right t additinal shares that are the result f a stck split. Lk t where the cntrl f the change happened. If the increase ccurred withut any actin n the part f the testatr, treat the ttal amunt f stck as the amunt intended t be part f the. Example 15: Testatr's will leaves "all my Ggle stck" t a particular persn. At the time f executin, Testatr wns 50 shares f Ggle stck. If, at the time Testatr dies, he wns 100 shares f Ggle stck, des the beneficiary receive all 100 shares? Answer: CHAPTER 6: STATUTORY LIMITATIONS ON THE DISPOSITION OF PROPERTY A. In General The testatr's takes precedence in MI wills law, but there are exceptins and limits t this. There are statutry mandates that require certain peple t have an interest in the decedent's prperty, even if the decedent has written them ut f the will. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 15

16 Rights may extend t a surviving spuse r certain ther family members, and testatr may be precluded frm leaving sme f these individuals ut f a will. B. Spuse's Elective Share 1. Optins fr Spuses Three ptins fr a spuse: 1) Take what is prvided under the will 2) share 3) Dwer right (nly fr widws) Elective Share: In MI, the elective share is f what wuld have been the spuse's intestate share had the testatr died withut a will, minus the value f prperty spuse received by any nn-prbate means. This is significantly less generus and prtective than many ther jurisdictins. "Nn-prbate": can include prceeds frm trust, anything that passes by peratin f jint wnership, life insurance, retirement payment payuts, etc. This means that if spuses are unhappy with what they have been left under a will, they wuld have been better ff if the testatr had died withut a will. Widw's Dwer Right: Gives a widw a life estate in 1/3 f all real prperty that was wned by the husband at his death r cnveyed during his life withut her apprval. Editr's Nte 1: The lecturer misses a key wrd when reciting this rule. Nte that the widw's dwer right gives the surviving wife an undivided life estate in ne-third f all real prperty wned by the husband at any time during the marriage nly Only 1/3 f all prperty that fits descriptin Only prperty husband wned at death, r prperty cnveyed during life withut wife's apprval. C. Statutry Allwances In MI, it is cmmn practice t have the wife sign alng with the husband any time real prperty is transferred, even if the wife is nt an wner f the prperty. This effectuates a f the dwer rights. All states have certain prtectins that pull certain prperty f the decedent ff the tp and preserve it fr her family. Exam Tip 7: The plicy gal f these prtectins is t avid leaving the decedent's family in pverty fllwing her death Themis Bar Review, LLC MI Wills and Decedents' Estates

17 The statutry allwances include: Hmestead allwance Family allwance Exempt allwance NOTE: The statutry allwances invlve specific dllar amunts, which are peridically adjusted fr inflatin/cst f living. 1. Hmestead Allwance A surviving spuse (r the minr and dependent children, if n surviving spuse) is entitled t a $ hmestead allwance, Exam Tip 8: The hmestead allwance is taken ff the tp f the estate and has pririty ver ther claims. The hmestead allwance is adjusted fr inflatin. 2. Family Allwance Available t the "family" f the decedent during time perid f administratin. The persnal representative may petitin the curt fr a mnthly family allwance distributin, but the statute prvides fr a amunt (f up t $18,000, adjusted fr inflatin) that the persnal representative may distribute frm the estate. Under MI law, "family" includes: 1) The surviving f the decedent 2) Any children that the decedent was bligated t supprt 3) Any children (whether the decedent's r nt) that the decedent was actually supprting. 3. Exempt Persnal Prperty Right is held by, r if there is n surviving spuse, then by regardless f whether they are minrs r dependents f the decedent. Allws family t select frm Exempt persnal prperty may include husehld furniture, furnishings, clthing, appliances, and ther persnal items frm the estate (des nt include cash, stcks, bnds, etc.). Pririty f allwances: (1) Hmestead Allwance; (2) Family Allwance; (3) Exempt Persnal Prperty Executr must satisfy these in crrect rder f pririty MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 17

18 CHAPTER 7: WILL CONTESTS A. Grunds fr Cntesting a Will 1. In General The grunds fr cntesting the admissin f a will int prbate are established in cmmn law and have develped ver time. A prbate curt is a curt f jurisdictin, but like every curt it must receive evidence in rder t reach its findings. The will itself is a kind f evidence. The presumptin under the law is that decedents want their prperty t be distributed at death accrding t the rules f successin unless there is evidence t the cntrary. The best evidence t the cntrary is. The prpnent f the evidence will ffer the evidence fr admissin after laying the fundatin regarding the exhibit's reliability, the general chain f custdy, etc. If there is n bjectin, the curt will generally admit the exhibit int evidence. 2. Specific Grunds f Objecting t Admissin f the Will There are limited grunds upn which ne may base an bjectin t the admissin f evidence. Except fr minimal threshld requirements, the prpnent f the will desn't have t d anything unless smene bjects. The traditinal grunds fr bjectin t a will int prbate include: 1) Lack f capacity 2) Lack f requisite intent 3) Undue 4) Revcatin 5) Fraud 6) Mistake B. Wh May Cntest a Will? Only parties may cntest a will. An "interested party" can be anyne wh stands t take anything under the will and anyne wh stands t prperty if there is n will. Include the f the decedent and the devisees named in the will itself The prpnent f the will must shw that the will appears t have been prperly and make a claim that the testatr had the requisite capacity and testamentary intent Themis Bar Review, LLC MI Wills and Decedents' Estates

19 C. Testamentary Capacity At the time the will was executed, testatrs must have had the ability t understand: The and extent f their prperty; The natural bjects f their bunty (i.e., the peple wh wuld take if there were n will); What srts f are being made in the will; and Hw all three f the abve factrs relate t each ther. Remember: Capacity is a test f the testatr's, nt actual knwledge r understanding. Legal Capacity: The testatr must be years f age r lder. Insane Delusin: The testatr may have had capacity, but the capacity may have been diminished by sme that the testatr pssessed. An insane delusin is a mistaken belief that is nt subject t crrectin. Fr an insane delusin t be grunds fr bjecting t a will, the delusin must have sme effect n the dispsitins made in the will (i.e., causatin). The insane delusin must cause smething in the will that wuld nt be there but fr the insane delusin. D. Undue Influence 1. In General Undue influence is cercin exerted by a third party n the intentins f the testatr. Influence becmes "undue" whenever it the alleged influencer's desires fr the desires f the testatr. Test: The test fr undue influence can be remembered by the acrnym "SODR." 1) The testatr must have been Susceptible t undue influence; 2) The influencer must actually have had the Opprtunity t the testatr; 3) The influencer must be the type f persn with the Dispsitin t unduly influence the testatr; and 4) The influence must have actually Resulted in a change in the will. SODR: Susceptibility: Factrs cnsidered when determining susceptibility include age, general mental ability, mental ability as influenced by illness r age, and verall traits that reflect the testatr's ability t undue influence. N ne f these factrs is determinative. Opprtunity: If there is evidence that the alleged influencer had time alne with testatr, it may qualify as pprtunity. The amunt f time needed is arguable. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 19

20 Dispsitin: The best kind f evidence t lk fr is evidence that the alleged influencer has unduly influenced the testatr. Result: The influence must actually the testatr t change a testamentary plan. Example 16: Testatr executed a will leaving half f all f her gds t ne f her tw children. That child is unaware f this and wrries that Testatr will nt leave her any prperty. S the child begins t drp by Testatr's huse when n ne else is present and tries t influence Testatr, wh is very susceptible t being influenced. Further, Testatr's child has tried t exert influence ver Testatr in the past. Is this undue influence? Answer: In this case, the dispsitin had already been made befre the child attempted t unduly influence Testatr. Nthing changed in the will as a result f the influence. The will is valid, and the dispsitins shuld remain undisturbed. 2. Cnfidential Relatinships There are sme cnfidential relatinships frm which a presumptin f arises. There is n statutry definitin f "cnfidential relatinship," but these relatinships ften invlve a and the persn t whm they we a duty, such as a lawyer-client relatinship. The presumptin f undue influence arising frm a cnfidential relatinship is rebuttable. It is up t the prpnent t rebut the presumptin. Assciatins that d NOT qualify as cnfidential relatinships frm which a presumptin f undue influence arises include spuse-spuse and parent-child. Dctr-patient relatinships are generally cnsidered t be cnfidential, but ther relatinships with medical care prviders may nt be. Generally, smene with cntrl ver the testatr's r items necessary t the testatr's survival r can be said t be in a cnfidential relatinship that gives rise t a presumptin f undue influence. E. Fraud There are tw types f fraud. Bth types will result in the invalidatin f the will. 1. Fraud in the Inducement A false statement made fr the purpse f inducing the testatr t execute a will that has particular prvisins Themis Bar Review, LLC MI Wills and Decedents' Estates

21 When the testatr executes the will, he truly intends all f the prvisins in it and that the dcument will be his will, but he wuld nt have signed the will but fr the. 2. Fraud in the Executin Fraud with regard the nature f the itself The testatr signs a dcument, nt knwing that the dcument is his will There is n intent F. Mistake Under cmmn law, mistake cnsidered grunds fr invalidating a will. Under MI law, there are categries f bjectins t wills that are classified under "mistake." 1. Mistake in the Inducement If the testatr leaves smene ut f the will because f the mistaken belief that the persn is, the mistake will nt be admitted int evidence unless the mitted beneficiary is a f the testatr. If the mitted beneficiary is a f the testatr, relief must be. Under the cmmn law, a mistake nt created by a fraud instituted by smene else will nt be admitted. Exceptin: Mistake n the Face f the Will Example 17: Testatr writes in the will, "Because my child is dead, I leave X t A." Testatr is mistaken, and his child has nt died. If the mistake can be prven, the will may be ruled inadmissible. 2. Mistake in the Cntent f the Will When the testatr makes a mistake in the cntent f the will, such as accidentally leaving smene r smething ut, evidence f the mistake admissible. 3. Extrinsic Evidence Extrinsic evidence is nt admissible t alter the meaning f the language f the will. Example 18: Testatr leaves prperty t "Je Smith," and Je Smith can be fund. Curts will nt allw extrinsic evidence t shw that this was nt what Testatr meant. But there are certain situatins when the curts will lk t extrinsic evidence t try t srt ut the testatr's intentins. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 21

22 Latent Ambiguities: A latent ambiguity is a that makes sense when read, but des nt make sense when applied. Example 19: Testatr's will leaves certain prperty t "Je Smith, wh lives n Wdward Heights Blvd." Testatr has a friend, Je Smith, wh lives n Wdward Ave., and a friend by the name f Smith wh lives n Wdward Heights Blvd., but is nt named Je. There is a latent ambiguity here. The curts will lk t extrinsic evidence t try t srt ut what Testatr meant. G. N Cntest Clauses Testatrs ften include n-cntest clauses, calling fr certain (e.g., getting nthing under the will) if smene bjects t the validity f a will. These clauses are generally cnstrued t be. But, if the cntestant t the will wins and the will is nt admitted, the n-cntest clause is nt admitted either. If the cntestant lses and the will is admitted, curts may be reluctant t enfrce the ncntest clause if the cntest was based n r a reasnable basis. CHAPTER 8: PROBATE AND ADMINISTRATION A. Jurisdictin and Venue Jurisdictin: The crrect jurisdictin is the state in which the decedent was r where certain real prperty f the decedent may be lcated. Venue: Prper venue is the in which the decedent was dmiciled. Real Prperty Real prperty is subject t the jurisdictin in which it is (in rem jurisdictin). If the testatr was dmiciled in MI, but wned prperty in anther state, there must be an ancillary prbate in that ther state. Cnversely, if the testatr was dmiciled in anther state and wned MI real prperty, there must be ancillary prbate in MI. Venue is prperly in any cunty in MI, but is usually in the where the prperty is. B. Prcedure There is n statutry limit t apply fr prbate f a will. Prbate requires prf that the dcument is the testatr's will Themis Bar Review, LLC MI Wills and Decedents' Estates

23 Administratin is the prcess f administering the estate cllecting the, making an inventry, paying and expenses, and then making distributins under the will (if there is ne). Prbate may be either frmal r infrmal: Frmal Prbate: Initiated by a petitin t the curt, resulting in the curt appintment f the persnal representative Infrmal Prbate: The will is taken t the register f prbate where there is an applicatin prcess. If the will appears t be valid n its face and if there are n bjectins t the will, the register f deeds may apprve the applicatin and issue the letters that will allw the administratr t serve his tasks. C. Persnal Representatives MI law designates an rder f pririty fr appintment f the persnal representative, starting with beneficiaries under the will. After being appinted, the persnal representative has the duty t take an f all estate assets and liabilities. The persnal representative has the same legal authrity in administering the estate as the testatr had befre his death. Persnal representatives are entitled t reasnable fr their duties. Liability f Persnal Representatives Persnal representatives are liable fr breaches f fiduciary duties. If the persnal representative enters int cntracts n behalf f the estate, the persnal representative persnally liable fr thse cntracts unless: The cntract states that the persnal representative is accepting liability; r The ther party did nt knw that they were entering int the cntract with the individual as a persnal representative f the estate. D. Administratin f the Estate The administratin f an estate can be either supervised r unsupervised: 1. Supervised Administratin Very burdensme: The persnal representative must btain apprval fr nearly everything t be dne. Supervised administratin is apprpriate if the curt determines that it is. MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 23

24 2. Unsupervised Administratin (mre cmmn) The persnal representative receives authrity t administer the estate. She then cllects all f the estate's, pays all f the bills, satisfies all and bligatins, and makes the final distributin. When administratin is cmplete, the persnal representative files dcuments with the curt and receives apprval, relieving her f any future liability in administering the estate. If the persnal representative has prceeded in an unsupervised administratin, she may need t get a authrizing a particular actin. This gives the persnal representative the f an unsupervised administratin. It als allws her the prtectin frm liability that a curt rder prvides with regard t decisins that seem likely t be subject t litigatin. If a persnal representative has reasn t believe that there will be cntentius matters in the administratin f an estate, a administratin may be mre apprpriate. E. Creditrs' Claims Creditr claims must be satisfied with the assets f the estate befre any distributins can be made either under the will r in intestate successin. The prcedure is similar t that f a bankruptcy r divrce: 1) Hit the "pause buttn" t prevent any significant f assets; 2) all assets; 3) Cllect all evidence f ; 4) the debts; and 5) the remaining assets. Ntice When prbate is pened, creditrs must be given. Ntice must be made and must g ut directly t any creditrs. When a will is ffered fr prbate, frmally r infrmally, ntice must be published in the legal publicatin Themis Bar Review, LLC MI Wills and Decedents' Estates

25 Creditrs receiving ntice nly by publicatin have mnths t respnd and file claims. Knwn creditrs receiving ntice by mail have mnth t respnd and file claims. Statute f Limitatins Claims are either paid r denied at the time they are. If n administratin f the estate has begun at all, creditrs have up t years frm the date f in which t pen a prbate f the decedent's estate in rder t satisfy claims. F. Payment f Claims 1. Pririties fr Payments Claims are paid in a particular rder defined by statute: a. Csts and expenses f b. Reasnable and burial expenses c. The three 1) allwance 2) Family allwance 3) Exempt d. Debts and that have pririty under law e. expenses relating t the decedent's illness f. Debts and that have pririty under law g. All ther claims (including gifts t devisees) 2. Abatement Occurs when the estate des nt have assets t satisfy all claims f creditrs and still distribute prperty accrding t the testatr's will In these situatins, certain gifts abate accrding t the categry in which they belng. Gifts are distributed in the fllwing rder (and abate in the ppsite rder): 1) gifts 2) devises 3) pecuniary devises 4) MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 25

26 Pecuniary gifts that cannt be satisfied will be abated accrding t each devisee's pr rata share. CHAPTER 9: ISSUES AFFECTING INHERITANCE A. Survival Rule MI Fllws the UPC's Survival Rule: T inherit prperty, a party must survive the decedent by at least hurs (five days). In sme cases, a party may be deemed, under the law, NOT t have survived the decedent, even thugh the party technically died after the decedent. Example 20: Dug, the decedent, died n Mnday. Dug's sn Sam, wh is devised prperty in Dug's will, dies n Wednesday. 120 hurs will nt have passed between Dug's death and Sam's death. Thus, Sam will be deemed t have predeceased Dug, even thugh he actually died after Dug. 120-hur rule applies t successin, wills, survivrship estates (e.g.,, payable n death bank accunts, and plicies. Exceptins Wills: A testatr can state that he/she des nt want the 120-hur rule t apply (but if nt disclaimed, the rule applies as the rule). Intestacy: The rule des nt apply if its applicatin wuld result in an f the estate t the State f Michigan. Different Time Requirement: A testatr can change the amunt f time required t satisfy the survivrship requirement (can be mre r less than 120 hurs). The rule applies (default) unless smehw disclaimed in writing. B. Advancements and Satisfactin A cmmn law cncept thrugh which a party receives prperty frm anther persn during that persn's lifetime Under cmmn law, a lifetime transfer t a prbable heir was cnsidered an advancement n the heir's inheritance. Under mdern (UPC) and MI law, a lifetime transfer is nt cnsidered an advancement against ne's inheritance unless certain cnditins are met (in ne f the fllwing tw ways): 1) The decedent executed a writing t the transfer when he that makes clear that this was intended as an advancement, OR Themis Bar Review, LLC MI Wills and Decedents' Estates

27 2) The executed a cntempraneus writing, stating that he accepted the prperty with the that it was meant t be an advancement "Satisfactin": refers t same cncept, with regards t a specific devise under the will Prcess Calculating an heir's share f an estate when that heir received an advancement r satisfactin: Bring heirs back int the " ": Bring that heir back int the general grup f heirs, but deduct frm that heir's share what he already received. Example 21: Decedent dies with three children, A, B and C. At sme pint befre death, the decedent's estate was wrth $90,000. At sme pint during his lifetime, Decedent gave $30,000 t A. Nw, upn Decedent's death, the estate is wrth nly $60,000. Assuming a cntempraneus writing was made, acknwledging an advancement against A's inheritance, then the advancement ges back int the "htchpt." Cnsider the entire estate after death as thugh A never received the $30,000. S a $90,000 estate is divided three ways, r t $30,000 apiece. Because A already received his $30,000 share, A des nt get additinal prtin f the estate; B and C divide the remaining $60,000 share, based n the ttal estate value f $90,000. C. Disclaimers In MI, n ne is frced t accept a transfer f prperty. T disclaim prperty, a beneficiary must d s in a that must: Describe the item being disclaimed; Be by the disclaiming party; and Be t the prperty party. Under MI law, prperty must be disclaimed within a amunt f time. A "reasnable" amunt f time is nt defined, s it is a fact-specific analysis. Under federal tax law, mnths is the maximum amunt f time allwed, but it has n impact n MI prperty law. Descriptin: make sure disclaimer has right details, n ambiguity "Prper Party" t receive the disclaimer: Estate: The Gift: The dnr Trust: The MI Wills and Decedents' Estates 2016 Themis Bar Review, LLC 27

28 Insurance Plicy: The paying insurance cmpany Survivrship Interest: The t receive the prperty Disclaimer f Real Prperty: Must be with the register f deeds Disclaimers are ; nce executed and delivered, it is final. Disclaimers are NOT effective if the party trying t disclaim already exercised ver the prperty. Incidents f wnership: almst anything a nrmal persn wuld d culd be cnstrued as exercising an incident f wnership (e.g., paying prperty taxes, trying t sell autmbile) D. Slayer Statute Regarding inheritance, wills, trusts, r ther methds f transferring prperty, it has been histrically clear that n ne shuld benefit frm cmmitting a. Slayer Statutes (in general): If a party is f intentinally and felniusly killing a decedent, this serves as the party's disclaimer f the prperty. Standard f prf is prepnderance f the evidence, s actual criminal cnvictin is nt necessarily required Editr's Nte 2: Prfessr Belian misspke in stating that the standard f prf under the statute is a clear and cnvincing evidence standard. The standard f prf under Michigan's slayer statute is nly that the cnduct be fund by a prepnderance f the evidence. Intentinal and felnius killing: des nt include all hmicides. Must be intentinal, and it must cunt as a felny if yu culd prve it in a curt f criminal law. Michigan Statutes: In additin t murder, anyne wh is cnvicted f cmmitting, neglect, r explitatin f the decedent is als barred frm receiving prperty frm the decedent's estate (see utline fr full list f actins that may bar receipt f prperty). Disclaimer v. Predeceased: We treat slayer as having "disclaimed" prperty, and nt having predeceased testatr. [END OF HANDOUT] Themis Bar Review, LLC MI Wills and Decedents' Estates