Bar Review: Wills, Trusts

Ademption: Intend test

Minority rule: is more lenient test over identity theory test - beneficiary entitled to substitute property owned by testator if beneficiary can prove testator intended beneficiary to take substitute property UPC: specific devisee has right to any real property owned by testator at death tat was acquired as replacement for specifically devised property

Codicil

Modifies/Amends previously executed will and must itself be executed with same formalities - To extent possible will and codicil are read together - BUT extent of any inconsistent provisions, later document controls - Can be admitted into probate itself because of requisite formalities - Republication of codicil - treats will as executed on date of last codicil Testamentary document similar to a will

Per capita Representation

Most states are per capita w/ representation Divide estate into shares - one for each UPC and Modern trend (per capita at each generation level) - divide into shares - one for each line of decent

Cy Pres

"As nearly as possible" Court finds settlor had general charitable intent and only mechanism for effectuating intent is not possible or practical - Court will modify the mechanism - Can introduce instrisic and extrinsic evidence

Fraud: Definition

(1) There must be a representation (2) Of material fact (3) Known to be false by the wrongdoer (4) For purpose of inducing action or inaction (5) In fact induces action or inaction desired

Pretermitted spouse

Most states marriage after will has no effect on will UPC - effect of marriage following execution of will is that pretermitted spouse takes Unless (1) appears from will that omission intentional (2) T made other provision for spouse by transfer outside will and intent that transfer be in lie of provision in will shown by statements of testator, amount of transfer or other evidence

Manifestation of trust intent

Must be present manifestation of trust intent - Precatory word not enough alone - hope, wish, desire

Private Trust

Must have ascertainable (human) beneficiaries - beneficiaries does not have to be alive

Republication

A will is treated as having been executed (republished) on the date of the last validly executed codicil - To be republished, will must have been validly executed

Harmless Error Doctrine

A will not executed in compliance with witnessing requirements may nevertheless be admitted to probate if at the time the testator signed the document he intended it to constitute his will - Usually applies to formal attested will when technical rule not complied with *Clear and convincing evidence at time testator signed document intended to be will*

Insane Delusion

Will be attacked if at the time of execution the testator was suffering from insane delusion (1) T had false belief (2) False belief was product of sick mind (3) No evidence to support belief not even a scintilla of evidence (4) Delusion must have effected T's will Consequence - only that part of will effected is invalid

Joint Will

Will of two or more people on one document

Interlineations

Writing between lines - Brings in holograph, DRR - When interlineation is less than cancelled provision DRR not used

Fraud in Inducement

Wrongdoer representative affects the contents of T's will - T intends document to be will but contents affected by misrepresentation Consequence: Only that part of will affected by the fraud is invalid

Cancellation

cannot increase a gift to co-beneficiary by means of cancellation (crossing out)

Incorporation by Reference

non-integrated writing [extrinsic document] by reference given testamentary effect becomes party will 1) writing must have been in existence when at time will executed 2) language ow will must sufficiently describe the writing to permit ID 3) Will must manifest an intent to incorporate the document UPC and many other states - may refer to written statement or list disposing of TPP - must be signed by T and must describe property

Transfer in trust

third person trustee: 1. Real property - settlor must execute and deliver deed to trustee - SOF applies 2. Personal property - settlor manifests intent and delivery of trust property to trustee

Trust: Rule

Creator delivers legal title of trust assets (the res) to trustee for the benefit of the beneficiaries with intent to create trust for valid purpose

Widow's election

Includes widower and surviving domestic partner - Arises when testator attempts to dispose of more than 1/2 CP or quasi-CP - Widow may invoke widow's election - may accept gift given in T's will in lieu of statutory right ➞ taking under the will - OR widow can renounce all benefits given in will and confirm right to CP ➞ taking agains the will

Decedent leaves no surviving spouse

Intestate scheme - issue, parents, issue of parents, grandparents, issue of grandparents

Physical Revocation

1. Must be burned, torn, cancelled destroyed or obliterated - cancel = lining out; obliteration = erasing 2. T simultaneous intent 3. Done by T or by someone in T's presence - writing void on back - most states no revocation - UPC void anywhere on the will is sufficient to cancel - not good enough to write voice on a xerox copy of the will

Residuary Devise

All other property not expressly disposed in will

Capacity

Lowest capacity recognized in law to make a will At time of execution must: (1) Testator must be at least 18 (2) Must be able to understand the extent of her property (3) Must know natural objects of her bounty: Spouse or domestic partner, Issue, Parents, and those who's interests are affected by will (4) Must known nature of her act: she must know executing a will; does not have to know legal technicalities of will [T does not have to know the Rule Against Perpetuities]

Interested witness

Majority - interested witness does not result in denial of probate of will but beneficiary- witness loses legacy unless 1) two disinterested attesting witnesses 2) witness beneficiary would be heir if no will in which case she takes lesser (i) amount given in will (ii) intestate share UPC: interested witness rule abolished - but could raise undue influence issue - Witness who is beneficiary in will Consequence - Will not invalid but raises presumption of wrongdoing - If rebut takes gift, if not takes what amount intestacy

Ademption: Identity Theory

Majority rule: objective test, testator's intent is irrelevant, in deciding if devise is adeemed and bequest fails - bequest fails ➞ devisee take nothing of the gift

Scope of vision test

Minority rule Witnessed testator sign will if they could have seen T sign it had they looked

Declaration of trust

Settlor is trustee: 1. Real property - settlor satisfy SOF applies 2. Personal property - settlor does not have to deliver

Termination of Revocable Trust

Settlor retains right to revoke trust

Trust Termination: Missing Trustee

- A trust will not terminate for a lack of a trustee - The court can just appoint one -Until trustee appointed legal title will remain in settlor's estate or court - A trustee cannot resign without permission of the court unless authorized by trust terms or consent is given by beneficiaries

Trustee: Breach of trust

- Beneficiaries may sue trustee for amount necessary to restore the trust property and distribution to what they would have been without the breach = surcharge -Trustee personally liable

Lack of Capacity of Testator

- Burden of Proof on contestant - Presumption of T - T must have capacity at time will executed - T must have the ability to understand: (1) Nature of her act, (2) Extent of her property, and (3) Persons who are the natural objects of her bounty

Trustee: Duty to Administer Trust

- Good faith -Prudent manner -In accordance with terms and purposes of trust instrument [follow instructions] -Duty of Care - prudence - degree of care, skill and causation that a reasonably prudent person would in managing her own property - Duty of Loyalty - impartiality - cannot favor one beneficiary over another

Holographic will

- Handwritten -Signed by testator but no witnesses - Present intent the paper serve as his will - Half states not allowed - UPC: valid if material provision are in T's handwriting and signed by T -- material provisions are words that identify property and beneficiaries to receive it

Ademption by extinction problems

- Only specific gifts (devise) adeem by extinction

Separate Property: Definition

- Property owned by either spouse before marriage - Property acquired during marriage by gift, will, or inheritance - Property acquired during marriage with expenditure of separate funds ➞ Source Rule or Tracing - The rents, issues and profits derived from separate property

Constructive trust remedy

- Remedy to prevent fraud or unjust enrichment - Tort Equitable Restitutionary Remedy - imposed on improperly acquired property which D has title - D serves as trustee and must return the property to P - Applies when the property increases in value - Applies when person acquires title to property wrongfully (fraud, misrepresentation, duress, or mistake)

Revocable Trust

- Settlor retains the right to revoke, alter, amend the trust - Trustee's duties are exclusively in settlor -Upon death of settlor the trust becomes irrevocable - Gift by will to trust valid if terms set out in written instrument (if trust revoke before death gift will lapse)

Statute of Frauds and Trusts

- Trust for personal personal property does not have to be in writing - SOF applies to real property

Irrevocable Trust

- Trustee owes exclusive duties to beneficiaries

Doctrine of Integration

- Will proponent must show that extrinsic document offered for probate was present at will's execution -Intended by testator to be part of the will

Attesting witness beneficiary

- Witness is competent to testify ➞ will will be probated -But devise raises a presumption of duress, menace, fraud or under influence -Presumption is rebuttable - devise is not void

Execution of Attested Wills

-Testator must sign or acknowledge the will or his signature in joint presence of at least two witnesses - witnesses must understand the instrument being witnessed is testator's will - witnesses need not sign in presence of each other and may sign at any time during testator's lifetime

Mutiliated Will

-found at T's death rebuttable presumption T had intent to revoke will

Will: Statutory Formality

1) T must be 18 or over 2) Will must be written 3) with testamentary intent 4) T must sign will 5) Two attesting witnesses who witness T's signing Uniform Probate Code (UPC): court can validate defectively executed will if proponent establishes by clear and convincing evidence that testator intended document to be his will (will signed by notary is valid)

Undue Influence: Common Law Presumption

1. Confidential relationship between T and beneficiary 2. Beneficiary participated in procuring wills 3. Will provisions are unnatural and favor the alleged influencer

Undue Influence: Prima Facie Case

1. Influence exerted on T 2. Effect of influence - overpowered mind and free will of T 3. Product of influence was will would not have been executed but for influence -Susceptibility: Psychological, Financial, Physical, Any weakness of testator -Opportunity - wrongdoer access to T -Active participation - disposition to exert influence -Unnatural result - T devises to wrongdoer when have no relationship

Holographic Will

A holographic will is valid if the signature and material provisions are in the testator's handwriting

Predeceased 120 hours

A person who fails to survive decedent 120 hours is deemed to have predeceased the decedent

Pretermission: Defintion and Rule

A pretermission is an accidental omission - A child is pretermitted if born or adopted after all testamentary instruments are executed and not provided for in any testamentary instrument UPC - entitle to take intestate shares Unless (1) appears from will omission intentional 2) Left substantially all of his estate to parent of pretermitted child 3) provided for child by transfer outside will and intended transfer in lieu of provision in will If believe child is dead then UPC child is pretermitted; CL no relief for mistake

Mutual Wills

AKA Reciprocal Will Separate wills of two or more people which are reciprocal

Totten Trust

AKA tentative bank account trust where named beneficiary takes whatever is left in account at death of owner of account - Revocable during life by any manifestations of intent to revoke including withdrawals - Not true trust - Trustee no fiduciary duty to beneficiary - Will substitute - also can be revoked by depositor's will (majority rule)

Property of trust

Any presently existing interest in property that can be transferred can be corpus of trust

Trust: Definition

Arrangement which trustee holds legal title to property for benefit of beneficiaries - Trustee has burdens and beneficiaries have property ownership - Trustee subject to fiduciary duties - Harsh self dealing rules preclude trustee from using trust property as his own

Ademption by Extinction

CL: When specific gift fails because T did not own property at T's death (property not in T's estate at death) - The bequest fails

Stock devise

CL: specific bequest of stock includes any additional shares produced by stock split but not produced by a stock dividend UPC and majority of states: specific bequest of stock includes stock dividends

Charitable Trust

Charitable - Help poor, Advance Education, Help the sick, Promote religion Creation: 1. Manifestation of intent 2. T's death by will 3. Settor's lifetime by declaration of trust or transfer of trust 4. Presently existing interest to property that can be transferred 5. Legal charitable purpose - must be in favor of a reasonably large number of unidentifiable beneficiaries - Beneficiary not ascertainable person or group because society benefits Not subject to RAP

Corollary

Child born or adopted before all testamentary instruments are executed and not provided for in any instrument is not pretermitted - child takes nothing Except: child is treated as pretermitted if the only reason not provided for in testamentary instrument because testator erroneously thought child to be dead or not existent

No Capacity

Entire will is invalid - passes intestate succession or if there was a prior will [ property will pass intestate] Except: Second will cannot be revoked by first if did not have capacity in the first - first will be probated - Look for testator for a conservator appointed or a testator diagnosed with mental disorder (still needs to satisfy 4 prong capacity test)

Manner of Revoking Will

Express revocation: expressly through written language in Will #2 Implied: Will #2 implies revocation because totally disposes T's estate

Trustee Duties Owed to Beneficiaries

Fiduciary duties

Private Express Trust

Fiduciary relationship with respect to property whereby trustee holds legal title for benefit of another, beneficiary, which arises out of manifestation of intent to create it for legal purpose Creation: 1. Trust created to take effect at settlor's death and during settlor's lifetime 2. Other time frame settlor can create trust is during lifetime - Beneficiary can transfer his right to further payments - Creditor can attach or seize beneficiary's right to future payments

Trust Termination: Beneficiaries Consent

For a irrevocable trust: (1) All beneficiaries must consent to termination - existing and potential of all present and future interest (2) No further trust purpose to be served and modification will not interfere with material purpose of trust - interest in minors or unborn beneficiaries precludes termination - Spendthrift clause in trust makes trust indestructible (beneficiaries cannot terminate) - there is further trust purpose Except: spendthrift trust can terminate with consent of all beneficiaries and settlor

Final Dissolution of Marriage or Domestic Partnership

For testamentary gifts - Operation by law - revocation of devisee to spouse if annulment for final dissolution by marriage - legal separation does not count - Devise is reinstated if will unchanged and T remarries former spouse - Rules do not apply if T provides language in will stating otherwise

Distinguish fraud in execution from fraud in the inducement

Fraud in Execution: T does not intend document to be his will Inducement: T intends the document to be his will but contents affected by misrepresentation

Specific Devise

Gift of unique item - Real property is always specific - Antique automobile specific - "My" shares is specific other public shares general gift - Shares of closely held corporation is specific

Demonstrative devise

Hybrid of general and specific Gift of particular fund

Distinguish lack of capacity from delusion

No capacity ➞ severe problem goes to testator's essence Delusion ➞ narrow problem there wise perfectly normal

Mistake in Description

No one or nothing fit description or more fit description Latent ambiguity: no problem on face of will - extrinsic evidence is admissible to clear up ambiguity Patent ambiguity: apparent on face of will

Ademption by satisfaction problems

Only general gifts adeem by satisfaction

Intestate

Person dies without a will -Testate person dies with a will

Devisee

Person who receives gift of property by will

Advancement

Similar to ademption by satisfaction CL Intervivos down payment made intestate to heir apparent UPC - not advancement unless (i) declared such in a contemporaneous writing by dependent or (ii) acknowledged as such in writing by heir

Community Property: Definition

Property acquired by either spouse during marriage Common examples: (1) Salary or wages earned by either spouse (2) Income from community assets

Support Trust

Provision in Private Express trust - Trustee required to use only so of the income or principal as is necessary for beneficiary's health, support, maintenance, education - Trustee does not have discretion to refuse to pay/provide for beneficiary

Discretionary Trust

Provision in Private Express trust Trustee given sole and absolute discretion in determining how to pay beneficiary if anything and when to pay beneficiary if ever - Court will generally not interfere unless trustee acts in bad faith or dishonesty

Spendthrift Trust

Provision in Private express trust *Settlor's material purpose and manifests lack of confidence in judgement and management ability of beneficiary* - Beneficiary cannot transfer right to future payment of income voluntary or involuntary - Creditors cannot attack beneficiary right to future income on principal -- except some states do not enforce a spendthrift provision against certain types of creditors - like beneficiary defendants (alimony, child support)

Revocation of Codicil

Rebuttable presumption that testator intended to revoke codicil only but if revokes will then rebuttable presumption intended to revoke both

Ademption

Refers to the failure of a gift because property no longer in testator's estate at time of death

Integration: Definition

Refers to which papers make up the will

Revival of revoked will

Revocation of physical act - in CA Will# 1 not automatically revived - Will #1 revived if testator manifests intent to revive Revocation by subsequent instrument - T revokes Will #2 by codicil

Fraud in execution

Someone forges testator's signature to a will or Testator is given document to sign and signs purportedly is non-testamentary in nature but in fact it is - T does not intend document to be his will Consequence: Entire will is invalid

Omitted spouse

Spouse that married decedent after execution of all testamentary instrument and is not provided for Consequence: -Spouse receives statutory share of decedent's estate equal in value to that if decedent did not have testamentary instrument - One- half community property, quasi-community property, share of separate property (only if would have received share - Other gifts will be abated or reduced Exceptions: - Decedent's failure was intentional - Spouse otherwise provided for - Omitted spouse signed waiver

Ademption by Satisfaction

T gives beneficiary an inter vivos down payment on a devise (gift) UPC (majority): lifetime is not prepayment of any interest under a will unless: (i) will provides for this treatment; (ii) testator declares in contemporaneous writing that gift is deducted from devise or is in satisfaction of devise or (iii) devisee acknowledges in writing the gift is in satisfaction

Mistake in Execution

T signs wrong document

Mistake in Content

T will names wrong beneficiary or wrong gift due to accidental omission or accidental addition

Abatement problems

T's estate is partially insolvent - what order gifts sacrificed to satisfy funeral expenses, expenses of administration, creditor's claims *Start at bottom and work up* - Does not apply to demonstrative gifts UPC: T's intent material and statutory provisions apply to avoid abatement Stock: CL type of distribution title matters (stock splits, stock dividends); UPC: Specific devisee is entitled to securities of another entity owned by testator as result of merger, consolidation, reorganization or similar action initiated by entity Encumbered property: UPC specific devisee of encumbered property is not entitled to have encumbrance paid out of residuary estate unless will shows such intent; CL pass free and clear of encumbrance

Trust Termination Rule

Termination of trust usually permitted if all beneficiaries consent and *termination does not interfere with material trust purpose*

Mistake in content

Testator names the wrong beneficiary or makes the wrong gift due to accidental omission or accidental addition

Pour Over Will

Testator's estate is divided to trustee of inter-vivo trust - Incorporation by reference - Independent Significance - Uniform Testamentary Additions to Trust Act - valid simply because statute says valid

Undue Influence: Definiton

Testator's free agency is subjugated Contestants bear burden: 1) existence and exertion of influence 2) effect is to overpower the mind and will of testator 3) result is will that would not have been executed but for the influence Not enough - mere opportunity, mere susceptibility, mere fact of unnatural disposition Consequence: - Residuary devisee - Heirs at law - Constructive trust remedy

Dependent Relative Revocation (DRR): Definition

To allow a court to disregard a revocation which is based on, induced by, premised on a mistake of law or fact if court is satisfied but for the mistake T never would have made revocation Heart of DRR is (1) Testator revokes will or portion (2) Mistaken belief that substantially identical will or codicil effectuates her intent (3) then operation of law revocation of Will #1 is deemed conditional dependent and relative to Will #2 effectuating T's intent (4) If Will #2 does not effectuate T's intent then first never revoked - DRR allows court to ignore revocation of Will 1 because of testators mistaken belief

Honorary Trust

Trust has no ascertainable beneficiaries and confers not substantial benefit on society - Simply goal of settlor Problem: trustee may refuse to cary out settlor's wishes and trust fails - Typically RAP problems with honorary trusts - void and property returns to the estate - Under UTC - valid for lifetime of beneficiaries

Second will

Two wills and second does not in terms revoke the first: 1) If second will has no residuary clause, it is presumptively a codicil to the first 2) if second has a residuary clause - it will revoke the first will in its entirety by inconsistency *Majority Rule: Revocation of a will revokes all codicils thereto. But revocation of a codicil to a will does not revoke the will.*

Conscious presence test

UPC/Majority Witness T signing if they were councils of where T was and what he was signing

Fraud in preventing testator from revoking

Variation of fraud in the inducement Consequence: Court will not probate the will and thus the property will go to heirs

Waiver by Spouse of decedent's property

Voluntary relinquishment of known right whether signed before or during marriage - In writing, signed by waving spouse - Full disclosure of decedent's finances - Independent counsel for waiving spouse But will not be enforced if unconscionable *Omitted domestic partner same

Unworthy Heir or Beneficiary: Killers

[Slayer statute] Feloniously and intentionally killed decedent - Conviciton and guilt by preponderance of evidence Consequence - Deemed predeceased decedent

Fact of independent significance

problem with four corners of the will - fills in blanks with parol evidence

Duplicated Originals

revoke one - revoke all