Professional Documents
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Wills and Trust Outline
Wills and Trust Outline
Test Outline
Daar (Fall 2015)
1. Control of the Dead Hand: Property can be controlled by the dead, Freedom of Disposition (though not
favorable to certain people) is upheld by the law.
a. Conditions and Restraints
i. Rule: Decedent conditions a gift on the beneficiary in a certain way generally upheld
unless the condition violates law or public policy. (eg. Absolute restraints on marriage)
1. Exceptions to Restraints on marriage: partial restraints that impose reasonable
restrictions are generally not contrary to public policy. Reasonableness is fact
sensitive. (eg. Marrying within a reasonable time period/certain religion)
2. Invalid restrictions:
a. Freedom of religion
b. Encourages separation or divorce
c. Committing crime or fraud
3. Analysis (w/ constitutional/policy arguments): right to inherit is not a constitutionally
protected right, but condition can be a violation of constitutional right. Policy
arguments relates to reasonableness of the condition.
ii. Remedy and gifts over clauses
1. Rule: if the conditional gift is void and there is a gift over clause, courts will
distribute the gift to the alternate beneficiary. If there is not a gift over clause, the
condition is void and the original beneficiary receives the property.
b. Wills requiring destruction of property
i. Rule: courts will break down their analysis into a variety of factors evaluate facts and
weight the benefits and burdens for fulfilling the condition.
1. Real Property: balance public and private interests
2. Personal Property: motivation, intent and social utility
c. Challenging Wills
i. Rule: the pecuniary interest in the estate. A person who is named in a will or who would get
the property would have pecuniary interest in the will, and everyone else will not have
standing to challenge the will.
d. Posthumously Acquired Property
i. Property rights that the descendant acquired after death
ii. Rule: the disposition of property only extends to property at death, and extends to the
testators envisions of the property earned after death.
2. Terminology
a. Inherit: to gain property of the death of the individual inheritance is the passing of property at
death.
b. Devise: property that is passed through a will and Devisee is the same as beneficiary
c. Ways to inherit property (3): more than one way can happen
i. Will: a will is a written instrument that conveys property at death
1. Testator: a person who drafts the will
2. Testate Succession: the process of passing the property through a will
3. Succession: the passing of property
4. Beneficiary: person who takes property under a will
ii. Intestate Succession
1. Dies without a will/ without disposing of all property
2. Subject to state laws = intestate succession laws
3. Heir: person who inherits property through intestate succession
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c.
d.
e.
f.
g.
h.
iii. CA Rule: requires clear and convincing evidence that the beneficiary or heir survived
then to distribute that property but there are exceptions.
1. Joint Tenancy: if property is held by two joint tenants and both have died and no
evidence show one survived the other, the property shall be distributed under a
sharing agreement. The property would be held in tenancy of common.
iv. Avoid: create a will ahead of time.
Death of Spouse: the surviving spouse is always the preferred first taker of the intestate
succession. Even if separated, most states view the parties as legally married. Some states
disqualify a spouse if the spouse has abandoned.
i. Rules:
1. UPC: spouse gets everything if no issue/parents; share with the children
2. California: community property, surviving spouse is entitled to of the CP.
Inheritance and Gifts are not CP.
Systems of Distributing Property
i. Per Stirpes: the initial division is made at the first generation regardless if there are any
living members.
1. # of primary shares is the # of the surviving persons in that nearest generation,
plus the # of deceased persons in that generation who have descendants who
survived.
ii. Per Capita on representation: the initial division of the estate is made at the first
generation in which one or more members survived. Representation is recognized for
surviving decedents of that generation. The # of primary shares is the # of surviving
persons in the first generation with a surviving member, plus the # of deceased persons in
that generation who have decedents who survive.
Half Bloods
i. Genetically related siblings through 1 parents are treated the same as fully genetically
related.
Escheat: when a decedent has no relatives, the property will escheat to the state.
Transfers to Children
i. Adoption: formal adoption and equitable adoption (court looks to the behavior and intent
of the parties due to lack of formalities, requires clear and convincing evidence)
ii. Nonmarital Children (step children): are treated like marital children
iii. Posthumous Children: PH children can take property (Common Law); a child
conceived after death can inherit if the parent gave permission, in writing, for the use of
genetic material after death to conceive a child, and the child was in utero within two
years after death. (CA)
Advancement (lifetime gifts with possible post death consequences)
i. Common Law: if an heir receives a life time gift then that share is often counted against
any distribution that person would receive. CL presumes gifts as advancements. Requires
evidence (preponderance of the evidence standard) to rebut.
1. Advancement of the heir intestate share: an heir succeeds the estate that is
identified at the time of death; therefore a lifetime gift is counted against the heir
in the distribution.
ii. Accounting (Hotchpot): the blending of property to ensure equal distribution
1. Adding the advancement to the estate, then dividing the property, and subtracting
the advancement from the advanced devisee.
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NOTE: beneficiary dies before will executes the gift is void; beneficiary dies before
the testator the gift lapses
b. Default Takers or Failed Gifts
i. If a gift fails, it falls to the residuary, otherwise intestacy
ii. If a residuary gift fails completely, it falls into intestacy
iii. If part of a residuary gift fails, then:
1. CL: goes into the residue that did not fail
2. UPC: goes to the other devisees
c. Classification of Gifts
i. Specific Gifts: a gift or specific items or property either real or personal, a particular
piece of property anything that can be specifically identified.
ii. General: gift of monetary or pecuniary benefit gift of some pecuniary amount.
iii. Residuary: the rest of the estate
iv. Class Gifts: multiple gifts that share a common attribute. Reasonable presumption.
d. Anti-Lapse (to save failed gifts)
i. Death of Beneficiary before Testator: requires the gifts to the deceased beneficiary,
who is closely related to the testator, be given to the beneficiarys heirs.
1. Lapse
2. Predeceased beneficiary meets the statutory degree of relationship to the testator;
and
3. The predeceased beneficiary has living issue who survive the testator.
4. Result: the lapsed gift will go to the issue unless the will expresses a contrary
intent
5. CA Result: any beneficiary who is related to either the testator or the testators
spouse. Anti-lapse does not apply to the testators spouse.
ii. Death of a Beneficiary of a Class before the testator
1. CL: gift would be shared among the remaining class members
2. Majority J/x: the gift goes to the deceased members issues not the remaining
members.
3. DOES NOT APPLY: if the member dies before the will is executed and the
testator is aware.
11. Change in the Testators Property
a. Ademption (death of the property): applies to specific gifts, does not apply to general or
residuary gifts.
i. Ademption by Satisfaction: Descendant/ Heir acknowledge advancement was made or
the decedent receives the property during the testators lifetime.
1. Advancement: Hodge podge scenario and advancement is not presumed unless
the decedent or heir has acknowledged the advancement. (Decedent
acknowledges intervivos gift satisfies entire amount)
ii. Ademption by Extinction: property is no longer available because it is not owned by the
testator at death. Gifts that changed form is not adeemed, and is given to the beneficiary.
Gifts that change in substance is adeemed.
1. Change in Substance
a. CL: with specific gift, the executor is required to go back through the
testators probate estate to see if the gift can be identified. If the gift
cannot be found, then it is adeemed.
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f.
g.
h.
i.
iv. Remedial Trusts: operations of law, implied intents. Results in Constructive Trusts.
1. Arises:
a. An express trust fails to make an incomplete disposition of the trust
property
2. Constructive Trusts: used as a remedy for unjust enrichment. There is no trustee,
but the constructive trust orders the person who would otherwise be unjustly
enriched to transfer the property to the intended party.
a. Elements:
i. Confidential or fiduciary relation
ii. Promise, express or implied
iii. Transfer made in reliance on that promise; and
iv. Unjust enrichment
Testamentary Trust: created in a testators will, and must be in writing. If the testamentary trust
fails for wont of writing, the result will depend on if the trust was a secret or semi-secret.
i. Secret and Semi-secret
1. Secret Trust: a testamentary trust that fails because the terms of the trust are not
set forth in the will. On the face of the will, the secret trust looks like a gift, and it
lacks indication that the devisee is taken as trustee. Court uses extrinsic evidence
to impose a constructive trust.
2. Semi-Secret Trust: includes no terms of the trust but hints at the devisee being
the trustee. Courts will not take extrinsic evidence, but the gift will fail. The court
will impose a resulting trust falls to the residuary or if the trust was the
residuary, then falls to intestacy.
Modification and Termination of Trusts
i. Rule: administrative provisions and disposition provisions.
1. Administrative Provisions: provision to the trustee stating its duties and
power/discretion.
2. Disposition Provisions: states the details and terms of the payments.
ii. CL (Claflin Doctrine): a trust cannot be modified or terminated if doing so would
interfere with the trusts material purpose. It can be modified if the settler and all
beneficiaries agree.
iii. ML (Changed Circumstances Doctrine): changed in unforeseeable circumstances, and
the modification or deviation will further the interests of the trust.
Pour-Over Will: has a will and trust. The will directs the executor to pour over any existing
assets to a trust. Intervivos revocable trust may be funded during the lifetime of the testator/
settler.
Trustee Duties
i. No self Dealing, unless court ordered; settler gives power; or all the beneficiaries
consent.
ii. Court looks to good faith and fair dealing.
iii. Prudence Investor Rule: trustee has a duty to the property
1. To not speculate
2. To not diversify
3. To not comingle
4. To not earmark
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