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Trusts and Estates: An outdated but interesting review of the UPC

“As an attorney, you must not forget about equity. You may have to go to cases where equity was not enough and then distinguish that case from yours… If you have facts that clearly point that the black letter law should not apply. Find the black letter law, find the facts, and then arrive at a result. At times an equitable result will take place”

Suggestions for the exam=
1. Cardinal Rule= get to the intent of the testator and abide by it if it is legal and not against public policy
2. Know the UPC for the exam
3. Know the Components of a Will and how the UPC handles them
The uniform probate code (UPC) is used as a starting point for transferring assets. The states will adopt it in its entirety or with amendments. Policy of the UPC intestate procedures is to make sure that the descendants of the decedent get something. The UPC is pro intent and not pro-procedure with the intention of honoring the intent of the testator

Generally when someone dies there is a probate procedure in the statute. The probate procedure is used to transfer assets to those who are in the will or are the heirs or decedents.

American courts are unique as they do not make the losing party pay for the lawsuit, so any defense of a will or such procedure will ultimately come out of the disputed estate

Civil Law countries require an authenticated will , which is executed before a quasi-judicial officer called a notary… it is not the only way to make a will valid in those nations… it is costly and so it is not used that much… but when it is, it is difficult to set aside for want of capacity.

Pension plans both private and government have grown to a 2 trillion dollar asset… the beauty behind them is that they won’t leave the holders without because the assets are pooled together with other investors… but there won’t be anything left to inherit either.

Being able to transmit property at death is another right associated with property rights but…

Things may not always be freely transferable. It is not a constitutionally protected right. Getting money from an inheritance is not a constitutionally protected right.

Property passing by will or intestacy is going to be probated and it is costly, it is public, and it is time consuming… because of that people want to try avoid having property pass through probate… one way is to have things pass by trust
A person dying testate devises real property to devisees and bequeaths personal property to legatees… wills take care of both of these types of property… This is different than an intestate situation… we say real property descends to heirs and personal property is distributed to next of kin… today heirs and next of kin is determined by statute.

A state action is needed to facilitate it or restrict it. A state statute can facilitate or restrict transfers of estates but they can only go so far. Up until 1980, it was though that the states could do whatever they wanted to do via legislation. Transfers that have to give a certain % to the children have been found to be constitutional.

It should be noted that every county has a court that manages the estates of decedents. A person dying testate (with a will) = devises real property to devisees and bequeaths personal property to legatees.

There are two possible taxes in this country that may have to be paid when a person dies and transfers his estate:
1. Federal Estate Tax= paid to the IRS and is due on estates that exceed 1 million dollars (net). This figure includes probate and non-probate assets (401k plan…). The 1 million dollar figure will be increasing to 3.5 million dollars.
2. State Tax= also known also known as an inheritance tax. This is a maybe tax that is paid to the state. It is a maybe tax in the in the sense that not all of the states will have it.

o Less than ½ percent will have to worry about paying the federal estate tax, so what is the point of the fed estate tax? = It is not intended as a revenue maker (our hesitancy as a nation to make this a revenue maker shows our desire not to abolish inheritance through taxing). It is designed to tax the type of money that has not had the opportunity to truly be taxed. This type of wealth is located in stocks and things that appreciated significantly. This type of wealth can be transmitted without taxing. An example is transferring wealth to one’s spouse…that is not taxable. The fed estates tax stands as a way to limit these types of transfers. Another control on this is to set mandatory percentages to make people give a certain amount of their estate to their children and spouse.

Probate and Process:
o For a testate situation, the person in charge of disposing of the estate is the executor and in an intestate situation the person is known as the administrator. In a lot of jurisdictions, both persons are known as the personal representatives. (This will be on the test)

o Formal probate proceedings= is more expensive and will help resolve a pending dispute over a will, an asset, payment of liabilities…= it lets people go in front of the judge and get their chance to be heard. It should be noted that small estates are not going to want to use this avenue because it is costly to implement. A good attorney will explain probate vs. non-probate assets to his clients.

o Probate procedures: can be easy or difficult or easy. In Louisiana, they are considered difficult. Most estates can be handled without this procedure. Even though 95% of estates can be handled without this type of procedure, that other 5%can be really troublesome, especially because it is easy to change the dispersal of goods. It should be noted that property passing by intestacy or will goes through probate. Property passing by other means (like a trust) does not. It is a lot easier to not go through probate if you can help it.

o Informal probate proceedings (ex-parte probate) UPC 3-301= tells you how informal probate procedures are to work

o According to the UPC if a will is not formally or informally probated within 3 years, it can not be and it is presumed to an intestate situation.
o once the estate is open, the personal representative is in place/ and he has the letters of administration=he can do what he wants without court approval. Informal probate proceeding usually deal with smaller estates. People are usually in agreement. It is easier than formal proceedings until someone has a problem (a person who has an interest) and requests to make the proceeding formal (which most states allow to happen).
o Primary Jurisdiction= This is the place where the decedent was domiciled. This is where all of the personal property is moved to and governed. It should be noted that this also applies to out of state accounts and other taxable out of state assets. The domicile state gets to tax those types of assets.

o Ancillary Jurisdiction= this is the place where the property is located when it is located out of the domicile state of the decedent. When it comes to handling this part of an estate the procedure used is called the ancillary probate procedure. There is also a mini-procedure for the real property located in an ancillary jurisdiction. The idea in this type of estate situation is to turn all of the out of state property into non-probate property because it is expensive to have all of those probate procedures going on. Generally you are going to want to avoid opening up ancillary estates.

o The Federal code has to be dealt with in every state and has nothing to do with the probate procedure.

o In Louisiana= you still have to go through probate even though it practices succession.

o The executor has the duty to pay expenses and debts of the deceased (including burial fees). Mortgages are passed to the heir and not to the executor. Not naming an executor or successor can be a problem if you are not survived by the person you are trying to leave your stuff to.

o The prof guarantees that a surviving spouse will get remarried if they have kids they are still trying to raise.

o Every jurisdiction has a child protection devise built in but some are a little too protective
o There are a number of jurisdictions that practice informal probate and require the testator to say in a will that the probate should be distributed informally.
o Most people (parent) are not able to name someone that will take care of the kids if both of them were to die at the same time. You want them to talk to a person that is ready, willing, and able to take those kids. Once the naming of the guardian takes place, it is very enforceable and that person will generally get the kids unless something really incredible happens.
o The original will is deposited into the registry of the court and held perhaps forever by the court clerk.

Probate Property:
1. If you need title changes by the court= probate property. Generally real property, sometimes cars, stocks, bank accounts, and jewelry qualify as this type of an asset. Probate proceedings are held in limited jurisdiction probate courts except in Louisiana where the probate proceedings are held in general courts.
2. When this happens the first step is to appoint a personal representative to wind up the affairs of the decedent… his duties will be to inventory the assets of the decedent, to manage the assets during administration, to receive and pay the claims of creditors and tax collectors, and to distribute remaining assets to those entitled… When there is a will being used and it names this person, this person is known as an executor…when the person is not named in the will… he is known as an administrator.
3. The person listed above is appointed by (although named in the will at times), under the control of, and accountable to the probate court.
4. These were the actual class notes on this matter…For a testate situation, the person in charge of disposing of the estate is the executor and in an intestate situation the person is known as the administrator. In a lot of jurisdictions, both persons are known as the personal representatives. (This will be on the test)
5. In this country each county has jurisdiction over administration of decedent’s estates… the name of the court (the probate court) will vary from state to state
6. Creditors have a relatively short period of time to make good on their claims of an estate as compared to a much longer time for things like revocable trusts
7. Wills are public documents where as intervivos trusts can be kept private
8. Something that goes through probate will have the option of coming into substantial compliance… non probate assets like insurance policies will not have this option because the insurance company has a right to know who it is going to pay benefits out to (majority rule)… so UPC 2-804 has not been adopted by the majority of the states

Probate Process:
3. There is no important distinction among the jurisdictions. Each has a unique way of doing things. There are very detailed books on the matter though.
4. According to the UPC, formal probate proceedings are judicial determinations after notice to interested parties has been given. Also, any interested party can demand formal probate…this formal process may be used to probate a will, to block an informal proceeding, or to secure a declaratory judgment of intestacy… these formal proceedings become final judgments if not appealed.
5. The time line for challenging a will is a jurisdictional study. If everything is done as it should be and the statutory time passes, then the probate becomes final even if evidence to the contrary is discovered.
6. Creditors may file claims against the estate of the decedent for debts not paid. They are going to have to do this is the time allowed by statute… these are known as (non-claim statutes). These statutes will have one of two effects… they bar claims not made within a relatively short period of time after the probate proceedings have started (2-6 months) or whether or not the probate claims have commenced claims not made within (1-5) years of the death of the decedent… For the short term statute… creditors receive notice via publication but the Supreme Court has held that if the where a bout of the creditor is reasonably ascertainable that they receive actual notice before the SOL actually starts to run but the (1-5) year statue requires no such actual notice before the SOL starts to run
7. In many states… the administration of the estate by the e representative is supervised by the court… this supervision can be costly and time consuming… in a state like this the court must approve the inventory and appraisal, payment of debts, family allowance, granting options on real estate, sale of the real estate, borrowing of funds and mortgaging of property, leasing of property, proration of federal estate tax, personal representative’s commissions, attorney’s fees, preliminary and final distributions, and discharge of the personal rep… In other states, this supervision is not necessary unless minors are involved.
8. Under the UPC the court supervision (but can be requested) is not necessary and so the representative has broad powers like the trustee in dealing with the estate property and may collect assets, sell property, invest in other assets, pay creditors, continue any business of the decedent, and distribute the estate without court approval.
9. Either way via court approval or not, the personal rep is supposed to deal with the estate as quickly as possible…
10. Once the personal rep’s action is judicially approved… the rep is relieved from liability or in the alternative the SOL ran and now the rep is off the hook. The rep is not discharged of his fiduciary duties until the court grants such a discharge.
11. The original will is kept in the court house indefinitely
12. All you need is “I give”
13. The functions of probate=
a. Provides evidence of transfer of title to the new owners by a probated will or decree of intestate succession
b. It protects creditors by requiring payment of debts
c. It distributes the decedent’s property to those intended after the creditor’s are paid
1. To do a probate, you should first probate the will or letters of administration where the decedent was domiciled at the time of death (primary/domiciliary jurisdiction)… if real property is located another jurisdiction… ancillary administration in the jurisdiction is required… this ancillary process can be expensive because the state may require that a resident be appointed personal representative along with a local attorney… they will be paid from the assets located in that jurisdiction…it should also be noted the domiciliary representative/ attorney will also be paid from that asset as well.
2. Each state is going to have their own procedure stating how the letters come to be (for both an executor or administrator)… these letters authorize that person to act on behalf of that estate.
3. Most state are not going to permit ex-parte proceedings but most states will require prior notice to interested parties before the appointment of a personal representative or probate of a will. At the hearing… if a will is to be probated, it must be proved by the testimony or affidavits of the witnesses… this probate procedure can be heard in front of a probate judge or a clerk
4. It should be noted that a and c are done through a non-probate process and b in terms of paying the creditors (the decedent can’t get out of it)
5. You can do a little probate and a little non-probate
6. In an intestate situation, the first thing to do is to figure out who the executor is (for a testate situation=this is already known). The executor’s duties are=
7. Probate cost comes from… mainly court fees, commission of the personal rep., attorney’s fees, and sometimes the guardian’s and appraiser’s ad litem’s fees. In most states, the personal rep’s fees are set by statute
8. Federal Estate taxes begin on estates of 675,000 in the year 2000… this figure rises to 1,000,000 in the year 2006 with tax rates from 37-55%.
9. If the attorney is to serve as the personal rep and the attorney, he must have written acknowledgement of the testator otherwise he will only get half of the statutory rep fee and a reasonable legal fee (and not his normal fee if higher)… note that the fees for the attorneys can be affected by the complexity of the case and lowered if there is no real property.
10. Probate can be avoided… if testator transfers all of his property during his lifetime to joint tenancy or into a revocable/irrevocable trust or by contract as mentioned above in non-probate assets… but the more property one owns… the harder it will be for him to totally dispose of it through non-probate means
11. A will is a great backup for all of those assets that are not taken care of by intervivos non-probate methods… there are also ways to dispose of such willed property without having to go to probate… this occurs with many items such as furniture or personal effects…ownership will be assumed… but with items that require documents… it may be a little harder and the person who wishes to have that item may need to obtain some official recognition of their rights to have that particular item (a car is a good example). Also note that in community property states= property acquired with spouse’s earnings is community property unless the spouses have changed it into another form of ownership.
12. Common statutes among the states are rules that allow non-probate of small assets like small bank accounts, wage claims, or transfers of automobile titles. They will have to provide an affidavit for the car and will have to fill out the right paper work for all of the aforementioned things. There are similar things for small estate amounts… when the estate does not exceed a certain amount in certain jurisdictions… the heirs are allowed to come and collect the property… it does not yet give them title… but with a lot of assets this is really the equivalent of getting title to it.
13. The Uniform Probate code authorizes universal succession as an alternative to probate administration

Closing an Estate:
1. Simply follow the rules in your jurisdiction “generally”
2. You need to have paid/taken care of the creditors
3. You need proof that the inheritance state tax has been paid if it is do
4. You need to petition the court requesting a judgment that the estate is closed, personal representation has been dismissed, and assets distributed.
5. It should be noted that most of the question you may have about the probate process in your jurisdiction can probably be answered by the local probate rules.

Is probate really necessary? =
1. most wealth is transferred non-probate (today) but in most jurisdictions there is a probate procedure
2. Probate procedure can be time consuming and expensive.
3. The executor’s fee is usually a % of the estate
4. The attorneys handle their fees in a variety of ways. The old way was by a % of the probate estate, another way is by negotiation with the administrator= usually in terms of hourly pay, but a lump some with a provision for hourly pay later on is also ok. The last way is just full of problems in its implementation though. It should be noted that when an attorney is hired, that debt is high on the list of debts to pay from the estate.
5. It is possible for the attorney to serve both executor and attorney function= but some jurisdictions will not allow this unless it is expressly stated
6. Every state has a small probate procedure. They can be done through an affidavit or a small probate procedure. This type of probate procedure is much simpler.

Barring Creditors:
2. All states permit a creditor to file a proof of claim with the estate. This is an easy procedure but a lot of creditors don’t do it. Even if they do it right, it does not automatically mean that they will get their money back. The estate may challenge their claim to the money.
3. If the creditors do not file on time= there are ways to handle it= they can file a short time after the probate starts or else be barred. They might be able to file a longer time after the decedent dies or else be barred from collection. This depends on the jurisdiction that you are in.

o Restatement of Property= Donative Transfers section 6.2= As long as a restraint to induce a person to marry is valid if and only if under the circumstances the restraint does not unreasonably limit the opportunity to marry... the motive or the purpose of the testator is irrelevant.

o Courts are reluctant to affect family matters by enforcing a will provision with constraints on collection. For example “I will give half of my estate to my daughter if she does not talk to her brother for 35 years”

o Courts will not honor wills to destroy an asset after death. The justification of this is that it will affect other people.

Wills get rid of property acquired even after he execution of the will
A typical statement that starts a will is that this is my final will and testament making other such prior wills invalid
By getting married in most jurisdictions, the pretermitted spouse status gets enabled… this means that the new spouse will get the pretermitted share in the event that a will does not change this over… it should be noted that the majority of states hold the claim of a 3rd party bene over the pretermitted right of the 2nd wife
Most jurisdictions also have a pretermitted share provision for children that are born after the will is made UPC 2-302
This could apply to trusts as well… but if a provision is too speculative like “friends” the courts will not be able to enforce it
The Cardinal Rule of the Will’s Act= is to get to the intent of the testator
Devisee Predeceasing (on test)=
1. If a devisee (person that receives something in a will from decedent) predeceases the decedent… the property passed will go back into the decedent’s estate when there is no issue of the devisee… this is known as lapsing
2. the UPC 6-101 has a provision handling this
3. The UPC is silent as to whether a named POD needs to survive the decedent to not have a lapse (under the Will’s Act this thing would lapse)… if there are issues… they will inherit the POD… it should be noted that if this was close relative… the issue of the relative would be substituted in place of the bene UPC 2-706.
Redoing estate planning process... if you can’t find a will… it is presumed revoked… intestate procedures will apply… as for trusts, no… they must be done in accord with the trust instrument or the trust code to revoke… why the trust owns things and so there needs to be rules in how to modify or revoke (Pilafas Case)… if there is no specific way to revoke… any reasonable evidence will be accepted
A power to revoke an inter-vivos trust created by the decedent can be done by a will (if the trust so provides)
A power of appointment given to the decedent over a trust created by another person can be done by a will of the decedent

Types of Wills:
Pour Over Will=
1. this is when a trust is already set up for someone with only certain assets and then the remainder of the assets are set to that bene (as trustee) through the will to hold by the terms of the already existing intervivos trust set up
2. this is a useful device when someone wants to set up a trust to dispose of some assets now and then dispose of other assets later under that management of trust later
3. incorporation by reference and independent significance are 2 doctrines that are used to justify these things
4. Assets are poured over into the trust from the will provisions and are subject to that trust and are considered additional assets to that trust… this comes from the doctrine of Independent Significance
5. UPC 2-511 deals with the Testamentary Additions to Trusts
6. UTA (Uniform Testamentary Additions to Trusts Act)validates pour over of probate assets into an inter-vivos trust only if the instrument is executed (signed) before, concurrently or after the execution of the will… The uniform act also does not require that some of the property be transferred to the trust during the lifetime of the testator like Independent Significance… what this means is that assets can be put into the trust after death… these trust are amendable after death… The purpose of this is to allow the testator to create something with the same function as an intervivos trust
7. These types of wills can effect their underlying trust in the event of a divorce/annulment because the presumption is that the will won’t include the ex-spouse.
1. needs a date, entirely done handwriting, and signed by the testator
Joint Will= this is one will for the husband and the wife… never sign it… never use it… it has turned out to be a difficult idea
Mutual Will=
1. signed by a husband and wife… it is the execution of a mutual will (a contract) where the surviving spouse can not change the will when the other dies…
2. UPC 2-514 deals with this…
3. How do you make something like this but still give the spouse the freedom to dispose of their things… one way is to make the kids the executor)
4. The mutuality of will says there is no presumption of revocability… this is on the exam… it would not be fair if you don’t allow the surviving spouse to use the money as they see fit

Holographic Wills=
1. If a state permits a holographic will… then witnesses are not needed when the will is entirely in the handwriting of the testator
2. States that allow these types of rules really hold people to a strict guideline on them.
3. Most states have not embraced these types of will because they don’t require going through the formalities of the regular wills… that is one of the reasons why guidelines are so strict in states that do permit them
4. UPC 2-503 deals with this as well
5. It should be noted that in holographic will is extremely important… the courts are going out on a limb as it is and if there is any doubt as to the intent… whether the intent is convey or not… if the intent can’t be made out then the court are not going to be comfortable probating it
6. In order to probate one of these types of wills… it is necessary to eliminate the typed matter on the face of the holographic on the ground that it is immaterial (because of the modification) or that there is not intent to incorporate the typed matter
7. Holographic will need to make sense apart from the typewritten words… other wise you can’t get rid of the type written words
8. Some concerns with these are:
Is it a testamentary writing,
Does it comply with the wills act
It is really the intent of the testator

Statutory Will Forms=
1. these are those fill- in the blank will formats
2. these wills must be signed and attested to in the same manner as any attested will

Conditional Wills=
1. One thing to consider when looking at these types of will is whether or not the piece of paper is to refer to only one particular event (like not making back from a trip) or death.
2. Generally the presumption is that the person intends to do____ when they die instead of only when a certain thing like not coming back from a trip happens

Dead Hand:
1. This is when the will of the decedent continues to be implemented after his death. This type of action is enforced in this country unless it violates constitutional rights or public policy. A person has the right limit what is passed to family. There are limitations to what the law will enforce though.
2. Once a person does that, then those limitations will be set in stone and won’t be changed with the changing facts (even if it could fairly be said that in retrospect that the writer never wanted that).
3. It should be noted that wishy-washy language can be molded to intent but if it is not wishy-washy, it won’t budge, it is etched in stone. A trust falls into the legally allowed limitation placed on the passing of an estate.
4. The professor agrees with this type of limitation and not with the ones that are more intrusive.
5. The Shapira Case: financial restrictions placed on estate passing have been accepted by the courts where as other limitations are not accepted. In this case, the court decided that the plaintiff was not really being forced into anything. The court felt that they were not restricting his marital or religious practices; they were only restricting his financial gain if he did not meet the conditions of the will. A provision prohibiting him from getting married would be contrary to public policy and held void. The courts will try to honor the intention of the deceased within the limitations of the law.
6. Restatement 2nd of Property “Donative Transfers” section 6.2 says that restraints on marriage to marry inside the faith are considered valid unless they become too restrictive. It should be noted that the restrictive degree will depend on the particular case and that the intentions of the decedent are not a factor to consider.
7. Restatement 2nd of Property Donative transfers section 7.1. Other types of restrictions that serve to disrupt a family are not enforced by the court. An example would be a provision that encourages a divorce.
8. Restatement of Trusts 3rd section 29= invalidates trusts that contrary to public policy. It frowns on restrictions of marriage, religious freedom, disrupting family relationships, and choices of careers but it will balance the factors

Components of Wills:
Look for the intent of the testator and if you don’t see any fraud or undue influence… follow through with the dispensing powers (integration, republication, and incorporation)
Integration of wills=
1. dealing with sentencing and numbering and what needs to be included
2. writing on the will in a non-destructive manner
3. basically this says that all papers that are intended to be part of a will and are present @ the time of execution will be considered part of the will
4. papers being stapled together and the continuity of the language from page to page… helps the courts figure out what was supposed to be included… it is recommended to have the testator sign or initial each numbered page of the will and to type the entire will in the same font
Republication by Codicil=
1. When the codicil is made it has the effect of republishing a will
2. When a typed will does not make it… a codicil that is all handwritten, has a date on it, is in accord with intentions of testator, and is valid by clear and convincing evidence will allow the will to take affect by the majority of jurisdictions… so a defective will followed up by a valid codicil can make the will not defective
3. A codicil is considered a will and as such must be held to the standards for a will in the state where it is made (especially in a Republication)
4. A codicil must also meet the qualifications of the Will’s Act… really a codicil is a will in itself and depending on the jurisdiction… you may need 2 witnesses to sign or in states accepting holographic wills… the requirements for that
5. A codicil supplements a will and not replaces it… it sort of becomes a will in and of itself (even though it republishes the will)
6. you can revive a 1st will by adding a codicil to it
7. Note that this updating function does not happen automatically… it must be done in accord with the intent of the testator
8. This doctrine can only republicate a previously properly executed will… a codicil can’t republish an instrument that was never properly executed in the first place
9. Codicils can make a will that was not legal on the first go… legal on the 2nd turn if they were done right prior to codicil
10. A codicil must be testamentary in character
11. A codicil needs to be written by the testator, dated, and signed by the testator… even if written on the same piece off paper as the type written will… it will not be invalidated
12. holographic codicil=

Incorporation by reference=
1. Not recognized in Lousiana
2. Handled by UPC 2-510 “Incorporation by reference”
3. stuff referenced does not have to be witnessed… there may be no date on that reference thing
4. can’t be done unless the reference was in existence when the will was made… but if it does not get in on time look for a codicil that will republish and look to see if it substantially complies or gets in under UPC 2-503
5. things that are not included by reference @ the time of the execution of he will… will go by the terms of the will or by intestacy
6. The reference material need not be witnessed o be included in the will by reference… but it must be in existence when the incorporation by reference was made
7. the reference needs to be specific enough to be recognized

Execution of Wills=
1. The courts need proof that the statements used were intended to enact a transfer
2. … if the primary purpose of the will is to determine the intent of the testator… are you going to require that every little requirement is met even if no one is complaining… or are you going to guide yourself according to the intent of the testator regardless of the procedure.
3. Executing wills… is going to be different from state to state. The probate codes are a little different in each state.
4. These ceremonial requirements have a way of impressing the seriousness of what this event represents
5. Having the formal requirements also protects the testator from undue influence or other forms of imposition
6. Why do we require wills to be in writing and why do we require witnesses… to permit people to rely on oral assertions are just not good enough and these measures that we have protect a tradition, give a safe harbor, evidentiary protection…
7. Duplicate original wills…there should only be one original will… and it should be kept by an attorney (not solicited)… obviously there are going to be photo-copies
8. The Wills act=
? you two witnesses to the signing of your will… both have to be there to either see the signing or see the testator acknowledge that the signature is his… the signature must come at the end or at the foot of the will.
? Some concerns in the Wills Act:
Does the signature meet the requirements… courts have determined that the signature does not have to be your whole name and in one case someone wrote father one time and the court did not have a problem with that
People write wills to occasion an event that could be seen as death… when the particular event does not happen like not coming back from a trip but then someone later dies… the courts are comfortable saying that death is what the person meant when they said if they did not come back from the trip…

9. After the will is written it needs to be signed in the presence of the lawyer who wrote it… otherwise it could be malpractice… the will needs to be notarized.
10. Qualifications of valid will are dealt with in the UPC 2-502.
11. If witnesses do not actually see the signing of a will it will still be okay for them to have the testator acknowledge the will…Even if there is no contest that a will is the intent, there is no dispute to the testator signing or the witnesses signing… the witnesses need to attest to the will being signed or that a witness saw the testator acknowledge that it was his signature…all parties don’t have to be there as long as both witnesses attest or have acknowledged by the testator that it was his signature on the will. (this is the feeling in most of the jurisdictions)
12. A will should not be witnessed by those who stand to be beneficiaries or spouses of a beneficiary… If an attorney does not advise his client to this in some way, he could be held liable for its faulty execution to beneficiaries of the will.
13. In states (a minority) that require a witness to actually see the signing of the will… the line of sight test only require that if the witness decided to see the will signing that he would able to do so if he were to look… an exception is made for blind people
14. In states that require the conscious presence test… the witness is considered in the presence of the testator signing when he can see it, hear it, has general conscious of the event
15. Note that 8 and 9 are superceded by those states that follow the UPC in that the UPC allows for the signing to actually take place without the witnesses if the signature is acknowledged
16. Codiciles of Wills= they are additions to wills…
17. Witnesses to a will must be disinterested for the execution of the will for it to be valid… Without 2 disinterested witnesses involved any amount going to one witness (who is interested) will be void… One exception to that is if an interested witness would receive something in the event that the will could not be executed… in that kind of a case he will inherit only that which he would have received if the will could not be executed. The purpose for such a rule is to protect the testator from undue influence or fraud at the moment of execution… A witness can’t disclaim after the execution of the will.
18. Disclaimers… are treated as if they had pre-deceased the testator and the disclaimer shall relate back to the date of the creation of the interest
19. The UPC deals with this as well… The UPC looks to the witnesses as not going to check the competency of the testator but they are to simply there to prove the signing or acknowledgement of the will on the day in question.

20. A witness to a will finishes his job when the will is executed.
21. The recommended method of executing a will is in a graph as well
22. Permitting the probating of a will before a testator dies…You have to notify all of the people who are considered in the will…and they participate in these proceedings.

Equity in the Execution of wills=
2. Courts will try to amend wills to meet the intention of the testator but they can only go so far before they make the provisions protecting wills invalid… so courts will correct the mistakes in will only to a certain point
3. The UPC deals with this in UPC 2-503.
4. Additionally, courts will enforce the probate of a will when it substantially complies with the formalities unless a statute is offended by it
5. There are two ways to apply equity… the dispensing power =if a court of equity determines the testator' itent… it can dispense with just about anything as long as it has clear and convincing evidence (very liberal view”minority”) = this allowed by the UPC. The other test is the substantial compliance test “the near miss test”… a concept that has grown under the common law as opposed to statutes… if the court can determine the intent of the testator and the testator substantially complied with the statute the court will honor the will…this one is statutorily or common law part of most states… but look to see if your state follows this.
6. Is there a requirement to have both witnesses witness at the same time??? No the majority of jurisdictions allow witnesses to sign at different times… the dispensing test would be made and the near miss rule would be satisfied as well.
7. Most jurisdictions do not require privity… to allow for the beneficiaries to sue the solicitor…
8. We have witnesses…to simply see the testator sign the document… there are two different line of sight = not actually seeing the event but could if so desired
9. conscience presence= “general consciousness of the events”
10. The order of signing… it makes sense that the testator sign first and then the witnesses… but when you are in a hurry… this can sometimes happen… than the witnesses may sign first… jurisdictions are naturally split on this because it can be interpreted all kinds of ways
11. The signature= generally all you need the signature… you don’t need the whole name… you just need their regular signature…what if the hands are so shaky all the testator can do is sign with an “X”… go to the jurisdictional laws covering such matters and then…it comes up because sometimes old people can’t use their hands as well… every jurisdiction will permit an “X” but the question is will there need to be anything else that needs to be included with that “X”… A signature can be just about anything…Some jurisdictions will allow for testator to have assistance if he has requested such assistance… A rubber stamp will not be allowed probably according to the prof
12. Additions after the signature… almost all probate codes require that the testator sign at the end of the will…so if something is put in after the signature… they will be ignored unless you are in a state that allows holographic wills… these are will that are dated in the handwriting of the testator and are signed… so on a will like that if there is something added…and it is in the testator’s handwriting and he signs the additional matter. Follow this when making an addition or a holographic will…have the testator date it, personally write it and then sign it in their own handwriting (all of it)… and it will be honored in all of the states.

Self Proving Affidavits and Attestation Clauses=
1. Attestation clauses facilitate probate by providing “prima-facie evidence” that the testator voluntarily signed the will in the presence of the witnesses… They also allow the will to be probated when the witness forgets the circumstance of the will’s execution or dies before the testator. The witnesses with attestation clauses… the witness expresses the present intent to act as a witness.
2. Self Proving Affidavits are sworn statements by the eyewitnesses that the will has been duly executed. It performs virtually all of the functions of an attestation clause except it has the further effect of permitting probate without requiring the appearance of either witness. Witnesses in these are swearing that the will has already been witnessed
3. Will can be made self proving simultaneously with or after the execution of the will.
4. It should be noted that attestation requirements serve the function… of preventing undue influence and fraud while offering a streamlining process to will probate

Revocation of Wills=
1. Wills are subject to both modifications and revocations during the lifetime of the testator
2. All states permit the revocation of a will in 2 ways:
A subsequent writing executed with testamentary formalities
A physical act such as destroying, obliterating, or burning a will + intent (majority opinion)… note that destruction and intent have to come from the testator… then get rid of it (the presumption of revocation will be on your side)

3. The UPC deals with this in UPC 2-507
4. An oral revocation without more is not an effective revocation
5. A subsequent will revokes the previous one by inconsistency… the first will is to be considered revoked if the testator intends it to replace rather than supplement the old will… the presumption of intent to replace will be made when the new will disposes of the entire estate… If the new will does not totally dispose of the estate it is not presumed to replace the old will but it is presumed to be a supplement (a codicil)
6. UPC 2-507-b-d deals with this although it is not in the book
7. In cases where the revocation of a will is called into question… just because someone (other than testator) has the opportunity to destroy a will does not mean that the revocation of the will be called into question… there needs to be more to call the revocation into question
8. When there is no statute dealing with this… a destroyed will (without the consent of the testator) or a will not destroyed according to such statute (but with consent of the testator)… will be admitted to probate if it s contents are proved… a lost will can be proved by a copy or by a secretary that drafted it or by other clear and convincing piece of evidence
9. If writing on a will does not mutilate it (like marks, lines, writing over, or cross outs would) they will not be of the type to revoke the will. So writing on a blank portion of it will not have the effect of revoking it. Writing on the back or on a separate piece of paper will not in and of itself revoke a will… UPC 2-507 deals with this
10. Opportunity = just because someone has the opportunity to revoke the will does not mean that there is a presumption of non-revocation… a will that was lost and if it can be shown that it was not destroyed or revocated… a copy will suffice to allow it to go to probate
11. there is a common law presumption that a testator destroyed the will with the intent to of revocation when the will was last seen in his possession and now can’t be found after his death
12. An attorney needs to advise a client as how to revoke a will
13. Writing on the back of the will and signed as a revocation and the same thing on the codicil… The intent to revoke is there but you need destruction… since the words do not destroy the will until they are written over the wording of the will for some jurisdictions (some courts feel that revocation by writing on the will needs to be written over the word of the will)… jurisdictions like this feel that writing on the will not over the words is the equivalent of writing on a separate piece of paper… Note that this is from a case in the book and one of the concerns was that the writing was not totally in the handwriting of the testator and so the words were not given the effect of a new and separate will “Holographic” which would have revoked in its own way.
14. Partial revocation by physical… when you partially revoke a will that reduces or cuts off someone’s will you could be cutting someone off through intestate proceedings…now later a will is found but the partial revocation is in the form of crossing out someone’s name (cutting that person out of that will)… it did not follow the guidelines of revocation and there is a move to prevent people from benefiting from non-conforming (with statute) revocation. The prof thinks that under 2-507… this type of partial revocation would be considered consistent with revocations
15. Revocations of copies are not considered revocations… but if a person believed that they were destroying the original… the courts may extend some equity and make a constructive trust or something of similar resolve

Challenging Wills=
1. There are more will contests in this country because the civil tradition in other countries the child and the spouse are forced to have something. In Louisiana, we have forced heir ship to some degree. In some states and in some civil countries there is the requirement of having a notary who examines the sanity of the person making a will… Having this can prevent future challenges to the will later on.
2. In the US everyone pays their own court/attorney fees and so an amount will come out of the estate to defend and the loser of the dispute will not have to pay for the proceedings. Requiring the loser to pay…in other countries can act as a barrier to challenges to wills
3. A lawyer who writes a will and is in the will from a request is already in trouble, could be in trouble… If you write a will that is not normal…this could automatically be a problem in many jurisdictions…Regardless…you are likely going to have to prove that this was not a result of undue influence…the prof suggests that if someone wants to include you that they use a different lawyer…and if you ask someone else don’t choose a friend who also a lawyer…otherwise you are going to have ethical problems involved.
4. The prof would have a letter written in someone’s own handwriting to back the provision in an unusual will by the testator…don’t write it at their behest.
5. You represent family when you do estate planning as long as there is no problems… then when there is a problem… you represent the testator…
6. Can the lawyer name himself as an executor… that is questionable depending on the circumstances of the case… The lawyer can name himself as an executor/trustee and have his firm do all of the work… thus getting paid twice… this will be okay as long as the attorney knows the rules but it should be written n the will.
7. Name of executor is binding in the will but naming the attorney is not binding
8. The executor can go and hire his own lawyer unless it is written into the will (this depends on the jurisdiction
9. When the will is properly executed… but there is a shadow of fraud/
10. Unexecuted wills= this is when people can’t make up there minds as to how to leave things and they stay in limbo.
11. Expectancies= are not property rights… and there is no ability to use that expectancy in any commercial way… it can’t be used as security to get loans
12. The UPC looks to the witnesses as not going to check the competency of the testator but they are to simply there to prove the signing or acknowledgement of the will on the day in question.
13. Separate and apart is the attestation clause that you want to use not the other one allowed by 2-504-b
14. Substantial compliance is gradually becoming art of the common law as courts of equity are reaching out to determine the testator’s intent… this tends to bail lawyers out of trouble for malpractice
15. If a will is proper in one state then it can be probated in all of the states… if an individual is domiciled in one state but has property in other states you are going to have to probate in all of those states… or you could put them into an LLC… which means it is personal property and is not subject to probate in those other states… big savings for your client… nice freakin’ work.

Dependent Relative Revocation and Revival:
The Doctrine of Relative Revocation=
1. The doctrine of dependent relative revocation… when a revocation is based on some facts that he believed were true and it was but for this belief he would not have revoked…then the revocation will not be given effect… the usual case is where the testator makes a new will that he believes to be affective and so revokes the old will… it then later turns out that the new will is not effective and so the old one will be given effect… the court needs to find that if the testator had known the truth… he would not have destroyed the will… then they will negate the revocation and give the old will effect
2. If there is evidence that the testator intended the revocation to be absolute anyway… then this doctrine won’t apply to the old will
3. The prof mentioned these… With rare exceptions, courts have held that DRR applies only:
Where there is an alternative plan of disposition that fails (evidence must be sufficient to show this) or
Where the mistake is recited in the terms of the revoking instrument or
Possibly, is established by clear and convincing evidence
It should be noted that the alternative plan of disposition is usually in the form of another will (either duly or defectively executed)… by limiting the doctrine... the type of evidence that can be looked @ is narrowed
4. The mere fact that the testator intended to make a new will or made one which failed of effect (will not alone in every case) prevent a cancellation or obliteration of a will from operating as a revocation.
5. If it is clear that that cancellation and the making of the new will were parts of one scheme (and the revocation of the old will was so related to the making of the new as to be dependent on it) then if the new will (be not made, or invalid) the old will (though cancelled) should be given effect (if its contents can be ascertained in any legal way.
6. you are going to need proof like the destroyed or revoked will… this doctrine tries to honor the testator’s presumed intentions
7. But if the old will is once revoked (if the act of revocation is completed (like it was burned or other thing that is clear to the intention of revocation though it be not totally destroyed/obliterated)… then the fact that the testator intended to make a new will or did make an ineffective will means nothing. Basically… it mans that evidence that the testator intended to make a new will or made an ineffective one only may show intention to revoke to old one but it will not revive the old one after it was completely revoked
8. The burden of proof will fall on the person attacking the instrument offered to probate… there is a presumption that a cancelled or obliterated (in part) will has been revoked and where a will has been cancelled or obliterated (in part) and found among the testator’s things (the same presumption is made)… so the burden will fall on the person trying to show that the revocation was not intended
9. DRR is held to a higher standard when a situation arises from the making of a subsequent instrument as opposed to a physical act

This is a doctrine of presumed intent designed to get to the true intent of the testator
With rare exceptions, courts have held that DRR applies only:
1. where there is an alternative plan of disposition that fails (usually in the form of another will either duly or defectively executed) or
2. where the mistake is recited in the terms of the revoking instrument or
3. possibly is established by clear and convincing evidence
By limiting the doctrine… the kind of extrinsic evidence that can be looked at is narrowed
Carter Case=
1. To revoke, you need to have both intent and obliteration (lots of ways to obliterate)… just because a will is destroyed does not mean that it has been revoked you need to have the intent.
2. the burden of proof goes to the person that is trying to attack the paper offered for probate
3. Where a will has been cancelled or obliterate in a material part… the burden of proof goes to the person trying to prove that revocation was not intended… especially when the paper in question is found among the testator’s things because the presumption is that it was cancelled or obliterated by the testator
4. There is a huge presumption against intestacy when it comes to revocations
This doctrine depends on a series of events leading up to the questionable outcome
You can have a holographic codicil to a statutory will if your jurisdictions allow holographic wills… in states where partial changes are not allowed… you just read it without the modifications
Changing a will to give someone more is not a partial revocation… just because a partial revocation might be permitted does not mean… changing the will to give more will be allowed… this may be considered a new will… if the modifications don’t qualify as a new will… the DRR will set the will back to a pre-modification status
If you can prove a mistake by extrinsic evidence then you can use DRR to get a will back to the way it was before the mistake… the prof said that extrinsic evidence as to a mistake should be let in to show the mistake and the basis for it
The Auburn Case:
1. if you can’t revive in a state then revocation of a later will won’t instate the other will that was revoked… using DRR in a situation like this (one of these wills will remain in effect)… because of the presumption against intestacy
1. If there is no revocation in the 2nd will and it gives away everything… this is revocation by inconsistency but if not everything was given away then it is a partial revocation UPC 2-509
2. Revocation by Operation of Law… Change in Family Circumstance= in the event of divorce… when life-insurance policy is not changed over to the new wife… the new wife won’t be a beneficiary to that asset because it will go to the 1st wife… most states feel this way but UPC 2-804 feels differently
3. The majority of states presume that a divorce/annulment revokes the benefits to the divorced spouse (like the spouse died before or disclaimed)… this presumed revocation includes provisions providing powers of appointment, nominations as executor/trustee/conservator/ guardian unless it is other wise provided in the will… the remainder of the states require a property settlement to revoke… note that this does not ordinarily apply to life insurance plans, pensions, or other non-probate transfers unless there is some sort of settlement agreement
4. UPC 2-804 deals with revocation and non-probate property
5. In most states if a souse is not included in the will… they will get an intestate share unless it is shown that it was intended to be that way or if the spouse is accounted for in some other way UPC 2-301

1. When you can’t revive… use DRR against intestacy… UPC 2-509… note the difference between partial and full revocation
2. Revival is where the later will is revoked or found invalid… then the courts have to decide whether or not the first will should be revised
3. The large majority of states hold that the 2nd will legally revokes the first will (when 2nd revokes by an express clause or inconsistency)…@ the time when the 2nd will was created… then the majority finds that when the 2nd will is revoked… the first one is revived if the testator so intends… the intent can be shown from the circumstances surrounding the revocation of the 2nd will or from the testator’s contemporaneous or subsequent oral declarations
4. Under UPC 2-509 if a will is wholly revoked by a later will… revocation of the 2nd will presumes that the first one is still revoked… If the 2nd will is only a partial revocation of the 1st one… then the presumption is that the 1st will is revived

Acts of Independent Significance:
UPC 2-512 deals with this
an example of this is when someone wills their car to you… at the time they had a 1995 Eagle Vision but when they died they were driving around in a Ferrari… that lucky someone gets the Ferrari
When property designations or beneficiaries are identified by acts or events that have a lifetime motive and significance apart from their effect on the will (they will be upheld under this doctrine)
Note that this doctrine can be used to dispose of things by trust… a trust can count as one the aforementioned events… note that the trust need not be in existence @ the time of the will execution but there needs to be some assets in it before the death of the testator… much different than incorporation by reference
Do not require attestation under the statute of wills

Contracts Relating to Wills (2 types):
Contract to make a will=
1. UPC 2-514 deals with this
2. falls under contract law and not probate law…
3. the bene could be entitled to specific damages as well as fungible damages
Contract to not revoke a will=
1. UPC 2-514 deals with this
2. Some examples are joint wills, mutual wills, and joint and mutual wills
3. joint and mutual wills is the name that the court gives to a joint will that devises property in accord with a contract
4. These are generally held to be unenforceable unless they are proved by clear and convincing evidence
5. Generally it is presumed that joint wills and mutual wills are not wills of contract
Contract law applies to these and not probate law… beneficiaries sue to show that there was a valid contract
If a beneficiary sues successfully… the will is still probated as it is set up to be but… the assets will be placed in a constructive trust for his benefit by the people that got the assets or the estate of the defaulting party
Contracts that handle dispositions of property need not be in conformity with the Statute of Wills
A couple of examples of these types of instruments are:
1. 3rd party bene contracts performable @ death are of this kind and are honored by the courts
2. inter-vivos trust where a settlor reserves a life interest
3. insurance policies

Mental Capacity=
1. In almost all states, to make a will, a person must be 18 or over. A person must also be of sound mind as well.
2. The policy for requiring a sound mind is that a will should represent a person’s true desires, to protect the decedent’s family, public opinion that wills need to be a process of reason, making sure that the desires of a person while they were sane are carried out even when they became insane, protect society from irrational acts, and to protect those of impaired minds from exploitation.
3. The test for mental capacity= The testator has to know the nature and extent of the testator’s property, the person’s who are the natural objects of the testator’s bounty, the disposition the testator is making, and how these elements relate so as to form an orderly plan for the disposition of the testator’s property. It should be noted that the testator does not have to be of average intelligence to meet these requirements but he must have the mind and memory relevant to the four matters in the test for mental capacity for making wills
4. It should be noted that testamentary capacity can’t be destroyed by a few isolated events like foibles, idiosyncrasies, moral or mental irregularities, or departures from the normal unless they bear upon and have influenced the testamentary act… then mental capacity may be called into question… the test may be used to determine if the person was of sound mind when the will went into effect.
5. Note that the capacity required for contract or for gift than that of a will… As for the gift, the idea is to protect those who may not be of sound mind from being depleted economically. Legal capacity to make a will is required to be higher than that to enter into marriage
6. A lucid interval is a period of time where someone can make a will even when they are found not to be of sound of mind other times… these are times when the person seems to be sound of mind
7. A lawyer will have to make his own judgment as to the mental capacity of a person for the purposes of writing a will… but drafting a will for someone who is not sound of mind is not ethical
8. When the kids are really trying to ease the transfer of the estate and the person is a little out of it, it will probably be alright to get the transfer done… as long as no one is asking out landishly reaches.
9. But if someone has been taking care of the mother/father for a long time and feels entitled to a larger share and so wishes to get the will changed and the mother/father is a little out of it…there could be an ethical problem here…you have a duty to figure out if the testator has sufficient mental capacity to do this legally/ethically.
10. Another concern is the kids of the incapacitated mother/ father… they could try and sue you for intended beneficiary collection.
11. Old people have long term memory but they can’t remember the short term stuff.
12. The treating physician… is important as being able to measure mental capacity
13. The sitters (people that actually sit with the elderly) are other people that can be used to determine the person’s mental capacity. These people usually hate to get into this type of position.
14. Some states allow for a person who does not have legal mental capacity may be able to write a will while being protected from contract.
15. It is not always easy to tell who has mental capacity or not. People will have quirks and so some things

Insane Delusions=
1. a person may otherwise be sane but suffer from an insane delusion that makes part or all of the will invalid as they will not have the testamentary capacity to make a will
2. A delusion is a false concept of reality… that a person adheres to despite all of the evidence and reason to the contrary… Some courts have found that if there is some truth backing the insane delusion… then the person is not insane but the majority view is that even if there is a little truth to the delusion the person will still not have testamentary capacity… the test for it is if a rational person in the same situation would not find the same way
3. Often… these are false beliefs about family members
4. If a will is thrown out in its entirety then the estate passes by intestate… if just partially, then that part passes by intestacy
5. An insane delusion as opposed to a mistake can’t be corrected by evidence… the person continues to believe what he is going to believe even after the facts have been presented to him
6. Evidence to otherwise good financial judgment can be a strike against insane delusions… if the person was able to keep good books… it appears like they know what is going on… but note it is not an end all defense to overruling a case of an insane delusion
7. Minor changes in a will due to a valid insane delusion may not be enough to over rule a will when those who were supposed to be taken care of were
8. The burden of proof attacking a properly done will has the burden of proof to show an insane delusion. In the case above, she would not have to show that she was not actually having an affair but that he believed something so wrong that no one in their right mind would think that would happen or would think the same thing.

Undue Influence=
1. Every jurisdiction permits wills to be overturned do to undue influence.
2. The burden of proof falls to the people challenging the will under undue influence
3. Undue influence can be from a confidential relationship or a non-confidential relationship.
4. Proof of undue influence can be circumstantial or inferential
5. The type of undue influence that seems to raise eyebrows is when a beneficiary or indirect beneficiary asserts the influence
6. when someone is unduly influenced, their free agency and free will is influenced by another to the point that their will is substituted by another’s will and that substitution actually causes them to act in a way that they would not have normally done without that kind of undue influence
7. It should be noted that just because you prove a relationship where undue influence can happen, that there was opportunity, and that there was a motive does not mean that you have proven undue influence… you need to further prove that the will or change of it was from a result of undue influence
8. If the testator was unduly influenced… did it change the will…this is what the challenge has to prove by a preponderance of the evidence
9. It should be noted that a person has the right to dispose of his property in the manner that he wishes… the burden then falls on those who wish to challenge the will on the basis of undue influence to prove that there was undue influence and that the undue influence was the cause for the will coming out the way that it did
10. When a person is not in the best capacity… (impaired by age or disease)… and a person in a confidential relationship receives the bulk of the estate… the burden will fall to the person in the confidential relationship to prove the absence of such undue influence (in most jurisidictions).
11. Also in the event that undue influence is shown and it applies only to part of the will… only those parts resulting from undue influence will be removed while giving effect to the other legitimate parts when the separation can be done without destroying the intent of the testator or without destroying the testamentary scheme.
12. There are three factors to look for when you think that there might be some undue influence:
It must be proved that the testator was susceptible to undue influence, that the influencer had the disposition and opportunity to use undue influence, that the disposition was the was the result of the influence, and an element of cohesion should also be shown

13. The UPC deals with this in UPC 2-517 and 3-905 (I don’t have 3-905 in the book yet)

No Contest Clauses=
1. These provisions are set up that if a beneficiary challenges what is left to them in the will that they will receive nothing or they will receive a reduced share
2. The policy behind these clauses is to discourage challenges to wills
3. The majority of courts will support these types of clauses built in to wills unless there is a legitimate reason to challenge the will… the legitimate cause rules come from UPC 2-517 and UPC 3-905
4. When you are challenging a no-contest will on the behalf of your client… you need to check the local law very carefully because there are subtle differences from state to state especially when it comes to what a contest is…
5. For a good no-contest clause…Get a no-contest clause in there offering a certain sum as an incentive for them not to fight it out… they will lose everything or they will be guaranteed this some…

Bequests to Attorneys=
1. There is a presumption that if an attorney receives a legacy from a testator in the will… there was undue influence unless the attorney is related to the testator
2. The presumption can only be rebutted by clear and convincing evidence to the contrary… this will often be in the form of paper work.
3. Note that if someone still wants to give their attorney a gift and the attorney decides to have another attorney draft the will, then he should probably pick someone who he does not know that well… otherwise the same undue influence issue and the same presumptions will arise.
4. There is something called “Body Heat” that may be an old test… we need to ask about this.
5. There is a conflicting evidence rule about this… it states that a lawyer may not draft a will that he will be a beneficiary in unless he is related to the testator… note that this does not includes tiny gratuitous presents from the testator… if the gift is of the nature that it requires some paper work to be filled out then… an independent lawyer will have to be brought in to provide the proper paper work or write the will himself.
6. These types of ethical prohibitions apply not only to attorneys but their family/spouses. On the same note other ethical standards do allow for small gifts of gratuity (not substantial) that are normal such as thank you gifts or presents on the holidays…the problem comes into when the gifts are substantial and require preparing legal documents… then the person should have detached advice from other council.
7. Even if another attorney is used a gift to an attorney that is not writing the will could be challenged on the ground that the testator did not receive the full benefit of council from that independent lawyer

Some recommendations to avoid contests=
1. A way that the prof though was good was when a client writes you a letter telling you what they want done in their will… and you notice that certain key people are left out… you send a letter back to the client telling them that certain people are going to be left out and then ask for the reasons why they have been left out… the client writes back with the reasons why certain people have been left out… and then you start on the will…
2. After the will has been written… these letters are filed away for when challengers to the will come.
3. These reasons written in the hand of the testator are very useful for warding off challengers
4. It should be noted that this method is not bullet proof either… the challengers may still want say that they believe the person was unduly influenced or not in the right mind when the letter or even in some cases video tape was done.
5. Notes as to the mental capacity… should be taken after a testator’s health begins to fail each time he comes in to something to the will… otherwise it is considered malpractice.
6. Don’t act as a witness as to mental capacity when you are the drafter of the will because you will be disqualified as represention to the personal representative of someone’s estate if there is going to be a challenge to it… it will be considered a conflict of interest… A lawyer is not to act as an advocate when he is likely going to be a necessary witness in that case… If the drafting attorney works for a firm… the partner may represent the personal representative unless the partner also happened to be a witness to the will

This occurs where the testator is deceived by a misrepresentation and does something that he would not have done but for that misrepresentation
To qualify as the but for element… the misrepresentation must be of the nature where both the intent to deceive the testator while having the deception being part of a purpose of influencing the testamentary disposition
A provision of the will that was caused by fraud will be considered invalid… but parts of the will that not as a result of fraud will stand unless inseparable from the parts that were affected by fraud
In situations where fraud arises and the courts can’t do justice in the situation… they will enforce the will as it stands and the person who should not be benefiting from the will hold the assets he received in a constructive trust for those who are deserving from them… the idea is not to award wrongful behavior wile upholding an otherwise valid document… it should be noted that the trust is set up only to the extent the interferer received at the expense of the rightful heir.
Fraud that happens in the testamentary setting will be one of two types: It should be noted that provisions will be considered invalid if they resulted in fraud only if things would have been left to different people but for the fraud. This rule will even be imposed on innocent parties if they benefit from unjust enrichment… they will have to hold assets received in such a manner in a trust also

Fraud in the inducement=
1. this occurs when a person misrepresents facts thereby causing the testator to execute a will, to include a provision, not revoke a will, not to execute a will, or other behavior… that will benefit the wrong doer…
2. One thing to look for is intent… if someone induces someone to do something in a will while having legitimate intent but then later changes his mind after the death of the testator… it will not be considered fraud.
3. This question of whether it happened will ultimately go to the jury or the judge… the remedy for fraud is going to be a constructive trust. When there is regular fraud… the written portion will be honored and the person who gets it under the fraud gets it in the trust… to hold for the person that the court decides should have received it but for the fraud.

Fraud in the execution=
1. this happens when a person misrepresents the character or contents of the instrument signed by the testator… which does not equate the testator’s intent

Tortious Interference with an Expectancy=
1. Transfer of an expectancy = Generally people expect something from their parents. These expectancies are not property rights according to the law. Since it is not a legally recognized property interest, then it can’t be an interest but there is another base to sue for what you think should have been yours (Tortuious Interference with an Expectancy)
2. this is another theory that can be used to challenge a will
3. Under this theory… a ? must show that that the interference involved conduct tortuous in itself such as fraud, duress, or undue influence.
4. This theory can’t be used when it is based on the testator’s mental incapacity
5. Since this is a claim based in tort law… it is not considered a will contest… It does not seek to challenge the probate or validity of a will but it is going after parties for certain tortuous acts committed.
6. An advantage to this being based in tort law is that it will not be subject to the same SOL as will challenges would be but in instances like this the SOL will start running when it is deemed that the ? knew or should have known about the tort.
7. Most courts are going to require that a ? pursuing this method of justice only after trying other remedies… failure to try the other remedies could result in a bar to a collection in tort but note that if a ? challenges a will and loses this may also bar him from an action in tort
8. Challenges based in tort law are not affected by a no-contest clause. Also punitive damages may also be available to those who pursue this type of legal remedy
9. Not all courts will recognize a claim based on Tortious Interference with an Expectancy

o In Louisiana= Minor and disabled children can’t be disinherited.

o Some thing that started out as non-probate property can end up being probate property. This can happen when the property is transferred automatically to one person and that person does not provide for its transfer at their death.

o You can turn probate property into non-probate property by putting it into a trust. This is usually done by a declaration “I hold this property in trust”. Trusts are considered to be non-probate property. Trusts are permitted in every jurisdiction where as probate/non-probate property is not permitted in every jurisdiction.

o POD= payable on death… most states hold that these things can be made to contract like insurance policies…. Thus designating to that person by contract… these were authorized by the UPC 6-101 and the majority of states followed suit

o TOD= transferable on death

o Louisiana does not allow POD or TOD without further probate procedures.

o Examples of POD and TOD accounts are IRA, 401k plan, … thee are a lot of devises that allow for POD designations on them like mutual funds but there is great variety among the states on this
o Every jurisdiction permits certain assets to be non-probate assets. Not every jurisdiction allows all assets to be held in TOD/POD account
o FED law permits death benes to be put on these types of plans = pension plans, profit-sharing plans, Keogh plans, 401-k plans, and Individual Retirement Accounts (IRAs)
o Some Non-Probate property is off limits to creditors (like Life Insurance Proceeds or retirement benefits) if payable to a spouse or a child… other things like US Savings Bonds with a POD bene may be exempt as well… but not that not all POD things are treated the same. UPC 6-215 expressly permits the decedents creditors to reach POD bank accounts and joint bank accounts if the probate estate is insufficient

Non-probate property:
1. This is property that passes under an instrument other than a will which becomes effective before death. There is no need for a court proceeding to have these forms of property pass to their intended recipient but the passing must be made in accord with the deed, trust, or contract. They transfer simply by designation of the beneficiary
2. Non-probate assets governed by FED laws are not covered by state laws (like 401-k) plans…
3. Non-probate assets but are governed by designation of benes… 6pts on the final (in book)
4. Non-probate assets are evolving… these are now recognized in all jurisdictions=
? Life insurance
? Revocable trusts
? Annuities
? IRA, 401k, and Pension Plans
? And these are not recognized in all jurisdictions= bank accounts, investment accounts, and CDs

5. Examples of non-probate property joint-tenancy (property that is held by both people… the person who survives is not passed to but the person who dies has an interest that simply goes away… must have a death certificate to bring this into effect), life insurance policies (benefits paid to a beneficiary when the holder dies… need a death certificate to make this happen), contracts with payable-on-death-provisions (like IRA’s…the benefits of such a contract pass to a beneficiary like a life insurance policy…need a death certificate to give to the custodian of this type of property), and interests in trusts (these are intervivos instruments assembled by the decedent and name a trustee that holds the assets in conformity with the wishes of the instrument… they come in revocable and irrevocable forms… Revocable are recognized in all states... if the testator maintains some testamentary power over the assets in trust then the will must be admitted into probate but the trust assets will not have to go through probate because they are distributed to beneficiaries through the trustee…)
6. Joint Tenancy=
? When one of the joint tenant dies… the property automatically passes to the other tenant
? Common law vie is that the other interest simply vanishes and so there is no need for probate
? There 3 important features of joint tenancy:
1. creation of jt for land gives both tenants equal interest to it… neither party can revoke the transfer and cancel the other party’s interest in the land (during life)… this is way different than a POD designations that can be changed by the owner during life and the UPC says that a joint bank account can be revoked by the depositor that puts in all the funds
2. A joint tenant can’t designate his share by will… if he does not want the other party to get his share… he need revoke the JT during life and concert it into a tenancy in common
3. creditors must seize a joint tenants property during his life because after… there is no property interest for them to get a hold of
7. If title changes automatically= non-probate property (without court order). Property that transfers due to a contract will qualify as this like a life insurance policy (because you don’t need to go to court). It should be noted that the actual passing of the property happens before death.
8. IRAs, 401k plan, Insurance Policies, Contracts with payable on death provisions, and Joint Tenancy Property… qualify as this also. When insurance policies are not separately owned= there is a greater chance that Uncle Sam won’t get involved. When trying to gain control of a non-probate asset, a death certificate needs to be produced and filed with those holding the asset. The prof recommended about 10-15 should be made up for the survivors.
9. It should be noted that at times non-action can actually have the effect of transferring the non-probate property= “drive the car until it dies, or close the account= these are the informal ways of transferring the non-probate property.
10. Trusts and deeds are the conduits this type of asset transfer or at least they dictate the terms of the transfer.
11. If you see a T.O.D. (transferable on death) tag on an asset=
? it means that a probate asset was turned into a non-probate asset.
? An asset on this would be an investment thing
? this is definitely one way around probate
? Once you move from insurance contract (recognized in most jurisdictions as non-probate)… to a deposit arrangement (not recognized by all jurisdictions as non-probate)… you are probably losing non-probational attributes… so stay in the majority
12. Insurance policies will not have the benefit of substantial compliance because insurance companies have the right o know who they are going to have to pay benefits to (majority rule)… so UPC 2-804 has not been adopted by the majority of the states
13. Non-probate assets recognized by the FED like IRAs… can be designated to others but if they are not designated… they go back to the estate for probate (it becomes a probate asset)
14. when trying to avoid probate don’t just name one bene… otherwise it may lapse if bene predeceases you… it should be noted that anti-lapse provisions are rare.
15. Non-probate assets=
state controlled= governs life insurance, annuity TOD/POD
fed controlled= governs IRA, 401k (not affected by jurisdictional statutes)
POD and TOD will not help you with Estate Taxing… having rights associated with those types of things makes them subject to Estate Taxation

Types of Accounts:
Joint Accounts (several types)=
1. When either side has the right to put in and take out=… these accounts are of low liability because if either party tries to steal funds the bank is off the hook and that is why banks like them so much… the survivor is entitled to the remainder of the account… known as the true joint tenancy account… the person challenging the gift of one of these will have the burden of proof showing that the gift was not intended because the presumption is with the document that created it
2. When one party can’t withdraw during the life time of the other= but is entitled to the remainder in the account… (POD account disguised as a joint account)… POD accounts have a requirement of survivorship (UPC 6-212) the same is true for securities in TOD registration and (UPC 6-307
3. One party is entitled to with draw on the account during the life of the other party but= then is not entitled to the remainder on the death of the other party… an agency account disguised as a joint account
4. Parent-child agency accounts= When the surviving joint owner survives… the banks will look to who was putting money in the account to figure out where it goes (even with survivorship… most states will decide that this is to go to parent’s estate unless clear and convincing evidence that the right to survivorship was the intent of the parent
5. UPC 6-211-b these types of accounts belong to the parties during their joint life times in proportion to their net contribution of each to the sums on deposit unless there is clear and convincing evidence of a different intent

Joint Account Concerns= signature card and jurisdictional differences and the starting point with joint accounts

A trust is a legal entity… it can sue… it can be sued… you are relying on the jurisdictional trust codes when you make a trust

1. Basically, a trust is where one person (trustee) manages property for one or more beneficiaries
2. Trusts are a separate legal entity that can sue, be sued, has to pay taxes, and can terminate itself/destroyed in some way.
3. Every jurisdiction allows trust and has their own trust code.
4. Trusts are much simpler than other devises that transfer assets.
5. unlike the execution of wills, the creation of a trust involves the present transfer of property interests in the trust corpus to the benes... these trusts create interests that can’t be taken away except by the trust instrument, by actions of the benes, or decree of the court… this even applies for revocable trusts… they have the right to enforce the terms of the trust
6. Additionally, if you have kids, you can prevent them from getting a hold of the assets at 18 by having it managed.
7. You can more than one trust in your will if you would like to for each of the kids.

8. Even though the Uniform trust code is the starting point, the states are free to modify it.
9. The uniform trust code needs to be studied for the test.
10. Trusts are transferred through a trustee that holds the property for the beneficiary in accord with the terms of the trust.
11. AB trust= common law trust, trusts have been reformed to the intent of the testator when that intent is absolutely clear. The IRS is beginning to respect those reformed trusts.
12. The IRS is beginning to respect those reformed trusts.
13. If the trust is created by the decedent the trust will either be revocable irrevocable. Revocable trusts are valid in all of the states. If the decedent has a testamentary power of appointment over assets in the trust, the decedents will must be admitted to probate, but the trust assets are distributed directly by the trustee to the beneficiaries named in the will and do not go through probate.
14. The trustees of the trust need to look out for the best interest of the beneficiary but everything else is secondary to that
15. The trust gives maximum control over the property to the testator when disposing of his property as compared to other available instruments
16. Provisions in the trusts= the prof thinks that the trustee should given the authority to distribute assets according to his judgment…in how it pertains to the principle and the payments. The provisions will guide how the trust is handled. The provisions will also give the trustee the authority to act in a way consistent with the decedent’s wishes. The provisions also contain contingencies for events where a chosen party may not be able to perform their duties.
17. Trusts should end when people are 25 according to the prof.
18. When a settlor creates a trust for his own benefit a trust of support or discretionary trust… the creditors can reach the max amount that he (or the trustee) can give or apply for his benefit to the settlor… holds true even for spendthrift trusts
19. When settlors retain so much power… like the power to revoke, power to control bene enjoyment … the IRS determines that the settlor owns that property and that it is part of the Estate… the same applies to creditors after the death of the settlor (when the amount exceeds what they got in the estate) to go into that trust to get the reminder of what the settlor owes them… note that this claim can only go against those assets that the settlor had control over to use for his benefit
20. Next to a will, they are the most important way to handle property
21. If your trust says nothing… it will be executed according to the trust codes
22. New Forms of Trusts: income generally does not mean capital gains so if you have a stock portfolio in the trust and you also have provisions for other income… you must include capital gains as income coming in… normally a person with a stock portfolio… that says nothing more will only be entitled to the dividends…
23. Uni-trust= the income bene is not entitled to the actual income earned on trust property but gets a certain % of the total value of the trust… (this is another way to get around the short comings of stock portfolio trusts)
24. Making a gift=
to make a gift of personal property… intent to make the gift (and give up ownership of it) and (either delivery of property to donee or written declaration if intent to make the gift) are needed
Delivery can be constructive, actual or symbolic
Constructive delivery could be when the safety deposit key is delivered, pointing out places where the money is hidden…constructive delivery is usually done when actual delivery is not practical… this is what is what will in reason (under the circumstances) be equivalent to actual delivery
A failed gift should not be tortured into a trust but equity will do that by clear and convincing evidence… especially if the person to receive the gift substantially changed his position and it would be inequitable not to let him have the property… in case like this a constructive trust might apply until the gift is given but it won’t be created to have an ongoing fiduciary duty… another example of this is when a person makes an ineffective gift to his children (and they are the natural objects of the bounty) but dies before it can be corrected… the court will put a constructive trust on it until it is conveyed

o Cy Pres doctrine= in a charitable trust, if the purpose of the charitable trust can no longer be met, then the organization can move the assets to a similar charity but this doctrine only works with charitable trusts.

1. The declaration of a trust= the settler declares that he holds this property not in fee simple for himself but for his children… A declaration does not require actual delivery of property or the written declaration that is needed to make a gift… the only thing you need in the intent… but the donee has the burden of proof
2. The intent to create a trust:
1. no particular form is needed to create a trust
2. trusts can be created through written or oral means but if it is dispensing with real estate… it must be done in writing
3. Making a trust=
• there are no words necessary to create a trust
• really the only question is if the settlor intended to create the trust or not… if intent to hold property for another is shown… then this will be enough… silence is a tricky thing to sort out… it will come down to interpretatio
• anything that can be called property can be put into a trust
• A trust is valid even if upon execution no trust corpus is transferred if the bene has the right to the trust corpus at a later time
• The prevailing view is that future earnings from trust property can be transferred even though they are not existent… this is different than non-existent trust property that no has made measures to obtain
4. Modifying or Terminating a trust=
in most jurisdictions… if the settlor and all the benes agree… the trust may be modified or terminated (revocable trust is assumed)
When the settlor is not around… as long as all benes agree… a trust can be modified or terminated if all of them agree, all benes are of legal capacity and the purpose of the trust won’t be frustrated…
Also a trustee might be ordered to modify a trust when a situation arises out of the foresight of the settlor that would frustrate the purpose of the trust (even if the trust forbids it)… but note that this won’t happen just because it may be advantageous otherwise
This can be done for both intervivos revocable or testamentary revocable
There are good notes for this in the book
If termination of a trust means that it won’t meet its purpose then the courts will not allow it even with the consent of all the benes when the settlor is not around… this is the majority opinion
IF the main purpose has already taken place or does not exist anymore… then the trust will be terminated
there are a number of states that allow for termination of trusts ahead of time when the cost of administering the trust does not make sense compared to the value of the trust
There times when the courts will modify trusts to have them conform to the tax laws… allowing them to still have a tax advantage… the same is true for gifts… UTA 414 allows this to happen for trusts and for gifts (as long as the new gift provision does not run counter to the donor’s probable intention
A good piece of advice is to give the bene a special power of appointment to modify or terminate the trust
These trusts are generally not able to be terminated because they still have a material purpose of the settlor to do:
Spendthrift trusts
Trusts that don’t allow someone to collect until a certain age
Discretionary trusts
Trusts to support a bene
An active trust with a job to do
5. If there is no bene, there is no trust… this is one reason why you can’t have an animal as a bene… they can’t object to the handling of the trust… what you can do is bequest in the animal’s name but not to the animal
6. Deed of trust= when a person transfers property to a trustee
7. Both the declaration of the trust and the deed of trust need to be done correctly
8. You can have pretty much what you want in a written trust (that does not violate law or public policy) or else you get what the trust code says you get when it is not written out
9. A trust can be revocable (usually by the settlor) or irrevocable (meaning the settlor can’t get his money back)=
10. When something is just a wish to get the trustee to do something… it does not impose any legal duty
11. Equitable Charge= This is going to be on the exam… this is where somebody has a fee simple but owes a 3rd party a certain sum of that money… this asset is then transferred to someone else… now it is an equitable charge
12. The courts of equity will try and create trusts or fix wills (2-503)… courts really want trusts to get adjusted to suit there purpose
13. A trust can’t exist without trust property… the property must be “Res” (meaning it must exist) otherwise… it is just an expectancy and no trust has been created… an expectancy may be more likely to get the property to someone but is not a property right until the thing is actualized… (expectancy in buying stocks for kids vs. contingent remainder to kids)
14. Prof says that a declaration of trust should take affect as a non-expectancy as soon as there is Res… even though it was declared before there was Res… kind of like a shell bringing this into existence… but note that the delay can’t be too long and the circumstances could kill the continuity… Normally if there is nothing to create a trust with… there is no trust… @ most you could have a contract or gratuitous promise to create a trust… but it would not be binding unless the elements of contract law were complied with (you would need consideration for it to complied with)… a person that creates a trust but does not yet have the property but immediately takes steps to acquire it will have made a valid trust with Res… a person may bind himself (by contract) to create a trust but it will not be enforceable without the right elements of contract law present
15. Love and affection is not considered to be enforceable consideration for a promise but it is effective consideration for a conveyance
16. An expectancy can’t be the subject matter of a trust and so the trust is non-existent without trust RES
17. Gratuitous Promise= is not a trust… courts don’t like torturing these into being trusts
18. Trusts and Debts both have liabilities attached to them
19. Trusts can transfer just about any type of property
20. Trusts that transfer real property= must be in writing
21. In most states it is enough to have a settlor, Res, and a beneficiary but not in Louisiana
22. An example of how to get Res (a really tricky one)… when property is not exactly in existence but not out of existence (like when a guy says that he will give a bene all the profits he makes from stock trading)… it is not in or out of existence… to have Res get a writing of the declaration… have it notarized… and give it to a 3rd party… boom you got Res… note this is different than an example where a guy says he will give all profits to a bene from the stocks that he owns
23. Trusts terminate when their purpose comes to an end… this is usually when a principle bene will get the remainder
24. Improperly dispersed trust funds that went to a charity… non-charitable dispersal get taxed 100%+ penalties and fines will apply
25. In Louisiana trusts can’t be assembled without a writing
26. When a person maintains too much control over a trust asset… he is deemed to have fee simple… thus that asset would not avoid probate… when taking the exam you need to need to determine the difference between revocable trusts and fee simple
27. You can’t have a settlor/trustee/bene as the same person and you can’t have a trustee/bene as the same person… you don’t owe a fiduciary duty to yourself
28. Forget about those self help publications for setting up trusts
29. Trusts allow for easier borrowing against property than life estate/remaindermen arrangement… the tenant, remanidermen, and the reversioners would all have to sing the loan… also trusts allow for leasing of the property to go on after the death of the tenant more on this on page 564… tenants, waste, taxes against tenant, and upkeep… over all making a trust over a life estate will be less troublesome
30. If the powers of the trustee are not spelled out then tryst law will apply to them
31. It should be noted that if a parent is also the trustee… any funds given to the bene from the parent’s money is not to considered a pay out of the trust
32. A moral obligation is not enforceable in law

Revocable trust= is a non-probate asset in every state. This is a hot commodity in California, this avoids probate. The problem with it is that it brings into question whether or not you are going to lose your homestead exception (in Louisiana). It is an awkward device to use, especially after assets are moved around later. At that point there are no longer huge savings. They do not help you to save on taxes.

Constructive Trusts:the courts like to use these when it appears there was fraud somewhere involved in the execution of will resulting in unjust enrichment of a party… the enriched party will hold that asset given to them in trust to hold for the people that the court deems should have received it in the name of equity… This hardly ever happens though…it is not something that the courts are going to like to do… note that fraud is not the only time when a constructive trust may be used… there may be other instances where someone was unjustly enriched… but you must have clean hands if you are trying to get a constructive trust imposed on another party

Types of Trusts:
33. Private Trusts=are usually between family members
34. Public Trusts=an example of one is a charitable trust
35. Marital Trusts= FED allows for a fed estate tax deduction for marital trusts… in it a person can set up the property to pay income off it to the spouse and then the remainder going to the children… when the surviving spouse dies… the estate tax will be paid
36. Intervivos Trust=
these are made during the life time of the Settlor (the person setting up the trust)
Spend thrift restraint=
1. is a starting point for all inter-vivo trusts… and from there you can have just about any type of trust that you want…
2. what these things do is not let creditors get a hold of assets coming in under the spendthrift restraint…
3. every juri permits a trust to have a sped thrift restraint. Most require these to be in the trust itself… other states say that all trusts have this automatically built in…
4. can be in the form of principle coming in or income flow coming in…
5. These things allow for people to give a livelihood to another person that will protect them in bad times…
6. Another feature of these is that they also provide limitations… that keep people from alienating their own trust interests…
7. but it will not protect form the exceptions (like the IRS) like a discretionary trust will… these things keep people from alienating the trust… the settlor’s purpose and the spendthrift are good things to consider together
Spendthrift vs. Alimony and child support= Income and principle will be treated differently here… public policy calls for the distribution of income to meet the legal needs of supporting children and wives according to the situation.... equity steps in here… For the principle (trust corpus)… when this part of the trust is discretionary… can be done if there is a beneficiary… or when child support is found to be inadequate. If income and principle are at the discretion the trustee… then results may be different… because someone having expectancy… when the trust is complete would not be seen as having a property interest to protect… IT will be harder in a case like this to cut through the spendthrift provisions… A lot of jurisdictions will not care but do this…look at what is discretionary and what is not… the non-discretionary can be distributed easily when there is an expectancy recognized by the court (when it is not discretionary) (look at the SHELLEY v. SHELLEY) case… in that case the prof thinks that since there was a recognizable property right… it allowed the court to easily cut through the spendthrift provisions. The majority of states will allow. FED taxes can cut through spendthrift provisions… when it is not discretion (there is a property interest) but when there is a discretionary thing (that property is an expectancy… there is no actual property right until the trustee pulls the trigger) so the when it is discretionary… the gov. can’t get it.
Tort Creditors and Spendthrifts= mentioned.
In most jurisdictions you can’t spendthrift your own money to give to someone else. The spendthrifts protects won’t apply to keeping creditors off your money… The jurisdictions that do allow this have restraints on making these types of trusts…
IRS issuing a levy… is only good… for what is do at that time… there are on going levies but this has not been covered yet. So this means that a levy will only apply to an interest that is vested at that time. So look for what type of levy that it is. This is important because when a non ongoing levy is issued… it will not be able to touch expectancy… A discretionary trust can protect someone in this regard because all property in this type of a trust is considered expectancy.

37. Spendthrift Trusts=
• In these types of arrangements… the benes are not allowed to alienate the their interests nor can creditors reach their interests
• These are created by imposing a disabling restraint upon the benes and their creditors… this can come in the form of a provision saying that this life estate can’t be alienated and is not subject to bene’s creditors
• Recognized in most jurisdictions
• But I don’t think that these will protect you from tax collection like a discretionary trust will
• Can be reached for the purposes of legal obligations… so it is not protected from those
• Judge made laws shooting down things like rule against perpetuities, the against the restraints on alienation, the refusal to recognize trusts for capricious purposes/illegal purposes, or for purposes against public policy chip away @ trusts like this
• When a spendthrift trust is set up for the benefit of the settlor by the settlor… the assets will be in the reach of his creditors… in an situation like this… both the principle and the income can be reached by the creditors in a mandatory trust.
• People that provide necessary support can reach the bene’s interest in these
• Federal Taxation can be derived from the trust assets for the taxes owed by the bene
• Excess funds left after the support and education of the bene can be reached
• Most states allow this type of trust to imposed on the income and the remainder but as soon as the remanderman is entitled to the funds… his creditors can get at it
• Can’t be reached in the event of bankruptcy
• A trust can be modified by the agreement of the settlor and the benes… even a spendthrift provision against alienation won’t apply to this
• Now note… modification or termination is available (when settlor is not around) that all benes must agree… all benes must have legality to testify… and the purpose of the trust would not be frustrated… I think this is when the settlor is not available

38. Support Trusts=
• This is a trust that requires the trustee to make payments of income (or principal) in the amount that is needed for support or education complying with a certain level that was laid down by the trust
• This figure is to no more or no less than the amount laid down in the trust
• The bene can’t alienate and creditors can’t reach it with the exception of those who provide the necessary support
39. Pension Trusts=
• Fed Law upholds that certain retirement plans can’t be alienated or assigned… like
• These types of assets can be reached for alimony, child support, or marital property rights
• The reason being is that retirement should be protected even at the expense of creditors
40. Testamentary Trust=
these are put together by a will
The Statute of Wills calls for these to be created in the will… but in certain circumstances… the court will let it slide
these trusts will not avoid probate
additionally they will have to comply with the statute of wills
the interest that they pass will not pass before the death of the settlor
also known as court trusts because it comes into being by order of the probate court that supervises the administration of the estate (not like an intervivos trust that requires no such order)
most states will allow these to be terminated by compromise agreement between benes and heirs… this applies to spendthrift trusts as well
41. Revocable Trusts=
These are examples of grantor trusts… income to this type of trust property is taxable to the grantor because he has maintained substantial control over the property that the code recognizes him as the owner of the trust… generally these into being when the grantor has a reversionary interest in the income of the trust property that exceeds 5% @ its inception… the one exception where a settlor can have a reversionary interest is when the income of the asset is actually passing to a lineal descendant and the reversionary interest only kicks in @ the death of the descendent… Where the settlor (as trustee or individual) has discretionary power over the income or the principle that he can use without the permission of the bene… the trust is also likely to be called a grantor trust… and so the grantor is taxable over the trust property hat he has control over. The plus side of a grantor trust is that anything over 10,000 dollars will be taxed to the settlor and the bene. will receive a tax free gift
In the above given example… if the settlor was not in control but had an independent trustee (not subject to the control of the settlor)… he would not feel the brunt of the taxation… alternatively he could set up the trust so that he or someone subject to his influence can’t stray from… if there are enough constraints… he won’t feel the taxation burden
Even when the trustee makes the trust for his own benefit… if is set up so that he has sufficient control or someone under his influence does… he will be taxed on the assets that he has control over (grantor trust)
Grantor Trust= if the trust is set up to satisfy a legal obligation… then the settlor is taxable on the amount used for such a purpose… it does not matter if the trustee is independent or not… so if an additional amount gets by in a child support payment… it will not be taxable against the settlor
If a grantor trust is found then the underlying assets to the taxable trust income may be subject to the estate tax of the settlor when he dies
are very popular because you can avoid probate
The reason why these assets avoid probate is that they legal title passes to the trustee and there is no need to change the title to the trust assets by probate administration on the settlor’s death… and although there may be costs due to a third party trustee… but these costs will be substantially smaller than probate costs… however to get the full picture one needs to consider the drafting charges from an attorney for a trust (more than a will) especially for revocable trusts… and the transfer costs of some of the assets like stocks
It should be noted that the revocable trust process is a lot shorter than probating as estate… additionally since the rules for trusts are much simpler than for executors… the trustee can take care of the estate better in the interim (especially in business relationships)
Also by using these types of trust… a settlor can avoid the ancillary probate problems (when real property is located in another state)
The elective share concept does not apply to revocable trusts by statute (where a spouse not included in a will shall receive a certain share of the estate unless…) but in a majority of jurisdictions courts of equity will permit the surviving spouse to reach the assets in a revocable trust created by the decedent spouse
Pretermitted statutes only apply only to probate property and so will not apply to revocable trusts… pretermitted shares are when a family member (including wife) was not included in the old will because they were not yet part of a family
One down side is that creditors have a longer time to take a swipe @ the trust assets than they would for a probate asset
you can get rid of 100% of your assets through an intervivos trust… the problem is that people don’t like having their assets tied up for financing… although some banks will recognize this and give financing
you can have successor trustees with this so that someone can manage the disposition of their assets while living when needed
These do not have any income, gift, or estate tax benefits
These are commonly used for older people but are not common in Louisiana
They can be created:
by a declaration of trust where the settlor becomes the trustee of the trust property… it is recommended that the settlor name a trustee successor to take over in the event of his death or incompetancy… if this is a trust that is designed to end on the death of the settlor as a means to avoid probate… the death bene should be named the successor trustee… in situations like this… the successor trustee automatically takes over (without court order) and distributes property to the trust benes… it should be mentioned that an oral declaration of trust should manifest the intent to take on the responsibility of being a trustee so that it won’t be confused with making a gift
by a deed of trust= naming a third party as trustee (settlor can be co-trustee if desired)
Revocable trusts can be funded or unfunded
When these revocable intervivos trusts involve a deed of trust… the settlor transfers legal title to property to another person (trustee) via a writing… but the settlor retains the power to revoke, alter, or amend the trust and the right to trust income during his lifetime… on his death the assets are distributed accordingly… all jurisdictions now recognize these types of trusts… also the settlor may reserve testamentary power of appointment.
In a revocable trust the settlor has:
1. power to consume the principle
2. power to sell or mortgage the trust property and appropriate proceeds
3. the power to appoint or remove trustees
4. the power to supervise and direct investments
5. power to otherwise direct and supervise the trustee in the administration of the trust
6. Really any of these powers listed above by revoking the trust
When a settlor reserves a right to revoke in only a certain manner, then he can only revoke in that certain manner… the UTA 602-c-2 says that revocation can be made in anyway except when it is made exclusive by a will or something else that shows clear and convincing proof of the settlor’s intention
Can only transfer property put into it during the lifetime of the settlor… this is why a pour over trust would be used
Revocation can be made even when the settlor is not competent or under undue influence
Revocable declaration of trusts= this is when the settlor declares himself to be the trustee for the benefit of himself during his life time with the remainder to pass to others on his death
Revocable trusts have rights that can be enforced by the benes
Revocable trusts can be touched by tort creditors of the settlor after his death
42. Revocable Trust Functions:
o Keeping title clear= husbands and wives can use these to put their pre-marital assets/ inheritance into a trust… by doing this they will keep assets from getting confused in the event that the marriage ends and in the event of death… it also can step up getting an income tax basis on all of the property when one of them dies
o Income and gift taxes= under FED income, gift, and income taxes… assets in a revocable trust are considered owned by the settlor… this is because the settlor retains sufficient control over the asset… basically there is no FED tax advantage to creating Revocable Trusts
o Dealing with incompetancy= revocable trusts can be used to manage this type of event… this is done by making someone else a co-trustee… and providing to make so either can take control on behalf of the trust or set it up so that the other trustee steps in when the originator becomes incompetent
43. Irrevocable Trusts=
the settlor can’t get his money back in these kinds of trusts
In the majority of states a written trust is presumed irrevocable… unless there is an express or implied provision saying that the settlor reserves the power to revoke… In a few states (California and Texas)… the opposite presumption holds true… The UTA adopts the minority rule
44. Unified Trusts= you can make them a couple of ways:
o An unfunded revocable life insurance trust coupled with a will pouring over probate assets into a trust… a unified trust of (insurance proceeds and probate assets)turning into an intervivos trust
o Create a trust in a will and designate a bene of the insurance proceeds “the trustee in my will”… this unified trust is a testamentary trust because it was created by a will… the insurance proceeds won’t go through probate like they would if they went to the executor’s control like if the proceeds went to the estate of the insured
45. Special Needs Trusts=
these are trusts that are set up for incompetent people
done properly… this can avoid the Medicaid fall out… by arranging it so that the trust will cover those things that will not be covered by the state
If a bene is impaired… the court needs to appoint a rep for that person
46. Dynasty Trust= not mentioned much… the idea here is to keep the money in the family and avoid as much estate and transfer tax as possible but it is limited by the rule of perpetuities in most states
47. Trust for Minors= not mentioned much but you can make a 10,000 dollar a year gift to a minor every year… and then when they are an adult… you can give them the principle… having this in a trust will help them mange the money until they get older
48. Savings Account Trusts (Totten Trusts)=
o This is a type of multiple party bank account that functions like a POD account is the savings account trust
o Multi-party accounts are handled by UPC 6-201 through UPC 6-227
o The UPC treats this type of account as a POD account
o POD bank account benes can’t be changed by a will UPC 6-213-b
o Basically one person deposits money in an account for another and then on the death of the settlor... the account gets paid out to the bene
o Not usually available @ banks for checking accounts
o Accepted in the majority of jurisdictions
o Can be revoked by will and new bene named
49. Secret Trusts=testator gives everything to trustee in fee simple with the understanding that he will distribute according to the terms. The risk with these is that the trustee will not follow through with your desires… also these things tend to get out in the open… so going into to ask a lawyer to do these may eventually result in him having to tell someone
50. Semi-Secret Trusts=when testator makes a trust and does not designate benes… the court will generally not enforce these
51. Honorary Trusts= there is no legal enforceability but if the person wants to undertake the responsibility and receive the benefits… the law will enforce it…by making a resulting trust out of it if he later fails to do it… this occurs when someone makes a trust for the care of an animal… animal trusts will be limited by the life of the animal + 21 years…these rules apply to specific non-charitable purposes also. UPC 2-907 deals with this
52. Mandatory Trusts= trusts can be divided into 2 kinds of trusts… mandatory… where the trustee must dispose of all of the trust income/principle and discretionary where they do not
53. Discretionary Trusts=
The trustee can opt not to distribute income/principle
this allows the dispersal of the trust to be @ the discretion of the trustee… this allows for the trust to be protected for the collection of the IRS… they can’t tax an expectancy.
Allows for the settlor to give trustee the discretion to only give to a class of people (like grand children)
This is a good way for the settlor to set up a means for a person that is not subject to creditors, court judgments, and taxation
will not narrow constraints on it (like give 30% of it here) but it might allow for the distribution of need as equitably as possible
Discretionary trusts do not have absolute discretion but they can look into how the beneficiaries are being supported so he can figure how to distribute the trust… unless some other provision applies (like law or constraint in trust)… if the court determines that the trust is not being honored… it will intervene (like if it is not living up to its purpose)
The greater the discretion… the greater the flexibility in what is considered reasonable… the court likes to keep these things in check
Special circumstances can void the discretionary measures and the trustee can be made to pay out by court order
It is possible for a trustee to be brought under investigation for not giving money for drug use but a trustee could easily side step this when he shows that he did not want to give out money for illegal drugs… he was acting in his fiduciary duty and so he will be fine
these are not really discretionary… the trustee has the fiduciary to investigate
the trustee may be liable for not living up to his fiduciary unless there is an exculpatory clause The presumption of exculpatory clause… the prof thinks that an exculpatory clause is a necessity… so put it in there… and explain it to the client… show it to them and tell them that you will do the best that you can but you don’t want to open yourself up to absolute liability… unless you show that it was put in as an abuse of confidence… then it will be effective… The UTA presumes that if there is an exculpatory clause in a trust entered by the trustee that it is an abuse of the confidential/fiduciary duty unless the trustee shows that it isn’t (and fair under the circumstances) and that the settlor was aware of it
IRS issuing a levy… is only good… for what is do at that time… there are on going levies but this has not been covered yet. So this means that a levy will only apply to an interest that is vested at that time. So look for what type of levy that it is. This is important because when a non ongoing levy is issued… it will not be able to touch expectancy… A discretionary trust can protect someone in this regard because all property in this type of a trust is considered expectancy.
Discretionary Trusts are not in reach of the gov. but the prof is worried about the state going after the trustee because he has the discretion so… you can make a special needs trust.
These trusts allow a person to qualify for Medicaid while having the benefit of trust income but the remainder assets will go to the state to cover the amount of care given
Note that these trusts are not considered in reach for Medicaid benefits… as opposed to support trusts or other such mandatory trusts because the bene has a right to the assets… where as with a discretionary trust… the rights are not recognized by the courts

54. Life Estates with remainder interests= are being phased out by trusts
55. All Trusts (a type of trust) are revocable
56. Class Trusts= are made up of a class of people… like grandchildren… note that this must be an identifiable concrete set of people … so saying friends will too subjective
57. Resulting Trusts=
? arises by operational laws in one of 2 ways:…where an express trust fails or makes an incomplete disposition or where one person pays the purchase price for property and causes title to the property to be taken in the name of another person who is not the natural bounty of the purchaser (the relationship created here is called a purchase money resulting trust)
? Not subject to the Statute of Frauds because it is set up by operational law
? The resulting trust does not contemplate an ongoing fiduciary relationship… once the trust is found to exist… the property is automatically conveyed to the beneficiary

58. Insurance Trusts=
o Funded inter vivos trust… this is where there are funds added to the inter vivos trust and the trustee already named the trustee of such instrument the bene of an insurance policy
o Unfunded insurance trust= this is when a trustee to an intervivos trust with no assets in it is named the bene of the insurance policy
o The above two are considered to be valid intervivos trusts
59. Constructive Trusts=
is not a resulting trust although it arises by operational laws and not by the express terms of the instrument
Implemented to prevent unjust enrichment
When someone is found not deserving of some property because granting it would unjustly enrich him… he/ she is to hold the property in a trust for another (Constructive Trust)
The usual situations for this type of trust to be made are confidential or fiduciary relationships, promises expressed or implied by the transferee, transfers of property in reliance on the promise, and unjust enrichments of the transferee… also an oral agreement in a confidential relationship or where there is a fiduciary will make the agreement enforceable (applies to making constructive trusts)
It can be imposed because someone obtained property through fraud or when someone breaches a contract not to revoke a will
It can be used to enforce an oral promise to convey Real Property or to enforce a secret testamentary trust
Are not subject to the Statute of Frauds because it is set up by operational law
The emphasis of these is shifting from fraud correction to getting to the trust intent of the testator
To enforce a constructive trust or other such equitable measure… you better have clean hands

Trusting Characters:
The settlor, the trustee, and the beneficiary are not always separate people… One person can wear all of the hats but not solely. The real problem comes into where the settlor wants to be the sole beneficiary… since he does not owe a duty to himself a trust can’t be there
There is an exception to the rule that there must be a bene to have a trust... when the benes just are not born yet… courts will protect this type of a trust on behalf of the unborn children but if the designation to a bene is too indefinite, the trust will fail... like a designation to friends… it must be a definite class of people… this is the rule for private trusts and not for public trusts like charities
1. the person that runs the trust
2. There can be more than one trustee
3. the trustee can be the settlor, 3rd party, or beneficiary… but he can’t be the sole bene because he will have no fiduciary duty… there is no trust… the titles merge and he ends up having absolute legal title
4. a trust will not fail for lack of a trustee… if there is not one… go to the code… if a trustee died before the completion of the trust… then one will be appointed
5. A trustee has a fiduciary duty of fairness to income benes and remaindermen alike
6. A trustee is not allowed to delegate trust powers but can ask for assistance
7. If a trustee violates his fiduciary duty through improper management… the trustee may not be paid or may be liable… the trustee may also be removed by the court
8. the trustee is considered a fiduciary and is held to the highest standard of care as the law will allow (fiduciary duty)… he/she is to manage the property and take care of it, he is to keep the trust property separate from his own… he does all of this on the behalf of the beneficiary… just because a trust loses money does not mean that the trustee violated his fiduciary duty as long as he acted prudently and not speculatively… a trustee has the duty to investigate, make decisions, and invest
9. The trustee is required to account to beneficiaries and can’t delegate most of his powers… but he can hire some people to assist him as long as he is not delegating substantive tasks (he can delegate administrative tasks)… The trustee must give accurate figures in accounting use of the funds or he/she is going to be personally responsible
10. A trustee is to keep trust property separate from their own property… if there is inter-mingling of the property… the burden will be on the trustee to show what property goes where and if it can’t be unmingled… then the property may go in its entirety to the benes
11. Trustees have broad powers of management
12. When a trust is intended but no trustee is named… one will be appointed by the court… another situation is where someone named in the will refuses to take on the responsibility or the trustee dies and the will does not have a provision for that… then a trustee will be appointed by the court
13. A trustee can be removed when he/she violates their fiduciary duty
14. This is a voluntary duty not a forced one… a trustee gets paid
15. The prof. recommends having an individual handle this matter… but going to a corporation can be good too when no one is there to do it… but they are not going to be as personal as a family member would be… but you know that the corporate trustee will always be there
16. The corporate trustee will have a fee schedule usually a minimal or a % depending on the size of the trust and the corporation
17. If the trustee is a professional… he may get an hourly fee… note that an attorney who decides to be a trustee will not have being a trustee covered under his malpractice insurance… get paid hourly
18. Custodian vs. Trustee= Jimenez Case= a custodian’s duty to account ends where a trustee’s does not end until the property is gone or the trust ends
19. the Trustee may be liable for not living up to his fiduciary unless there is an exculpatory clause
20. A Custodian relationship is an agency one
21. Changing Trustees= in most jurisdictions you are not allowed (as settlor or bene) to simply change the trustee… without an instance of fraud or violation of fiduciary duty
22. Once a person accepts the trust duty… he can only be released from liability with the consent of the benes or by a court order
23. The trustee can invest in better property
24. Where does the family stop when h and w come in and want wills… and then the kids come in a and get wills… Representing can be done for all but there are not going to be bright line rules.
25. Personal creditors of the trustee can’t reach the trust property
26. The trustee can’t use the trust funds to pay off his own personal debt

1. the person that sets up the trust for another
2. when a trust is created while the settlor is alive it is known as an inter-vivos trust… these can be setup by a declaration of trust (where the settlor declares that he is holding certain property in trust for another) or through deed of trust (in which settlor transfers property to a trustee for another)
3. Through a declaration of trust the settlor is also the trustee… note that you will not be able to orally declare the trust of real property… a written instrument will be required... there are some exceptions to this of course
4. Through a deed of trust someone else is a trustee… note this is necessary whenever the settlor is not the trustee
5. when a trust is set up in the settlers will after his death… then it is known as a testamentary trust
1. can be an income beneficiary or a principal beneficiary (or both @ the same time)
2. Principle Bene= the timeframe that the principle is received @ will be in the trust instrument or in the trust code… if the time frame is in the trust instrument… you can pretty much do what you want… as long as it does not offend the law or public policy
3. entities can be beneficiaries
4. are not needed for charitable trusts… when the organization closes down but there is still money on the trust… they cypress-doctrine kicks in and the money (liquidated value included if building was the thing that was given) goes to another similar charity... so even when the purpose of the trust comes to an end… the trust can go on…
5. benes have equitable title in their trust property and can enforce that in a court of equity against the trustee who has legal title
6. When a trust fails… the benes get legal title to the trust property
7. Even though benes only hold equitable interests in trust property… they can legally enforce those interests in a court of law
8. If a trustee wrongfully disposes of the trust property then the benes can go after it unless the property was acquired by a bona-fide purchaser but if the property is wrongfully sold and other property acquired… the trustees can get to that property as well

this is what happens when your property is not dealt with by a will or non-probate procedure. The method used will be that as provided by the statutes of that state. The state where the decedent was domiciled usually applies its laws to the personal property and the state where any real property is located uses its laws to distribute that property
1. When a person dies intestate, he gives up the right to dictate where his stuff goes.
2. Under the UPC= having children from a previous marriage will affect how much the spouse gets. The UPC is more generous than most state laws dealing with intestate succession for the surviving spouse. The UPC also lessens the surviving spouses share where there are children (this is different than most state laws Also, the UPC differs when there are no surviving parents… the spouse takes all even if there are surviving kin like brothers and sisters (and their descendants)… State laws are limited by the constitution in what they can do as they must have a permissible state objective to justify the limitation on the transfer of the decedent’s estate.
3. All Jurisdictions= spouses will split in some fashion with the kids when the other spouse dies intestate.
4. Most jurisdictions don’t allow in-laws to collect the issue of an in-law parent when the grandparent dies.
5. In every jurisdiction in an intestate situation = If descendant dies with no kids and his parents are dead= his brothers and sisters will take= if those brothers and sisters are dead but have kids= those kids will take their parents’ share of their dead uncle’s estate.
6. When someone dies intestate there is no executor and so there is a pecking order to who can become the administrator (usually the spouse is the highest on the list). The surviving spouse is going to have to post bond from an insurance company.
7. Common law marriages are not recognized in Louisiana but in places where they are, the common-law wife can collect according to intestate statutes. In a jurisdiction that does not respect common law marriages will give no intestate rights to common-law spouses (the prof thinks this applies to all states that don’t recognize common-law marriages.
8. When a person marries two people without divorcing, the courts try to honor that second marriage if that other spouse was a spouse in good faith, not knowing about thither spouse. This “Bigimous issue” can go away if one of the spouses dies before the decedent spouse dies.
9. English Per Stirpes “minority rule in the US”= This is where the shares are divided equally at the next generation to the decedent and if heirs to that inheriting generation want to collect= they will only be able to share in the share that their parent got.
10. Modern Per Stirpes Rule= “majority rule in the US”= The division goes to those living at each generation
11. The source of the property is irrelevant for the distribution of intestate property in common law property states... how the title is held at death is controlling.
12. When a person marries two people without divorcing, the courts try to honor that second marriage if that other spouse was a spouse in good faith, not knowing about thither spouse. This “Bigimous issue” can go away if one of the spouses dies before the decedent spouse dies.
13. The UPC has an “elective share” based on the years of marriage that handles situations where provision for the new spouse are not made

English Per Stirpes Rule: “Minority view in the US”.
1. The shares are divided into equal fractions by the amount of people in the generation following the decedent (dead or alive). If someone is dead, the heirs to that generation member can collect on that member’s share.

Modern Per Stirpes Rule: “Majority view in the US”
1. The shares are divided up into equal fractions at the generation level that has a survivor closest to the generation of the decedent.

When there is no immediate family (spouse, descendants, or parents) to leave the estate to then states will practice one of three ways to figure out who should get an intestate estate:
1. Degree of Relationship System: When somebody dies intestate, the estate goes o the person considered the closest according to a relational chart on page 92
2. Parentelic System: When there are no descendants, then the estate will go to the parents or their descendants, or if there are none, then to grandparents and their descendants, or if there are none to the great grandparents o their descendants and so on and so on.
3. UPC 2-103-4: This is practiced in a minority of jurisdictions. It limits the inheritance of to the level of the grandparents and their descendants in the event that there are no descendants
4. It should be noted that all blood relatives that are not ancestors or descendants are known as collateral kindred… see relative chart for this

o Half Bloods= In most states, half-bloods are treated the same as whole bloods. In some states they are treated different.

o UPC presumptions= pg97, when kids are born more than 280 days after the death of the husband then it is presumed that they are not his kids for inheritance. If the are born within 280 days they are presumed to be his kids. Note that this is just a presumption and it can be disputed with a showing of evidence. The burden of proof will fall on the party going against the presumption.

o A child is a child for inheritance purposes at conception. This is a universal rule.

1. who the child can inherit from and who can inherit from them is not always the same
2. One does not gain personal status by virtue of false information on a birth certificate.
3. Adults can adopt other adults. This can come in handy for future challenges to a will. The people who can challenge a will are those that would benefit if the will was found to be bogus. So one way to get around these potential challenges is to adopt someone and then leave the things to that person. This has the effect of putting that person in the line for people that would benefit if the will was found to be no good and adoption requires a court order. A court order would be much harder to challenge than a bad or bogus drafting of a will.
4. An adoption based on undue influence or fraud can be challenged. Other types of adoptions that are challengeable are the ones that go against public policy
5. Adoptions must be made by people competent to make that kind of a contract… If someone can show an agreement between the natural and adoptive parents, performance by the natural parents by giving up custody, performance of the child by living in the home of the adoptive parents, and partial performance of the foster parents by taking the child into their home and treating it as if it were theirs... then they can show a successful adoption Her aunt her had physical possession of her and everyone knew and did not object= an equitable adoption. The court found that since there was no legal guardianship (only legal custodian) the aunt could not contract for adoption and then the child was not able to inherit from the intestate estate.
6. A legal custodian does not have the right to consent to the adoption of a child as this right is specifically retained by one with greater rights over the child (the child’s parent or guardian)… you need legal authorization to consent to the adoption of a child
7. Non-marital children=
Some courts have found that it is unconstitutional for a child to be denied from inheriting the intestate estate from a natural parent.
What if you don’t know who the father is can you go about determining that? Depends on the jurisdiction and the situation. DNA testing has really changed the way that courts feel about this. UPA ON THE BOTTOM OF 115.
There have been cases where people have been unburied and a DNA test was done on them.
8. Equitable adoption=
o no formal adoption occurs; the adopting parents contract the natural parents to adopt the child. The adopting parents breach and don’t adopt the child but the child continue to care for the child anyway and then the adopting parents die intestate. The people handling the estate are estopped from denying the adoption rights of the child as a third party beneficiary and those who were not part of that adoption contract should not benefit from the breach of it. The child will be able to collect an intestate share of the adopted parents’ estate. Equitable Adoption is going to be a big deal in big areas because of all of the fail safes built in. People are so afraid of liability that they will require some form of legal guardianship (like schools and hospitals) so it is not likely that those kinds of cases will slip through the cracks.
o when a child is raised as the parents own when they are not the real parents… the child may inherit from those “adopting” parents via the theory of equitable adoption… Under this theory, an oral agreement to adopt can also be enforced in equity… Note that if the adopting parents fail to live up to their end of the contract they can’t collect inheritance from the adopted child even though such a child could collect from them.

Paternity can be established= This comes up when children not born of the marriage come in. If a child wishes to collect from such parents they need only prove the subsequent marriage of their natural parent and the step parent in most states, or prove acknowledgement of the father, show an adjudication of the step father during his lifetime, or by showing clear and convincing evidence after the death of their step father (view held in most of the states).

The Uniform Parentage Act= adopted in about a third of the states… A parent-child relationship is presumed to exist when a parent and child together regardless of the marital status of the parents when:
1. while the child is a minor…the father receives him into his home and openly holds the child out as his natural child
2. the father acknowledges his paternity in a writing filed with an appropriate court or administration agency
3. Note that when there is this presumed relationship… a child may bring an action to determine its existence at any time but if the relationship is not presumed to exist… then the action to make that determination must be brought within 3 years after the child reaches majority

DNA may not be the dominating force in figuring out inheritance rights. Some states find that contracts rule and other states find that DNA rules.

Simultaneous death=
1. A person succeeds to the property of an intestate or testate only if the person survives the decedent for a period of time unless sufficient evidence can show other wise… If no sufficient evidence can be given then the person is presumed to have predeceased the decedent… Sufficient Evidence is the standard
2. This period of time is going to depend on the jurisdiction. Of course if this matter is covered in a will then this rule need not apply.
3. The same story in true for insurance policies except that if there is a simultaneous death then the holder of the policy is deemed to have survived the beneficiary
4. The UPC deals with this in UPC 2-104 and UPC 2-702
5. The burden of proof is on the party whose claim falls on ownership. The level of proof may vary from state to state if they have not adopted the UPC
6. In a simultaneous death cases= look to the statute and how it affects probate assets but it may or may not affect non-probate assets. Note that FED non-probate assets will not be governed by the jurisdictional (non-fed) statutes. Additionally, when using a rule of law, you use the one on the date that the case was held not the one that was in place when the accident occurred. The standards for this act are going to differ according to the jurisdiction that you are in.
7. Non-probate assets=
state controlled= governs life insurance, annuity TOD/POD
fed controlled= governs IRA, 401k (not affected by jurisdictional statutes)

Negative Disinheritance=
1. If a person would normally inherit through intestate laws of the state… then you must declare that he is to receive nothing if you wish to disinherit him. If there is a partial estate left to intestacy… then he will inherit according to the intestacy laws of that state according to that particular asset not handled by will or non-probate.
2. The UPC deals with this manner as well

1. You don’t have to Collate/or deem an advancement the things that parent normally give their kids as a part of growing up.
2. if a child wishes to share in an intestate portion of their parents estate he must allow for the administrator to include in the determination of the shares any advancement on inheritance he received while the parents were living
3. If such a child actually predeceases the parent… then that advancement will be deducted out of the share that the heirs of that child receive
4. Note this rule only applies if there is more than one child standing to inherit from the estate of the parent
5. The shares are determined by adding in that amount received ahead of time and then dividing up the entire estate into equal shares… then the amount already received is taken out of the child’s estate (the one who had the advancement)… and he receives the difference. When the amount advanced will exceed the share allotted to each… when it is added in…then the child will not do this and let the others collect equally from the remains of the estate… thus staying out of it… otherwise he would have to pay in
6. Some states are not counting these gifts as advancements unless it is declared in writing and signed by the grantor.
7. UPC 2-109 deals with this topic as well… also in a graph
8. The prof says that he thinks that 90% of parents don’t want things to be advanced to their kids and don’t want it to be counted against them when it is time to inherit. He agrees with the UPC approach to this.
9. The family pot trust usually benefits the younger kids as they… The definition of equal as it pertains to estate distribution is not really equal. The parental view on equal may be different than the kids’ perception. Also assets that were equal when the will was written may have changed in value by the time that the decedent dies.

Laws Affecting Transfer of Property:
Conflict of interest in family planning:
1. as the family dynamic unfolds who do you represent? Where does the family stop when h and w come in and want wills… and then the kids come in a and get wills… Representing can be done for all but there are not going to be bright line rules.
2. How do you represent both sides of a dispute?
3. What do you do with the probate/non-probate assets?
4. Don’t rely on the clients to change over the non-probate assets. 95% of the non-probate sheets need to be changed after you work with the clients.
5. Minors= you don’t want to trample their rights and additionally they can’t really give up those rights. It may not be a bad idea to a succession (give to mom) = and the kids can get it at 18.
6. The Surviving Spouse= she needs a will, there is no doubt about it. The will means you decide and not the state. You get to name the executor and waive the bond (hiring an insurance company to hedge against a loss from theft committed by an executor).
7. Most courts have found a duty between the attorney and the intended beneficiary of a will… so if poor drafting causes a loss to such beneficiary… the attorney could be liable… this is true even though there is no privity between the attorney and the beneficiary because his injuries are foreseeable. If the ? can plead sufficient facts that the attorney did not draft the intent of the testator (as he expressed it)… then he will be able to collect.
8. The job of the probate court is to find the intent of the testator as it is expressed in the will.
9. If an attorney can’t handle a certain case… he is expected to send it to a specialist or be held to the standard of care expected by a specialist.
10. A fiduciary duty exists when one has a special confidence in another so that the latter, in equity and good conscience is bound to act in good faith.

A client comes in:
1. you need to know a little about the assets to determine (most houses are non-probate when bought in the marriage “in both names”)
2. cars are usually in one name or the other= probate
3. CD’s could be in either name= non-probate
4. Pension= is usually in one name= non-probate
5. Life insurance policies that name someone the beneficiary than the applicant are considered a non-probate asset but if the beneficiary dies then another beneficiary will have to be named if the asset is to remain a non-probate asset. In life insurance policies, the owner and the applicant are usually the same person. The beneficiary= you can a primary as well as a multiple and still have it qualify as a non-probate asset.

Case Studies:
1. Simpson v. Calivas= this was a case that had a dispute over what homestead meant. The dispute over what the word meant changed who got what and when they got it. In times like these with ambiguous terms, the probate courts try to determine the intent of the testator. They should admit extrinsic evidence in order for them to determine intent. It should be noted that this admission of evidence is not going to be liberal in probate courts. Another point brought up in these proceedings was that a beneficiary can bring a suit against an attorney for bad drafting of the will. A party in this situation can do this using extrinsic evidence when there are no ambiguous terms in the will. The malpractice field of law is more liberal at letting in extrinsic evidence because it is difficult to show negligence and the person may not be able to afford brining the suit. One final note= the theory of the probate is to determine the testator’s intent (actual intent) not that which may be expressed in the will.
2. Hotz v. Minyard= an attorney/ client relationship is a fiduciary duty relationship.

Transfer of an Expectancy=
1. an expectancy is not a legal right
2. Although, in some cases, these expectancies can be traded… the court really frowns on this practice
3. After a testator dies, then the heir can sue as a right via 3rd party beneficiary but not until then

Managing a minor’s property=
1. a minor does not have the legal capacity to manage a property
2. Guardian of the person= responsibility for the child’s care and custody. When one parent dies, the remaining natural parent is the guardian of the person as long as he/she is competent. When both parents die and the will does not handle this matter, the court will appoint a guardian from the nearest relatives.
3. Guardian of the minor’s property= a guardian of the person does not have the authority to deal with the property of the minor. There are three ways to handle this… guardianship (conservatorship), custodianship, and trusteeship. The latter two are done while the testator is alive by will… if the person dies intestate… then the court appoints the guardian/conservator of the property…When a father writes a will to who will raise his children in his death= the court will honor this in the with (the wife is dead). This is another reason to have a will. Otherwise the state will decide= this is not good. This is especially so if the child inherits a lot of money or is the beneficiary of a huge life insurance policy.
4. The guardian of property who does not have title to the ward’s property usually can’t change investments without a court order. He has the duty to preserve the property for the ward until the age of 18. He can’t sell, lease, or mortgage it until he gets permission from the court. The guardian can only use the income generated by the property to support the ward and can’t dip into the principle to support the ward unless the court approves. Each trip to the court to get approval costs time and money in court fees and attorney costs. Frequently, this type of arrangement leaves the ward with less property than he had at the beginning of the arrangement… Again this is another reason to write a will. In a lot of jurisdictions this is a terrible situation when it is not handled by the will. You want to set up a trust in the will for each child. Now you know who is going to handle the property of the minor. You can be sure that the assets won’t be squandered. The prof encourages= the person who is the minor’s guardian should be the manager of the trust. This way he can make sure that the kids are not victimized by a frugal trustee.
5. Now what happens if the children are left with someone who does not have enough= Give him a monetary incentive or monetary aid to facilitate the care of the children from the estate. This incentive can be tax free.
6. Custodianship is a person who is given property to hold for the benefit of a minor under the state Uniform Transfers to Minors Act… The creation of a custodianship is very simple… Additionally under this act section 14-a, the custodian has the power to expend for the minor’s benefit so much or all the custodial property as the customer deems advisable for the benefit of the minor, without court order and without regard to the duty or ability of the custodian personally or any other person to support the minor or any other income property of the minor which may be applicable or available for that purpose… What ever is left of the property… the custodian is to give it to the minor at the age of 21 and if that minor dies then to the estate of the minor… the custodian has a fiduciary duty to use a standard of care that would be observed by a prudent person dealing with the property of another… There is no accounting to the court required.
7. A trust is the most flexible of all property arrangements… It can also delay the receiving of the property until the testator thinks that the beneficiary will be ready…
8. A testator can make cash bequests to a minor by giving the money to the parents for the child without have to create a custodianship or trust but if the will does not state this then the UPC 5-101 has a way to do it without bringing in extra help

Slayer Statute concerns=
1. The legal title passes to the slayer but equity holds him to be a constructive trustee for the heirs or next of kin of the decedent… This type of equity essentially avoids the need for making confusing laws on the subject…
2. After the property is put into this equitable trust… the slayer must give it to the next of kin or the next rightful heir to the decedent.
3. UPC 2-801 and 2-803 handle this matter as well
4. Slayer Statutes…There is a two part test… Some states require that there be an intentional/voluntary killing to bar someone from collecting from the estate of the person that they killed. A probate court may not be able to handle a case like this…probate courts are courts of limited jurisdiction…Cases of this nature will have to be sent elsewhere. A case like this will not stem from a criminal proceeding…it will be a civil court…and this court will have a lower threshold of conviction than a criminal court…a person may actually get away criminally but charged civilly (there is no res judicata). Additionally…if someone is convicted criminally…they will be (via res-judicata) deemed civilly liable.
5. Slayer Courts apply to probate assets definitely…in some jurisdictions don’t apply them non-probate but a court of equity may do so…the UPC applies to both kinds of assets (probate and non-probate… You will have to figure out how the FED and state statutes apply to both of these types of assets to correctly resolve this situation.

1. The advantage of this is tax savings
2. When someone disclaims an inheritance… the courts treat it as if the property had already gone to that person and then passed to the next generation
3. The disclaimer is treated as having predecease the decedent and thus never had a property right (he never accepted property from the decedent)
4. UPC 2-801-d-1 deals with this topic as well but I can’t seem to find the actual statute… essentially what it says is that the disclaimer relates back for purposes to the date of the decedent’s death… but the property passes directly to the next of kin (by passing the person trying to avoid taxes for legal purposes)
5. Under the Internal Revenue Code= only qualified disclaimers will not have to pay the gift tax…the disclaimer must file the disclaiming thingy within 9 months of the interest being created or after the donee (receiving party turns 21) which ever is later.
6. A disclaimer can remedy a defective estate plan and correct the drafter’s error (saving the estate hundreds of thousands of dollars)
7. You can disclaim and avoid creditors as the estate passes to your heirs... but you can’t do this against the fed government… you can’t disclaim Medicare benefits and you can’t disclaim to be able to collect on Medicare benefits
8. You need to meet the guidelines of both FED and State tax law…(IRC 2518 and the relevant state law)… if you do it right and don’t have some debt with the fed or are receiving medicade benefits then you can give a tax free gift to an heir
9. If you do not do it right though, the property will be looked at as if it is a gift… this is disastrous for taxing and creditor avoidance
10. I made a graph and I want the prof to look at it… what is this bit with the descendants of the disclaimer receiving only that which is received to prevent the other heirs from paying taxes on the entire estate as a whole
11. IRC says that if you vertically disclaiming a CD by vertically slicing it (keeping only ½) you must make no claims as to the other half of the instrument… getting nothing in the form of income from it
12. Disclaimers have the effect of allowing you to avoid creditors… this will not allow you to beat a FED tax lien but the courts are split on that

Medicaid and Disclaimers=
1. Medicare= FED and Medicaid= State
2. Giving away property to children to qualify for Medicaid can result in disqualification of the applicant for a while depending on the amount transferred.
3. There are certain transfers that are exempt from this like home transfers to a spouse, and trust transfers for certain disabled persons
4. In some states the Medicaid applicant will have to take measures to get any such illegally transferred property back… like when people are receiving income in addition to the benefits that they are receiving… the state may liquidate the house to pay off the excess… In one situation… someone disclaimed an inheritance so that his sisters could receive what would have gone to the state… the state honored the disclaimer but made the recipients of those disclaimed funds the trustee to hold those assets for the disclaimer to pay the state for the excess benefits he received when he had such asset (a constructive trust against fraud)
5. It should be noted that falsifying a Medicare/caid application is a crime
6. If the recipient dies leaving some sort of asset… the state may attempt to take that asset to pay some or all of the benefits that were given to the recipient
7. If you are knowingly and willfully counsels or assists an individual to dispose of assets in order to become eligible for Medicaid when the disposing of the assets results in the disqualification of benefits for a while… you are committing a crime.
8. To properly qualify for Medicaid/care… you need to have your assets totally depleted… before you can receive benefits… income generation will be looked at… there are some excempt assets (residence, jewelry, and furniture/fixtures
9. Note that additional income can reduce Medicaid/care benefits in part of in whole.
10. Transfers need to be 36 months old before someone can qualify for benefits… (something valuable was transferred before receiving benefits)… sometimes this figure jumps to 5 years in trust transfers… it should be noted that no strings can be attached
11. The states have found fraud and denied coverage for inaction (not claiming an asset) or action (like disposing of an asset just to qualify for coverage)
12. The states will differ in how they handle disclaimer/Medicaid situations
13. There are 3 exception assets that can be given to a person that would otherwise qualify for medicade/care… and not be deducted into the state… they will be used as supplemental:
Special trust= this is where a trust is set up for a disabled person by another… to be used only as supplemental assets to the state care
There is another type that is similar to the one above except that when the disabled person dies… the remainder goes to pa the state back for the care that it gave to that individual
A discretionary trust created by the other spouse in the will= this is not deemed an asset that is in reach of the surviving spouse for these purposes
14. Self Settled Trusts can’t be used for the same purposes as the exceptions above

Some Information on Taxes:
the tax codes don’t allow an individual to transfer income payments to children @ their tax rate… those income payments will be taxed @ the parents income
If you own the income brining asset, you will be taxed on the income that it produces @ your rate
Cayman accounts are not subject to our laws in the same way… but the fed is putting the smack down through the credit card companies.

Power of Appointment:
It is very useful for estate planning and tax issues there of
They can be open ended (no one excluded from power of appointment)
Or they can be more limited (like power of appointment to the children)
This is not fee simple
These are not trusts
This can involve a property right and the power to appoint or just the power to appoint
Does not require a definite class of benes… but it needs to be enough that a person could reasonably fit the description
These things are often given to people in trusts to dispose of the assets to a given class of people
This is a non-fiduciary power… it is totally discretionary
Special power of appointment allows for the to person appointed to modify the trust to the benefit of the benes not including him… this is why there is no tax consequences for having it

General Transferring Concerns:
The following are how the courts deal with uncertain time in vesting property:
a. A property interest must vest in a lifetime + 21 year “the rule of perpetuities”
b. Another doctrine is the wait n’ see rule… the courts will hold off and see what happens

Drafting advice= is a special power to keep things fluid
Paying to the registry of the court= protects people from paying twice due to judgment

When the property is not owned by the testator @ death… the devise is adeemed and the devisee gets nothing
Power of Attorney:
Durable Power of Attorney= this is a relationship started by an instrument where the principal confers express authority on an agent to perform certain acts or kinds of acts on the principal’s behalf
1. this does not terminate in the event of incompetence
2. it will terminate on death… so no transfers can be done after the death of the principle and so a durable power will not avoid probate
3. If the agent dies… the power of attorney end unless the principle provides for a successor where as in a trust … the court could appoint one
4. Also different from a trust… the agent does not actually have title to the property like a trustee does and the laws concerning this type of relationship is really constrained… making them not as flexible as trusts
5. UPC 5-501 to 505 and all state statutes permit this
6. each state may limit the application of this doctrine in their own way
7. There needs to be some specific language stating that this is to be a durable power of attorney
8. These things must be created by a written instrument and in some states must be witnessed and notarized
9. the agent will be able to do a lot of things with the property of the principle… the principle can generally empower the agent to revoke the trusts or amend them without referring to them specifically
10. the agent can also be given the power to make gifts
11. the agent could also be empowered to make a revocable trust (revocable by the settlor) for the principle in the event of his incompetancy… this power to make trust is not limited just to the times when the settlor becomes incompetant
12. other powers that may be authorized are to amend or revoke POD designations, sever joint tenancies, or making life time gifts (good for the 10,000 dollar exclusion thing)
General Power of Attorney=
Durable Power of Attorney for Health Care:
1. A person can appoint an agent to make health care decisions in case of the person’s incompetence
2. of course this power will to terminate on the vent of the principle’s incompetence… but it will expire @the death of the principle
3. This power enables an agent to respond flexibly to a situation
4. As with Living wills… a health care provider must respect the wishes of the principle unless they break the law, are against public policy, or are contra to the health care provider’s conscience

Living Wills:
o If the state law requirements are met… a person may state his wishes about termination of medical treatment or appoint a surrogate to make decisions for him
o These types of ting handle events where life will not be supported without extraordinary measures and there is no reasonable chance of recovery
o Almost all states have these provisions
o Any patient receiving FED funds for medical care… must be advised of their rights covering this area and of their opportunity to sign a document authorizing something like this
o In almost every state… this provision will not apply to pregnant people
The Recommended Method for Executing a Will
“The Universally Appealing Method”

English Per Stirpes: for intestate succession
“Minority rule in the US”

“American” Modern Per Stirpes Rule
“Majority Rule in US”

UPC 2-106
“Per Capita at each Generation”

Disclaimers and UPC 2-801:

Advancement Graph:

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