FOR CLASS WILLS & TRUSTS ISSUE – Who gets the decedent’s property? QUESTION – Who should get the property? WHO GETS YOUR PROPERTY WHEN YOU DIE 1ST VARIABLE • NON PROBATE (opt to) o Joint Tenancy – b/c each person owns the property with right of survivorship (at that time of death the property interest is extinguished) (it does not pass…b/c if it would pass then it would have to go through probate o Life Insurance Policy (Common Law)Insurance company creates a Contract for a 3rd party beneficiary contract with a payment upon death clause why shouldn’t any contract be treated as non probate (Modern Trend) – should any contract that has a payment on death clause be non probate (modern trend) yes Inter Vivos – During Life (i.e. intervevos trust = created during life of party) Testamentory – During Death (i.e. testamentary trust = created after death b/c of will) o Possessary Estates of Future Interest (Fee Simple, Life Estate with a Remainder) o Trust (There are Different Types of Trusts) Only one of them completely opts out of probate (i.e. inter vivos trust • PROBATE (default) o IN TESTATE (W/O A WILL) o TESTATE (EXECUTE A VALID WILL) When you get to the Wills 3 types of Gifts • Specific Gift (unique items i.e. wedding ring, my vehicle) • General Gifts (general pecuniary value – 1000 dollars) • Residuary Gift – Clause in the will that gives the remainder to a certain person (it is a catch all) -> therefore you cannot die intestate Non Probate • JT • Life Insurance • Possessory Interest • Trust Probate • Testate • Intestate PROBATE > INTESTATE (w/o will) • Surviving Spouse o How much does the spouse take – depends upon whether Community Property • Any earnings acquired by either spouse during the marriage. Quasi Community • When you marry in a non community property state the earnings acquired during marriage are separate property -> they move to a community property state -> any property at the time of acquisition would be classified retroactively -> quasi community property Separate Property – • Property acquired prior to the marriage • Does marriage change the characterization of his property (even if married tomorrow it does not change the characterization of the property acquired prior to marriage) • If I (inherit = w/o will “intestate”) $100 during marriage (people with a will = do not inherit they devise their property) -> NOT COMMUNITY PROERPTY B/C NOT EARNINGS • Therefore Gifts(alive), Inheritance(death), Devises(death) -> Separate property o Surving Spouse Can Take 100% -When no Issue (all blood descendents), no parent, no issue of parents 50% -When 1 child* (* or they are deceased but has their own issue but just count as one child) or no issue but Parent or Issue of Parent 33% -When more than one child* • Registered Domestic Partners – have the same rights and obligations as a spouse 1. Surviving Spouse /Domestic Partner a. CP /QCP b. SEP 2. Issue -EQ* 3. Was there Predeceased Spouse – a. No -> go on to 4 b. Yes -> Recapture Doctrine -> recapture all the qualified property 2nd spouse received by virtue of the 1st spouses death. i. What constitutes Qualified Property 1. Real a. if real property -> qualified if 2 spouses died within 15 years of each other 2. Personal a. Within 5 years of each other b. Original Record of Title or Ownership (some kind of written record) c. Individually or in aggregate over $10K 3. We will recapture only if there are qualified takers a. Issue b. Parents c. Issue of Parents i. If you don’t have these 3 then you do not recapture 4. Parents -EQ 5. Issue of Parents -EQ 6. Grand Parents /Issue of Grand Parents -EQ 7. Issue of Grand Parents -EQ 8. Issue of Predeceased Spouse 9. Next of Kin 10. Parents or Issue of Parents Of Predeceased Spouse 11. Escheats to State 6402.5 – • If Wendel and Jeri have no kids • Wendel dies 1st (survived by his mother) then Jeri gets about 100% of the wealth created • Then 1 week later Jeri dies (survived by her mother) -> without the recapture doctrine (6402.5) Jeri’s side of the family would have a windfall even though the family died WHO GETS YOUR PROPERTY WHEN YOU DIE 1. NON PROBATE a. Joint Tenancy b. Life Insurance c. Legal Life Estate /Remainder d. Intervivos Trusts 1. PROBATE a. Testate (with will) b. Intestate (without will) i. Surviving Spouse /Domestic Partner 1. Community Property (including Quasi Community Property) a. All of the Decedents ½ Community Property /Quasi Community Property 2. Separate Property a. 100% -> IF No Surviving Issue, No Parent, or No Issue of Parent b. 50% -> IF 1 Child*, or No Issue but Parent or Issue of Parent c. 33% -> IF > 1 Child*, 1 Child i. * 1st Look for Child that is Alive, 2nd look to Child that are survived by issue ii. Issue Equally* (surviving) iii. Predeceased Spouse (RECAPTURE DOCTRINE) 1. If yes – recapture all the qualifying property a. Recapture ALL of the decedents qualifying property which 2nd Spouse Die received by virtue of 1st spouse’s death b. QUALIFYING i. REAL = 15 years ii. PERSONAL = 5 years 1. Record of Written Ownership 2. Aggregate of 10K a. Issue of Predeceased Spouse b. Parents c. Issue of Parents iv. Parents Equally*(surviving) v. Issue of Parents Equally*(surviving) vi. Grand Parents (take 1st) /Issue of Grand Parents Equally* (surviving) (really separate) vii. Issue of Predeceased Spouse Equally* (surviving) viii. Next of Kin Equally* ix. Parents or Issue of Parents of Predeceased Spouse Equally* x. Escheats to the State Predeceased Spouse • No • Yes o Recapture ALL of the decedents qualifying property which 2nd Spouse Die received by virtue of 1st spouse’s death • Qualifying Property o REAL = 15 years o Personal = 5 years Record Written Ownership Aggregate of 10K • Issue of Predecease Spous • P • I of P Simultaneous Death Situation • Both Die from a drunk driver • 1st on the scene see one laying dead in pool of blood other laying in a pool of blood but squirting from the neck • Civil Case – preponderance Uniform Simultaneous Death Act • The second spouse survived the first by 120 hours = 5 days • Look at the burden of proof and statutory provision • 2 pages on this issue • CA – CA has different survival requirements dependent upon the different type of property. o non probate (b/c has a written instrument) § 21000 – any time you see in the 21 hundred series it applies to non probate and probate testate and that is why the terminology changes to (transferor, transferee) Survive by a mil second Clear and Convincing • If the written instrument does not require longer o probate – testate (b/c has a written instrument) § 21000 – any time you see in the 21 hundred series it applies to non probate and probate testate and that is why the terminology changes to (transferor, transferee) Survive by a mil second Clear and Convincing • If the written instrument does not require longer o probate – intestate Clear and Convincing by 120 hours Did the Person Actually Survive • Did they legally survive • Type of property and terms of the written instrument o non probate (b/c has a written instrument) § 21000 – any time you see in the 21 hundred series it applies to non probate and probate testate and that is why the terminology changes to (transferor, transferee) Survive by a mil second Clear and Convincing • If the written instrument does not require longer o probate – testate (b/c has a written instrument) § 21000 – any time you see in the 21 hundred series it applies to non probate and probate testate and that is why the terminology changes to (transferor, transferee) Survive by a mil second Clear and Convincing • If the written instrument does not require longer o probate – intestate Clear and Convincing by 120 hours 7. Assume A, B, C, D, H and I die before the decedent, who dies intestate. Who takes the decedent’s property? Per Stirpes: a. Per Stirpes b. Per Capita c. Modern Trend (per capita for each generation) 1. What is the 1st step you have to think of – 1. At which tier do we make our first division 2. At which tier do we have a live taker a. 2nd tier and then how many shares does each taker get b. We give everyone a share who is alive or dead but survived by issue c. How are those shares going to drop – D’s shares will drop either by i. Blood Line ii. Pool Shares and drop by survival d. Under Per Stirpes 1. 1st tier always (dead and alive get the same amount of shares) 2. Blood Line e. Under Per Capita 1. 1st teir were there is a live taker 2. Blood Line f. Under Per Capita 1. 1st teir were there is a live take 2. Pooling Decedent A B -Sp C D E G H I R S T V W X DEFENETIONS • Spouse • Co Habitants • Domestic Partner – Registered Domestic Partner • If Living Together – Assume not married not domestic Partner • Marriage – When go through marriage ceremony • Marriage Ends – When final document is Filed • Survival Doctrine o Non Probate – By Clear and Convincing Evidence – survived by a mila second OR until expressed survival Requirement o Probate – Testate By Clear and Convincing Evidence – survived by a mila second o Probate – Intestate Issues Equally Approaches to Distribution • Per Stirpes o Where 1st Die – Which Tier o How Many # Shares divide into at that tier 1 share each party tier Alive 1 share…..dead but survived by issue o How do we treat the dropping Share • Per Capita • Per Capita Each Generation Under Per Stirpes • Divide at first tier (dead* or alive) o Dead* but survived by issue • Blood Line Per Capita • 1st tier a live taker • Blood Line Per Capital Each Gen • 1st Tier Live Taker • Pooling (add and divide equally) ISSUE EQUALLY **** 3 approaches (CA is Per Capita) • This is the default approach for CA but the written instrument could have adequate expression of intent Per Stirpes Per Capita Per Capita Each Gen Where do we divide 1st Tier Always 1st Tier Live Taker Each Gen 1st Live Taker How Many Shares do we divide at that Tier 1 share for Alive, or Dead but survived by issue 1 share for Alive, or Dead but survived by issue 1 share for Alive, or Dead but survived by issue How do we treat the Dropping Shares Blood Line Bloodline Pooling • I leave all my property to my issue by representation (“by representation”) or by right of representation is associated by which approach • In CA by Representation goes with Per Stirpes • Therefore if you said Per Capita “by representation” NEXT OF KIN • Is going up and out • Collateral Relatives • Two Basic Approaches o Parentelic – Who is the parent from this line of issue Issue of Parents GP/Issue of Grand Parents o Degree of Relationship (CA is degree of relationship) Non Probate (for Test) • CA material Surviving Spouse (under the micro scope) Equally • Per Stirpes • Per Capita (CA) but need to know b/c • Per Capita per generation Next of Kin (2 approaches) • Degree of Relationship (least degrees of relationship takes) o Count the number of steps between decedents and closest live taker • Parentelic (lines of takers) o Pairs of Parents and Children (closet line) How do you qualify as an Issue • Predecedent Issue • Child is directly below decedent • Issue – multiple levels below decedent o You can be an issue with multiple parent /child relationship Parent Child Relationship • Father and Mother • Common Law o Natural Mother contributes the egg o The natural father contributes the sperm • From a social prospective we would like the father and mother to be husband and wife Assuming a woman give birth while married – then just assume the mother that gives birth is the natural mother • If natural mother gives birth while married -> virtually irrebutable presumption that the husband is the father (only the husband can challenge and within a short period of time) • A child can inherit Full inheritance rights • From and through the other party • Right to inherit from me • Right to inherit through me • Once parent child relationship child can inherit from and through Ways to Establish Parent Child Relationship • Natural o Married – Virtually irrebutable presumption o Not Married NP(mother) – presumed b/c birth NP(father) – • Court order during father’s lifetime (preponderance) • Fathers acknowledgement (during lifetime) clear and convincing • (clear and convincing) post death Before the arrow up will occur • Natural parent or relative of parent (acknowledge) & • Support that child • Adoption (paradigm situation) o 2 parents adopt a baby child (this is the typical situation) o Where using an “anonymous sperm donor” (one parent legally) o Where using a turkey baster (two legally obligated parents) o Inside out condom – (two legally obligated parents) • Step Parent ADOPTION • Natural Parents (assuming married) – as soon as the child is born inheritance right from and through both directions o As soon as that child is legally adopted o Adoption parents step in the shoes of the Natural Parents – inheritance rights from and through in both directions o What happens to natural parents rights – generally natural parents rights are fully severed between the natural parents and the adoption (common law) CA Rule -• Post Death Adoption – Pete and Gerri both die survived by child -> Mcdurment and his wife adopt P and G’s 4 kids • Not the traditional example – • Who should get your property when you die -> Who you want should get it -> presumed intent arising from a legally recognized relationship. • B/C involuntary act and there was a relationship o We severe the arrows up but not the arrows down o If the adoption is post death of (natural parents – one or both) o The child had to live with the natural parent (b/c the meaningful relationship test • The Step Parent Adoption Scenario o When natural parents are married – full inheritance rights in both direction o Gerri leaves Peter and marry’s Cupp o Cup wants to adopt all four kids The natural parents have to consent – for Cupp to be able to adop The moment he adopts full inheritance rights are established 1 adopting parent (step parent scenario) (has to be married to one of the natural parents • Adoption is by a step parent (have to be married to one of the natural parents) • The child lived with the natural parent in question • Then we cut the arrow up but not the arrow down HW Skim – Chapter 2 pg skim 59 – 126 (skip UPC completely) (1 case read carefully O’neil case) PG 62 • You do not qualify as an heir until the time of death and they meet the survival requirement • While mother is still alive (I am an heir apparent) o Expectancy • Do I have a right to share in the estate of your parents ( • Technically expectenc Expectancies • There is no property interest in an expectancy. An heir must meet the survival requirement to qualify as an heir, and even then the decedent may have defeated the expectancy by transferring the property inter vivos or by executing a will that otherwise disposes of the property. • Transferability: general rule is that an expectancy cannot be transferred because it is not a property interest. o Exception: when an heir apparent contracts to transfer an expectancy for valuable consideration, a court may enforce the agreement in equity if it is fair and reasonable under the circumstances. ANUS v. TARASEWICZ 135 Ill. App.3d 936, 482 N.E.2d 418 (1985) CASE: This appeal arose from a declaratory judgment action over the survival of a spouse. FACTS: • Stanley and Theresa Janus were recently married. They unknowingly ingested Tylenol capsules laced with cyanide from the very same bottle that had killed Stanley's brother earlier in the day. • Stanley collapsed immediately and within minutes Theresa experienced seizures. They were immediately taken to the hospital where Stanley who had no blood pressure, pulse, or signs of respiration was pronounced dead on September 29, 1982. • Hospital personnel were able to get Theresa's heart beating again and were able to detect some blood pressure. She was placed in the intensive care ward. On September 30, 1982, various tests were conducted and as a result Theresa was pronounced dead on October 1, 1982. • The proceeds of Stanley's life insurance policy was paid to the administrator of Theresa's estate because she survived Stanley according to the medical records. Theresa's father, Jan Tarasewicz (D) then received the life insurance proceeds as Theresa's heir. Alojza Janus (P), Stanley's mother and the contingent beneficiary on the life insurance policy, sued D for the proceeds. The court concluded that Theresa survived Stanley. P appealed; there was not sufficient evidence to prove that both victims did not suffer brain death prior to their arrival at the hospital. ISSUE: • Are legal death determinations to be made in accordance with the usual and customary standards of medical practice? RULE OF LAW: • Legal death determinations must be made in accordance with the usual and customary standards of medical practice. • Where there is irreversible cessation of brain activity (modern) • Where there is irreversible cessation of vital sign pulse (classic) o CA – will be opposite b/c of recapture doctrine HOLDING AND DECISION: (O'Connor, J.) • Are legal death determinations to be made in accordance with the usual and customary standards of medical practice? Yes. • Legal death determinations must be made in accordance with the usual and customary standards of medical practice. In cases where the death process is monitored by medical professionals, their testimony as to the usual and customary standards of medical practice will be highly relevant when considering what constitutes a positive sign of life and what constitutes a criteria for determining death. • Both parties arrived at the hospital with artificial respirators and no obvious vital signs. There is no dispute that Stanley Janus died in both a cardiopulmonary sense and a brain death sense when his vital signs disappeared on route to the hospital and were never reestablished. • However, hospital personnel were able to reestablish a spontaneous blood pressure and pulse in Theresa that did not have to be artificially maintained by a pacemaker or medication. In the medical director's opinion, Theresa's condition did not warrant a diagnosis of brain death, and she did not suffer irreversible brain death until much later. From the evidence presented it can only be concluded that the treating physician's diagnoses of death with respect to these unfortunate victims was made within the usual and customary standards of medical practice and that the trial court's findings was not against the manifest weight of the evidence. Affirmed. LEGAL ANALYSIS: • The problem in determining death under medical standards is as was stated by the court and in other opinions the advancement of medical science. This is one of the few and extremely rare opinions that effectively takes into account advancements in technology. Negative Disinheritance • Disinherit daughter b/c taken up with Cupp • “Daughter doesn’t get a penny” that is all it says but I haven’t disposed of property Half Blood /Whole Blood • CL – Whole Blood and Half Blood Take Differently • MT -Whole Blood and Half Blood Take Same • CA = MT -> Whole Blood and Half Blood Take the Same THE FIRST ESSENTIAL OF A CONTRACT FOR ADOPTION IS THAT IT BE MADE BETWEEN PERSONS COMPETENT TO CONTRACT FOR THE DISPOSITION OF THE CHILD O'Neal v. Wilkes ("Adopted" Child) v. (Decedent's Administrator) Instant Facts • A child was denied intestate inheritance from her "adoptive" father's estate because her aunt had no authority to contract for her adoption. Black Letter Rule • A relationship less than that of legal guardian will not give one the authority to enter into an adoption contract, and any such contract is thus invalid. ISSlie: • Was there a valid contract to adopt O'Neal (P), such that she is entitled to inherit Cook's estate property? NO Facts: • Hattie O'Neal (P) was born out of wedlock [gasp!] and raised by her mother, Bessie Broughton, until her mother's death eight years later. At no time did O'Neal's (P) biological father recognize O'Neal (P) as his daughter, take any action to legitimize her, or provide support to her or her mother [a fine, upstanding fellow!]. • When O'Neal (P) was twelve years old, her maternal aunt, with whom she was living, surrendered physical custody to a woman named Louise who wanted a daughter. Shortly thereafter, Louise determined she could not care for O'Neal (P) and took her to the home of Estelle Page, the sister of O'Neal's (P) biological father. After a short time with Page, Roswell Cook and his wife, wanting a daughter, came to pick up O'Neal. • Although O'Neal (P) was never statutorily adopted by Cook, he raised her and provided for her education and she resided with him until she married. While she never took the last name of Cook, he referred to her as his daughter and, later, identified her children as his grandchildren. • When Cook died intestate, Firmon Wilkes (D), the appointed administrator of Cook's estate, refused to recognize O'Neal's (P) asserted interest in the estate. O'Neal (P) filed a petition in equity asking the court to declare a virtual adoption, thereby entitling her to the estate property she would have inherited if she were Cook's statutorily adopted child. A jury found for O'Neal (P), but on post-trial motions the court granted a judgment notwithstanding the verdict to Wilkes (D), on the ground that the paternal aunt who allegedly entered into the adoption contract with Cook had no legal authority to do so. Decision and Rationale: (Fletcher, J.) No. • The first essential of a contract for adoption is that it be made between persons competent to contract for the disposition of the child. The only issue on this appeal is whether the court correctly determined that Page was without authority to contract for O'Neal's (P) adoption. As a preliminary matter, we agree with O'Neal (P) that although her biological father was living at the time the adoption contract was allegedly entered into, his consent to the contract was not necessary as he never recognized or legitimized her or provided for her support in any manner. • What is less clear are the rights and obligations acquired by Page by virtue of her physical custody of O'Neal (P) after her mother's death. 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, such as a child's parent or guardian. • After O'Neal's (P) mother died, no guardianship petition was filed by her relatives. Neither was there any evidence that any person petitioned to be appointed as her legal custodian. Accordingly, the obligation to care and provide for O'Neal (P), undertaken first by her aunt, and later by Page, was not a legal obligation but a familial obligation resulting in a custodial relationship properly characterized as something less than that of a legal custodian. Such a relationship carried with it no authority to contract for O'Neal's (P) adoption. • We therefore conclude that Page had no authority to enter into the adoption contract with Cook and the contract, therefore, was invalid. Because O'Neal's (P) relatives did not have the legal authority to enter into a contract for her adoption, their alleged ratification of the adoption contract was of no legal effect and the court did not err in granting a judgment notwithstanding the verdict in favor of Wilkes (D). Judgment affirmed. Dissent: (Sears, J.) • I would hold that where a child has fully performed the alleged contract over the course of many years or a lifetime and can sufficiently establish the existence of the contract to adopt, equity should enforce the contract over the objection of the adopting parents' heirs that the contract is unenforceable because the person who consented to the adoption did not have the legal authority to do so. I dissent. Analysis: • The dissent is a better reasoned opinion in this case, and it arrives at the preferable and more equitable result. To hold that the contract is unenforceable after the child has performed is to permit a virtual fraud upon the child and should not be approved in equity. • Equity does not permit such action with regard to contracts that are initially unenforceable because they violate the statute of frauds, but instead recognizes that the full performance of the contract negates its initial unenforceability and renders it enforceable in equity. • Additionally, the purpose of requiring consent by a person with the legal authority to consent to an adoption, where such a person exists, is to protect that person, the child, and the adopting parents. However, as equitable adoptions cases do not arise until the death of the adopting parents, the interests of the person with the right to consent to adopt and of the adopting parents are not in jeopardy. • On the other hand, the interests of the child are unfairly and inequitably harmed by insisting upon the requirement that a person with the consent to adopt had to have been a party to the contract. • That this legal requirement is held against the child is particularly inequitable because the child, the course of whose life is forever changed by such contracts, was unable to act to insure the validity of the contract when the contract was made. • Furthermore, where there is no person with the legal authority to consent to the adoption, such as in the present case, the only reason to insist that a person be appointed the child's legal guardian before agreeing to the contract to adopt would be for the protection of the child. Yet, by insisting upon this requirement after the adopting parents' deaths, this Court is harming the very person that the requirement would protect. • For all the foregoing reasons, equity ought to intervene on the child's behalf in these types of cases, and require the performance of the contract if it is sufficiently proven.: