WILLS HOW TO MAKE THEM TESTATOR ISSUES (INTENT) General Capacity at Time of Execution (lowest capacity recognized in law) Elements: Must be 18 years of age Able to understand the extent of his property Must know natural objects of his bounty Must understand the nature of the testamentary act Consequences of lack of capacity = entire Will is invalid Insane Delusion An insane delusion is a delusion which the testator adheres when a rational person in his situation could not have drawn the same conclusion reached by the testator. Elements: False Belief Product of a sick mind Not even a scintilla of evidence to support the belief b/c then not insane Affected the disposition in the Will as proven by the person saying T is insane Consequences of an Insane Delusion Under the Code = Will invalid Case law = Only the affected portion is invalid Fraud Fraud in the Execution Forgery Testator signs testamentary document believing it to be non-testamentary Extrinsic evidence & proof of this fraud is allowed into court Consequences of fraud in the execution = entire Will is invalid Fraud in the Inducement: Representation of a material fact for purposes of inducing action or inaction, known to be false by the wrongdoer which induces the action or inaction. Wrongdoer’s misrepresentation affects disposition Extrinsic evidence & proof of this fraud is allowed into court Consequences of fraud in the inducement = only affected part of Will is invalid Remedies can include constructive trust if necessary Undue Influence: Testator’s free agency (free will) is subjugated or dominated and Testator substitutes another person’s will for that of his own. Prima Facie case Testator is Susceptible to Influence (and is actually influenced) Wrongdoer’s active participation (opportunity to influence) Wrongdoer benefits, directly or indirectly Unnatural disposition of testator’s property Presumption of undue influence arises if: The beneficiary was in a Confidential relationship with the testator Confidential relationship defined very broadly for purposes here = testator must just rely in confidence on this person (astrologer, mistress) and doesn’t need to be an established confidential relationship such as attorney-client/doctor-patient, etc., but those traditional relationships are definitely included in this broad definition. Wrongdoer’s active participation in the execution of the will Wrongdoer benefits directly or indirectly Unnatural disposition of testator’s property Consequence of undue influence = invalidates only affected portion Mistake (can use extrinsic evidence to prove the mistake) Mistake in Content: accidentally in the drafting of the will, a gift is left out or left in Accidental omission – no relief when something left out of the will Accidental addition – strike out accidental term Mistake in Execution Signing the wrong will or the wrong document and since the wrong document it will not be probated Exception: Reciporical wills: H accidentally signs her will and W accidentally signs his will. The wills are just the same and when each accidentally signs the other, it is treated as though each signed them both and both are probated w/ no problem. Mistake in the Inducement: erroneous belief of some fact/belief No relief unless mistake and true intent (what T would have done if the mistake did not happen) appears on face of Will Mistake in Description (ambiguity) Admit extrinsic evidence (most any that is relevant) of the circumstances under which the will was made to show what the testator meant by the words used. DRR: mistake in validity of subsequent testamentary disposition Applies when testator revokes his will upon the mistaken belief that another disposition of the property is effective, and but for this mistake, would not have revoked the will. In CA, DRR applies to revocations by physical act and subsequent instrument (even if it contains an express revocation clause.) If the other disposition fails, the revocation is set aside, and the original will remains in force. When considering when to apply DRR remember: One needs a validly executed alternative disposition (or else ineffective = no DRR) The alternative disposition must be ineffective, and If the revocation is by subsequent instrument, EE is not admissible to show the mistake Pretermission If a T writes a will and after writing the will, marries or has a child, and never writes a new will or republishes the will, then spouse and child is pretermitted. Therefore, pretermitted spouses/children statutes allow for these people to take anyway and kids get to take their full intestate share and spouses get their statutory share (at least 50% of deceased spouse’s SP and other intestate share). An exception to pretermitted kids: If decedent executed a will and then died and never knew that he had another kid (so didn’t care for kid) or though that kid was dead, the child the decedent was unaware of can take. The child would receive a share equal to her intestacy share if decedent would have died w/o a will. DOCUMENT ISSUES Formalities of Execution (witnessed Wills) Elements There must be a writing Signed by T anywhere T signs or acknowledges signature or Will in presence of 2 witnesses both present at the same time Sight presence: witnesses actually SEE testator sign or acknowledge will Conscious presence (hearing distance): in vicinity of will signing Witnesses knew it was T’s Will Interested Witness (left something in will): Rebuttable presumption that interested witness only takes lesser of bequest in Will or what she would have taken if Will never written Exceptions and interested witness takes whatever given to him/her in will if: Two other non-interested witnesses, or Witness/beneficiary only takes as a fiduciary (trustee) Incorporation by Reference: any separate document may be incorporated into the will by reference if the document is in existence at the date of the will, clearly described in the will, and proven to be the document described in the will. Elements: Writing: In existence Clearly identified T intended to incorporate If documents aren’t in existence when execute will, but later write documents and then republish the will, that is ok b/c documents in existence at time of republishing. A properly executed codicil usually incorporates by reference a prior defective will, thereby validating that instrument. Acts of Independent Significance: “blanks” in a will can be filled in by referring to acts or documents executed during the testator’s life primarily for non-testamentary motives. Who a beneficiary is or what gift is made can be given meaning (explained) by facts that have significance independent of the T’s Will Pour Over Wills (PBQ-1) Incorporation by Reference: the document must be in existence at the time incorporated trust must be in existence when execute will and will must clearly refer to it and then will “pours over” into the trust Independent Legal Significance Properly funded trust other than pour over: trust has independent significance If not funded other than pour over: then no independent significance Uniform Additions to Testamentary Trusts: (Cal. Probate Code § 6300): Valid trust at time Will is executed (even if not funded) can result in property pouring out to whomever is designated on day of testator’s death PBQ-1: Pour Over Wills On 1/1/96, S executed a trust agreement transferring property to T in trust for X and Y. He expressly reserved the power to revoke or modify the trust by instrument in writing. On July 1, 1986, S executed a will in which he disposed of the residue of his estate as follows: “ . . . to T in trust for each persons and such purposes as are stated in the trust agreement executed by me to T on 1/1/1986.” On 9/1/1986, S executed an instrument in writing to T in which he modified the trust by removing Y as a beneficiary and substituting Z therefor. In Oct, 1986, S died. After probate of the will, S’s executor filed a petition for instructions to determine if he could validly pay over the residue to T, and if so, whether T must qualify as testamentary trustee. T intervened to determine whether any money paid over by the executor should be held in trust for A and Y or for X and Z. Incorp by reference of trust into will? It could happen but when he changed the trust and never republished the will, the only thing that could be incorp is the unamended trust and this doesn’t fulfill the Testator’s intent so try acts of independent significance. Can ascertain beneficiaries if acts are independent of the will and can be sued here b/c IV has sufficient significance apart from its impact on the will (trust already funded before death, so AIS). Under CA, UTATA was adopted and if there is a valid trust at the time will is executed (even if not funded) then will can pour over and trust as it is at the time of Testator’s death is valid and the beneficiaries indicated on this day take w/o any problem. HOLOGRAPHIC WILLS Elements Permitted in CA if the signature and the material provisions (who and what) of the will are in the testator’s own handwriting. Testamentary intent in T’s hand or preprinted or proven by extrinsic evidence Dates: CA does not require the date on the holographic but could cause problems: Inconsistent Wills: if two wills, one written and one holographic w/ no date, the written Will prevails if two holographic wills w/ no date, consistent provisions b/t the two holographic wills will be probated and inconsistent provisions are not probated Capacity Problems if it is established that the testator lacked testamentary capacity at any time during which the will might have been executed (no date so don’t know when that was) the will is invalid UNLESS established will was executed at a time that Testator had such capacity CHOICE OF LAW: WILL VALID IF IT COMPLIES WITH Will Valid if it Complies with: CA LAW, or Laws of Estate Where Executed, or Laws of State Where Domiciled CODICILS: modification or amendment to a pre-existing will Must Comply With Statute of Wills (intent, writing, signed, etc) Holographic codicils are valid No Automatic Republishing; however, usually it is Use incorporation by reference Rebuttable Presumption Cumulative: IF you have one will, and another codicil, each giving A 100 and then other one giving A 1000, A gets 1100 b/c gifts are cumulative. Revocation of Codicil Does not Revoke will nor does revocation of Will automatically revoke codicil unless codicil is a modification on will and only exists b/c of the underlying will, then all would be revoked. Distribution of the Estate After Acquired Property Passes: If transferor intended specific gift of stock rather than value of the stock, the B gets as much of the stock that T’s estate has at time of death any stock that T owned b/c the company split or merged or took some sort of action which increased or decreased stock for T (except giving T purchasing options b/c then not an action by company) Dividends prior to death and not specifically given are not part of the stock gift. Who Can Take Posthumous Children Take Child born, no more than 9 months after the testator dies, can take Relatives of the decedent conceived before the decedent’s death but born thereafter inherit as if they had been born in the lifetime of the decedent. Lapse and Anti-Lapse Lapse: Dead people can’t inherit from the testator. So, if a beneficiary predeceases the Testator, that beneficiary loses their interest and their interest lapses b/c they died first. Anti-Lapse: Interest of a predeceased beneficiary does not lapse if they were a blood relation of the testator or the testator’s spouse (gift is saved). Beneficiary’s estate receives the gift/devise. The spouse is never covered by the anti-lapse statute. If the spouse predeceases the testator, the spouse’s gift lapses b/c spouse is not a blood relative of the testator nor a blood relative of herself. Simultaneous Death Modernly/CA: Depends on if or NP or Testate or Intestate: Testate/Non-Probate: §21109: Need to prove with clear and convincing evidence unless written instrument says otherwise that SS survived longer than Decedent in order for SS to take Intestate: §6403: SS needs to survive 120 hours (5 days) longer than Decedent in order for SS to take otherwise presumed to have predeceased Decedent. BOP = Prove by clear and convincing evidence that SS survived for 120 hours longer If BOP not met, the property of each person shall be distributed as if that person had predeceased the other This section DOES NOT apply if failure to meet 120 hour requirement would result in property escheating to the state OR person in question died before 1/1/90. Classification of Gifts Specific Gifts: “my diamond ring;” General Gifts: money, stock, etc Demonstrative Gifts: hybrid gifts b/c part is specific and part is general Bank account in which T gives to A the exact amount in a specifically named bank: if not that much money in the account when T dies, then courts use other moneys to give A the exact amount devised to A The amount in the account is specific and amount used to make it that right amount is general Residuary: remaining gifts go to this Abatement: Gifts by will are reduced (abated) when the estate is not sufficient to pay all debts and legacies. Omitted spouse or child: you take away the same amount from all other devisees at the same time in order to be able to pay the pertermitted spouse or child their share Exception: if purpose of the gift would be defeated by making the devisee abate his gift in order to make up for an omitted child, that devisee does not have to give up the gift and other devisees will have to make up for it To pay debts ABATEMENT FOR LAST DEBTS OF THE DECEDENT Directions in the Will Intestate Property Residue General Gifts to Non-relatives General Gifts to Non-Relatives Genwral Gifts to Relatives Specific Gifts to Non-relatives Specific Gifts to Relatives Exoneration: extinguishment of encumbrances No automatic exoneration; devises are passed subject to any liens existing on the property when the testator dies RESTRICTION IN DISTRIBUTION Spousal Protection: T can will away only ½ of the community and quasi-community property b/c T only owns ½ of that property Community Property Quasi-Community Property: defined for wills purposes as all real property located in CA, as well as all personal property wherever it may be located that would have been CP if it had been acquired while domiciled in CA Illusory Transfers: If spouse gives away property on condition that the spouse retains a LE, this is deemed an illusory transfer. a) Courts say that the spouse dies owning it and did not give it away w/ a LE and thus the spouse can only will away ½ b/c other spouse owns ½. Waiver a) Spouse may execute a waiver of the right to receive property or benefits from the other spouse’s estate. These rights may be waived before or during marriage. Widow’s election Putting SS to an election: picking to take under the will or deciding to enforce the SS’s CP rights. Can’t do both so either take under will and forgo and CP rights in any property, or take CP rights and don’t take under the will. Unworthy Heir (devisee who has killed the testator or another devisee who would inherit) One who feloniously and intentionally killed testator/intestate can’t inherit Must kill w/ both feloniously and intentionally in order to not take If found guilty of invol. manslaughter, not intentionally but if contesting the inheritance, can go into civil court which has a lower burden and establish that the person did kill intentionally and feloniously Anti-Lapse statute doesn’t apply No Limitations on Gifts to Charities HOW TO BREAK THEM REVOCATION BY PHYSICAL, ACT OR INSTRUMENT Revocation by Physical Act Elements: Burned, torn, canceled, destroyed Simultaneous intent to revoke Cancellation by interlineation Crosses out gift to B of 500 and writes in gift of 10k. Gift is not valid b/c change is not witnesses and done w/ will formalities. Can’t probate the 10k and T scratched out the 500 so what does B get, the court will apply DRR. Revoked 500 b/c thought could give 10k and since made a mistake the original applies so B gets 500. If the opposite was true and crossed out 10k and gave 500, won’t use DRR for such decreases b/c no evidence of his intent that T really wanted B to have 10k in the first place. Revocation by Later Written Instrument Revocation can be express or by implication (if later will makes an inconsistent disposition, then the later executed will controls) Revival of a previous will is not automatic unless document executed by formalities states as such REVOCATION BY OPERATION OF LAW The omitted child will not take if any of the following occur: Decedent parent’s failure to provide for the child was intentional and such intent is apparent from will Decedent had one or more children and devised or otherwise directed the disposition of substantially all the estate to the other parent, therefore the other parent is impressed with the duty to care for the kids so child doesn’t need money to take care of him or her self. Decedent parent gave kid something by means other than through the will and the transfer was to be in place of getting something under the will and such intention can be shown by decedent’s statements, amount of the transfer, or by other evidence. The surviving spouse, not provided for in the decedent spouses’, will not take if any of the following occur: Decedent’s failure to provide for spouse in the will was intentional and such intention is apparent from the will Decedent provided for spouse by a transfer other than his will and decedent intended that the transfer be in lieu of receiving anything under the will and such intent is shown by decedent’s statements, from the amount of the transfer, or by other evidence. Spouse made a valid agreement waiving the right to share in decedent’s estate before or during the marriage, and either: Full and fair disclosure of finances with independent counsel, or Waiving spouse knew or should have known T’s finances, or There was a settlement which was actually fair Dissolution of Marriage If a marriage dissolves, any gifts to ex-spouse in the will are void. If the couple get back together and will is not changed, then the provision is revived and that spouse would take under the will. REVOCATION BY CHANGE IN HOLDINGS Ademption by Extinction: Gifts do not automatically fail by extinction; establishing the testator’s intent is crucial. Can’t inherit what doesn’t exist, so if T gives A BA in the will but later sells BA, A can’t get BA b/c T no longer owns it If sold BA and w/ that money bought stock, than that stock would go to A b/c it shows an intent to keep the value of BA together as one gift. Ademption By Satisfaction or Advancement (IV down payment made by T to the beneficiary) Property transferred by T to B during T’s lifetime is satisfaction of the gift in the will if any of the following occur: will provides that subtract life gift from the gift in the will OR T declares in a contemporaneous writing that the transfer is to be deducted from testamentary gift or is in satisfaction thereof OR Transferee acknowledges in writing that the gift is in satisfaction of the testamentary gift. Valuation: If life time gift is in satisfaction of death gift, property given during life is valued at the time beneficiary got it or at time of T’s death, whichever happened first. If there is a contemporaneous writing by Transferor or Transferee that states the value, that is the value of the property. CONTRACTS TO NOT REVOKE OR TO MAKE A WILL Contract Law Controls Contracts to make, not to make, or not to revoke, wills are controlled by contract law and not the laws of will. Formalities Contracts to make, not to make, or not to revoke or to die intestate must be in writing. Such contracts can be established by: Contract mentioned in Will Extrinsic writing alone but must comply with Statute of Frauds Remedies: No cause of action until T’s death unless irreparable injury Specific Performance of the contract Breach of Contract against the T’s estate Constructive Trust imposed on the testator’s beneficiaries INTESTATE SUCCESSION SURVIVING SPOUSE Takes 100% of Community and quasi-community property Decedent’s share of CP and QCP passes to the SS; the other ½ of CP and QCP already belongs to SS Separate Property of Deceased Spouse takes 100% if decedent left no issue, no parents nor issue of parents Divide 50/50 if decedent left child or surviving issue of child If decedent left more than 1 child or surviving issue, then spouse takes 1/3 w/ remaining 2/3 divided among children or their surviving issue Divide 50/50 if no issue but surviving parent or surviving issue of parent ALL OTHERS INTESTATE SUCCESSION FOR OTHERS (NOT SPOUSE) Issue of Decedent Parents of Decedent Issue of Parents Grandparents Issue of Grandparents Issue of Predeceased Spouse Next of Kin Parents of Predeceased Spouse Issue of Parents of Predeceased Spouse Eschaets to State PER CAPITA VERSUS PER STIRPES Per Stirpes and by representation are synonyms HOW DOES AN ISSUE TAKE?: Issues take equally. Issues’ spouses are not entitled to take. If one is related through two blood lines, they still only get one single share. (§6413) ISSUE TAKING ANALYSIS: Where (which tier) do you make your first division? How many shares will the property be divided into? How are we going to treat dropping shares? Three distribution analysis: When one of several children has died before D, leaving kids of their own, the descendants of D’s dead child REPRESENT the dead child, and divide that child’s shares among themselves. Per Stirpes: Make first division in first tier ALWAYS: whether there are issues alive or not One share for each live person and one share for each dead person survived by issue Shares drop by blood line: dead person’s share goes to their surviving issues and all issue split it if more than one issue of dead person Per Capita: CA §240: This is the default approach if one doesn’t positively express how they would like distribution to be made. Individuals can opt out of default by using §§245-47 of the Probate Code. Make first division at the first tier where there is a live taker One share for each live person and one share for each dead person survived by issue Shares drop by blood line: dead person’s share goes to their surviving issues and all issues split it if more than one issue of dead person Per Capita Each Generation: Make first division at the first tier where there is a live taker One share for each live person and one share for each dead person survived by issue Shares are dropped to the next tier and pooled and split equally b/t all eligible takers. Any issues, in the last tier, with surviving parents would not share in pooling. CHILDREN BORN OUT OF WEDLOCK Non-marital children inherit from and through their mother, but in many states not from their father unless paternity is established by one of the following: subsequent marriage of the parents an adjudication of paternity during the father’s lifetime, or clear and convincing proof of paternity after the father’s death The Probate Code provides for inheritance rights where there is a parent-child relationship. To establish a parent-child relationship: acknowledge the child (hold it out as their own), AND contribute to the support or care of child, or a court decree establishing paternity, or father marrying mother 1 10