Wills, Trusts, Estates Outline – Fall 2015 (Prof.

Crawford)

Session #1 – Introduction

Chp. 1 Intro: Freedom of Disposition (“FoD”)

 W&T law = “law of gratuitous transfers”  focus on “SUCCESSION” [passing prop @ death]
 Am law of W&Ts built on principle of “Freedom of Disposition”
o Embraces “dead-hand control” to unique extent, though some limits exist
 Rule v. Perpetuities  No interest is good unless it must vest or fail not later
than 21yrs after death of some “life-in being” @ creation of the interest
 Spousal & Creditor Rights  Can’t disinherit spouse; Creditors can override will
if have certain debts
 Restraints on Alienation & Marriage  can’t say you get X if you divorce Y
 Provisions Encouraging Illegal Activity
 Impermissible Categorical Provisions (ex: race)

(A) Power to Transmit Prop @ Death

 “SUCCESSION” = law of wills, law of intestacy, law of trusts, law of charitable foundations, law
concerning “death taxes” and some aspects of future interests
 USA allows “dead-hand control” to extent:
o Simplest form, done through “WILL”
 If follow certain formalities, you get to specify who gets what when you die
o If no will, “INTESTATE SUCCESSION”
 Estate plan by default

(1) “FoD & Dead-Hand Control”

 Under USA law, FoD @ death subject only to wealth transfer taxation & some policy limits
 No limits based on interests of expectant beneficiary (“B”) in receiving future inheritance –
donee’s interest in future inheritance is mere expectancy derived from donor’s right to
dispose of his prop as pleases and that’s disposable @ his whim
 Restatement 3d of Prop: Wills & Other Donative Transfers § 10.1:
o Organizing principle of Am law of donative transfers = FoD
o Cts don’t have general authority to Q wisdom, fairness, REAness of donor’s decisions
abt how to allocate prop – law’s function in this area is to facilitate, not regulate

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 o Law can only restrict FoD as relates to [above 5 categories]
 Restatement 3d of Trusts § 29 cmt. 1 (“balancing test”):
o In reckoning what transfers are v. public policy, cts should balance DONOR’s FoD “v.
other social values and the effects of dead-hand control on subsequent conduct or
person freedoms of others … [I]f a provision is unnecessarily punitive or unREAly
intrusive into significant personal decisions or interests … provision may be invalid.”

(2) “Justifying FoD”

a) Donor’s Prerogative
 Rationales for FoD  (i) Notion that testator’s have natural right to bequeath – having
created the wealth, can do what you want with it; (ii) Creates incentive to industry and save $
- people derive satisfaction from bequeathing prop to others & law’s restriction of such
decreases subjective value of prop; (iii) Encourages DONEES to take care of DONORS; (iv)
‘Father Knows Best’ Hypothesis – permits intelligent estate planning by allowing T to take into
acct all diff needs of family members; (v) Political Preferences – accords w/ general human
wishes
 FoD & Alternatives:
o Forced Succession  followed in most countries whereby D’s prop could pass by rule
of mandatory or forced succession [ex: primogeniture, to spouse, to kids/dependents]
o FoD  followed in USA, whereby prop passes in accord w/ D’s declared wishes if such
REAly preserved
o Confiscation by State  failed USSR experiment, whereby D’s property could be
confiscated by state upon death
 Most powerful argument v. FoD  concentrates economic wealth and perpetuates social
class inequality

Session #2 – FoD (cont.) & Intestacy

(B) Mechanics of Succession

(1) “Probate & Non-Probate Property”
 All of D’s prop @ death divided into 2 categories:
o Probate = prop that passes through probate process under D’s will or by intestacy
o Non-Probate = prop that passes outside probate process by will-substitute
 B/c of cost & inconvenience of probate process, most prop passes by non-probate transfer:
o Inter Vivos Trust = prop is put in “TRUST” through which “TRUSTEE” holds it for 1+
names Bs & distributes to them in accord w/ trust terms; “TESTAMENTARY TRUST”
created under D’s will passes through probate but prop put in IVT during D’s life
passes according to trust terms & avoids probate

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 o Life Insurance = proceeds from LI policy on D’s life paid by ins comp to Bs named in
insurance K
o Pay-on-Death (POD) & Transfer-on-Death (TOD) = Acct custodian distributes prop to
named Bs when D dies
o Joint-Tenancy = D’s interest dissolves @ death & survivor owns prop free of D’s
participation

(2) “Probate Terminology”

 When person dies & probate necessary, “PERSONAL REP.” appointed to oversee winding up
o Personal Rep = “fiduciary,” who collects & inventories D’s prop, manages & protets
prop during estate admin, processes creditor claims, files tax returns, and distributes
 If D dies “TESTATE” [with a will] and will names person to execute will and admin probate
estate, that personal rep = “EXECUTOR”
o If will doesn’t name EXECUTOR, named EXECUTOR is unwilling, or D dies intestate
[w/o a will], court will name personal rep = “ADMINISTRATOR”
o ADMIN’R usually selected from statutory list - 1) Surviving Spouse; 2) Kids; 3) Parents;
4) Siblings; 5) Creditors [**in this order]

(3) “Probate Administration”

 Core functions of probate:
o Provides evid of transfer of title to new owners, making the prop mktable again
o Protects creditors, giving procedure for debt repayment
o Distributes D’s prop to those intended after creditors paid
 But probate causes lots of COSTS & DELAYS --- **USE I-V-Ts INSTEAD!!!!!

a) Opening Probate & Choice of Law

 Generally, law of state where D domiciled @ death governs disp of personal prop
 Law of state where D’s real prop located governs dispo of that
 Will should first be probated in state D domiciled @ death (“primary jurisd”) and then, if real
prop included in estate that not located in that state, “ancillary probate” in another estate

b) Formal & Informal Probate

 UPC provides for both “NOTICE [FORMAL] PROBATE” & “EX PARTE [INFORMAL] PROBABTE”
o Formal Probate – notice probate w/ litigated judicial determin’n after notice to all
interested parties – become final if not appealed. See UPC § 3-401
o Informal Probate – ex parte probate; if person seeking letters asks for informal
probate, then the validity of the will needn’t be litigated unless someone objects; W/o
giving notice, rep petitions for appointment giving name, address, children , spouse,

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 heirs, etc. Executor swears will is valid. W/in 30 days, rep must mail notice to all
interested parties, including those disinherited in will b/c those people can request
formal probate. See UPC § 3-301; UPC § 3-402
 NY has “FORMAL PROBATE”  must give notice to D’s heirs & creditors – no ex parte proceed
c) Barring Creditors
 Every state has “NON-CLAIM STATUTE” [see UPC § 3-803] that req creditors to file claims w/in
specified time if want to get their due from estate
 Those statutes come in 2 forms:
1) Bar claims not filed w/in short prd of time after probate commences, usually 2-6
mos; OR
2) Bar claims not filed w/in longer period after D’s death, usually 1-5 years
 Under 1) , Cs notified of reqmt to file only by publication in newspaper after probate opens
 Under 2), protection provided after time period has run, whether probate commenced or not
 USSC has held that DP Clause req that known or REAly ascertainable Cs rec actual notice
before barred by statute running @ commencement of proceedings

d) Closing Estate
 Personal Rep expected to complete admin & distribute assets “as promptly as possible”
 Cs must be ID’d and paid  taxes must be paid and tax returns accepted

Chp. 2 Intestacy: An Estate Plan by Default

A. An Estate Plan by Default

 Person dying w/ WILL dies “TESTATE”
o probate prop of D distributed in accord w/ will terms
 Person dying w/o WILL dies “INTESTATE” 
o Distrib of estates gov’d by “default rules of intestacy law”
o If will disposes part of probate estate, result = “PARTIAL INTESTACY” in which probate
prop not disposed of by will passes by intestate
 PRIMARY PURPOSE OF INTESTACY STATUTES = CARRY OUT PROBABLE INTENT OF D , as
determined by views of majority
 Generally, USA intestacy laws favor D’s spouse, then D’s children, then D’s parents, then D’s
collaterals and more remote kindred
o Adoptive kids and those born from reproductive technology are increasingly treated as
= to bloodline relatives.
 Most states DON’T provide for unmarried cohabitating partners or “step-relatives”
 If D doesn’t have surviving relations w/in degree of kinship specified by intestacy statute, D’s
prop “ESCHEATS” to state

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 (1) Applicable Law and UPC
 Generally, law of state where D domiciled @ death governs dispo of D’s personal prop, and
law of state where D’s real prop located governs dispo of that
 Most states base intestacy statutes on UPC
 See UPC § 2-101: Intestate Estate (p. 67)
(a) If no will or will doesn’t cover specific prop, intestacy law governs dispo
(b) In will, D can exclude/limit who takes prop under intestacy law – that prop treated as
if excluded person disclaimed share [who’s next in line?]
 See UPC § 2-102: Share of Spouse (p. 68)
Intestate share of D’s SS is:
(1) Entire estate if:
(A) No descendant or parent of D survives D;
(B) All D’s surv descendants also descendants of SS
(2) First $300K plus ¾ of intestate balance if D has no surviving descendants but a
surviving parent
(3) First $225K plus ½ of intestate balance, if all D’s surviving descendants also
descendants of SS and SS has 1+ surviving descendants not w/ D
(4) First $150K plus ½ intestate balance is 1+ D’s surviving descendants aren’t
descendants of SS
 See UPC § 2-103: Share of Heirs Other than Surviving Spouse (p. 68)
(a) Part of intestate estate not going to SS under above §, or entire estate if no SS, passes in
this order:
(1) D’s descendants by rep
(2) If no surv descendants, to D’s parents equally if both surv or the surv if only 1 surv
(3) If no surv descendants or parents, descendants of D’s parents by rep
(4) If no surv descendant, parent, or descendant of parent, but if survived by 1+
grandparents on both sides or descendants thereof:
(A) ½ to D’s dad-side grandparents, equally if both survive, to surv dad-side
grandparent if just one survives, or descendants of D’s dad’s grandparents by rep
(B) ½ to D’s mom-side grandparents, equally if both survive, to surv mom-side
grandparent if just one survives, or descendants of D’s mom’s grandparents by rep
(5) If no surviving descendant, parent, descendant of parent, but survived by 1+
grandparents on dad’s but not mom’s side, or vice versa, to D’s relatives on side of w/
1+ surviving members in same manner as (4)
(b) If no taker under (a) but D has:
(1) 1 deceased spouse who has 1+ descendants who survive D, estate passes to that
spouse’s descendants by rep; or

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 (2) More than 1 deceased spouse who has 1+ descendants who survive D, = share of
estate or part thereof passes to each set of descendants by rep
 See UPC § 2-105: No-Taker (p. 69)
If no taker, escheats to state

(2) Heirship & Expectancy of Heir Apparent

 No living person has heirs  only have “heirs apparent,” which is a mere expectancy that’s
contingent on their surviving D and defeasible if D makes will in meantime

B. Basic Structure of Intestate Succession

 Two areas of agrm’t among states:
(1) All states, after spouse’s share, descendants take to exclusion of ancestors & collaterals;
(2) Almost all states, intestacy favors only spouses & blood relatives, w/ latter including
adopted persons and assisted reproduction technology products
 Two areas of divergence:
(1) Size of SS’s share & whether
(2) Methods for implementing principle of rep by which descendants of pre-deceased child
take child’s share

1. “Surviving Spouse”

(a) Spouse’s Share

 Most states, SS gets at least ½ of D’s estate – variations among states as to specifics
 Under UPC § 2-102(1), if D’s descendants also SS’s descendants, SS takes entire estate
o (3), (4) – SS gets less if step-kids involved  comes from fear of divided loyalties
 If no kids, ½ of states and UPC say that SS shares w/ D’s parents, if any
 NY Default Rule – spouse gets half – is different from UPC – surviving spouse does not get
everything, instead gets 50% and descendants get 50%

(b) Domesticc Partners & Same Sex Marriage

 Same-sex marriage w/ spousal intestacy rights recognized all over, a la summer 2015

(c) Problems of Simultaneous Death

 Person succeeds to prop of D only if person survives D for instant in time
 Usually joint accounts are split 50/50
 Life ins paid out like neither survived the other

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CASE: Janus v. Tarasewicz (1985)  Tylenol simultaneous deaths
Facts: H and W took bad Tylenol and both got really sick. H pronounced dead w/in 2 hours of
getting to hospital. W had taken pill @ same time and collapsed simultaneously. When brought
to hospital, W was unconscious but had pulse and blood pressure. W was on life-support for 2
days before pronounced dead. H had life-ins policy for $100K, of which W was primary B and
mom was contingent B. Ins comp gave $$ to W’s dad but H’s mom wants it, saying evid not
sufficient to est that W out-survived H.
Ratio Decidendi: H died before W and W’s heirs get $$. Survivorship proven by PPE. Clearly,
efforts to preserve W’s life continued after such efforts for H stopped. W still had brain activity
and a pulse after H dead.

 Case wouldn’t have turned out this way if 1991 UPC revision was in play
o UPC §§ 2-104, 2-702  an heir, devisee or life ins B who fails to survive by 120 hours
(5 days) is deemed to have pre-deceased D  Claimaint must est survivorship by 120
hours by CCE
o NY EPTL §2-1.6
(a) Except as provided in (b)
(1) Where title to prop depends on person’s surviving another, person must
est by CCE that he/she survived D by 120hours – if not, that person treated
as if pre-deceased D
(b) Surviving rule above doesn’t apply if …

2. “Descendants”
 In all states, after SS’s share is set aside, children & descendants of dead children take to excl

(a) Representation
 When one of several of D’s children has died before D, that child leaving his own kids behind,
all states allow dead child’s kids to “rep” the dead child and divide his/her share among selves
 ***IN-LAWS ARE EXCLUDED AS INTESTATE SUCCESSORS IN ALMOST ALL STATES
 Three systems of “Rep”:
(1) English Per Stirpes: treats each line of descendants equally – prop divided into as
many shares as are living kids of designated person & deceased children who have
descendants living, w/ each of those moving into deceased parent’s position
beginning @ 1st generation below designated person ---- produces = shares across
D’s line of descent --- *OBSESSED W/ ROOT, STOCK OF D
(2) Modern Per Stirpes: First look to whether any kids survive D – if yes, distribution
identical to (1) – if no, estate divided = @ first generation where there are living

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 takers [usually grandkids], and “horizontal equity” @ closet living generation --- *GO
TO 1st GENERATION W/ ANYONE ALIVE & DIVIDE EVENLY
(3) UPC(1990)/New York: Estate divided into as many = shares as there are (i) surv
descendants in generation nearest to D which has 1+ surviving descendants and (ii)
deceased descendants in same generation who left surv descendants --- *this only
differs from MPS when there is add’l person of most recent living generation dead

BBb
B C
D E F

o English Per Stirpes = If B, C pre-die A, then A dies --- D = ½ ; E = ¼ ; F = ¼

o Modern Per Stirpes = If B, C pre-die A, then A dies --- D =1/3 ; E = 1/3 ; F = 1/3
o UPC(1990)/New York = If B, C pre-die A, then A dies --- D =1/3 ; E = 1/3 ; F = 1/3

B C Z

D E F

H G I J K L M

o English Per Stirpes = D gets ½ [that B would’ve got]--- C-line gets ½  that leads to ¼
for E [H & G get nothing b/c he still alive] & F’s line gets ¼ to split among 5 of them
[which is 1/20 each]
o Modern Per Stirpes = D gets 1/3 --- E gets 1/3 [G&H get nothing b/c E is alive] --- F line
gets 1/3  the five of them get 1/15 each
o UPC(1990)/New York = Same as MPS

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 But if E was dead:
o English Per Stirpes = D gets ½ [that B would’ve got]--- C-line gets ½  that leads to ¼
split btw H & G [1/8 each] & F’s line gets ¼ to split among 5 of them [which is 1/20
each]
o Modern Per Stirpes = D gets 1/3 ---G&H split 1/3 [or 1/6 each] --- F line gets 1/3  the
five of them get 1/15 each
o UPC(1990)/New York = D gets 1/3 --- the remaining 2/3 get split btw E’s descendant’s
and F’s descendants  they each get 2/21 [= 2/3 divided by 7]

Session #3 – Intestacy (cont.)

3. “Ancestors, Collaterals, & Others”

(a) Parents
 If intestate D survived by descendants, D’s ancestors [including parents] & other collaterals do
not take
 ½ states, if D doesn’t have descendants, after deducting SS’s share, rest of D’s prop goes to
his/her parents see UPC § 2-102(2)
 Rest of states, SS takes to exclusion of D’s parents

(b) Other Ancestors & Collaterals [SEE P. 86]

 If no spouse or parent, heirs will be “remote ancestors” or “collateral kindred”
o Collateral Kindred = all persons related by blood to D, other than D and D’s
descendants
o First-Line Collaterals = descendants of D’s parents, other than D and his descendants
o Second-Line Collaterals = descendants of D’s grandparents, other than D and descnd’t
 All jurisd, where D not survived by SS, descendant or parent, siblings & their descendants take
o Descendants of deceased siblings [nephews, nieces] take by rep, usually in same
manner as would D’s descendants
 See UPC § 2-106(b)
o Initial division of shares made @ closest generation where descendant is alive, but
shares of deceased person on that level treated as one pot and are dropped down and
divided equally among reps of next generation
 See UPC § 2-106(c)

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 o Similar to above
 If there are no “First-Line Collaterals,” states differ on what to do:
o Paternalistic System = intestate estate passes to grandparents and their descendants;
and if none, to great-grandparents and their descendants; and if none, to great-great
grandparents and their descendants, etc., etc.
o Degree of Relationship System = intestate estate passes to closest of kin, counting
degrees of kinship  to ascertain degrees of relationship of claimant to D, count steps
[one for each generation] up from D to nearest common ancestor, and then count
steps down to claimant from that common ancestor  SEE p. 86!!!
 NY EPTL § 2-1.2
(a) If distrib made to “issue,” & persons are of same degree of relationship, take per capita.
But if in unequal degrees of relationship, take per stirpes
(b) If distrib made to “issue,” that “issue” takes by rep
 NY EPTL § 4.1.1 – INTESTACY STATUTE [*IMPORTANT]
In calculating distributions, need to subtract debts, admin expenses, REA funeral expenses
(a) If D survived by:
(1) Spouse and descendants  $50K and ½ of estate to SS; rest [really ½] to
descendants
(2) Spouse and no descendants  100% to SS
(3) Descendants and no spouse  100% to descendants
(4) 1+ parents, no SS or descendants  100% to surviving parents, split = of both
(5) Siblings and their descendants, no SS, descendants or parents  whole to siblings by
rep
(6) 1+ grandparents or descendants thereof, no SS, descendants, parents, siblings  ½
to surv dad-side grandparents or their descendants if neither survives; and other ½
to mom-side grandparents or their descendants if neither survives. But descendants
here gets cut off after grandchildren of these grandparents.
(7) Great-grandchildren of grandparents; first cousin once removed, (most remote in NY
that can inherit)  ½ to maternal line, ½ to paternal line, or 100% to either, per
capita
(b) Half-bloods treated as whole blood relatives
(c) Distributees conceived before but born after D’s death are in the pot
(d) Adopted children take [???]
(e) …

(c) Laughing Heirs

 LHs = relatives of D that are so far removed in terms of degrees of relationship that they
didn’t even know D but get his $$$ anyway

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 Many states solve this by drawing line at grandparents and their descendants UPC § 2-103(a)

(d) Stepchildren & In-laws

 1/3 of states & UPC recognize “stepchildren” as potential heirs
 UPC § 2-103(b) – step-kids take id there are no surviving grandparents or closer related kin

(e) Half-Bloods
 Majority of states, and UPC § 2-107, treat relatives w/ “half-blood” the same as “whole
bloods”

(f) Escheat
 If intestate D leaves no surv entitled to take under intestacy statute, probate prop escheats to
state as under UPC § 2-105

Session #4 – Transfers to Children

1. Adopted Children

(a) Formal Adoption

CASE: Hall v. Vallandingham  adoption = “rebirth” into new family to excl of old one

 Facts: H died & survived by W and 4 kids. W remarried SF who subsequently adopted the 4
kids. 25 years later, H’s brother dies childless, unmarried and intestate. The 4 kids want a
piece of his estate.
 Ratio Decidiendi: Ct says that 4 kids CANNOT inherit from natural father’s bro  Inheritance
rights are not natural rights but statutory ones. Every state can regulate how they want to
provide such rights. According to state statutes here, adopted kids can inherit from deceased
relatives of new family as if they are “natural born.” But adopted kids can’t have MORE rights
than natural-born kids such that they have a “dual inheritance.” Adoption is considered a
rebirth into a new family, whereby, upon the adoption, the rights of the natural parents
and his relatives are terminated.

Notes

 Variation among states  Adopted children’s rights vary by state; UPC § 2-114(b): “…
adoption of a child by the spouse of either natural parent has no effect on (i) the relationship
btw the child and that natural parent or (ii) the right of the child or a descendant … to inherit
from or through the other natural parent.”

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 2008 Amendments to UPC  New determination is whether there is a “parent-child
relationship” [UPC § 2-116] – if so, they are parent&child for intestate succession purposes;
For adoption purposes, a PC relationship exists btw adoptive child and adoptive parent [UPC §
2-118(a)] but not btw adopted child and child’s genetic parents [UPC § 2-119(b)-(d)], subject
to exceptions:
UPC § 2-119: Parent-Child remains between a child adopted and genetic parent when
A) Spouse of genetic parent adopts (child can inherit 3 ways)
(a) Stepparent (spouse of genetic) and adopted child
(b) Genetic parent spouse and child
(c) Other genetic parent – only for inheritance
B) Adopted by a relative of genetic parent
C) Adopted after the death of both parents

 However – kids adopted by stepparents can inherit from genetic parents, but genetic parents
cant inherit from kids.
 If person is related to decedent by two ways – like uncle marries mom and adopts kids, kids
can now inherit as children and nieces and nephews- UPC says – they can only inherit through
one connection, pick the largest
 NY Adoption Rule – adopted child can inherit from predeceased genetic parent relative:
o If child is adopted by stepparent bc genetic parent predeceased, child can still inherit
form predeceased parent relatives, but those relatives cant inherit from child.
(adoption rules go downstream not upstream)

(b) Adult Adoption

 While most adoption statutes don’t acknowledge distinction btw adoption of minor v.
adoption of adult, the latter may too sever adoptee’s relationship to genetic family
 NY Rule  adoption of one’s lover is NOT permitted. In re Adoption of Robert Paul P. (NY
1984)
 DE Rule  you can adopt your lover for inheritance purposes

(c) Adoption and Wills & Trusts

 Adopted child IS entitled to take under W&T of adoptive parent as if a biological child 
probative intent evidenced by the act of adopting
 But gifts made by 3rd parties in W&T to “children/issue/descendants/heirs” of adoptive parent
are less clear on intent
o “Stranger to Adoption” Rule  adopted child is presumptively barred if donor is not
the adoptive parent
o Can be overcome w/ evid of donor’s intent to include adopted kid

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 This is issue b/c the only ppl that have standing to contest a will – are those who would
inherit if the will was invalid
 With adoption becoming more common, exceptions to rule have been carved out:
o Most states, MINOR adopted by adoptive parent is presumptively included in a 3 rd
party gift to adoptive parent’s children/issue/descendants/heirs.

CASE: Minary v. Citizens Fidelity Bank & Trust Co.  adopting adults for intestacy purposes

 Facts: M died leaving estate for her H and 3 sons. When they all passed, prop supposed to go
to her “then surviving heirs, according to laws of descent and distribution then in force and, if
no heirs,” to Church. One son didn’t have any heirs but instead adopted his adult wife.
 Ratio Decidiendi: Court says that son’s adopted wife can’t take. Ct sees adult-adoption as a
ploy that thwarts the intent of the ancestor whose prop is being distrib and cheats rightful
heirs. Adopted adult wife NOT an “heir” of M b/c M clearly didn’t intend to cover her in
instrument.

Notes

 Adult Adoption as Power of Apptm’t  using adoption to create child that falls w/in class gift
is effectively using adoption as “power of appointment” enabling power holder to designate
who will take prop subject to the power
 Strategic Adoption & Class Gifts  To avoid litigation, common in W&Ts to provide expressly
for inclusion of adoptive persons but exclude adopted adults; Refined UPC § 2-705(f) test 
presumptively excludes a person adopted after reaching 18 years old from class gift to
adoptive parents’ “children, issue, descendants, or heirs” by 3rd party unless adoptive parent
was adoptee’s stepparent or foster parent, or adoptive parent “functioned as a parent of the
adoptee before the adoptee turned 18 years old”

2. Non-Marital Children
 All states permit inheritance by non-marital child from mother; Rules abt father vary by state
 Trimble v. Gordon (USSC 1997)  Ct held that, though not a suspect class subject to strict
scrutiny analysis, restrictions on non-marital children’s inheritance abilities in regard to
natural father must be accompanied w/ substantial justification that serves important state
interest
 Most states permit paternity to be est by evid of subsequent marriage of natural parents,
acknowledgement of father, an adjudication during life of father or CCE proof after father’s
death

Session #5 – Transfers to Children (cont.) & Bars to Succession: Homicide & Disclaimers

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 3. Reproductive Technology & New Forms of Parentage

(a) Post-Humously Conceived Children

 PHC = child born and conceived after the death of one or both parents
 B/c marriage terminates @ death, PHC children are necessarily “non-marital children”

CASE: Woodward v. Comm’r  the 2-part test

 Facts: H and W were married and childless. H got leukemia and treatment was going to
sterilze him. H then deposited sperm in sperm-bank before treatment but made no indication
what such to be used for. H died 10mo later. 2 years thereafter, W gave birth to twins
conceived w/ the preserved sperm. But SSA denied twin girls’ application for “survivor-child
benefits” b/c didn’t est they were H’s children. This case is all about deciding who are the kids
of deceased person.
 Ratio Decidiendi: Court says there are 3 types of rights to consider here  (1) Interests of
Children; (2) Interests of State: (3) Reproductive Rights of Genetic Parent. Court says that
there is a 2 part test  (i) The prospective donor must clearly and unequivocally consent to
posthumous reproduction AND (ii) consent to support any resulting child  burden of
proving affirmative consent to both rests on surviving parent or other legal rep of
posthumously created child.
o Sperm banking alone isn’t enough to prove consent to (i); Can presume consent to (ii)
if you consented to conception

(b) Posthumously Conceived Children and Wills & Trusts

CASE: In re Martin B.  NY case that’s can’t be reconciled w/ Woodward

 Facts: H executed 7 trust agreements which gave trustee discretion to sprinkle trust to “issue”
and “descendants.” H died, survived by W and S1 but pre-deceased by S2. When S2 had
gotten sick, he deposited sperm w/ instruction that it be preserved and used at his wife’s
direction. When H died, that sperm still unused. But years thereafter, S2’s wife used the
sperm twice, had 2 boys, and wants those kids to inherit under H’s trusts as his issue.
 Ratio Decidiendi: Ct allowed kids to inherit. Ct says that where an instrument is silent, PHC
children will be treated as biological children. The policy issues here are diff b/c we’re not
dealing with PHC of the decedent. It is likely that S2 intended that these boys inherit his
estate – had he not died, he would have acted as their father. It is also likely H’s intent that
these boys be included

4. Advancements & Hotchpot

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 (a) Advancements in Modern Law
 UPC § 2-109 Advancements
If individual died intestate – and prior gave gift to an heir – the gift is advancement of that
intestate share if D declared that in contemporaneous writing or the heir acknowledged it in
writing.
o Old common law said lifetime advancement to child was considered prepayment –
then they die by intestacy – they that gotten taken out.
o UPC reverses common law – saying it’s only an advancement if they said it in writing
because it’s too hard to keep track of. Presumptively NOT advancements.
o Advancements - NY Rule [NY EPTL § 2-1.5] is same as UPC, Common law rule is
different; most states follow UPC.
5. Guardianship & Conservatorship of Minors

(a) Guardian of that Person

 As long as one parent is living, that person is “natural guardian” of child’s person
 If both natural parents die, court appoints guardian from nearest relatives – NOT ALWAYS
who parent would’ve wanted so one important function of making a will is to designate a
guardian for minor children – such info in will isnt determinative when court making decision
but very persuasive

(b) Property Management Options

 Another function of wills when minor children involved = mgt of child’s property
 4 ways of approaching this:
(1) Guardianship of Prop = similar to continuous probate until child turns 18years old;
Guardian has responsibility of preserving specific prop of minor and delivering when
minor reaches 18 years old and court approval req’d for everything
(2) Conservatorship = guardian of property has been renamed conservator – more
flexible, one trip to court per year. (not used in NY much for minors anymore – used
for incapacitated)
(3) Custodian = given property to hold for benefit of minor. Cust. Is fiduciary – they acan
manage and reinvest property. Not under supervision of court. Good for small
property; UGMA – uniform gift/transfer to minor account, every state has them
now, not under court supervision, easy to set up – in any bank. Title of acct – X as
custodian for Y under NY UTMA.
(4) Trusteeship = Trusteeship good for large estates , most flexible, under guardian or
custodian, child receives property at 18, trust you can change that. Trust is an
agreement between grantor and trustee to hold property for benefit of beneficiary.
Not worth it for less than $100k – if less use ugma account.

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 D. Bars to Succession

1. The Slayer Rule

CASE: In re Estate of Mahoney  slayers get prop under constructive trust

 Facts: HM killed by gunshot and died intestate, His wife convicted of M/S in connection. HM’s
estate was worth abt $4K. Court entered decree that estate goes to HM’s parents. Wife
appeals.
 Ratio Decidiendi: Three ways to go about this: (1) Slayer should inherit b/c denying
inheritance is add’l crim punishment not included in statute; (2) Legal title will pass under
equity; (3) Legal title passes, but as constructive trustee so that she is compelled to convey to
next of kin. Ct approves of 3rd choice – the constructive trustee doctrine, under which legal
title passes to slayer but that person is then treated as pre-deceasing D  appropriate line
to draw is btw voluntary and involuntary actions by slayer. It is “voluntary” and “intentional”
killing that will bring constructive trust doctrine into play to prevent unjust enrichment of
slayer. But probate court didn’t have jurisd to create constructive trust and give to parents.
o Constructive Trust = equitable remedy causing legal owner to pay out to true owner;
hold on constructive trust – means pay it over as soon as you can – moral owners of
property get the property

Notes

 Some states, donors can opt out of the Slayer Rule

 Variation Across States: Almost all states have slayer rules but details among each vary a lot
o Does Statute Apply to Non-Probate Transfers, as Well as ot Wills and Intestacy?
 UPC § 2-803: well-drafted slayer statutes bar killer from succeeding to probate
and non-probate prop
o If Killer Barred, Who Takes?
 UPC § 2-803: killer treated as pre-deceasing the victim
 UPC § 2-1106: disclaimant treated as having died “immediately before” victim
 Some states, including NY, allow killer’s devisees to take but others, including
TX, extend bar to killer’s descendants
o IS Criminal Conviction Req’d
 UPC § 2-803 and most states: final conviction of felonious ad intentional killing
is conclusive; ***BUT lack of conviction NOT conclusive  then apply Prepond
of evid std to see if killer would’ve been guilty and if so, barred
 NY law – has no slayer statute; case law rules; Black letter in NY –
a. NY has no slayer statute but NY will use Mahoney constructive trust (a lot) to
accomplish same thing as slayer statute

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 b. NY – intentional killing is not reqd – reckless killing is enough
c. Insanity defense or self defense – killer can take.
d. Crim conviction is not required. If no crim conviction – u just need
preponderance evidence of criminal killing
e. Applies to non-probate property as well
f. Joint bank accts will be treated slightly differently from real property. joint bank
account – killer will only forfeit funds he did not contribute to the account.
Tenancy by Entirety – real property owned my married couple – spouse doesn’t
forfeit 50% of real property owned jointly regardless of who contributed.
Treated as predeceased

2. Disclaimer
 Lots of time, devisee disclaims prop left to him, likely b/c doesn’t want to pay taxes on it
 Disclaimed Property – Follow the will
o If Will makes specific instruction in event of disclaimer, follow the will
o Treat as if disclaimant predeceased; if will sayds “if he doesn’t survive me” then follow
will
o Deemed predeceasing – may or may not pass depending on will – like if it says per
stirpes
 Disclaimers may not increase the share of disclaimants descendants
o if A disclaims; her kids don’t get more than the ½ she was entitled – even in per capita.
o Can’t disclaim so your kids get more – C-26. The only impact of B’s disclaimer is on B’s
half ( B cannot negatively impact C by disclaiming).
 Disclaimers have to be in writing and completed in a certain amount of time.
o Disposal of Disclaimed Property Slide C-24-25, Rule 1 – if will makes specific
disposition in event of disclaimer
 Framework
o Do what will says
o If will does not specificy, distribute as if disclaimant predeceased (if will says “if he
survives me” then follow will)
o Deemed predeceasing – may or may not pass to disclaimers heirs- depends on the
will.
o Ex. “to my descendants who survive me” – baby, Maggie, lisa take if bart disclaims
o Ex. “ to my children who survive me” – only Maggie and lisa take, if bart disclaims

Session #6 – Formalities & Forms of Wills

Chp. 3 Wills: Formalities and Forms

 Person who makes will = TESTATOR, and is said to die TESTATE

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 o Probate prop of testate decedent is distrib accord’g to will
o Wills ineffective until testator dies so probate courts follow “Worst Evid Rule”
 The person best able to authenticate the will, to verify its voluntariness and
clarify meaning of its terms is dead by time court considers any of this
 Present day focus = AUTHENTICITY
o Wills statute in every state requires compliance w/ particular formalities for making &
revoking wills  idea is to enable courts to easily and reliably discern authenticity
 Categories of wills:
o Testate Will = in writing signed by testator, and singed by 2-3 Ws
o Holographic Will = handwritten (entirely or largely) and signed by testator
o Notarized Will = in writing and signed, acknowledged by notary
 Must be 18 years old to make will --- must have certain formalities in executing --- must have
req’d mental state [ex: no duress or fraud]

A. Execution of Wills

1. Attested Wills

(a) The Core Formalities

 Three core formalities for making a TESTATE WILL:
(i) Writing
(ii) Signature
(iii) Attestation – witnessed by 2 or 3 people; signed and Ws present for that
 NY Formalities:
o Requires testator PUBLISH the will  means that T declare before Ws that instrument
is his will
 Wills Act was stricter  2 Ws had to be present and will had to be signed at end
 Statute of Frauds req’d 3 Ws for real prop to be devised and less rules for personal prop
 UPC §2-502 Execution; Ws or Notarized Wills; Holographic Wills [*simple approach]
(a) Attested and notarized wills must be:
(1) In writing
(2) Signed by testator or in his/her name by someone else while in testator’s
conscious presence & @ his direction and
(3) Either
(A) Signed by @ least 2 people w/in REA time after witnessing T’s signing or
receiving an acknowledgement from T that he signed it; or
(B) Acknowledgment by T before notary public or other person authorized to
make that kind of acknowledgement

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 (b) Holographic Will – will that doesn’t comply w/ above can be a valid holographic will,
whether witnessed or not, if signature and material portions of doc are in T’s
handwriting
(c) Extrinsic Evid – Intent that a doc constitutes T’s will can be est by extrinsic evid,
including, for holographic wills, portions that aren’t in T’s handwriting
 NY EPTL § 3-2.1 Execution & Attestation of Wills; Formal Reqmts
(a) Except for holographic wills, as per EPTL § 3.2-2, all wills must be in writing and executed
and attested in following manner:
(1) Signed by testator or another person @ testator’s direction and in his presence
(A) Everything before the signature is not nullified by stuff coming after signature
unless it’s incomplete in court’s discretion;
(B) No effect given to anything after the signature – “SUBSCRIPTION;”
(C) If someone signs for testator, his name and address have to go on will too but
he doesn’t count as one of the attesting Ws
(2) Testator has to sign will in presence of attesting Ws or testator has to acknowledge
to them that he signed it or directed someone to sign it for him
(3) Testator has to declare to attesting Ws that this is his will
(4) Need at least 2 attesting Ws, who must attest and sign w/in 30 days of T signing

(b) Functions of Formalities

 Several functions of having all of these will requirements:
(1) Cautionary Function = forces people to take process seriously so they know it’s solemn
(2) Evidentiary Function = need court to have confidence in will and its execution; supplies
evid to court that the transfer is right
(3) Protective Function = protect testator from fraud and ill will
(4) Channeling Function = channel all wishes into one doc so wishes will be followed in
format that court knows how to deal with;

(c) Strict Compliance Rule

 For will to be admitted to probate, MUST be in “strict compliance” w/ formal reqmts of
applicable wills statute  in writing, signed by T, attested to by Ws
 This rule guards v. spurious finding of authenticity – “a false positive”

CASE: In re Goffman  strict compliance case – Ws must be present in room @ same time

 Facts: G had lawyer prepare will. Lawyer gave it to G to execute on own. G had friends over
his house one evening and asked two friends at same time if they’d be Ws to his will. At this
time, G already signed it himself. The friends agreed and signed, though they signed at
separate times during course of evening and not together.

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 Ratio Decidiendi: Court says will is invalid b/c no strict compliance  though he asked them
to be Ws together, G acknowledged his own signature [which was already there at time of
request] to the Ws at separate times. Even though intent is clearly here, we need strict
compliance and this wasn’t that.

Note
 Attestation Clauses  these are clauses that recite that the will was duly executed in accord
w/ particulars of applicable wills statute; no state requires an A/C but such gives rise to
rebuttable presumption of due execution; With an A/C, a will may be admitted to probate
even if one attesting W dies before T or can’t recall events of execution

CASE: Stevens v. Casorph  even if intent clear, strict compliance can still screw things up

 Facts: Man took his uncle to bank to have will executed. There, uncle had a
bank-employee/notary public witness execution. After uncle signed, that employee brought
will to two other bank employees, separately, who, outside uncle’s presence, signed the will
as Ws. Neither of those latter 2 employees saw the uncle sign it. The uncle died soon after
and left most of his estate to his nephew. But his nieces contested it, said will was invalid b/c
formalities of will statute not observed – no strict compliance bc applicable statute requires 2
Ws witness T sign and then sign themselves in presence of T and one another.
 Ratio Decidiendi: Court said will not valid  this clearly wasn’t strict compliance. Doesn’t fall
w/in Wade exception. There, ct allowed will where the 2nd W signed in presence of 1st and T.
Here however, no one signed in the presence of the other.

Note

 Meaning of Presence = (A) LINE OF SIGHT = some states, T doesn’t have to actually see Ws
sign but must be able to see them were he to look; (B) CONSCIOUS PRESENCE = some states,
W is in presence of T if T, through sight, hearing, or general consciousness of events,
comprehends that W is in act of signing.
 UPC § 2-502(a) = dispenses w/ reqm’t that Ws sign in T’s presence; For signature by another
@ T’s direction, UPC requires conscious presence
 Meaning of Writing & Video/Electronic Wills:
o Usually, “writing” reqmt satisfied if will written/typed on paper
o But all that’s req’d is REAly permanent record of markings that make up will:
 Video Will = invalid except in NV under certain circumstances
 E-Wills = Probably no good but may be permissible under curative doctrines
[ex: “substantial compliance” or “harmless-error”]

(d) Interested Ws and Purging Statutes

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 There are four types of “Purging Interested Ws” Statutes:
(1) Purge gift to W if W is getting more under will than he’d get via intestacy (NY EPTL § 3-
3.2 and Estate of Morea)
(2) Avoid transfer to interested Ws (take that prov out of will)
(3) Interested Ws are fine, no issues (UPC § 2-505(b))
(4) Devise to W creates rebuttable presumption of duress (CA)

CASE: Estate of Morea (NY)  NY approach to purging interested Ws

 Facts: In will, D made bequest to GB and son. But both were also the attesting Ws at
execution of will. There was also one other attesting W who didn’t receive anything under the
will. The son’s gift is less than what he’d get if D had died intestate. NY law says that an
attesting W to a will to whom a beneficial dispo is made can serve as attesting W if there are
at least 2 other Ws present that aren’t getting anything under will.
 Ratio Decidiendi: Ct says that the dispo to GB is NOT void. B/c the son’s dispo is less than
what he’d get had D died intestate, court feels comfortable counting him as one of two Ws
that didn’t get anything under the will, so as to satisfy reqmts of NY statute.

Notes

 DQ-ing & Purging = slim majority of states have purging statutes related to interested Ws;
Most purge only the benefit W would’ve received under will that’s in excess of what W
would’ve gotten via intestacy
 Interested Ws Under UPC = Minority of states follow UPC § 2-505(b) which says interested Ws
aren’t a problem at all

(e) Curative Doctrine #1 – “Substantial Compliance”

 This is first doctrine under which a will may be valid even if formalities not observed
 SCD  key Q is whether manner in which instrument executed satisfied purposes of Wills Act
formalities
o If so, instrument should be deemed in substantial compliance w/ Wills Act and
admitted to probate
 Does noncomplying doc express D’s testamentary intent?
 Does form sufficiently approx. Wills Act formality to enable it to conclude that
it serves purpose of Wills Act [think 4 functions of will above]?
 This doctrine hasn’t really caught on

(f) Curative Doctrine #2  “Harmless Error”

 UPC § 2-503 Harmless Error

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 Although Will not incompliance w/ formalities, it still can be admitted to probate if
proponent of doc est by CCE that D intended the doc to constitute:
(1) The D’s will
(2) A partial or complete revocation of the will
(3) An addition or alteration of the will
(4) A partial or complete revival of his formerly revoked will or of a formerly revoked
portion of the will
 Adopted in a few states, NOT including NY
 Will usually apply to attestation issues, not writing (too fundamental) or signature (expresses
finality)

CASE: In re Hall  “harmless error” curative doctrine

 Facts: H and W had att’y draw up joint will for them and sent them the draft. The couple then
went to his office to discuss and made some changes before agreeing to terms. They were
prepared to execute final version whenever it was sent to them. But before leaving, asked
lawyer to have draft serve as will until final version ready. Lawyer told them that’d he’d
notarize the draft and that should take care of everything. So couple signed and lawyer
notarized the draft but no attesting Ws there. H then shredded his original, individual will. H
died before final version of joint will could be executed. H’s daughter contested the draft as a
legit will and wanted H’s original will to be valid.
 Ratio Decidiendi: Ct said that failure to execute draft of joint will doesn’t invalidate  ct was
satisfied that there was CCE [W’s testimony] that H intended the drafted joint will to be his
will and that his original was revoked.

CASE: In re Probate of Will & Codicil of Macool 

 Facts: Lousie and Elmer were married for 40 years. She raised his 7 children (her steps) and
was close with a niece. He died, Years later she went to atty to change her will. She gave him
a handwritten note of what she wanted to do – it was rough. He drafted what they discussed,
she died before signing. Her neice wants draft will probated, stepchildren do not.
 Ratio Decidiendi: There were minor discrepancies btw her handwritten note and the draft –
it’s unclear what her intentions were. House is unclear. Ct holds proponent must est by CCE
that (1) D actually reviewed the doc; (2) D gave his final assent to it. Lawyer’s draft was never
reviewed by Louise so we don’t have (1) or (2).

2. Notarized Wills
 UPC § 2-502(a)(3): Will is good if attested to by 2 Ws or if notarized
o Only CO and ND adopted this

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 3. Holographic Wills
 ½ of states permit “holographic wills”  written in T’s handwriting and signed by him
 These wills don’t need attestation
 UPC § 2-502(b) authorized holographic wils
 NY EPTL § 3-2.2 Nuncupative [Oral] & Holographic Wills
(a) Definitions:
(1) Nuncupative means unwritten and requires T 2 Ws
(2) Holographic means written entirely in T’s handwriting and doesn’t observe formalities
(b) Nuncupative and holographic wills valid only if:
(1) Made my member of US armed forces in service during war or other armed conflict;
(2) Someone who serves w/ or accompanies someone in above scenario; OR
(3) A mariner at sea
(c) Scenarios in (b) become invalid if:
(1) Armed forces member’s will not executed w/in 1 year of his discharge from AFs
(2) If person serving w/ or accompanying’s will not executed w/in 1 year of his ceasing the
serving or accompanying
(3) For mariner at sea, if will not executed w/in 3 years of its making
(d) …
(e) …

Session #7 – Revocation of Wills

B. Revocation of Wills
 A corollary to the FoD = person similarly remains free to rework estate plan until their dead
o Wills are AMBULATORY – subject to modification, revocation by T @ any time before
death

1. Revocation by Writing or by Physical Acr

 All states allow revocation of will by:
(i) Subsequent writing executed w/ Wills Act formalities, and
(ii) Physical act, such as destroying, obliterating or burning the will
 **Oral declaration that will is revoked, w/o more, isn’t enough to revoke  if duly executed
will not revoked in accord w/ applicable statute, will must be admitted to probate
 UPC § 2-507 Revocation by Writing or Act
(a) Will or part thereof revoked if:
(1) Executing subsequent will, in accord with formalities, that revokes the previous or is
diff from first one in anyway; or
(2) By T performing a “revocatory act” that was intended to be such and done for the
purpose of such or if another person does so at T’s direction and in T’s conscious

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 presence. “Revocatory act” includes burning, tearing, canceling, obliterating, or
destroying the will or any part thereof.

(a) Express & Implied Revocatory Writings

 EXPRESS REVOCATION  writing executed w/ Wills Act formalities may revoke earlier will by
beginning w/ clause … “I … hereby make this my will and revoke all prior wills.”
 IMPLIED REVOCATION  writing executed w/ Wills Act formalities that is inconsistent w/ a
previously duly executed will
o Q becomes whether T intended subsequent will to replace the prior in whole or part,
or if intended it to be a supplement
 MODERN VIEW (a la UPC § 2-507(c)) 
o If new will doesn’t expressly revoke previous will but does make complete dispo of T’s
estate, previous will is assumed to be revoked by inconsistency
o If new will doesn’t make a complete dispo of T’s prop, the new will is treated as a
codicil and any prop not disposed of under it is dispo’d in accord w/ prior will
 Codicil = testamentary instrument that supplements, doesn’t replace, an
earlier will and supersedes will to extent of inconsistency
 If you revoke will, codicil to will is revoked too!!!

 Restatement 3d of Prop: Wills & Other Donative Transfers § 4.1

o Cmt. m  Revocation of Codicil by Act: The revocation by act of a codicil to a will does
NOT revoke the will, but the revocation is presumed to revive portions of the will that
the codicil revoked
o Cmt. n  Revocation of Will by Act: The revocation of a will by act doesn’t revoke a
codicil of the will. But if the codicil depends on the revoked will for its meaning, the
codicil may have no effect as a matter of construction.

(b) Formalities, Writings & Physical Acts

CASE: Thompson v. Royall  proper revocation

 Facts: D executed typed will and left it with executor. 11 days later, executed codicil and left it
w/ att’y. 4 days after that, D requested that both be given to her to be destroyed. At att’y
suggestion, D didn’t destroy either and kept them as memorandum. On back of the will’s
cover page and page on which codicil written, a notation was made by att’y and signed by D
stating that both were “null and void.” D died w/o making another will.
 Ratio Decidiendi: Ct said that will wasn’t properly revoked and therefore should be admitted
for probate  must be (i) demonstrated intent to revoke in writing and properly executed
AND (ii) D cuts, tears, burns, obliterates, cancels, or destroys the original, with intent to do so.

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 While intent may have been here, the physical act wasn’t enough. “Cancellation” would’ve
req’d, at least, lines across the written instrument itself or physical defacement of the will of
some kind. If the writing that’s supposed to be the cancellation doesn’t even come into
contact with the will, it can’t be a revocation.
o Under UPC § 2-507(a)(2), this would’ve been enough to revoke b/c “word touching”
not req’d
o Also, “Harmless Error” curative doctrine applies to revocations and may have saved
this revocation

CASE: In re Estate of Stoker  revocation by physical act to copy of will

 Facts: D executed will naming then GF executor and leaving her some stuff, while the rest was
to go to a trust, the successor of which was G. When D died, GF wanted that will submitted
for probate. But D’s daughter contested and said there was more recent will that specifically
said that GF “gets nothing” and that “everything goes to my kids.” At trial, testifying W said
that D told her to write something for her and that she authored a new will based on his
instructions which D eventually signed. Also evid that D pissed on and burned a copy of old
will.
 Ratio Decidiendi: Ct said that the new will revoked the old one  this is a loosey-goosey
jurisd that says there is exception to will formalities when est by CCE that, at time of signing, T
intended writing to be his will. C Court uses Harmless Error Doctrine in saying this revocation
was good – it doesn’t matter that the new will didn’t observe formalities b/c intent was clear.
The burning and pissing on wont count b/c that was done to a copy of the original and that
will never be good enough for revocation purposes.
o Revocatory act must be performed on will. Doing it on another doc or unexecuted
copy is insufficient. But if the intent to revoke is proved by CCE, failure to perform act
on will, accompanied by performing act on copy that D mistakes for will, may fall
under “harmless error” curative doc.
o If you physically destroy a copy (not original) by mistake, then a constructive trust is
imposed – forcing devisees to hand over their inheritance to the ones who should.

(c) Presumption of Physical Act Revocation

CASE: Harrison v. Bird  presumption of physical act revocation

 Facts: D executed will naming KH primary beneficiary. Original kept by D’s att’y and KH had
copy. D later called att’y and said she wanted to revoke will. Att’y tore original into 4 pieces in
front of his secretary, wrote letter saying he “revoked her will” and that D was w/o a will. He
also sent her the 4 pieces of the will. D died and found among her personal stuff was the att’y

25
 letter but the 4 pieces were not found. KH said will wasn’t properly revoked b/c D didn’t tear
it up and we don’t know if she did anything to it that would count as revoking.
 Ratio Decidiendi: If evid est that D had possession of will before death but it wasn’t found
among her personal stuff, presumption arises that D destroyed it. If the presumption sticks,
presumption that will was revoked follows and sticks and D thus dies intestate. Here, att’y
tearing didn’t do it b/c T has to do it. But presumptions both stuck and D died intestate.

Note
 Authority is split on std of proof for overcoming presumption of destruction
o Older cases  CCE
o Newer Cases  PPE
 But if lost or mutilated will was last known to be in possession of someone other than T, NO
PRESUMPTION of revocation and will IS entitled to probate.

(d) Partial Revocation by Physical Act

 UPC § 2-507 and most states authorize “partial revocation by physical act”
o If someone crosses out name, must show that was T’s intent
o In jurisd that allows holographic wills, crossing out name prob okay b/c no rule that
will has to be written at same time.
 ***NO PARTIAL REVOCATION BY PHYSICAL ACT IN NY

Session #8 – Revocation of Wills (cont.)

2. Dependent Relative Revocation

 If t undertakes to revoke will upon mistaken assumption of law or fact, under DRR the
revocation is ineffective if T wouldn’t have revoked but-for the mistaken belief
 Court will disregard T’s revocation of will if T revoked under mistaken belief that new will was
valid
 DRR only applies if:
(i) there is an alternative plan of disposition that fails (tried to make another will) OR
(ii) if mistake is recited in the terms of revoking instrument or is est by CCE (“I revoke to
Judy since she is dead” – but she isn’t)
 Status of DRR in NY is unclear
 Restatement 3d of Prop: Wills & Other Donative Transfers § 4.3: Ineffective Revocation
(a) Partial or complete revocation of will is presumptively ineffective if revocation made
(1) In connection w/ attempt to make dispo objective that fails under law or
(2) b/c of false assumption of law, or b/c false belief abt objective fact, that is either
recited in revoking instrument or est by CCE

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 (b) Presumption in (a) is rebutted if allowing revocation to remain in effect is more
consistent w/ T’s intent

CASE: La Croix v. Senecal  DRR

 Facts: D executed will and then codicil 1 mo later. He died and instruments submitted for
probate. Original gave ½ to AS and ½ to NL. Codicil inconsistent only in that it claried that NL
was really named “ML, aka NL.” But AS’s husband was one of codicil’s attesting Ws and such is
forbidden by this state’s statute.
 Ratio Decidiendi: Gift to AS stands  DRR says that if T destroys/cancels will w/ intention of
making another be its substitute, and new one fails for some reason, presumed that T prefers
old will to intestacy and the old will becomes effective again. Here, codicil failed b/c of
attesting W issue. So we’ll put the original will back in play.

3. Revival of Revoked Will

CASE: In re Estate of Alburn  revival of revoked will

 Facts: D moved to Milwaukee to live w/ grandniece. There, executed will naming the
grandniece as B of a lot of stuff. Soon D moved to Illinois to live with brother and there
executed another will. Then moved to Wisconsin to live with other brother and stayed there
until died. While in Wisc, D told other brother that she got rid of Illinois will, showed him
ripped up pieces of it, and he brought it to dump for her. Evid indicated D told Wisc brother
that she thought Milwaukee will back in play.
 Ratio Decidiendi: Ct says that revival of old will is better than intestacy. Clear here that D did
not want to die intestate. Problem is that she did revoke Illinois will but was mistaken in belief
that result was revival of Milwaukee will. So court uses DRR to revive the revoked Illinois will.

Note

 UPC §2-509: Revival of Revoked Will

(a) If W#2 wholly revoked W#1, but W#2 is subsequently revoked by a “revocatory act,”
W#1 remains revoked unless revived – W#1 is revived if its evid from circumstances of
revocation of W#2 or subsequent declarations that T intended W#1 to retake effect
(b) If W#2 partly revoked W#1 and is thereafter revoked by a “revocatory act,” a revoked
part of previous will is revived unless evident from circumstances of W#2 revocation
or from T’s contemporaneous or subsequent declarations that T didn’t intend for that
part of W#1 to retake effect
(c) If W#2 revoked W#1 in whole or part is thereafter revoked by W#3, W#1 remains
revoked in whole or part, unless revived. W#1 is revived when, to extent it appears
from terms of W#3 that T intended it to take effect.
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 NYS says no revival  intestate

4. Revocation by Operation of Law

(a) Divorce
 Most states, statutes say that divorce revokes any provision in a D’s will for the divorced
spouse --- remaining states, revocation occurs only if divorce comes w/ prop settlement
 In NY, spouse’s relatives no necessarily cut out by divorce (majority rule)
 UPC §2-804 [CB p. 240]  divorced spouse and relatives are cut out

(b) Marriage
 If T has existing will that makes no provision for spouse and then gets married and fails to
revise will:
o Majority rule says give spouse an intestate share, unless it appears admission was
intentional or spouse is provided for in a will or will substitute – life insurance, etc (if
clear in substitute of testamentary transfer)

(c) Birth of Children

 Birth of children born after execution of will – after born children are usually cut in somehow
to participate in estate

Session #9 – Components of Wills

A. Components of a Wil

1. Integration
 All papers present @ time of execution, that are intended to be part of the will, are
considered integrated into the will [sewn w/ ribbon, stapled, etc.]

CASE: In re Estate of Rigsby  must be apparent that pages, together, constitute will

Facts: Pages of D’s will found by SS folded together but not otherwise attached. Both pgs
initialed and dated @ top, and in D’s handwriting, but only pg.1 signed. P.1 clearly has
testamentary intent. But P.2 only has list of assets.
Ratio Decidiendi: Not going to count p.2 as part of will  where instrument is 2+ pages, must
be “clearly apparent” that T intended all pages constitute the will. Not so here b/c (1) Not
stapled, otherwise bound; (2) P.1 doesn’t reference P.2; (3) P.2 contradicts P.1 in some ways.
Note

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 Usually Q of integration is obvious  papers present @ time of exec, stapled together,
numbered consecutively, connecting language btw pages, etc.

2. Republication by Codicil
 Doctrine under which validly exec will is “re-exec” as of date of codicil and any defects in will
are cured [ex: interested W, etc.]
 BUT CODICIL DOES NOT CURE DEFECTS IN EXECUTION [writing, signed, 2 attesting Ws]
 Restatement: “A will is treated as if executed when most recent codicil was executed,
whether or not codicil expressly republishes prior will, unless effect of so treating would be
inconsistent w/ T’s intent.”
 Consequences of ‘Repub by Codicil’ = if W#1 revoked via W#2, then execute C#1 to W#1 –
W#2 revoked by implication.
o Ex. Will 1- All prop to sister; Will2 – All prop to Bro; Will 2 revoked Will1. Doc 3 – I
revive Will1 except for giving earrings to X now I affirm Will1. Will1 is deemed to be
re-executed at Doc 3; if Will1 had an interested witness – cures interested witness
defect. If Will1 only had one witness, it would not have been properly executed and
could not be cured.

3. Incorporating by Reference

(a) Existing Writings

 Allows for writing in existence but not present @ time of exec and that wasn’t itself exec w/
formalities to be absorbed into T’s will.
 UPC § 2-510: Incorporation by Reference
o A writing in exist when will exec may be incorp’d by ref if language of will manifests
this intent and describes the writing sufficiently to permit its ID

CASE: Clark v. Greenhalge 

Facts: T’s will made G primary-B and said that he gets all prop except items “designated by a
memo left by T and known to G, or in accord w/ T’s known wishes.” 5 years prior, G helped T
draft doc titled “MEMO” that listed T’s personal prop and how such to be distributed @ death.
That list modified 2 years before will exec. But neither list said anything about a $2K painting T
owned. But T had private notebook in which he wrote that he wanted painting to go to VC.
Also, T’s nurses said they saw T write in that notebook and were told painting was to go to VC.
In 1980, T told VC that painting was going to go to her and that she would write that wish in
notebook. T also exec two codicils 3 years after exec will.
Ratio Decidiendi: Ct says that two MEMOs modified before will exec were obviously incorp’d by
ref and good to go. Evid indicated that notebook existed @ time codicils executed, so codicils

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had effect of “re-exec” original will @ that time which could now incorp the notebook by
reference to “MEMO” [this is also a republication by codicil issue].

Note
 Incorp by Ref NOT Recognized  doctrine NOT recognized in CT, NY, or LA; NY has instead
stretched doctrines of Repub by Codicil & Integration
o Distribution in accordance w terms of another person’s will (which has already been
probated) is respected
o A list disposing of tangibles is ok if list is referred to in will and attached to it (more like
integration)
o Pour over will to revocable trust ok if trust executed prior to or concurrently with will.
Trust becomes irrevocable on Ts death.Will says – I leave tangible and residuary to
trust and then follow the trust’s instructions. New law in NY. Popular in CA nad FL-
trust keeps dispositions private – bc only the will is probated, not the trust. (Execute
the trust first)

(b) Subsequent Writings & Tangible Personal Property

 UPC § 2-513: Separate Writing ID’ing Devise of Certain Types of Tangible Personal Prop
o Allows T to dispose of tangible personal prop by separate writing, EVEN IF PREPARED
AFTER EXECUTION OF T’s WILL, provided will makes ref to separate writing
 Essentially says that what happened in Clark v. Greenhalge is okay
 Allows T to change who gets what personal prop w/o formalities
 Slim majority of states have adopted some form of this
 NY does NOT allow this

4. Acts of Independent Significance

 If B or prop designations are ID’d by ref to acts/events that have lifetime motive &
significance apart from effect on will, gift may be upheld.
 Look for (1) CERTAINTY, as to “who” & (2) ACCESS, as to “where”
o Ex – I give $100 to the woman who wins the Boston Marathon in 2015. T dies 2020 –
we know who won th 2015 marathon – so she gets it
o I leave stock to “whom I may be married at time of death” – is ok.
o I leave house to most senior member of KZ Law @ time of my death  ok
o I appoint as executor whoever is Dean of Pace Law at time of my death.
o I give contents of my purse to my sister – probably not valid – bc avg person cant be
sure whats in their purse at time of death or that its been messed with – not
significant or certain enough for this doctrine.

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 o Contents of my safe deposit box to sister – OK. Pretty sure you know what sin the safe
deposit box – ti doesn’t change all the time like a purse.
 LAW LOVESSS SAFETY DEPOSIT BOXES!!
 UPC § 2-512: Events of Independent Significance
o A will may dispose of prop by ref to acts and events that have significance apart from
their effect upon dispos made under will, whether they occur before/after exec of will,
or before/after T’s death. Exec or revocation of another’s will is such an event
 *NY DOES RECOGNIZE THIS, THOUGH THERE IS NOT STATUTE REFERRING TO IT!!!

Session #10 – Will Contests: Mental Capacity

Chp. 4 Wills: Capacity and Contests

 Follows from FoD that only “volitional act of testation” should be enforced
 Think FIDO PPD
o Fraud
o Influence (Undue)
o Duress
o Old enough [over 18years old]
These 3 o Propery – T must be capable of understanding nature of his prop
speak to o People – T must know the natural objects of his bounty
capacity
o Disposition – T must understand the disp he’s making and relate it

A. Capacity to Make a Will

1. Mental Capacity
 The “mental capacity” req’d to make a will = minimal
 Restatement 3d of Prop: Wills & Other Donative Transfers § 8.1(b)
o T must be capable of knowing & understanding in general way
 Nature and extent of prop (1st “P”)
 Natural objects of bounty (2nd “P”)
 Disp of that prop he is making (D)
 Capable of relating these elements to one another & forming orderly desire abt
the disp
 Remember, MC is test of “capability,” not “actual knowl’g;” T needn’t be of avg intelligence

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CASE: In re Wright’s Estate  case shows that MC is easy to est
Facts: T died widower and childless. Estate included 2 prop in CA, 1 prop in UT and some
personal prop. Under his validly exec will, CJH (friend) got one house and all personal prop.
Another house went to daughter. The UT estate went to granddaughter. Also listed several
others as getting $1.
Ratio Decidiendi: Ct said T had MC to make will  legal presumption is always for sanity, esp if
formalities observed. In fact, attesting Ws shouldn’t so attest if they think T lacks MC. Few,
isolated incidents, acts, foibles, idiosyncrasies, moral/mental irregularities, departures from
normal aren’t enough unless directly bear upon and have influenced testamentary act. Here,
no evid that T suffered from insanity, hallucinations, or delusions --- evid fell short of
overcoming sanity presumption.

Notes

 Comparing States  most states, Mc req’d to make will < than that req’d to make K or
complete irrevocable lifetime gift – modern law = lower std of capacity applicable to will also
applies to other will substitutes, including revocable trust

CASE: Wilson v. Lane  shows that MC is easy to est

Facts: T’s validly exec will divided estate among 17 people – 16 relatives and 1 person person
who provided T w/ personal care before death. T’s MC at time of exec was contested. Drafting
att’y testified that he thought T had MC. Friends testified to same. But contestant presented
Ws who said (1) T acted crazy @ times; (2) Guardianship petition filed few months after will
exec; (3) Expert said T seemed to have dementia and Alzheimer’s; (4) Note from T’s personal
doctor saying that T was blind and had dementia.
Ratio Decidiendi: Ct said that T had enough MC to make will  person = mentally capable to
make will if has sufficient intellect to enable him to have decided and rational desire to disp
prop. Contestant’s evid here wasn’t enough to show not enough MC.

2. Insane Delusion
 Person mat satisfy MC test but still suffer from INSANE DELUSION that causes entire will or
particular disp to fail for lack of capacity
 INSANE DELUSION = legal concept; NOT a psychiatric one
o Delusion = false conception of reality
o Insane Delusion = bears on test’y capacity; present belief for which no exist in fact
and T adheres v. all evid and reason to contrary – will must be “materially affected”
 To prevail in INSANCE DELUSION CASE, contest must show
o T labored under an insane delusion AND will or some part thereof was product of it

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CASE: Breeden v. Stone  shot himself; still had capacity

Facts: T killed self just days after involved in publicizes hit-and-run that killed V. PO found
handwritten doc in T’s home that said SS gets everything, that he wasn’t the driver, and had
signature. T previously formally exec will 5yrs prior which devised prop to other people. At
trial, determined that T used cocaine, alcohol for years before suicide, just before suicide, and
that T had euphoric, depressive, and fearful moods.
Ratio Decidiendi: Ct said that T had MC to make will  Cunningham Test: (i) T understands
nature of act; (ii) T knows extent of his prop; (iii) T understands the dispo; (iv) T knows who he’s
giving it to; (v) Will seems to rep T’s wishes; Insane Delusion Test: this test involved persistent
belief in that which has no existence in fact yet is adhered to v. all odds. Must also be a causal
relationship btw the ID and capacity to K – ID must “materially affect” will dispo. Ct says that
T satisfied both tests and lower court right to say the will was good.

CASE: In re Honigman  NY Rule – insane delusion “might have” caused or impacted the
dispo
Facts: T came to believe his wife was having an affair. T left her very little. Court required
proponent to show that an unnatural disposition within Ts insane delusion was not in fact a
product of that delusion.

Session #11 – Undue Influence

B. Undue Influence

1. What is Undue Influence?

 “Doctrine of UI” = protects v. overreaching by wrongdoer seeking to take unfair advantage of
donor who is susceptible to such b/c of age, inexperience, dependence, physical/mental
weakness, etc.
o Usually have to rely on circumstantial evid that has tend’y to prove/disprove this
o Meant to protect FoD from impositions far less overtly coercive than fraud, threat of
force, etc. but that overcome will of T anyway
o Prevailing Rule = contestant has burden of proving will procured by UI  burden
may be shifted if proponent shows (1) C/R; (2) B gets bulk of estate; (3) T has
weakened intellect (Estate of Lakatosh)
 MAJOR CONSIDERATION  diff as to when we can INFER v. PRESUME
o INFER
 Donor was susceptible to UI
 Wrongdoer was opportunity to exert UI
 Wrongdoer had disposition to exert UI and

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  Result appeared to be effect of UI
o PRESUME
 Confidential relationship btw T and bad person AND
 1+ “suspicious circumstances”

CASE: Estate of Lakatosh  when UI will be presumed; what is a “C/R”?

Facts: Rose was an elderly woman who lived alone without contact with family. Roger
approached her and started doing odd jobs for her, did errands for her, drove her around. She
became dependent on him. When Rose’s nephew sued her for slander, Roger got his atty uncle
to help Rose out. Roger took her to her financial adviser and also sat in on meetings. Rose
executed a power of attorney – electing Roger. She executed a new will – leaving everything to
Roger. Atty Jacobs testified she was of sound mind when she executed the will and power of
atty, but 3 days later he had her evaluated for defense in slande.r Roger took her money. A few
years later she was living in squalor

Ratio Decidiendi: Ct says that UI here and will no good  “Confidential Relationship” =
whenever one person has reposed specific confidence in another to extent parties don’t deal
with each other on equal terms, either b/c of overmastering dominance on one side,
weakness/dependence/justifiable trust on the other  “Power of Att’y” = per se C/R.

Where proved by CCE that there’s (1) C/R; (2) person receiving benefit got bulk of estate
[suspicious circumstances?]; (3) D’s intellect weakened, burden shifts to will-proponent to
disprove UI [suspicious circumstances?]. We have all three here. So Roger had burden and he
didn’t satisfy it.

Notes

 Confidential Relationship  in this context, law requires person to be “other regarding” b/c
potential abuse of trust; Idea of C/R embraces 3 types of relationships:
o Fiduciary = atty-client, power of att’y, etc.
o Reliant = patient/doctor, financial advisor, etc.
o Dominant-Subservient = hired caregiver/sick person, child/sick parent, etc.
 Suspicious Circumstances  burden to show this can be satisfied by influencer procured the
will.
o Restatement 3d of Prop: Wills & Other Donative Transfers § 8.3 cmt. h
(1) Extent of donor’s weakened condition, physically and/or mentally, and
therefore susceptible to UI
(2) Extent to which wrongdoer participated in will prep or procurement

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 (3) Whether donor got independent advice from att’y or other disinterested,
competent advisor in prepping will
(4) Whether will prepped in “secrecy or in haste”
(5) Whether donor’s attitude towards others changed b/c of relationship w/
wrongdoer
(6) Whether decided discrepancy btw new and prev will
(7) Whether continuity of purpose running through new and former will
indicating settled intent in prop dispo
(8) Whether disp is such that REA person would regard it as unnatural, unjust,
unfair – like if dispo made abruptly and w/o apparent reason cuts out faithful
and deserving family member
 Burden Shifting  most states, if presumption of UI triggered, burden shifts to will
proponent to come forward w/ rebuttal evid showing presumed influencer “acted in good-
faith throughout trans and grantor acted freely, intelligently and voluntarily.”
o We shift b/c will proponent is in best spot to collect evid to show fairness in all

CASE: In re Estate of Reid  when burden shifts, what must will proponent show

Facts: Law student met elderly woman. He visited and developed relationship with her – nature
of which disputed. 3 years after meeting, student took woman to law firm and told lawyers he
wanted woman to adopt him to cut off her heirs. Lawyers instead drew up deed that gave
woman’s prop to student. Next day, student helped woman make holographic will that gave
everything to him. Year later, woman went back to law firm on own and formally executed will
which was similar to holographic will. 3 years later woman adopted student.
Ratio Decidiendi: Ct said the instruments here WERE product of UI  Ct says here that C/R is
enough to get UI presumption. Factors to consider in determining existence of C/R = (i) does T
have to be taken care of? (ii) Is there a close relationship? (iii) Does the other help T with
medical care and transportation? (iv) Are there joint accounts? (v) Is one physically/mentally
weak? (vi) Is one old, unhealthy? (vii) Is there power-of-att’y? --- If C/R found, burden shifts to
will proponent who must show: (A) Good-faith of B, considering (I) who initiated the gift, (II)
where was gift executed and in whose presence, (III) was there consideration for gift and (IV)
the degree of secrecy involved; (B) Grantor’s full knowledge, deliberation of consequences of
actions; and (C) Grantor’s independent consent and action.
Note

 Restatement 3d § 8.3 cmt. f rejects rule in Reid that says “suspicious circumstances” not req’d
for UI presumption  C/R alone is NOT enough

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CASE: Will of Robert Kaufman  gay men in 60s – undue infl
 Kay jewelers guy. In a relationship with another man a few years older. Every year he revised
his will to give more to walter. There was also a side letter addressed to his family saying he
was so grateful to walter for making him well adjusted and happy. Family contested – anti
gay – and court ruled this was undue influence. Today this would have come out different.

CASE: Lipper v. Weslow  left out her sons kin bc she didn’t like them

Facts: T married 3x. Son from 1st marriage had kids of his own. Had 2 step kids from 2nd
marriage. Days before dying, one of step-kids from 2nd marriage, a lawyer, helped T execute
valid will in which she disinherited her grandkids from 1st marriage and daughter-in-law. T
attached letter to will explaining that they weren’t nice to her and that’s why they get nothing.
The lawyer step-kid did not like T’s son.
Ratio Decidiendi: She was of sound mind, physically healthy, she told many ppl what she
wanted. This was her intent. She has a right to dispose of her assets as she wants. Not proven
that the lawyer step-son was substituting his own desires for T’s. Circumstances not suspicious
enough maybe?

Session #12 – Will Contests: Duress, Fraud, & Tortious Interference

C. Duress
 Duress = when UI crosses the line into coercion
o Restatement 3d of Prop: Wills … §8.3(c): “A donative transfer is procured by
duress if wrongdoer threatened to perform or did perform a wrongful act that
coerced the donor into making a donative transfer that the donor wouldn’t
otherwise have made.”

CASE: Latham v. Father Divine  cult leader – constr. trust

Facts: Contestants are cousins of T and claim that T wrote a will leaving everything to a cult
leader, then when she wanted to make a new will, the cult leader prevented her from executing
it by having her killed. Probate court came up with a compromise giving estate to cult leader.
Ratio Decidiendi: Restatement says – when beneficiary of existing will prevents T from exec a
new will by force, fraud, whatever, then there should be a constructive trust. Contestors want
a constr. Trust. Appel dismissed their complaint – reversed. The will is in full effect but Trust is
warranted for equity.

D. Fraud

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 Test = a donative transfer is procured by fraud if wrongdoer knowingly or recklessly made a
false rep to donor abt a material fact that was intended to and did lead the donor to make a
donative transfer that the donor wouldn’t otherwise have made
o Usually involve “fraud” in either
(1) EXECUTION  Person misreps the contents of the will which doesn’t carry out
T’s intent] or
(2) INDUCEMENT  misrep causes T to execute or revoke a will, or refrain from
doing that, or include a provision for wrongdoer

CASE: Estate of Carson  man had multiple wives – fraud?

Facts: Gamble married Carson and they lived happily together for a year and she died leaving
everything to her husband Gamble. She did not know that he was a serial groom and had many
wives undivorced so their marriage wasn’t legal.
Ratio Decidiendi: If they had lived togheter for 20 years and the marriage was void – the fraud
probably did not cause the devise. If it was only a few days – then yes – fruit of fraud. Hard to
say if she would have left him everything if she knew the truth. Question for a jury here.

E. Tortious Interference with an Expectancy

 Restatement 2d torts § 774B recognizes int’l interference w/ expected inheritance/gift as
valid cause of action
o P must prove interference involved tortious conduct [fraud, duress, etc.] but can’t be
invoked id challenge based on mental capacity
o Elements:
 Existence of expectancy
 REA certainty that expectancy would’ve been realized but for interf
 Int’l interference
 Damages

Note

 Tort Law as Alternative to Inheritance Law  an “interference-with-inheritance” tort claim is

NOT a will contest --- it does NOT challenge probate of a will, but seeks to recover damages
from D for wrongful interference w/ P’s expectation of an inheritance.

Session #13 – Construction of Wills: Mistaken & ambiguous Language; Death of Beneficiary

Chp. 5 Construction of Wills

B. Death of Beneficiary Before Death of Testator

 Gap btw will exec & T’s death can mess up even “perfect wills”  like if B dies before T

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 1. Lapsed & Void Devises
 If B doesn’t survive T, the de.vise fails of LAPSES
 Common-Law Rule: If devisee is dead @ time will executed [or is animal, imaginary friend,
etc.] then devise is void
o Specific or General Devise = If either lapses, devise falls into residue
 Ex: T says A gets watch [specific], B gets $10K [general], C gets rest. But A and B
die before T. Then C gets watch and $10K also.
o Residuary Devise = If residuary devise lapses, T’s heirs take by intestacy; If only share
of residuary lapses, lapsed share passes to T’s heirs by intestacy and NOT to remaining
residuary devisee  “No Residue of a Residue Rule”  NOT POPULAR AM’G STATES
 Ex: T says A and B to split rest of estate. But A dies. Lapsed share goes to T’s
heirs via intestacy and not to B.
o Class Gift = If devise is to class of persons and one dies, surviving members of class
divide gift.
 Ex: T gives $10K to “children of A.” One of those kids dies before T. But T dies
survived by A’s other child. Then the other child gets all $10K.
o Void Devise = If devisee already dead @ time will exec, or devisee is ineligible taker
[dog, cat, etc.], devise is VOID

 UPC § 2-605: Anti-lapse; Deceased Devisee; Class Gifts

o If devisee is grandparent or lineal descendant of grandparent of T that pre-dies at time
of will exec, fails to survive T, or is treated as pre-dying T, the ISSUE of deceased
devisee who survive T by 120 hours or more take in that devisee’s place; and if all such
ISSUE are of same “degree of relationship” to the dead devisee, then they take
equally; but if they are of unequal “degrees of relationship,” then those of more
distant relation take by representation.
o If devisee would’ve been part of class gift if survived T but is dead, that persons still
treated as part of the class.
 UPC § 2-604(b): Does Away with “No Residue of a Residue Rule”
o Majority of states follow  assume T would rather other residuary B to take
 UPC § 2-603(b)(3)
o Words of survivorship, such as in a devise to an individual “if he survives me,” or in a
devise to “my surviving children,” are NOT, in the absence of add’l evid, a sufficient
indication of intent contrary to application of anti-lapse statute
o This DOES NOT APPLY IN NY

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 NY Lapse Law – EPTL § 3-3.3:

Common Law UPC NY EPTL §3-3.3

Pre-Residuary Devise falls into If devisee is descent If devisee is T’s
residue of T’s grandparent issue or siblings,
(or gp), substitute then substitute
devisee’s issue, devisee issue,
otherwise follow otherwise follow
common law common law
Residuary Devise passes If devisee is descent If devisee is T’s
intestate (no of T’s grandparent, issue or siblings,
residue of residue substitute devisee’s then substitute
rule) issue, otherwise devisee issue,
give to other otherwise follow
residuary taker common law
(residue of residue
rule)
Class Surviving members If devisee is special, Same as UPC – but
of class divide the do substitution, special is different
gift otherwise common
law

CASE: In re Estate of Russell  devise to dog is void, so goes to residue

Facts: T made & exec valid holographic will which gave ½ of estate to Q, ½ to RR, and
specifically $10 gold coin and diamonds to P. But RR is T’s dog that pre-died T. P is niece that
says devise to dog not allowed, so she should get ½ that was left for dog.
Ratio Decidiendi: Ct said that will can’t be construed so as to say Q was supposed to get entire
estate and just care for the dog – that’s not REA so can’t say will susceptible to 2+ meanings. So
ext evid can’t come in – nothing in will says devise to dog was merely “precatory in nature.” T
intended dog to get ½ and b/c dog is ineligible devisee, P takes ½ by intestacy.
2. Class Gifts
 Treated diff than gift to individuals – if class member pre-dies T, survivors divide total gift,
including dead member’s share, unless anti-lapse statute applies
o Shares may fluctuate
o Bs not ID’d
 Restatement 3d of Prop: Wills … § 13.1

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 (a) Class gift = dispo to Bs who take as group members; Means IDs and shares subject to
fluctuation
(b) Dispo presumed to be class gift if terms ID Bs only by term of relationship or group
label; Presumption rebutted if language, circumstances est transferor intended ID,
shares of Bs to be fixed
 Restatement 3d of Prop: Wills … § 13.2
(a) Dispo not class gift if B IDs and shares are fixed
(b) In determining if above are “fixed,” consider:
(1) If terms of dispo are expressly fixed as to ID and shares = fixed
(2) If terms of dispo ID Bs by (i) by names or (ii) term of if relationship to other group
label and either by name or number = presumed fixed; Can be rebutted upon
showing that language, circumstances est that T intended Bs to take as class

Yes Class Not a class

My nieces My 5 nieces
My children My three children
My siblings My nephew Gene

CASE: Dawson v. Yucus  left land to H’s nephews so as to remain in family –> not a class

Facts: Stewart’s will said – I inherited some land from my husband. I want the land to stay in his
family – so I leave ½ to nephew Stewart and one half to nephew Gene. Residue to some friends.
Gene predeceased her. Was this a class gift? If yes then other nephew takes. If no – then it goes
to residuary.
Ratio Decidiendi: No – it was fixed and they were identified. Even though she stated her intent
was to leave the farm to her H’s family – she identified her nephews and their shares and didn’t
say anything about survivorship. Affirmed – not a class gift. Lapsed gift goes to residuary clause.
 SEE CHART ON P. 373!!!!!

Session #14 – Construction of Wills: Changes in Property

C. Changes in Property After Execution of Will

 Common problem = wills made stale or obsolete b/c change of circumstance after will exec
that affects prop that is subject to the will

1. Ademption by Extinction
 Adeem = to take away; to revoke
 Doctrine:

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 o T’s will says that A gets Blackacre and B gets residuary. But before death, T sells
Blackacre and uses proceeds to buy Whiteacre  A is out of luck and gets nothing
 This doctrine applies only to SPECIFIC DEVISES, not general devises, residuary devises, or
demonstrative devises
o General Devise = T intends to give general benefit and not particular asset
 Ex: Giving $100K – if no $100 of cash @ time of death, then devise is NOT
adeemed and estate must sell other prop to B of the $100K devise
o Demonstrative Devise = hybrid; it’s a general devise coming from a specific source
 Ex: T gives A $100K to be obtained from proceeds of IBM stock – if T has
sufficient IBM stock at death, in raising the $100K executor must comply w/
direction to sell stock; But if T doesn’t have $100K of IBM stock, $$ must come
from somewhere else and be given to A.
o Residuary Devise = Conveys portion of T’s estate not otherwise effectively devised by
other parts of will
 Ex: To A, all the rest, residue, and remainder of my prop and estate
 Two Theories of Ademption:
(1) Identity Theory = if specific item is not in estate, gift is extinguished; HARSH!!
(2) Intent Theory = Devisee may get cash equivalent of gift; Can get Whiteacre if can show
that was T’s intent
 Under UPC § 2-606, have to prove that intent
 NY Approach
o Applies IDENTITY THEORY, except for:
 If it’s a change of FORM, not substance, then ademption doesn’t apply
 Change must be directly traceable
 Guradian sells prop and T incompetent, then devisee can get cash equivalent
minus expenses for T
 Insurance proceeds – prop was destroyed during T’s life and insurance doesn’t
get paid out until after T’s death; Prop destroyed after T’s death but before
payout to B
 Real Prop sales – if T enters into sale for real prop, but K didn’t cloase, doesn’t
adeem [common law – prop does adeem if K not finalized]

CASE: In re Estate of Anton  sold land to take care of mom – intent

Facts: T and H were given land by T’s stepdaughter. T and H built duplex thereon and after H
died, T was sole owner. T exec will that left ½ of duplex to own son and ½ to stepdaughter.
Remainder to go to own son and own daughter. By T got in accident and needed med att’n for
rest of life. Went to lots of diff nursing homes. T exec power of att’y in favor of own daughter,
to remain in force until T’s death and authorizing mgt of finances. At times, own daughter

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talked about selling some assets from estate to pay med bills but not duplex specifically. But
own daughter told by nurses to stop talking $$ w/ T bc it was making her sick. Own daughter
then began selling T’s assets off to pay med bills. Saved duplex for last. Even talked to lawyer
who said that she could sell it. Own daughter first tried getting loan but they said have to sell
duplex first. Own daughter then sells duplex at time T had very little MC, if any. Proceeds went
to med exp. At time of T’s death, $104K left from $133K proceeds from duplex. Own son and
stepdaughter want ½ of original proceeds from duplex.

Ratio Decidiendi: Under identity theory – the devise is extinguished because the land was not in
estate. However, courts have started looking past it and whne T doesn’t know the land or
property was sold, then T didn’t intend to change his will – so devisee still gets. Intent theory –
applies when property is removed from estate though an act that is involuntary as to T. Ex. sold
by a guardian, accidentally destroyed contemporaneous to T’s death (car). This case however,
deals with attorney in fact, not a guardian, Power of attorneys are not treated same as a
guardian, treated as T’s alter ego, in some juris. Here – sale of land by power of attorney – did
not adeem the bequest. If she was incompetent – then the act of selling the house was
involuntary to her. Ademption happens when T has knowledge of a transaction involving a
specific devise, realizes the effect and has opportunity to revise will. If she was competent – it
seems like she didn’t know the house was being sold and didn’t really have the opportunity to
change her will. Mary didn’t have the opportunity to assent to the sale. Gretchen wants half of
the proceeds of the house, but shes only entitled to what is left of the proceeds after T’s
expenses were paid.

Notes

 ID Theory Exceptions – Cts in states following this have developed exceptions to avoid
ademption where prop not in estate “b/c of accident or action of someone other than T, or in
which facts indicate a high likelihood that T didn’t intend for ademption.” UPC § 2-608(a)
gives devisee any unpaid amount of condemndation award for prop or any unpaid casualty
insurance proceeds after prop destroyed;
 ID Theory – Std Tempered by Presumptions and Burdens 1990 UPC abandons ID theory and
adopts intent theory – see below
 UPC § 2-606: Non-Ademption of Specifi Devises; Unpaid Proceeds from Sale, Condemnation
or Ins; Sale by conservator or Agent
(a) Specific devisee has right to specifically devised prop in T’s estate at T’s death to:
(1) Balance of purchase price owed by purchaser at T’s death b/c of prop sale
(2) Any amt of condemnation for taking of prop unpaid @ death
(3) Proceeds unpaid @ death on fire, casualty ins or on other recovery for injury to
prop

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 (4) Any prop owned by T @ death and acq’d as result of foreclosure, or obtained
in lieu of foreclosure, of security inters for specifically devised obligation
(5) Any real prop or tangible personal prop owned by T 2 death which T acq’d as
replacement for specifically devised real or tangible prop and
(6) If not covered by (1)-(5), pecuniary devise = to value as of date of dispo of
other specifically devised prop dispo’d during T’s lifetime but only to extent
it’s est that ademption would be inconsistent w/ T’s manifested plan of
distribution

2. Abatement
 Abatement problems arise if estate lacks suff assets to pay D’s debts and devises
 In absence of clear indication in will of how to abate, will go in this order
o Residuary devises reduced first
o General devises reduced second
o Specific Devises reduced last, and usually pro rata

3. Stock Splits
 Most courts hold that, subject to showing of contrary intent, devisee of stick is entitled to
add’l shares rec’d by T as result of stock split  “change of form, not substance”
 UPC § 2-605(a)(1): stock dividends are treated same as stock splits – B gets them along w/
other shared
 NY = Intent  My shares of IBM stock. IBM splits and T owns 200 shares. X gets 200 shares

4. Satisfaction of General Pecuniary Bequests

 Doctrine of “Satisfaction” may be applicable if T makes inter vivos transfer to devisee after
executing will
o If T is B’s parent, and sometime after exec’ing will transfers to B prop that is similar in
nature to that in will,l there is rebuttable presumption that gift is in satisfaction of
devise made by will
 Doctrine usually applies to general pecuniary bequests, not specific bequests
 B.c intent tough to ascertain, some states enacted statutes requiring T’s intention to adeem
by satisfaction by shown in writing  UPC § 2-609

5. Exoneration of Lien
 T devises Blackacre to daughter A. Blackacre has mortgage on which T liable.
o Does A take mortgage or is she entitled to have lien paid by residuary?
o Depends on jurisdiction
o Common Law – Exoneration of Liens, residue pays off mortgage so devisee = lien-free

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 o UPC & NY – No Exoneration of Lien  A gets property w/ mortgage unless will directs
otherwise; “Pay all debts” isn’t specific enough to pay off mortgage – has to be specific
direction to pay off debt on Blackacre

Session #17 – Trust Creation

Chp. 6 Trusts: Characteristics & Creation

 Trust is preferred vehicle for implementing FoD

o Trust = legal arrangement created by “SETTLOR” in which a “TRUSTEE” holds prop as a
fiduciary for 1+ “BENEFICIARIES”
o TRUSTEE takes “LEGAL TITLE” to trust prop, allowing him to deal w/ 3 rd parties as
owner of prop
o BENEFICIARIES have “EQUITABLE TITLE” to trust prop, which allows them to hold
TRUSTEE accountable for breach of “TRUSTEE’S FIDUCIARY DUTIES”
o BENEFICIRIES typically entitled to periodic distrib from trust income $ sometimes from
principal too
o Trusts may be “TESTAMENTARY” [created by will & arising in probate] or “INTER
VIVOS” [created during SETTLOR’s lifetime by “DECLARATION OF TRUST” or “DEED OF
TRUST”]

A. Trust in American Law

1. Vocabulary, Typology & Illustrative Uses

 SETTLOR/GRANTOR/TRUSTOR = person who creates trust
 TESTM’Y TRUSTS = necessarily irrevocable
 INTER VIVOS TRUSTS = revocable or irrevocable, depends on SETTLOR’s intent
o May be created by “declaration of trust,” whereby SETTLOR declares self to be trustee
of certain prop or “deed of trust” whereby he transfers to trustee the prop to be held
in trust
o Can be uses as will-substitute to avoid probate  at SETTLOR’s death, trust prop
distrib or held in further trust in accord w/ terms of trust

2. Bifurcation of Ownership
 Bifurcation is hallmark characteristic of common law trust
o TRUSTEE holds “legal title” to trust prop but BENEFICIARIES have “equitable” owners’p

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 o Two common issues with bifurcation of ownership
 Effect on rights of 3rd parties to trust prop & personal prop of TRUSTEE
 Power & duties of TRUSTEE & corresponding rights of BENEFICIARIES w/
respect to trust prop and against TRUSTEE (“fiduciary admin”)

(a) “Asset Partitioning & Rights of 3rd Parties”

 Trust can’t sue, be sued, hold prop or transact in own name  TRUSTEE sues, is sued, holds
prop in his fiduciary capacity
 Modern Am trust law revised to that creditor of TRUSTEE in TRUSTEE’s fiduciary capacity
recovers directly from trust fund w/o recourse v. personal prop of TRUSTEE
o Vice versa also true  personal creditor of TRUSTEE can’t touch trust prop
 Modern law makes the TRUSTEE two distinct legal persons: (1) natural person K-ing on own
behalf; and (2) artificial person acting on behalf of Bs

(b) “Fiduciary Admin & Rights of Beneficiaries”

 Split btw “legal title” and “equitable ownership” gives TRUSTEE trust mgt responsibilities
 But while TRUSTEE has all of the power, it’s BENEFICIARIES that bear consequences
 To protect BENEFICIARIES from mismgt, TRUSTEE subject to and must act in accord w/
“FIDUCIARY DUTIES”
o Law requires TRUSTEE to subordinate own interest to those of BENEFICIARIES
(1) Duty of Loyalty = TRUSTEE must admin trust solely in interests of Bs  self-
dealing very limited or even prohibited
(2) Duty of Prudence = TRUSTEE held to objective std of care and must admin trust in
manner suited to purpose of trust, needs of BENEFICIARIES
 If TRUSTEE breaches “fiduciary duties,” BENEFICIARIES entitled to “election of remedies”

Notes

 Four Functions of Trusteeship:

(1) Custodial = involves taking custody of trust prop & safeguarding it
(2) Administrative = acct’g and record-keeping, paying taxes, other filings
(3) Investment = reviewing trust assets and making, implementing an investment program
for those assets as part of overall strategy REAly suited to purpose of trust and needs
of BENEFICIARIES
(4) Distribution = making distrib of income or principal to BENEFICIARIES in accord w/
terms of trust

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 3. Trust v. Legal Life Estate
 Creation of trust usually involves 1+ equitable future interest, as well as present interest in
income
 Legal Life Estates & Future Interest in tangible, intangible personal prop = unwise

(a) “Legal Life Estate”

 Legal life tenant has NO POWER to sell a fee-simple unless such power granted in instrum’t
creating the life-estate
o Such person has to get permission from all remainder interests before selling
 “Waste” is another problem  life tenant may want to take oil from land, cut timber, etc. but
all such is “waste” that’ll entitle remainder persons to injunction and/or damages
 Trustts resolve and/or mitigate these problems

B. Creation of Trust
 Elements to Create a Trust  SIDE BLT
o S  Settlor (or grantor)
o I  Intent to create trust
o D  Deliver existing prop interest
o E  Existing prop interest
o B  Beneficiaries
o L  Lawful purpose
o T  Trustee
 Some trusts must be in writing (testm’y trusts [b/c of Wills Act formalities] and those
involving real prop [b/c of Statute of Frauds])
 No trust fails for lack of TRUSTEE  court will appoint one if none or appointee refuses
 UTC § 402(a)(4): But TRUSTEE must have some active duties  otherwise, trust will fail
 Trust Creation Requirements:
o INTENT by SETTLOR to create the trust
 Doesn’t have to say “trust,” only manifestation of intent to create fiduciary
relationship known as trust  Focus on function over form
 Ex: “To X for the use and benefit of A”  usually enough
 Testm’y trust – created by will
 Requires will construction
 If intent not clearly stated, must be able to infer from language of will in
light of circumstances
 Deed of Trust – xfer of property
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  Declaration of Trust – Settlor declares self to be TRUSTEE of prop and may be a
BENEFICIARY too; If Settlor is sole B and sole trustee, wouldn’t be trust b/c
legal and equitable ownership would merge – has to have another B
 No formalities req’d for creation – just manifested intent to hold certain
prop in trust for ascertainable Bs
o ASCERTAINABLE BENEFICIARIES who can enforce the trust
o SPECIFIC PROPERTY, the residuary to be held in trust
1. Intent to Create Trust
CASE: Jiminez v. Lee  Dad took daughter’s gift $ in trust, breached duty
Facts: P’s grandma bought her $1K savings bond for schooling needs. P’s dad’s client gave dad
$500 gift to each of dad’s children, all of which deposited into savings acct in names of dad and
all 3 of his kids. Few years later, dad cashed grandma’s bond and invested proceeds in comm
stock – ownership registered dad as custodian for P. Dad also closed savings acct and invested
$1K into more stock which he held as custodian for his kids.
Ratio Decidiendi: Ct says that gift for P’s educational benefit made a trust – it’s enough that
transfer of prop is made w/ intent to vest beneficial ownership in 3 rd person. Here, clear that
gifts made for P’s educational benefit and trust made. Therefore, dad acting as trustee had
fiduciary duties that he had to honor and which he did not --- he did pay for education but he
also bought ballet tix, he didn’t keep track of records, etc.

Notes

 What was @ Stake  b/c this was trust, dad was subject to liability for breach of fiduciary
duties to P; If he wrongfully disposed of trust prop, daughter could recover prop unless it was
in hands of bona-fide purchaser for value; If he sold trust prop and acq’d other prop w/
proceeds, she could enforce trust on newly ac’d prop
 Accepting Trusteeship  UTC § 701: b/c trustee has onerous duties and is exposed to
potential liability, law doesn’t impose trusteeship on someone unless he/she accepts; UTC §
705: allows for resignation of trustee a/ 30 day notice to all interested parties.

(a) Enforceable v. Precatory (conveying a “wish” not “direction”)

 Enforceable = “I leave $1mm for my sister’s benefit, payout ½ at age 35 and ½ at age 40” 
this is a TRUST even though word “trust” not specifically used
 Precatory = “I leave $1mm to my husband. It’s my hope and expectation that he well share w/
my sister at ages 35 and 40”  NOT A TRUST b/c “my hope and expectation” is not direction

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 2. Ascertainable Beneficiaries

(a) “The Beneficiary Principle”

 Private trust must have 1+ “ascertainable Bs” to whom trustee owes fiduciary duties and who
can call trustee to acct. UTC § 402(a)(3)
 But Bs needn’t be ascertained at time of trust creation  only ASCERTAINABLE

CASE: Clark v. Campbell  “for my friends”

Facts: T created test’y trust in will w/ clause that said that he trusts his TRUSTEES to distribute
personal prop among his “friends” as trustees see fit.
Ratio decidiendi: Ct said that trust fails for lack of certainty as to Bs  “friends” is not a class
like nephews or nieces. Relations – you can look at statute distribution laws, No statute for
friends. Clause substitutes T’s will for the trustees’ will whereby latter disposes as they choose
to. This isnt allowed.
Notes

 BENEFICIARIES are often given power of appointment

o Ex: “For my wife for life, then to my descendants that W appoints in her will”  this is
okay and discretionary
 Can give power to Bs but NOT trustees
 UTC §§ 408-409: You can have enforceable trust for pet and other non-charitable purposes
but ct can reduce amount of $$ is it fins such excessive

(b) Honorary Trusts

 A pet cannot be the beneficiary but it can be the res in a trust.
 Because so many people want trust for their pets there are
1. common law honorary trusts
2. statutory pet and noncharitable purpose trusts. – honorary trust

CASE: In Re Seright’s Estate  honorary trust – “for my dog”

Facts: I give bequeth my dog Trixie to Florence and I direct my exec. To deposit $1000 to be
used for care of dog and pay her to take care of dog. If anything is left after Trixie dies, then
divide up equally between A B C D people
Ratio Decidiendi: “honorary trust” – one bonding the conscience of the trustee since there is no
B to come to court to enforce. Under trad’l law, the absence of a B who can come to court and

48
demand an accounting, etc. is fatal to the trust. But the object sought to be accomplished by T
here – care of his pet dog – is worthy. Plus, FH agreed to honor the clause.

Session #18 Non-Probate Transfers & Planning for Incapacity

Chp. 7 Non-Probate Transfers & Planning for Incapacity

 “Will Substitutes” = non-probate system of private succession

o Revocable [Inter vivos] Trusts
o Life Insurance
o Joint Accounts
o Pension Plans
o Payable on Death Instruments

A. Revocable Trusts
 Revocable Inter Vivos Trust is most flexible of all “will substitutes” b/c SETTLOR can draft its
provisions precisely to his liking
o Also most “will-like” of all will substitutes in that
 It’s not inherently asset specific
 Like testator, settlor is free to amend, revoke at any time and for any reason

1. Wills Act and Present Interest in the Beneficiary

 May be created by:
o Deed of Trust – whereby SETTLOR transfers to TRUSTEE the prop to be held in trust
 On SETTLOR’s death, trust prop then held or distrib in further trust in accord
w/ trust terms
 Doesn’t require will formalities
o Declaration of Trust – whereby SETTLOR just declares himself TRUSTEE of certain prop
for own benefit during life, w/ remainder to pass @ death in accord w/ declaration’s
terms

2. Revoking or Amending Revocable Trust

 UTC § 602(a) [also majority view]  inter vivos trust is revocable unless declared not to be
o Corollary to presumption – revocable trust can be amended, revoked in any manner
that clearly manifests SETTLOR’s intent to do so, unless trust instrument specifies a
particular method of amendment or revocation and expressly makes such method
exclusive

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Note

 Creditors & Other Non-Probate Transfers  creditors can’t reach certain other non-probate
transfers; Creditors of Joint-Tenant can’t reach jointly held prop after a joint-tenant’s death;
Life Ins proceeds usually exempt from insured’s creditors if payable to spouse-child;
Retirement benefits usually exempt also; U.S. Saving’s bond w/ POD beneficiary may be
exempt too; UPC § 6-102 permits decedent’s creditors to reach non-probate transfers such
as inter vivos revocable trusts and joint bank accounts if probate estate is insufficient to pay
debts

3. Revocable Trust in Contemporary Practice

 Today, will has yielded to RTs as central post-death instrument governing prop distrib
o RTs avoid probate and allow SETTLOR to consolidate dispo of all prop under 1 instrum
o Easy to change if want to
 RTs
o SETTLOR
o TRUSTEE – usually the SETTLOR
o Created by deed or declatation
 Common Terms
o “Income and principal payable to trustee during llife, successor trustee to be … ”
 Amending a Trusrt
o NY follows common law  an inter vivos trust silent on irrevocability means trust is
irrevocable
o UPC  silence means it’s revocable
 Creditors can reach revocable trust prop but not jointly held prop, life ins, or pensions

(a) Pour Over Will

 Concept  O sets up RT w/ himself or 3rd party as TRUSTEE; O then executes will devising his
probate estate to trustee of that trust
o Two themes  (1) Incorp by Reference (2) Act of Independent Significance
 Works by:
o Incorp’s RT by Reference  trust must be in writing the time the will is signed.
Changes in trust may not be incorp’d in will
o Acts of Independent Signif  trust doesn’t have to be in existence but trust must have
some prop in it at time of death
 UPC § 2-511: Test’y Additions to Trusts [Will may devise to trust if … ]

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 (a) Trust was est during lifetime by T or someone else, including funded or unfunded
insurance trust
(b) Trust est @ death by T’s devise to trustee if trust is ID’d in T’s will and its terms are set
forth in written instrument other than a will, executed before or concurrent with will
regardless of corpus of trust
 UTATA – permits pour over to trust created after will is executed, but UPC requires the
writing be in existence when will is executed.

(c) Lifetime Consequences

 RTs can facilitate “prop mgt by fiduciary”
o SETTLOR can select 3d party TRUSTEE to manage a funded RT w/ duties that run only
to SETTLOR
 RT can also be used in “planning for incapacity”
o Even if S names self initial trustee, successor trustee can take over and act
expeditiously to protect trust prop in event of S’s incapacity
 RT useful in keeping “clear title”
o This is so esp for newly-weds who want to avoid comingling separate prop w/ prop
acq’d during marriage
 NO fed income, gift, or estate tax to RT creation

(d) Probate Avoidance

 Prop transferred during life into a RT AVOIDS PROBATE @ Settlor’s death
 RTs can be contested for lack of capacity & undue influence, but generally more difficult to set
aside on these grounds in comparison to will
 Also, RTs not subject to ongoing court supervision after settlor’s death, unless interest parties
bring suit

C. Planning for Incapacity

1. Property Mgt

(a) Conservatorship
 Most states, court can appoint “conservator” to manage prop of incapacitated person
 UPC §5-401: Conservator may be appointed if court finds by CCE that person is “unable to
manage prop & business affairs b/c of impairment in ability to receive and evaluate info or
make decisions” and by PPE that the person “has prop that will be wasted or dissipated unless
mgt provided or $$ is needed for support, care, education, health and welfare of the” person
 UPC § 5-413: Priority for appointment as conservator typically given to:

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 1. Someone chosen in advance by person
2. An agent under durable power-of-att’y
3. Spouse
4. Child
5. Parent
 Conservator for incapacitated adult has power over prop similar to those of TRUSTEE

(b) Revocable Trust

 Can be alternative to conservatorship in planning for incapacity
 Even if SUCCESSOR named sole TRUSTEEE, can name successor trustee for if settlor becomes
incapacitated
 Or, settlor can name self to be co-trustee with someone else and give latter right to become
sole trustee if settlor becomes incapacitated
 Limitation  Successor Trustee can only act w/ respect to prop put in trust by SETTLOR
BEFORE incapacitation

(c) Durable Power of Att’y

 Ordinary PoA = creates agency relationship in which agent (“att’y in fact”) is given written
authorization to act in principal’s behalf
o Such limited by common law rule that agent’s authority terminates on principal’s
incapacity
 Durable PoA = effective during incapacity of principal and until principal dies
o Power can be drafted to be effective immediately upon signing or only upon incapacity
o Usually must be in writing and, in some state, witnessed and notarized

CASE: In re Estate of Kurrelmeyer  Durable PoA

Facts: LK executed 2 durable PoAs in favor of wife and daughter @ time LK still competent.
Pursuant to such, wife created trust that named she and daughter trustees, and transferred
Clearwater prop into that trust. LK was no longer competent when trust created and prop
transferred. And upon death, LK will read that Clearwater prop to be distrib in way that was
different than what terms of trust created by wife said was to be done with the prop.
Ratio Decidiendi: Ct said that Durable PoA allowd wife to create trust and Clearwater now to be
held under terms of said trust, not the will  durable PoA expressly allowed for trust creation
and for her to move prop. What she did was fine But what about her fiduciary duties? Did she
self-deal? Facts in dispute and need to be cleared up on remand. Wife had power to do it, but
maybe a duty not to.

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Note

 Estate Planning by Surrogate  Majority view is that although agent acting under power of
att’y can’t make, amend, revoke principal’s will, agent can create, modify, or revoke a trust id
power to do so is expressly granted in power of atty instrument. UTC § 602(e) and UPC § 5B-
201(a)(1); Some states and UPC § 5-411(a), a court appointed guardian or conservator has
power to make, amend, revoke a trust for ward and to make, amend, revoke ward’s will

2. Health Care
 Advance Directive  instructions on what you want – involves Health Care Proxies
 Otherwise, decision goes to others in this order:
o Spouse
o Adult Child
o Parent
o Adult Sibling (if more than 1, majority rules)
 Health Care Prozies
o Everyone has Const right to make health care decisions and refuse treatment
o Absent information, default rule is aggressive treatment. Even though most ppl say
they wouldn’t want aggressive treatment.
o Hospitals are required to inform patients of their rights to withdraw care and have an
agent – etc.

Session #19 & 20 – Spousal Rights

Chp. 8 Limits on FoD: Protection of Spouse & Children

 Principle of FoD NOT absolute  certain limits to ensure spouses & children are protected
o Separate Property States = surving spouse entitled to an “elective share,” typically 1/3
of dead-spouse’s estate
 Rule in 41 of 50 states
 Stresses individual earnings in prop rights
 Ex: H&W go to buy 1st home, it’s decided W will hold prop in own name if she
provides entire purchase price, then it is her prop [only from probate sense –
not the case for divorce proceedings] – this is pure title or donative transfer
analysis
o Community Property States = each spouse owns all earnings during marriage in equal
shares
 Same hypo as above, but doesn’t matter whose name prop is in – if acq’d
during marriage, it belongs = to each of them

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 In Am legal tradition, surviving child has NO rights to a mandatory share  many disinherit
even blood children if desire
o Am law protects children “accidentally omitted” from will [child born after execution
of will that doesn’t contemplate subsequent children]

A. Protection of Surviving Spouse

1. Elective Share of Separate Property Surviving Spouse

 Surviving spouse (“SS”) will always get something  can’t completely freeze them out, even if
disinherit/omit in will
 Elective Share = refers to surviving spouse’s right to take against the will [even if disinherited]
o Typically equal to 1/3 of entire pot of assets
o This includes all probate assets and, depending on jurisdiction, some non-probate
o Amt of E/S is far less than what SS would get from intestacy [usually ½ or whole]
o CAN waive right to take elective share
 Theories for Elective Share
o Partnership Theory – notion that the prop was acq’d in economic partnership
o Support Theory – notion that spouse’s right to elect v. the will is right in nature of
support
o No statute entirely endorses either, both incorp concepts of both
 Rights of a Surviving Spouse:
o How much is the Elective Share – what percentage?
o Is the share constant (NY) or dependent on factors (UPC)?
 Is it always 1/3 or does is vary bases on factors such as length of marriage?
o What form does the elective share take?
o To which property does the elective share apply?
o How robust or how easy to defeat the elective share?
 Many states tightening E/S statute to make it hard to get around --- UPC more
“ironclad”
 Same sex/Cohabitating partners
o Co-habitating partners get nothing if one partner dies
 If not married, get nothing in terms of elective share  go to intestacy
o In states allowing gay marriage, same-sex spouse have E/S rights
 Four scenarios to evaluate the theories
o What property be used to satisfy the E/S?
 1969 UPC and Majority:

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  If SS elects v. will, then SS not charged w/ (needn’t accept) a life estate
given to her under the will --- don’t have to count that as prop passing
under will
 Who can exercise right on behalf of SS?
 Typically on the SS or a rep acting on SS’s behalf during SS’s lifetime [a
la court appointed guardian or conservator]
 After SS dies, no more E/S
 What duties does guardian or conservator incompetent SS has?
 Minority Rule = must exercise right to E/S if it’d be greater than amt
passing under will
 Majority Rule = can take into acct all facts & circumstances when
deciding to elect or not
 UPC 1969 = limited E/S rught needed for support of incompetent SS
during lifetime
 Abandonment – spouse has done abandoning, has no right to E/S
 Abandonment in NY means either:
 Refusal to provide financial support;
 Constructive Abandonment – failure or refusal to engage in
sexual relations
o What property is subject to the Elective Share?
 Originally, E/S statutes gave SS a fractional-share, usually 1/3 of D’s estate 
term “estate” was understood to mean “probate estate” --- BUT …

CASE: Sullivan v. Burkin  prospective rule easy to defeat – just appoint 3d party to control
Facts: H created inter vivos revocable trust. H and wife were separated for 10 years before his
death. Widow wants E/S, and for it to include trust prop.
Ratio Decidiendi: Ct does not allow widow to take E/S from inter vivos trust trust was valid
and inter vivos – is not covered by the statutory provision. But makes prospective ruling that
inter vivos trust created by deceased spouse during marriage, with control maintained solely by
decedent, will now be included as part of estate for E/S purposes.
CASE: In re Estate of Meyers  Even easier to avoid E/S – put it in a PoD
Facts: w died and survived by H. @ time of death, W’s assets worth $480K. H became sole
owner of property couple owned as JTs w/ survivorship rights. W’s will left H no prop – rest of
prop went to her kids – most notably, a checking acct and COD worth $91K and an annuity
worth $19K – all of which with designations making them “Payable on Death.” H wanted E/S of
those assets.

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Ratio Decidiendi: Statute doesn’t say POD assets go into E/S so we will not include the assets at
issue here.
(b) UPC
 NY was basis for UPC re: “augmented estate” – see p. D-45 of sup
 Not so easy to defeat
 Overview on calculating
o Sliding scale based on marriage (CB p. 535)  longer marriage, larger E/S %
o Robust def of “augmented estate” – takes SS’s economic position into acct
o E/S only elected if in positive amt – and if SS is more wealthy than deceased, won’t
take E/S b/c will have negative E/s and can’t do that

 Calculating UPC Elective Share (D-45)

o Calculate the “Augmented Estate” – has 4 elements
 Net Probate Estate [ probate estate – funeral expenses, homestead, family
allowance, personal prop set aside, and enforceable claims]
 Decedent’s Non-probate Transfers to others, not SS [will substitutes, D’s
fractional interest in Joint-tenancy, PODs, proceeds of insurance if D had power
to change B, presently exercisable powers of appointment]
 D’s non-probate transfers to SS
 All prop owned by SS and all prop that would’ve been included in SS’s non-
probate transfers to others had she died first
o Multiply the “Augmented Estate” by the “Elective Share %” under Sliding scale [CB p.
535]
o Take number from above step, and cut in half
o Reduce the SS’s credits [non-probate transfers to SS and marital assets SS already
owns]  this means “everything SS owns”

2. Social Security Benefits (Miscellaneous other SS rights)

 Amount paid based on workers’ comp
o If worker dies, SS will get workers benefits
 Rights of spouse to social security are inalienable
 Ex-spouse can get benefits dependent on length of marriage

3. Private Pension Plans (Miscellaneous other SS rights)

 Defined Contribution plan
o Funded by contributions from both employer and employee and at returment the
employee is entitled to assets in the fund

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 o If employee dies, SS is entitled
 Defined Benefit Plan
o Rare
o Gives employee or SS a fixed % of salary w/o tegard to contributions made during
lifetime

4. Homestead (Miscellaneous other SS rights)

 A right to occupy family home
 Typically for life
 Exempts family home to some degree from creditor’s claims
o In NY, its only for $22K of a house – ltd right in NY

5. Personal Property Set Aside (Miscellaneous other SS rights)

 Diminimous but allows certain small amt of personal prop to be exempt from creditors and
pass to SS or minor children separate and apart from E/S
o In NY, it is furniture, applicances, computers up to $10K; books, family pictures and
software up to $115K, etc.

B. New York Elective Share

 NY Statutes – EPTL § 5-1.1

(1) Right to take E/S subject to:
(A) Greater of either $50K or 1/3 of net estate
(B) What are rights of SS who is left mere $19 under will?  he can take under E/S
instead of taking under will
(C) What is “NET ESTATE”?
 All prop owned by decedent + certain testam’y substitutes (defined in EPTL §
5-1.1A(b))
 NY E/S applies to NET ESTATE after payment of debts and admin of REA funeral
expenses but before estate tax
(D) E/S is diff and less than intestate share
 Intestate share will always be larger than SS’s E/S, unless decedent held
significant prop in form of defined testm’y substitutes
(E) Exempt prop set aside – come off the top, above and beyond prop passing to spouse
by will, intestate share or E/S
 EPTL § 3.1(a)
 SS entitled to value of car – capped @ $25K
 SS entitled to furniture, appliances, etc. – up to $20K

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  Entitled to cash allowance --- up to $25K
 Generally, NOT subject to creditor’s claims – except where
assets not enough for funeral expenses
 Entitled to farm animals, farm machinery, tractors --- up to $20K
 Books, pictures, video tapes, software --- up to $2.5K
(F) What about decedent who owns prop in NY but domiciled in another jurisd?
 Will and estate are probated in domiciled state but there’ll by ancillary probate
in NY
 Can SS of this domiciliary claim E/S under EPTL § 5-1.1??
 NO  not available to SS of decedent not domiciled in NY
 Exception  if decedent expressly states in will that disp of NY prop to
be governed by NY law, then E/S rule applies.
(G) Testm’y Substitutes
 Almost all nonprobate prop will be treated as “Testm’y Substitute” and, thus,
included as part of AUGMENTED ESTATE
 EXCEPTIONS: Life insurance, irrevocable dispos made before marriage,
or made more than 1 year before death
 7 Testm’y Substitutes:
 Totten Trust  bank acct w/ title “John Smith as trustee for Mary
Smith”
 This isnt a trust – just a bank acct w/ specific title
 Survivorship Estates  Joint-Tenancies, Tenancies by Entirety, Joint &
Survivor Bank Accts
 How much is included?
 For the ones created 1+ years before decedent’s death, only
decedent’s interest included in AUGMENTED ESTATE – rest
becomes irrevocable gift
 Where does money come from?
 The other Bs who have to contribute pro rata
 Lifetime Transfers w/ Strings Attached  transfers w/ respect to which
decedent retained right to designate possession, income or enjoyment
or tight to possession, income or enjoyment – and revocable transfers
or revocable trusts
 Employee Pension, profit-sharings, or deferred compensation plans – if
employee designated a B on or after Sept 1, 1992, to extent to ½
 Gifts Made w/in 1 year of Death (not gifts < annual exclusion ammt
$14K estate gift tax) or Gifts Causa Mortis 
 USA Govt Bonds or Other PODs

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  Powers of Appointment  prop over which decedent held presently
exercisable power of appointment --- not prop over which decedent
held ltd or testm’y general power of appointment --- ONLY PRESENTLY
EXERCISABLE
 6 Items Specifically NOT Testm’y Substitutes and DON’T fall into E/S (LOG PIT)
 Life Insurance
 1.2 of qualified pension or profit sharing plans
 Gifts under gift tax annual exclusion
 Pre-marriage irrevocable transfers
 Irrevocable transfers made 1+ year before death
 Transfers w/ retained life estate made before 9/1/92
 Time limit for electing v. will
 Notice for intent must be w/in 6mos after issuance of letters
 Absolutely no later than 2yrs after death
 Right of election is personal to SS
 If SS incapacitated, guardian w/ ct approval may elect
 May be waived w/ consideration
 Has to be in writing and signed and W’d before notary
 6 Circumstances where SS will be DQ’d from taking
 Divorce
 SS procured outside NY an invalid divorce or annulment that isnt
considered valid under NY – if decedent procured, SS can elect
 Final decree of separation entered v. SS
 If marriage void b/c incestuous or bigamous
 Abandonment
 Lack of support

 Calculating NY Elective Share (D-47)

Line 1 Net Probate Estate

Line 2 Plus Testm’y Substitutes [some only included @ ½ ]
Line 3 Equals Augment Estate
Line 4 Elective Share amount [1/3 of line 3]
Line 5 Minus Amt passing to SS under will or by intestacy
Line 6 Minus Amt passing to SS as testm’y substitute
Line 7 Equals Net elective share to which SS entitled

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Session #21 – Children’s Rights; Unintentional Omission

C. Intentional Omission of a Child

1. American Law
 No requirement that T leave any prop to a child  you CAN inten’ly disinherit them
o But if do leave them out, almost surely inviting a will contest
o And courts will often bend over backwards to find some curative doctrine that’ll allow
kids to take  courts are sympathetic to kids that are left out

D. Protection Against Unintentional Omissions

1. Spouse Omitted from Pre-Marital Will

 At common law, premarital will revoked by T’s subsequent marriage or marriage followed by
birth of issue  overridden in most states
 Most states will give SS intestate share when will was pre-marital
 Spouse omitted from premarital will  always entitled to E/S !!!
 Also, under UPC, SS can get intestate share – that pot doesn’t include what T bequested to
kids
 UPC § 2-301: Entitlement of Spouse; Pre-marital Will
o If will doesn’t give to decedent’s children had before the marriage, SS that married
after will exec is entitled to no less than portion of estate she’d receive had decedent
died intestate (as to portion NOT devised to said children), unless:
(1) Appears from will that it was made in contemplation of marriage
(2) Will expresses intent that it’s effective, notwithstanding subsequent marriage
(3) T provided for SS by transfer outside of will

CASE: Estate of Prestie  revoked by marriage – look to statute

Facts: M and WR married in Vegas. Divorced 2yrs later. WR got sick and moved to Vegas. M
moved back too but didn’t live with WR immediately. 1994, WR executed “pour-over will” and
inter vivos trust – will gave entire estate to trust and WR’s son named trustee and B. But when
WR got sicker, M came back around and took care and moved in. WR amended trust to give M
life estate in condo upon death. M and WR also remarried. WR then died. M wants intestate
share of estate – argued will was revoked upon remarriage.

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Ratio Decidiendi: Under NV statute, will was revoked  NV statute says marriage revokes will
unless there is a marriage-K, SS is provided for in will, or is mentioned therein to show intent
not to make such provision --- here, none of that applies  no marriage –K, no provision in will
giving M anything nor indicating intent not to give her something. Change in inter vivos trust
doesn’t count b/c statute doesn’t say that changes to that matter.

2. Unintentional Disinheritance of Child

 “Pretermitted Heir” Statutes = designed to prevent unintentional disinheritance of child
 UPC § 2-302: Omitted Children:
(a) If will exec before child born/adopted, child can receive:
(1) If T had no child living when will exec, child born/adopted after will gets intestate
share, unless will devised all of estate to other parent of omitted child and that parent
survives T
(2) If T had 1+ living children @ time of will, and will devised prop to 1+ of then living
children, an omitted after-born gets PRO-RATA SHARE OF PROP PASSING TO OTHER
KIDS [ex: $100K to 2 children in will; then has 3rd child; 3rd child gets 1/3 of $100K]
(b) These apply so long as omission wasn’t intentional and omitted child not provided for
outside of the will

CASE: Gray v. Gray 

Facts: 1981, D exec will when married to W1 and had 2 kids from prior marriage. Will gave
entire estate to W1 and didn’t include kids. 1984 D and W1 have own child. In 1989, D and W1
divorce – divorce judgment, prop settlement included provision creating trust for their child,
whereby anything D got from D’s mother would go to that kid’s trust upon D’s death. D died
2004 w/o changing will. Kid wants some of estate even though will gives all to W1.
Ratio Decidiendi: Ct says that kid doesn’t get anything from D’s estate  AL statute says that id
after-born comes after will exec and said will doesn’t provide for that child, omitted child
entitled to intestate share unless, at time of will exec, T had other children but still gave
substantially all of estate to other parent of omitted child. Here, T had 2 kids at time of will exec
but still gave everything to W1. So, new kid doesn’t get intestate share.

Session #22 – Trusts: Rights of Beneficiaries & Creditors; Powers of Appointment

Chp. 10 Trusts: Alienation & Modification

 Three issues with Trust Law & FoD concept

(1) Extent to which SETTLOR may impose a restraint on “alienation” of beneficial interest
(2) Power of court to modify, terminate a trust w/o SETTLOR consent

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 (3) Trustee Removal

A. Alienation of Beneficial Interests

1. Discretionary Trusts (DTs)

 DTs = preserve flexibility in distrib over time
o Trustee may be given discretion over when, to whom, and in what amount to make a
distrib
o Trustee must exercise discretion REAly and in good-faith
 DTs also provide asset protection
o B’s creditors have no recourse v. B’s interests in DT and B can’t voluntarily alienate
interests in trust
 Two types of DTs  (1) Pure DT and (2) Support DT

(a) “Pure DT”

 Trustee has “absolute discretion” over distributions to Bs
 Under trad’l law, creditor of B in a Pure DT has no recourse v. B’s interest in trust
 Nor can B voluntarily alienate beneficial interest
 Creditor may be entitled to court order prohibiting trustee from making further distrib to B
until creditor is paid
o UTC § 501: “… subject to a spendthrift trust provision, the court may authorize a
creditor or assignee of the B to reach B’s interest by attachment of present or future
distrib to or for the benefit of B/”

(b) “Support DT”

 Trustee has to make distrib to cover B’s needs
 B CANNOT alienate interest in trust
 STs insulate trust prop from some but not all of B’s creditors
o Trad’l law  child or spouse enforcing claim for support or alimony, as well as supplier
of necessities, has recourse v. trust prop through B’s right to support

(c) “Discretionary Support Trust”

 Mix of above two  trust provides for B @ T’s discretion
 Courts tend to treat as Pure DTs, thereby foreclosing claims of all creditors

(d) “Collapsing the Categories”

 UTC and Restatement 3d of Trusts collapse distinction btw “discretionary” and “support” DTs
o Creditor of B can’t compel distrib

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 o But court may order a distrib for child/spousal support
o Restatement  “if terms of trust provide for B to receive certain distrib in trustee’s
discretion, transferee or creditor of B entitled to receive, attach any distrib trustee
MAKES OR IS REQ’D TO MAKE in exercise of that discretion”
o UTC § 504: subject to exception for claims by child or spouse for support or alimony,
creditor can’t compel distrib even if B could do so

2. Spendthrift Trusts
 Trust whereby B can’t voluntarily alienate interest in trust, nor attach  even if B is entitled
to mandatory distrib
 Nor can creditors attach interests  true even if B has entitled to mandatory distrib
o Unlike creditor of DT B, creditor of Spendthrift Trust CAN’T obtain court order
preventing trustee from making distrib to or for benefit of B or attaching a future
distrib
 Spendthrift Trust created by imposing disabling restraint on alienation of beneficial interest
o Trad’l law = not a spendthrift trust unless SETTLOR includes spendthrift clause in trust
instrument
o But in most professionally drafted wills, boilerplates include spendthrift trust provision
– some states even presume its spendthrift even if no provision
o NY  all trusts presumptively spendthrift w/ respect to income
o Ex: “The interests of Bs in the principal or income shall not be subject to claims of any
creditor or to legal process and may not be voluntarily or involuntarily alienated or
encumbered.”
 UTC § 502: Spendthrift Provision
(a) STT valid if restrains both voluntary and involuntary transfer of B’s interest
(b) Term “spendthrift trust” in trust provision or words similar is sufficient to restrain xfer
of interest
(c) B can’t transfer interest in violation of STT, except as said in § 503, and a creditor can’t
get to interest or distrib of B before trustee pays it and B receives it
 UTC § 503: Exceptions to STT Provision
(b) STT provision NOT enforceable v.:
(1) B’s child, spouse, ex-spouse for court ordered support
(2) Creditor who provided services for protection of B’s interest in trust
(3) Fed or State claims

Notes

 Tort Vicitms  most states to consider have rejected proposition that tort victims are
exception to Spendthrift Trust prov
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 Children and Spouses  judgments for child-support can be enforced v. debtor’s interest in
STT in majority of states
 Necessary Support & Other Exceptions  UTTC §503(b)(2) allows claimaint who provided
services necessary to protect B’s interests in a trust to recover v. B’s interest
 “Station-in-Life” Rule  NY: B’s creditors can reach STT income in excess of amount needed
to support B – to determine what’s necessary for support of B, courts developed “station-in-
life” rule which says that creditors can reach only amt in excess of what’s needed to maintain
B in his station-in-life

CASE: Scheffel v. Krueger  tort victim creditors can’t get into a STT
Facts: P sued D for sexually assaulting child, videotaping it, etc. Same conduct formed basis of
crim charges. Court awarded P $551K in damages and P wants to tap into irrevocable trust of
which D is a B to get it. Terms of that trust say that all income to go to B quarterly, or more
often if D requests in writing. Also, trustee can pay B more of principal if in trustee’s discretion
funds are necessary for maintenance, support, and education of B. Otherwise, can’t touch it
until 2016. Also a STT provision, making B’s rights inalienable.
Ratio Decidiendi: Ct says that P can’t tap into D’s interest in trust b/c a “tort victim creditor” is
not among exceptions to STT exception statute. So this type of creditor can’t get into STT.

Chp. 12 Trusts: Powers of Appointment

 Settlor may give someone other than TRUSTEE a non-fiduciary power to distrib trust prop =
“POWER OF APPM’T”
o Holder of PoA = “DONEE” and he may appoint trust prop to 1+ persons (“OBJECTS”) in
accordance w/ terms of the power
o Ex: H devises prop to X in trust for W for life; On W’s death, distribute principal to
whoever W appoints in her will

A. Purposes, Terminology, Types of Power

1. Terminology & Relationships

(a) “The Parties”

 PoA = power that enables DONEE of power to designate recipients of beneficial ownership
interests in the appointive propert
o Primary purpose of PoA = build flexibility into estate plan
 Donor = person who creates PoA
 Donee = person who holds PoA
 Objects = person in whose favor power may be exercised

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 Appointee = person appointed
 Takers in Default = persons who receive prop if done fails to exercise power
 Appointive Prop = prop at stake

(b) “Creation”
 To create, DONOR must manifest intent to do so, expressly or by implication
o Words “PoA” or “appoint” not necessary
o “Any words, phrases sufficient … if they est that transferor so intended”
 PoA confers “discretion” on DONEE, who may choose to exercise power or not and must be
distinguished from a non-discretionary, direct dispo by DONOR

(c) “General & Non-General Powers”

 General Power = power which is exercisable in favor of done, his estate, his creditors or
creditors of his estate
o Donees w/ general powers of appointment are considered owners b/c donee can
appoint self and have the prop
 Non-General Power = power not exercisable in favor of done, his estate, his creditors, or
creditors of his estate
o Prop subject to these viewed as belonging to DONOR, not DONEE – DONEE is merely
filing in blanks for donor

2. Creditor’s Rights
 Trad’l prop law view w/ respect to creditors  DONEE has no prop interest in unless DONEE
exercises the power
 Modified view: UTC and Restatement  says creditor of DONEE presently exercisable can
reach assets

CASE: Irwin Union Bank v. Long  divorce spouse can’t reach DONEE’s interest until exercises
(old view)
Facts: Victoria obtained judgment v. Phillip from divorce decree. She wants to satisfy judgment
by going after his trust fund set up by his mom. 1969 order said marital prop included 4% of his
trust funds. Trust said when Phillip reached 21yrs old, he could take out 4% of trust principal
per year.
Ratio Decidiendi: Court says that Phillip has no control over prop until he exercises his power of
appointment  until he starts taking out that 4%, he doesn’t have control over it. Therefore,
creditors can’t get it until he exercises that power – they can’t force him to exercise.
B. Exercise Power of Appointment
 To exercise PoA:

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 (1) DONEE must “manifest an intent” to exercise the power
(2) Manner of expression must satisfy any “formal requirements” imposed by DONOR
(3) Appointm’t must be “permissible exercise” of power
(4) Disclaimer or release of PoA and contracts to exercise a power
 Problems arise when no instruction  DONOR can always specify how to exercise
 MAJORITY  DONEE’s residuary clause does not exercise power
o To overcome default rule, some wills have blanket exercise clause that purports to
exercise any power held by DONEE
 NY: it is an exercisable “non-general power” if residuary devisees are objects of power
o Most states say residuary is not exercise of non-general powe
 UPC: Residuary is considered expression of intent to exercise
o Absent reqm’t for how power to be exercised, residuary clause will be considered
expression of intent to exercise power

CASE: Beals v. State Street Bank & Trust Co. 

o She made her general power into a limited power and died without specifically
exercising her powers, leaving her existing property in the residue of her will to the
descendants of one of her sisters
o Reasoning of the case is flimsy

Session #23 – Fiduciary Duties

Chp. 9 Trusts: Fiduciary Administration

 Trustees are subject to 3 fiduciary duties:

(1) Loyalty: obligation of trustee to manage prop solely for benefit of Bs
(2) Prudence: behave better with another person’s prop
(3) Subsidiary: inform and account to Bs, impartiality (can’t favor one B over another), w/
respect to trust prop
 3 Kinds of Trusts
(1) Business Trust = commercial deals, mutual fund, securitization
(2) Revocable Trust = non-probate transfers, will substitute
(3) Irrevocable Trusts = ongoing fiduciary admin, fee paid professional to manage wealth

A. Duty of Loyalty
 No Self-Dealing, buying or selling assets from or to trust, borrowing trust funds, loaning $$ to
trust, no profiting [compensation for work as TRUSTEE is okay], no commingling [unless bank
is trustee]
o EXCEPTION: Bs consented, grantor agreed, or court agreed

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 o Otherwise, courts apply “No-Further Inquiry” Rule
 Ct doesn’t care if deal was fair, good-faith or best for trust
 Only Q becomes measure of damages

CASE: Hartman v Hartle  exec sold farm to other daughter = breach of loyalty
Facts: T died and son-in-laws were execs. Will left everything to children. Execs sold farm to
one of T’s sons who had bought the land for his sister (one of exec’s wives) for $4K. But
daughter then sold farm to another guy for $5.5K. Other kids now want piece of extra a$1.5K
that daughter and exec got for the farm.
Ratio Decidiendi: Ct said that daughter has to share profits  it’s breach of fiduciary duty of
loyalty for exec to self-deal. By selling land to son who was going to give it to exec’s wife, that
was self-dealing. Their subsequent extra profit was exec allowing himself to profit from position

CASE: In re Gleeson’s Will  exec worked the farm and profited = breach
Facts: MG died testate, owning lots of farm land. By will named CC to be exec of will. Also
named trustee under will and residuary of estate, including the land, to be devised to CC in
trust for benefit of MG’s kids. But 2yrs earlier, MG leased the farmland to CC and a partner for
1yr, released it a year thereafter. When 2nd lease exp’d, partners cont’d as tenants for another
year. Thus, CC had leased part of that farmland to himself in partnership capacity and rec’d
portion of profits therefrom as trustee.
Ratio Decidiendi: This was breach of duty of loyalty  RULE – trustee cant deal in his indiv
capacity with trust property. CC should’ve picked one  trustee or tenant-farmer of land

Note
 No-Further Inquiry Rule  if trustee undertakes transaction that involves self-dealing or
conflict btw his fiduciary capacity and personal interests, good-faith, fairness aren’t enough to
save trustee from liability Only defenses for trustee: (a) SETTLOR AUTHORIZED; (b) Bs
CONSENTED; (c) JUDICIAL APPROVAL AFTER FULL-DISCLOSURE
 Remedies for Breach  If trustee breaches, Bs entitled to “election of remedies” including
compensatory damages to restore trust estate and trust distrib to what would’ve been if not
for breach; Additionally, Bs entitled to “disgorge” trustee of any profit made on transaction; If
T sells own prop to trust, B may compel trustee to repay purchase price and take back prop; If
trustee bought trust prop, B may compel trustee to restore prop to trust; If in wrongfully
dispo trust prop trustee acquires other prop, B entitled to enforce “constructive trust” or
“equitable lien” on acq’d prop
 Categorical Exceptions  Most states allow corp-trustee to deposit trust assets w/ own
banking dept and to invest trust assets in mutual fund operated by trustee or affiliate; Also,
trustee allowed to take REA compensation even though this is self-dealing UTC § 802

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CASE: In re Rothko  exec profited from D’s painitgs, appreciation damages
Facts: Artist died leaving 800 valuable paintings and 3 execs.
Ratio Decidiendi: 2 of the execs breached duty of loyalty w/ conflict of interest – they had
dealings w/ gallery. The other one breached duty of prudence – didn’t maintain acting.

B. Duty of Prudence
 UTC § 804
o A trustee shall admin trust as prudent person would, by considering the purposes,
terms, distributional reqmts, and other circumstances of the trust. In satisfying thus
std, trustee shall exercise REA care, skill and caution.

1. Investment Function
 Involves reviewing trust assets and making and implementing an ongoing program of
investment in light of trust’s purpose and circumstances of Bs
 Prudent Man Rule
o In hindsight, was the investment prudent?
o Problem is that any bad investment meant that you breached the duty, made people
too cautious, trustees on hook all the time
 Modern Portfolio Theory
o Risk is related to return  should apply more holistic approach than prudent man rule
o Let trustees take some risks
o Gave rise to Prudent Investor Rule
 Prudent Investor Rule
o UTC Rule  shall admin as prudent person would in considering terms of trust,
distributional requirements, circumstances of the trust, REA care & caution
o Good-faith and diligence are good defenses
o If you are lawyer, or have special skills, expertise, held to a higher std than others
under this rule
o Hypo:
 A bond and 2 different stocks.
 Bond earns 2% guaranteed
 Stock 2 – 50% chance of -2% return and 50% chance of 10% return.
 Stock 3 – 50% chance of -10% return and 50% chance of 75% return.
 If you are governed by prudent man rule – you pick bond
 If you are under prudent investor – you can pick any of the 3 investment as
long as you have good faith and diligence etc.

Session #24 – Charitable Trusts

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Chp. 11 Trusts: Charitable Purposes, Cy Pres, & Supervision

 Three rules distinguishing charitable trusts (CTs) from private trusts:

(1) Must be created for a CHARITABLE PURPOSE
(2) B/c exempt from Rule v. Perpetuities, thus, may endure forever, can be more freely
modified under the CY PRES DOCTRINE
(3) NO ASCERTAINABLE Bs REQM’T, so law relies on respective State Att’y Gen to
enforce

A. Charitable Purpose
 Trust must be created for 1+ “charitable purposes” – diff from private trusts that require 1+
“ascertainable Bs”

CASE: Shenandoah Valley Nat’l Bank v. Taylor  true charitable purpose v. mere benevolence
Facts: T’s will instructed executor, AVNB to distribute $86K trust in trust in this way – on last
days of school before X-mas and Easter, have trust’s net income divided equally among children
in 1st-3rd grades of “the School” and pay each child one share, “to be used … in furtherance of
his/her obtainment of an education.” T’s heirs wanted the trust a la intestacy – argued that
trust was invalid under Rule v. Perps b/c not a true charitable trust.
Ratio Decidendi: Ct said that this was not a valid charitable trust and thus is void b/c violates
Rule v. Perps  must look to intent and see if dominant is charitable or mere benevolence.
Restatement says that “charitable purpose” includes “the advancement of education” and
“other purposes, the accomplishment of which id beneficial to community.” Here, education
justification doesn’t apply b/c Trustee had no way of ensuring students used $$ for education
purpose – trustee’s control over $$ ended when kids paid and thus, esp b/c it would be given
around holidays, this was mere benevolence. “Beneficial to community” is also no good – trust
doesn’t require consideration of who is in-need, poor, etc.

Notes

 Trad’l List of “Charitable Purposes,” as Codified in UTC § 405(a) :

(A) Relief of Poverty
(B) Advancement of Education and/or Religion
(C) Promotion of Health
(D) Government or Municipal Purposes
(E) Other purposes, the achievement of which is beneficial to community

B. Cy Pres & Deviation

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 1. “Cy Pres”
 Cy Pres = “as nearly as possible”
 Under this doctrine, if charitable trust’s specific purpose becomes (A) illegal; (B) impossible;
(C) impracticable, the court may direct application of trust prop to another “charitable
purpose that approximates the SETTLOR’s general charitable intent”

(a) “Illegal, Impossible, or Impracticable”

CASE: In re Neher’s Will 

Facts: EN’s will directed that much of her real estate, held in trust, be donated to Village with
direction that hospital be built thereon in memory of her deceased husband. Village also named
trustee. Village presented petition that said it didn’t have resources to build, operate a hospital
and that hospital in nearby village served this Village’s interests, making another one
unnecessary. They wanted to invoke cy pres and build administrative building on land instead.
Ratio Decidiendi: Ct invokes cy pres doctrine and let’s Village use land for Admin building  the
direction in will that hospital built lacked particularity as to what type of hospital, what type of
care to provide, etc. Ct says this is indication that gift NOT conditioned on particular use. Ct
thinks intent is “general charitable purpose,” not a “specific charitable purpose,” with direction
---- such directions can be ignored when it’d be impracticable  it’s impracticable here b/c no
resources and already have a hospital.

Notes
 Cy Pres & General Charitable Intent  Restatement:
o If T devises prop in trust to est & maintain an institution of particular type but similar
institution already exists and is sufficiently effective that T’s plan would serve no
useful purpose, intended purpose won’t be enforced … If prop given in trust for
particular charitable purpose and amount given is insufficient to accomplish intended
purpose in socially useful manner, specified purpose fails and may be modified as per
cy pres doctrine
o Under trad’l law, precondition of cy pres is finding that donor had general, rather than
specific, charitable intent  UTC § 413(a) modifies Restatement and cy pres doctrine
by est’ing presumption that donor had a “general charitable intent”
 Approximating Donor’s Intent  Inreasingly, courts/legislatures satisfied w/ alternative
purpose that “REAly approximates the designated purpose.” Restatement. Movement away
from “as near as possible” language; UTC § 413(a)(3): Ct may “modify or terminate the trust
by directing that the trust prop be applied or distrib, in whole or part, in manner consistent
w/ SETTLOR’s charitable purpose.”

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 (b) “Wasteful”

 UTC § 413(a) permits application of cy pres if particular purpose becomes “wasteful”

 Restatement: “… the amount of prop held in the trust exceeds what is needed for the
particular charitable purpose to such an extent that the cont’d expenditure of all of the funds
for that purpose, although possible [], would be wasteful.”

2. Deviation
 **Applicable to ALL TRUSTS, not just charitable trusts
 Court will permit trustee to devise from admin terms of trust if compliance would defeat or
substantially impair accomplishment of trust’s purposes in light of changed circumstances not
anticipated by the SETTLOR

CASE: Barnes Foundation  Philly gallery that deviated from terms of trust
Facts: Dr Barnes invented an antiseptic. Collected tons of artwork. Matisse Cezannes Picasso.
He only let middle class see his art collection – didn’t lke rich ppl. He created Barnes Foundation
– art education. By laws said no painting was to be removed ever, not sold nor loaned, nor
added. No admission fees, open only 2 days a week. When the last trustee died, control of
foundation passed to Lincoln University. They found the gallery in disrepair with not enough
money to maintain or secure the gallery. They asked to court for change. To charge admission
fee. Discretion in investing. Could hold fundraising events there. And to sell some of the art.
And a world tour of the artwork. Money was used to modernize the gallery.
Ratio Decidiendi: In 2002 trustees petitioned to move the gallery from Merion to Philly. Turned
down.

3. Discriminatory Trusts
 Religion, gender, race.
 Discrimin. Trust administered by state – violates equal protection.
 Usually take out the discriminatory clause.
 Courts will also often not uphold racists trusts – because court decision is also govt action.
 Discriminatory Trust
o Is there a government actor? If yes, then administration of trust violates equal
protection. Senator Bacon case – park for whites – shot down.
o Is it a private actor? Then no constitutional problem. But since trusts exists by legal
grace, any discrim trust is a problem. It could also violate other statutes.

 Hypo 1:

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 o Thelma devises estate in trust. Trustee shall distribute to benes doing polio research.
This promotes health – its valid charit. Trust?
 yes this is charitable trust
o Now polio is cured, what should trustee do when theres no more polio research? If
threshold question is answered
 Cy Pres Test
1. Can thelmas specific intent be accomplished? No
2. Did she have general charit. Intent? Yes. Medical research for disease.
3. If specific intent cant be accomplished, court applies cy pres, and directs
trustee to dis to other charities engaged in medical research.
 Hypo 2:
o Trust to pay to Buffalo White House for the blind. 2years later Buffalo white house for
blind goes out of existence.
 Cy Pres Test
1. Can specific intent be accomplished? No
2. Did he have general charitable intent? Yes – to provide for blind.Theres
still a lot of blind people
3. Apply cy pres – instruct trustee to distribute to other orgs.

Session #25 – The Rule Against Perpetuities

Chp. 14 The Rule Against Perpetuities & Trust Duration

 One MAJOR limit on FoD  Rule Against Perpetuities (RAPs)

o All interests, in trust or otherwise, must vest or fail w/in the lives of everyone who
could have possibly been known to thee donor (“lives in being”) plus the minority of
the next generation (“21 years”)
 Policy  a contingent interest is objectionable if the contingency may remain unresolved for
longer than “lives in being” plus 21 years
o Keeps property marketable
o Limits “dead-hand control”
 RAP Reform
o No state follows common law RAP anymore
o Types of statutory changes:
(1) Self-Help Through “Savings Clause”  “Any trust created here shall terminate
if it has not previously terminated, 21 years after the death of the survivor of

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 the Bs of the trust living at the date the trust becomes effective … Principal is
distributed as provided in the clause.”
(2) Cy Pres  allows court to modify a trust that violates RAP as necessary to carry
out T’s intent
(3) Wait and See  wait and see what actually happens, don’t invalidate an
interest b/c it might fail
(4) Abolition  just abolish the rule
 Things to know for RAP:
1. Origin of Rule  England, 4 brothers
2. State Rule  “Lives in Being” + 21 years
3. Policy Behind Rule  (1) Alienation of Land & (2) Dead-Hand control
4. Describe, Define, Apply Suspension Rule  need to know who to invite to the party to
convey the land in fee-simple
5. Identify reform efforts (reduction of age contingency, cy pres, second-look doctrine)
6. Identify Uniform Statutory RAP (either RAP or 90 years in gross)
7. When does the rule start to run w/ respect to “powers of appointment” – when is it
“irrevocably created”
a. Is the power valid  if it must be exercised w/in LIB + 21 years
b. Are interests created by power valid?  perp period starts to run from date
instrument irrevocably creating the power, not the exercise; EXCEPTION:
(i) Hypo 1: T creates revocable trust in 2001: “to T for life, then to kid
for life, on kid’s death, to persons appointed by kid in her will.” T
dies in 2014. Kid in her will “to such of my children as long as
permitted by perp-period.” When does perp period start to run? 
2014 when it becomes irrevocable!!!
(ii) Hypo 2: T creates irrevocable trust in 2012 – the rest the same as
above hypo. When does perp period start?  2012 when
irrevocable trust created.
8. Second-Look Doctrine  let’s wait and see what happens; then determine validity at
time of exercise, not at time of creation (see how old kids are), then aided by reduction
of age contingency
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