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Wills, Trusts, and Estates
South Texas College of Law Houston
Siegel, Mark R.

WILLS, TRUSTS, & ESTATES
FALL 2012
PROFESSOR SIEGEL
SOUTH TEXAS COLLEGE OF LAW
 
 
Technical Terminology
     Escheat – CL. Property of a person who dies w/out heirs to the estate à Goes to the state. Can’t pass by devise or descent
     Devise: A person dying testate (w/ will) devises real property to a devisee                                                                                                                                          EX: Blackacre
     Bequest: A person dying testate (w/ will) bequeths personal property to legatees                                                                                                              EX: Car
     Descent: Property not devised by will passes by intestacy
     Joint Tenancy: Joint tenants w/ right of survivorship                                                                                                                                      EX: If A dies à B takes all property
     Beneficiary Designations                                                                                                                                                                                                                                                             EX: Retirement plan, IRA, Life Insurance
     Executor
–   Duties
–   1) Inventory & Collect Assets
–   Must take an inventory of the property to learn what is probate vs non-probate property
–   2) Manage Assets During administration
–   Personal property in home à Easy to manage
–   Livestock à Difficult. Must keep alive & find chores prior to O’s death
–   3) Receive & pay claims of creditors
–   Find valid vs. invalid claims                                                                                                                                           EX: Fake creditors who read the obituary
–   4) Clear title to any assets                                                                                                                                                   EX: Ensure real property title clear before distributing
–   May be 9-18 months if estate tax return is due (next tax season)
–   5) Distribute remaining assets to proper party
     Descendants: Relationships by consanguinity (by blood). Narrow. Never includes spouse
     Heir: There are no heirs to the living. Broader. May include affinity (by marriage)
     Collateral Relatives: Neither ascendants or descendants but whom are related by blood to a common ancestor              EX: Siblings
 
Scenario
Who Takes?
In-class example
Who are the descendants? A-F are lineal descendant’s (children, grandchildren)
Who are Teri’s heirs? Mark & A-F (possibly). Must know who’s alive. There are no heirs of the living.
F? F has no descendants. F has lineal relatives, aka lineal ascendants (parents, B, & whomever)
B? A, C, D (siblings). They’re collateral relatives. [If C died à E& F are nephews (collateral relatives)]  
Right to Transfer Property
     Transferability §26.004
     Hodel v. Irving
–   Pre-Hodel: No right to make a will
–   Rule: 5th Amendment (taking w/out just compensation) curtails gov’t power to limit the right to convey property at death
–   Effect: Limits gov’t from decreasing property rights that can be transmitted at death
–   Facts: Fed gov’t fractioned property. Encumbered ability to sell bc can’t sell your 1/26th w/out permission from the other 25. The § abolished devise & descent, which was a takings violation. Protected right to transmit, not right to receive
     Shaw Family Archives v. CMG Worldwide (pg 10)
–   Facts: “Post-mortem right to publicity” in Marilyn Monroe’s property was posthumously created
–   Holding: It didn’t pass pursuant to the residuary clause
      
     After-Acquired Property: Property acquired after wills execution
     Residuary Clause
–   Definition: A catch-all of after acquired property that acts as a safety net to avoid intestacy
–   Compare to Shaw: In Shaw, the right of publicity wasn’t created until after death
–   Tip: A properly drafted will contains a residuary clause for after-acquired property (Shaw pg 1
      
 
 
Total vs. Partial Restraint on Marriage
Total Restraint à Invalid                                                                                                                                                                                                                                                                   
Partial Restraint à Valid         

tribute property to those intended after the decedent’s creditors are paid
 
Formal vs. Informal Probate
     Formal Probate (aka dependent administration)
–   Definition: Ct supervises personal representatives actions in administering the estate
–   Disadvantage: Potentially costly & time-consuming
     Informal Probate
–   Definition: Limited Ct supervision. Personal representative administers estate w/out Ct supervision unless an interested party asks for Ct review
 
 
 
Aaron Green Problem (pg 47)
Scenario
Questions
Facts
     Died testate
     “To my wife, Martha, if she survives me; otherwise to my children in equal shares”
     Executor: Martha
 
Property
     Car $15,000
     Furniture $20,000
     Mutual Fund $10,000
     Joint Checking Account $3,000
     Life Insurance (Martha is beneficiary) $50,000      Non-probate
     Pension Plan-survivors benefits (to Martha)
     No real property. Rented apt
 
Debts
     Utility Bills $80
     Consumer charge accounts: Visa $600, Dept Store $250
     Funeral $8,000
Cemetery Lot $600
 
Must it be offered for probate?
+ Administrative Costs. Must be in state domiciled @ death w/in 3 yrs
 
1) Must there be an administration of the estate? Yes
Title-clearing? Car. In TX, may be able to transfer title by affidavit into Martha’s name to avoid probate
Debts? Martha may have to sell assets (might not be in cash @ death)
If she pays as executor à May have to create an estate bank account. Look at totality to see if necessary. Might not matter if only 1 recipient, Martha
Creditors may intentionally probate the will to protect from creditors who haven’t timely filed a claim
Taxes?
–   May have unpaid income tax
–   There’s no estate tax
–   Minimum estate size à