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Trusts and Estates
Southern Illinois University School of Law
Noble-Allgire, Alice M.

Trusts and Estates

Noble-Allgire

Fall 2014

Probate process: Poperty of the decedent alone and held in as a tenant in common are subject to probate. Is used if no other theory authorizes a shift of property.

Joint tenancy (tenancy by the entirety) property, life insurance proceeds on the decedent’s life, property in lifetime trusts, pensions, and IRA’s are outside of it.

Intestacy: who are heirs?

Heir: person who takes under the state’s intestacy statute.

Alternatively is someone dies with a will

beneficiaries, devisees or legatees take.

Decedents are testators rather than intestate.

Someone is the executor of the will.

What property passes by intestacy? Probate assets or when a person dies partially intestate.

Survivorship:

simultaneous death: many states (illinois) have statutes that provide that if there is insufficienct evidence that the persons died otherwise than simultaneously, the property should be disposed of as if he had not survived.

UPC: created a rule requiring a person to survive 120 hours after the death of another person before they can be deemed to have survived.

Choice of laws: law tends to be the situs of the property. Concerning personalty use the law of the decedent’s domicile.

Protective provisions: family members are allowed to take assets off the top. These vary in different states. not limited to intestacy. Influences survivor’s shares. 3 categories. 1. homestead property ( real estate) 2. exempt property(personal property) 3. support (UPC grants a reasonable allowance for spouses and minor children from the estate.)

Intestate schemes

Blood relatives are favored. Family lines matter ( look up, look down, look up). Look to the descendants. If there are no descendants, then look to the parents. If the parents are dead, then look to brothers and sisters and if necessary nieces and nephews. STOP WHEN YOU FIND SURVIVORS.

Pay attention to degree of relationship: descendants are 1 degree. Parents are also one degree. Brothers and sisters are 2 degrees. As are grandchildren. Nieces and nephews are 3.

Representation: some states allow a deceased descendant to act as a placeholder. decedent has a child and two grandchildren. Representation= ½ to the child. And ¼ to the grandchildren, their deceased parent is representative.

Allocating Shares

Spouses

UPC: the spouse will take the whole estate if no descendant or parent of the decedent survives or all of the surviving descendants are also descendants of the surviving spouse and there is no surviving descendants. Lump sum to the spouse.

Or

first, 300,000 plus ¾ of the balance if the decedent had no descendants, but parents alive.

Second, 225,000 plus ½ of the balance if all the decedent’s descendants are also descendants of the spouse.

Third, 150,000 plus 1/2 of the balance if the decedent had descendants who are not descendants of the spouse.

Illinois does support: additional sum of money that the court deems reasonable for the proper support, during that period, of minor and adult dependent children of the decedent who reside with the surviving spouse at the time of decedent’s death for 9 months after the death. (support must be at least 20,000). (10,000 for support of each minor child).

Surviving spouse and descendants: half to spouse and half to the descendants.

If no spouse or descendants. Parents and parent’s descendants per stirpes. Still no? Grandparents and descendants per stirpes.

Descendants and collaterals

Per capita: count people treat as if all are in the same generation. Just count heads and apply.

Representation:

A. strict per stirpes: divide the estate into as many shares as there are surviving children or deceased children who left descendants surviving the decedent.

B. Per Stirpes: per capita with representation: skips older empty generations and divides the estate into shares at the first level with survivors. First generation with survivors is per capita and then per stirpes

C: per capita at each generation: divide at first gen. With survivors. Give each survivor a share and designate shares for deceased members who have descendants. Combine remainder of shares and distribute per capita.

Rights of non-marital children:

Illinois: children can take from their mother and if the father has established a paternal relationship or paternity has been adjudicate while alive.

Parents can only inherit from non-marital children if they have established a parental relationship.

Adoption: adopted children can generally only inherit from their adopted parent. Special cases: adopted by spouse of the birth parent, adopted by relative of the birth parent(can only take from one share of the common ancestor of birth parent/adoptive parent). Minority view: adopted kids can inherit from their birth parents.

Generally: only adoptive parents can inherit from an adoptive children.

Illinois: a child is not considered a child of a natural parent unless. 1. the child is adopted by the descendant or a spouse of a descendant of a great-grandparent of the child. 2. or a natural parent of the child died before the child was adopted.

Half-bloods: Majority:no distinction between half and full blooded relatives.

Minority: excludes in some case.( ancestral property and there are full bloods of same degree)

Step children: Usually they are not allowed to inherit. Minority: may take if there are n eligible takers.

Posthumous children: trad. Could take if they were in gestation at time of death (survived 120 hours UPC). Modern: can be conceived after death if consented to by the decedent.

UPC

Child conceived by assisted reproduction

No parent child relationship between a child and third party donor.

A parent child relationship exists between a child of assisted reproduction and the child’s birth mother.

Parent child relations ship exists for assisted child if the husband of the birth mother’s sperm was used.

Names on birth certificate establish presumption that there is parent child relationship.

Absent these things someeone can have a pare

997 letter is a codicil to his will because the testator only disposed of his remaining ownership interest in the Montana property and did not dispose of his entire estate

Capacity

can be about age(must be 18)

two possibilities for mental state: may be suffering from mental deficiency or operating under an insane delusion

Deficiency: capacity to make will compromised

general requirements

Mental Capacity:

1.know the nature and extent of property

2.know the natural object’s of the testator’s bounty, or people most likely expected to take.

3. understand the basics of the plan for disposition of property.

4. how the elements interrelate

Insane Delusion: a belief,adhered to without reason, impossible under the circumstances,and leading to an unnatural disposition.

In re estate of Romero: perfect memory of an estate is not an element of testamentary capacity. A testator may forget part of his estate and still have a valid will. Thus, the fact that the guy didn’t know the exact value of his estate does not demonstrate lack of capacity. The court dismissed the idea that the guy had an insane delusion that his estate had little value.

Capacity based on mental illness: the psychiatric history and mental status examination and specific inquiry into the patient’s understanding of and reasoning about the decision at hand. Determines whether symptoms are disabling decision making.

Undue influence

Often this allegation comes when a beneficiary is accused of deciding where assets would end up

1.The donor was susceptible to undue influence

2. alleged wrongdoer had chance to exert undue influence

3. alleged wrongdoer had a disposition to exert undue influence

4. There was a result appearing to be the effect of the undue influence

Factors for undue influence

Confidential relationships

1. influencer had some part in the preparation of the will

2. Extent of secrecy and haste

3. beneficiary’s benefit is unwarranted or unfair in light of other possible claimants

4. existence of independent advice

Restatement: presumption of undue influence: if there is a confidential relationship the influence is presumed

3 types

Fiduciary: relationships like those betweeen attorney and client.

Reliant: a relationship based on a special trust or confidence.

Dominant-subservient: the influencee must be shown to be subbservient to the dominant person. Like a caregiver at a nursing home.