PROFESSOR PARELLA
ST. JOHN’S UNIVERSITY SCHOOL OF LAW
TRUSTS & ESTATES
FALL 2010
TRUSTS & ESTATES OUTLINE
PARELLA – FALL 2010
INTESTACY
· We’re dealing with a situation where there was no will made OR if there is any property that is NOT covered under a will.
· Intestacy rules also apply where the will says “to my issue” or some to a class.
· Policy
o We want an orderly distribution of the property
o Distribute property that is close to what the decedent would have done if (s)he made a will.
o Spouses and children are generally favored in NY laws when dealing with intestacy
· EPTL 4-1.1 – lays out who gets what in certain situations
o Decedent survived by spouse and issue: the first 50k + 1/2 the residue goes to spouse; the rest to issue by representation
SPOUSE
ISSUE
PARENTS
HOW MUCH DO THEY GET?
Yes
Yes
Doesn’t matter
Spouse – first 50k & half the remainder
Issue – get whatever is left, by representation
Parents – nothing
Yes
No
Doesn’t matter
Everything to Spouse
–
Parents – nothing
No
Yes
Doesn’t matter
–
Issue – everything by representation
Parents – nothing
No
No
Yes; one or both
–
–
Whole to surviving parents
o (5) If there is no spouse, no issue, no parent(s)
§ the whole thing goes to issue of the parents, by representation (see table of consanguinity
§ Issue of parents: brother/sisters of decedent and their line (their kids, your nephews/nieces, etc)
o (6) if there is no spouse, no issue, no parent(s), no issue of parents
§ 1/2 to surviving paternal grandparent(s) and if they don’t survive, to their issue (the issue of grandparents) by representation.
§ The other 1/2 to surviving maternal grandparent(s) and if they don’t survive, to their issue (the issue of grandparents) by representation.
§ There is a limit though: “issue of grandparents” only extends to the grandchildren of the grandparents and no further – see table of consanguinity
· so here, issue of grandparents = uncles/aunts & first cousins & no more
o (7) if there is no spouse, no issue, no parent(s), no issue of parents, no grandparent(s), no children of grandparents or no grandchildren of grandparents
§ 1/2 to the great grandchildren of the paternal grandparents, per capita
§ The other 1/2 to the great grandchildren of the maternal grandparents, per capita
§ If there aren’t great grandchildren of grandparents on one side, the whole goes to great grandchildren of grandparents on the other side, in the same way (again).
o For this section Half-blooded relatives = full blooded relatives
o Distributees that are conceived in the decedents lifetime but born after death, take as if they were born in decedent’s lifetime
o An adopted child counts as a ‘real’ child.
· Distribution Methods: in general we are going mostly to the spouse and children
o Representation: EPTL 1-2.16
§ note: representation comes into play when 2 or more ancestors predecease w/issue (A & C in our example) – numbers 3 and 5 in the example
§ until that point we are in a per stirpes situation
o Per Stirpes:
§ Property divided into equal shares at the generation nearest, where there are surviving ancestors.
§ In the picture above it is numbers 1, 2 and 4 – also see below picture
o Per Capita: as a general rule; don’t use these words because it’s very confusing; it has had many meanings over the years.
· “Issue”=descendant of decedent/intestate in any degree. Includes
Non-Marital Children: Children of unmarried parents; illegitimate children
o EPTL 4-1.2
§ In general the non-marital child is the mother’s; the child inherits through and from the mother.
§ The non-marital child will inherit through and from the father only if:
(i) Paternity established by an order of filiation by a court or
(ii) The father has signed an instrument acknowledging paternity (there are 3 sub-requirements for this one) or
(iii) Paternity established by clear and convincing evidence, which may include:
1. Evidence from a Genetic Market Test
2. Evidence that father open and notoriously acknowledged the child as his own
§ NY Cases: if you can establish paternity through DNA then some evidence of open acknowledgement will be allowed (50 AD 3d 117)
o The non marital child (if she wants to claim from the father) must satisfy the proofs (above) at the time of putative father’s death.
o Also, if the non-marital is named in a will then none of this stuff matters.
o Domestic Relations Law (DRL) §24
§ If the parents marry anytime before or after the birth of the child, the child is “legitimized”
· Even if marriage is void the child will be deemed legitimate.
Adopted Children: EPTL 4-1.1(d)
o The general rule now is: complete assimilation into the adoptive family and complete cutoff from the natural (birth) family for the adopted child. (there are a few exceptions – see below)
§ Complete cutoff = no longer an heir of the birth parents; not presumptively included within the gifts of the birthparent. See also DRL§117(a) & (b)
§ Complete assimilation = for intestacy purposes you become part of the whole family (siblings, grandparents, etc); inherit from an through the adoptive parents. See also DRL§117(c)
o Adopted Out Situation
§ If you put a child up for adoption that child loses the right to inherit under the intestacy law.
§ Unless, you are in a re-marriage situation or adopted within the close family situation.
§ Instruments: DRL § 117 2(a): after the child is adopted out of the family, he/she is a stranger to the birth relatives in relation to an instrument.
· Applies whether instrument executed before or after order of adoption
· This is a default rule, if the instrument provides otherwise (a contrary intention) or expressly names the adopted out child then it’s ok
o Re-Marriage Situation
§ Husband and Wife have Child. H dies and W re-marries to H2. H2 then adopts C.
§ Father and Mother have Child but never marry. M ends up marrying another man (H).
· Both of these situations are covered by DRL 117
§ DRL §117 1(e)(2)(i): when in a re-marriage situation, the adoptive child can inherit and succeed from and through either birth parent shall NOT terminate
· So the adopted child can take from H1, W and H2: 3 families in essence
§ OLD WAY: the adopted child had 2 “families”: the mom and adoptive father; if the dead fathe
or vice versa
§ General Rule: You can’t profit from the wrong but you should not forfeit your own property from the wrong either. (Matter of Pinnock)
§ If killing occurs that exculpates criminal liability (eg insane) then the person IS NOT barred.
§ This often comes up in situations where the couple has a joint bank account etc
· also come in when there is a joint tenancy, or tenancy in the entirety or tenants in common
§ EPTL 4-1.6: If A & B have a joint bank account (j/t) and A kills B and is convicted A is entitled only to the money A contributed. The remaining money in the joint bank account goes to B’s estate.
o Disclaimer/Renunciation
§ General Rule: no one can be forced to take as a beneficiary or through intestacy
§ EPTL 2-1.11: beneficiary or intestate heir allowed to disclaim/renounce-in whole or in part- her interest in decedent’s estate.
· Disclaimers are irrevocable
· (a)(1): What can be renounced? Applies to wills, trusts, intestacy, shares, pensions -everything. This section calls it a ‘disposition’ – created by a will (for ex)
· (a)(2): Effective Date of the disposition for purposes of this section
o If: Will (death of T); Trust (date of trust agreement); other (date of the event)
o the effective date of a disposition of a future estate shall be the date on which it becomes possessory.
· (b)(1): Beneficiary can renounce all or part of her interest. There is an exception look at it and try to digest it and
· (b)(2): Procedure
o In writing, signed and acknowledged by “renouncer”
o Has to be submitted to the Court clerk or Surrogate within 9 months after effective date {see (a)(2)} – disclaimer made retroactive to effective date
§ If minor, disclaimer allowed until 9 months after 21st birthday
o Can get a court to extend the period for good cause.
· (d) DISTRIBUTION:
o The renouncing party cant direct where the property is supposed to go.
o If the distribution DOES NOT affect the distribution of another
§ It is as if the renouncing person had predeceased
§ Property goes to renouncing person’s issue.
o If the distribution DOES affect the distribution of another
§ It is as if the renouncing person died the same day as deceased but just a little while later.
§ In the example above B has predeceased, and if A renounces and we do this by representation (reg. way) C D E F each get ¼ [combine and distribute]
§ EPTL 2-1.11(d) says we go by strict per stirpes. So C, D, E get A’s 1/2 and F gets B’s 1/2.
· There are exceptions to renunciation, check Nan’s outline and see if they make sense.
