Estates and Trusts
I. Final – Wednesday, April 25th 9:00
Introduction to Estate Planning
The Power to Transmit Property at Death
Transfer of the Decedent’s Estate
Intestacy: Estate Planning by Default
The Basic Scheme
Transfers to Children
Bars to Succession
Wills: Capacity and Contents
Tortious Interference with Expectancy
Wills: Formalities and Forms
Execution of Wills
Revocation by Writing of Physical Act
Components of a Will
Contracts Relating to Wills
Nonprobate Transfers and Planning for Incapacity
Life Insurance, Pension Accounts, Bank Accounts, & Other Payable-on-Death Arrangements
Joint Tenancies in Realty
Planning for Incapacity
Construction of Wills
Mistaken or Ambiguous Language in Wills
Death of Beneficiary Before Death of Testator
Changes in Property After Execution of Will
Protection of the Spouse and Children
Rights of the Suviving Spouse
Rights of Issue Omitted from the Will
Trusts: Creation and Characteristics
Creation of a Trust
Rights of the Beneficiaries to Distributions from the Trust
Rights of the Beneficiary’s Creditors
Modifications and Termination of Trusts
Trust Administration: The Fiduciary Obligation
The Duty of Prudence
Subrules Relating to the Trust Property
III. Introduction to Estate Planning
A. The Power to Transmit Property at Death
1. Hodel v. Irving
a) Congress enacted legislation to prevent reservation land from being transferred to non-natives. An unintended problem with land fractionalization began to occur as the land was devised into smaller and smaller plots. To correct this problem Congress enacted § 207 of the Indian Reorganization Act, the “escheat” provision, prevent the decent or devise of certain small tracts—such tracts would escheat to the tribe.
b) Issue: whether the original version of the “escheat” provision of the Indian Reorganization Act, affected a “taking” of appellees’ decedents’ property w/out just compensation.
c) Holding: Gov’t may regulate decent and devise but may not abolish the right to do so on the grounds that such ultimate right is guaranteed by the 5th Amendment to the Constitution (taking w/out just compensation violates the 5th). Gov’t must use the least restrictive alternative (LRA). Undue influence.
2. Shapira v. Union National Bank
a) Testator placed a condition on his will stipulating that in order to take under the will, the son would have to be a nice Jewish girl, or Jewish ancestry, w/in seven years of the old man’s death. The son contested.
b) Issue: whether the condition for taking under the will was:
(a) The right to receive inheritance is a private matter, not deriving from the Constitution.
(b) May be an issue if the testator demands the son change his religion—the state would not be permitted to probate the will in violation of son’s freedom of religion under the First Amendment through the Fourteenth. Shelley v. Kraemer (1948).
(2) Contrary to public policy, and
(a) Son may marry whom ever he likes and practice whatever religion he like, but the old can do whatever he likes with him property.
(3) Unenforceable due to unreasonableness
(a) Issue of reasonableness arises only if testator is asking for the nearly impossible.
B. Transfer of the Decedent’s Estate
i. Probate and Nonprobate Property
1. Probate: the legal procedure necessary to prove that a will was legally made; more generally, the whole legal process having to do with legal administration of wills and estates.
2. 4 functions of probate:
a. Clear title out of the names of the dead
b. Pay claims or taxes
c. Distribute property
d. Provides forum for dispute resolution
3. Probate property is property that passed under the decedent’s will or by intestacy.
a. Estate is among the most ambiguous terms. Must know what property is owned and how it is held, and any liens and mortgages. Get a property
lear any titles—quiet titles
v. Distribute the remaining assets
b. If the person dies testate and names a person to administer probate, this person is known as an executor.
c. When no one is named, an administrator is appointed
d. The personal representative is accountable to the probate court
e. Last will and testamentàreplaced today with simply will
i. Testament traditionally disposed of personal property
ii. Will disposed of real property
f. A person dying testate devises real property to devisees, and
i. Bequeaths personal property to legatees
g. Real property descends to heirs, while
i. Personal property is distributed to next-of-kin
h. Today, heirs mean those persons designated by statute to take a decedent’s intestate property. Today, next-of-kin means the same thing
i. At common law, a spouse was not an heir; he or she had what was called curtsey or dower rights.
ii. Today, in all states statutes of decent and distribution name the spouse as a possible successor
i. Interested person is anyone that has a right or interest
Mulane v. Hanover (1950) Supreme Court case. “Mulane notice” reasonably ascertainable or known creditors must receive actual notice. If this is not done, it is a violation of due process. This is due to the state’s action through the probate court. Proper notice is sufficient to give interested persons an opportunity to be heard.