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Wills and Trusts
University of Dayton School of Law
Searcy, E. Dale

Introduction to Wills
o Wills (and Trusts) have changed dramatically over the last 40 years or so
o This class deals with “tradition notions” of Wills and Trusts
o Concerned with arranging of gratuitous transfers of wealth (i.e. not selling)
o Not just about intestate ( transmissions, but also testate conveyances
o Theme à passing property without consideration

Probate Process
o From Lesson #1
o Generally
o Over the past 50 years, there has been a major move to avoid probate
§ Many people feel that it is undesirable and does not operate in the best interest of the surviving beneficiaries/heirs, or the public
o Searcy:
§ Taxes à People think that avoiding probate means less taxes. à FALSE!
§ Costs of Distribution à People think that it costs more to distribute an estate through probate à FALSE
§ So then, why avoid it? See below!
o Functions of Probate
o Collect assets
o Pay all creditors
o Distribute what is left
o Introduction to Estates
o About Probate
§ 1) Refers to admitting a will into evidence in a court (“probating the will”)
§ 2) Process whereby a decedent’s property is transmitted after death (“probate process”)
o Process
§ A will is “offered” for probate by the “proponent” of the will
§ The will’s validity is determined à If valid, will is “admitted to probate” as the decedent’s last will
o Probate Defined
o “Probate” court is a court system collect the assets of decedents, distributes $ to creditors for the decedent’s debts, resolves conflicts among beneficiaries, and distributes what is left to the appropriate persons or institutions.
o Probate is a process of collecting decedent’s property after death, protecting it, paying costs of process, and paying decedent’s creditors, and distributing remainder
§ See Waggoner, pp. 21 – 25
o Deals with who takes decedent’s property
§ Taker’s of decedent’s estate determined one of two ways
· 1) If there is a will à then whoever is in the will takes property
· 2) If no will à statute designates who takes property
§ Used when there is a need to clear title (i.e. land, vehicles, planes, boats, stock, anything else that you need to get title to)
§ Can be avoided when there is one of the following (below) or if there are no items in the estate which need title to be transferred
· When items need to be transferred, probate is a necessity
· Sometimes there are statutes which allow vehicles to be transferred w/o probate, by way of an affidavit showing that there is no will à usually this is only for sole heirs
o Consists of admitting the will into evidence
o Not Subject to Probate
o Property that the decedent held alone or as a tenant in common is subject to the system
o Joint tenancy (or tenancy by the entirety) property
o Life insurance proceeds on the decedent’s life, and property in lifetime trusts are all outside of probate
o Depending upon local rules, the decedent’s half of community property may or may not pass through probate
o Certain trusts (See later)
§ Inter Vivos Trusts/Transfers
o Personal Representative
o Usually a family member
o Someone will petition a court in the decedent’s state of domicile to appoint a “personal representative” to handle the work
§ Executors (if there is a will)
§ Administrators (if there is no will)
o Criticisms of Probate Process
o Influential Book: “How to Avoid Probate!” à heavily influential, negative towards probate
§ Changed the way that probate was handled
§ Popularized the idea of avoiding probate
· Made it a near public obsession
§ Book said that probate was terrible (costly, time consuming, public)
· Easy to avoid
· Should be avoided
· Book suggested:
o Set up property in Joint Tenancy
§ Ex. If A owns shares of stock in his name and has a will leaving everything to B, the shares are subject to probate, and B will get them
§ But…If A owns shares of stock in JTWROS with C, and A has a will leaving everything to B, the shares are not subject to probate, and go right to C
§ Joint Tenancy therefore is a probate avoidance tool
o Set up Revocable/Inter Vivos Trusts
§ 99% of clients who go to lawyer in Ohio for estate planning use this to avoid probate
§ Basically, this is a trust which is funded during the lifetime of the Settlor (Trust maker) and everything in the trust avoids probate, and goes right to the trustee (who holds legal title) for the benefit of the beneficiaries (who hold equitable title)
· More on this later under Trust section!
o Invest in Life Insurance
§ “Credit Life Insurance” discharges the insured’s balance at death
§ The important thing with Life Insurance is that the money from the policy goes right to the person named as beneficiary of the policy
§ Why is probate so bad?
· Costs money – people don’t like spending money
o Note: Searcy says that the money spent n a probate proceeding is nominal compared to non probate distribution
· Involves courts – people don’t like dealing with courts
· Public process – people don’t like having their wills open to the public
§ Advantage
· Creditors have limited amount of time to collect on decedent’s estate
o If the decedent has debts, the administrator of his estate must attempt to pay the debts, but if he tries an is unsuccessful, the creditor loses his claim after so long
§ Truthfully
· It is not hard to avoid probate – we will cover lots of ways to do this throughout the course
· Almost all clients will ask attorney to help them avoid probate
o It’s best to help these people avoid à Clients who do not get the help they want will go to another attorney who will help them
o Who is served by the probate process?
o Process does not serve the government, nor is it set up to
o Private parties are served by the probate process
§ The beneficiaries are served because probate process gets them the money/property
§ The creditors are served also because they get their money
§ And, to some degree, the decedent is served b/c they et their wishes; for so and so to get certain personal property/money
o Timing and Issuing an Estate
o It can take around six months to issue an estate which is small
o It can take up to 2 years to issue a major estate
o Uniform Probate Code (the UPC)
o Most states have not adopted, but some have (usually smaller, less populous states)
o Like the UCC, the UPC was supposed to regulate probate nationwide
o Means that laws differ from state to state
o Searcy: Ohio probate laws suck L

Fiduciary Administration
o Personal Representatives
o Basically, the Personal Representative of the estate is the person who oversees the estate’s distribution and does all the busy work…
o Many duties
§ Open and close estate
§ Notify accounts, creditors, beneficiaries,
§ Find the will
§ Secure and inventory decedent’s items
§ Get information for tax returns
§ See Waggoner, pp. 21-25
o Despite heirs wanting to move quickly, a PR cannot shortcut mandatory closing procedures
o In the Western states, the PR need not be an attorney, but in the Eastern states, it usually has to be an attorney
o Guardians and Conservators
o This section applies mainly when the devisee is an incapacitated person or a minor (legally incapacitated), and someone has to manage property which has been devised to them either in a will, trust, or under the UTMA (See later)
§ All states have statutes which determine who will be responsible for caring for others and managing property
o Two types: (in non-UPC states)
§ 1) Guardians of persons
§ 2) Guardians of property
o Applies (generally) to minors and incapacitated people
o Professional Guardians
§ These include public agencies or non-profit corporations, or family members
§ Simple requirements to be a guardian/conservator
· No licensing required
· Must submit periodic reports to court on progress

Surviving Spouses and Heirs
o From Lesson #2
o Basics
o Intestate Estates
· Intestate = without a will/trust, etc.
§ An intestate estate would be an estate which has no formal disposition guide (i.e., a will)
§ To take a share of the intestate estate, an individual must survive the decedent
§ Note: The person who gets property (the devisee) of an “intestate” estate known as an “heir”
o Testate Estates
· Testate = with a will/trust, etc.
§ Note: The person who gets property (the devisee) of a “testate” estate known as an “beneficiary”
§ But, where there is a testate conveyance, the beneficiary is only a “potential beneficiary” until his interest vests which doesn’t happen until the Testator dies
· In other words, it is not certain that the potential beneficiary will survive the conveyor
o Survivorship
§ Only

o If the decedent left children, the spouse will often share with them, taking half if there is one child, and one-third if there is more than one child
o Jurisdictions
o Lump sum to spouse, remainder to children
§ Some states give the spouse a lump-sum amount and then divide the balance between the spouse and the children
o Estate à Spouse à Children
§ In other states, the spouse gets everything, and the children have to rely upon their surviving parent to serve as a conduit, leaving them anything that is left over at her death.
· The thought is that the SS will, upon her death, leave her estate to her children
o Marital Deduction
o Began in 1948
o Property left to spouse is not taxed
o In order to get marital deduction, must leave property to spouse
§ Spouse must survive
· Determined under the (new) USDA
o i.e., Spouse must survive by 120 hours

Representation Among Descendants
o From Lesson #3
o Basics
o This section deals with situation when a decedent dies intestate and passes their estate on, but when they are predeceased by one of their children
§ Representation” only occurs if a child predeceases the decedent
o Issues to consider…
§ Does the decedent have surviving children?
§ If the decedent has been predeceased by one of his children, what (if anything) passes to the grandchildren?
o Example
§ Decedent D has a child C and a grandchild GC
· D’s child C predeceases D
· D’s GC is said to “represent” his parent’s (C’s) interest in the estate
o Remember, “descendants” means children and grandchildren, etc.
o Representation Generally
o Main rules under representation
§ A person who predeceases the decedent does not get a share of the decedent’s will
§ Heirs are only people who outlive the decedent
· Possible that 120 hour provision is implicated (see above)
· Notes:
o the decedent must simply outlive the decedent, but does not necessarily have to live past when the decedent’s estate is administered
o Representation only comes into play when a child(ren) predeceases his parent
§ Representation is recognized by all states today
o Various Systems of Representation
o Per Stirpes System
§ Introduction
· “Per Stirpes” means “By the root”
· Root exists when
o A child survives decedent
o A child predeceases the decedent but has surviving heirs (i.e. children) who can take/divide decedent’s child’s share
· Most faithful to idea of representation
§ Two types of Per Stirpes…
· Per Capita
o Used in the UPC
o Also known as “modified per-stirpes”
§ Allows descendants of the D’s dead child to take equally with D’s living children
· Strict
o Most straightforward with idea of representation
§ Descendants of the D’s dead child to take an equal share to D’s living children, but divide the share
· When drafting, if using per-stirpes, you should always indicate what kind of per-stirpes method you want
o E.g., Say per capita or strict
§ Process
· Basically
o Deliver one share to each of the decedent’s surviving child
o Go to next generation and decide what method to use
§ If Per Capita PS Method…
· All kin in next generation are treated equally
· Example
o D has two children, C1 and C2
o C2 has two kids, GC1 and GC2
o When D dies, C1 is living, but C2 has already died
o Under the Per Capita Method, who takes?
§ C1 = 1/2 of estate (1/2 of estate remains)
§ GC1 = ¼ of estate (1/2 of remaining portion)
GC2 = ¼ of estate (1/2 of remaining