Trusts and Estates
A. Introduction to Estate Planning
1. Different Types of Estate Plans
b. Trust (inter vivos/ testamentary)
c. Joint tenancy property
d. Payable On Death account
e. Life Insurance
f. Pension Plan
ii. Default Estate Plan
2. Power to Transmit Property at Death and its Limitations
i. Power to inherit property created by gov’t. Irving Trust Co. v. Day: S Ct.: held that succession rights to a deceased party’s property are created by statute. C. doesn’t forbid states from limiting or abolishing testamentary disposition over property (just can’t do w/out due process).
ii. Hodel v. Irving: Act requiring tracts of land which did not meet certain req’ts to escheat to the state instead of pass through devise or intestacy invalid. Entirely abolishes both descent and devise of the property interests even when passing of property to an heir might result in consolidation of property (gov’t purpose).
3. Partial Restraints on Marriage Permissible:
i. Shapira v. Union National Bank: My son Daniel Jacob Shapira should receive only if he is married at the time of my death to a Jewish girl, both parents Jewish. Ct. P not being denied right to marry, just right to inherit property unless he marries Jew (and inheritance not C. protected). Gifts conditioned upon the beneficiary’s marrying w/ in a particular religious class or faith is reasonable, invalid if complete restraint on marriage or complete restraint on religion.
ii. Will/trust provision that encourages disruption of family relationship invalid.
i. Provisions encouraging sep/divorce invalid unless motive of T is to provide support in event of sep/div.
iii. Doctrine of Capriciousness: ct can strike out overly arbitrary provision.
iv. Cy Pres Doctrine – as near as it comes
4. Professional Responsibility
i. Will Beneficiaries owed Duty of Care: Simpson v. Calivas (NH 1994): Drafting attny owes duty of care to an intended beneficiary due to the foreseeability of injury to them. If T ks w/ attny to draft a will and identifies beneficiaries, they may enforce the K as 3rd party beneficiaries.
ii. Fiduciary Duty Hotz v. Minyard (SC 1991): (Special confidence) Attny whose law firm had prepared daughter’s tax returns for 20 yrs owed her a fiduciary duty to act in good faith when dealing with her and her father’s will. He did NOT have to disclose the existence of the 2nd will (
d setting aside homestead and exempt
(iv) paying creditor’s claims and bills, and
(v) distributing the assets of the estate upon the probate court entering a
decree of distribution.
ii. Uniform Probate Code:
a. UPC 3-301: Req’ts for Informal Probate. w/out giving notice to anyone, the rep petitions for apptment; the petition contains pertinent information about the decedent and the names and addresses of the spouse, the children or other heirs, and, if a will is involved, the devisees.
1. if the petition is for probate of a will, the original must accompany the petition; the executor swears that, to the best of his or her knowledge, the will was validly executed; proof by the witnesses is not req’d.
b. UPC 3-303: will that has req’d signatures, contains attestation clause showing execution req’ts have been met is probated by the registrar w/out further proof.