I. INTRODUCTION TO THE PROBATE PROCESS
probate and non-probate property
i. Property that passes under decedent’s will or by intestacy.
ii. Probate assets must be disposed of by will or intestate succession.
i. Property passing under an instrument other than a will
1. Joint Tenancy
2. Life insurance
3. Contracts with payable-on-death provisions (IRAs)
5. Life Estate remainder agreements
a. If you die, could go to remainderman
ii. These are sometimes called will substitutes
SUMMARY OF THE PROBATE PROCEDURE
i. Probate performs three functions:
1. Provides evidence of transfer of title to the new owners by a probated will or decree of intestate succession
2. Protects creditors by requiring payment of debts
3. Distributes the decedent’s property to those intended after the creditors are paid
i. Typically begins by filing of a petition. If there is no will it is a petition for filing of administration
ii. Court then appoints a personal representative
1. If there is a will the personal representative is called the executor of the estate
2. If no will, the personal representative is the administrator of the estate
iii. Executor receives “letters testamentary” which say that the person is authorized to act on behalf of the estate. If it is an administrator they are called “letters of administration”
1. Person must inventory and collect the assets, manage the assets, receive/pay the claims of creditors, clear titles to cars and land, and to make the tangible final distribution
iv. Notice must be given to potential heirs or devisees and creditors
Formal v. Informal Probate
i. Formal/Traditional process
1. Initiated by filing of a petition by interested party (devisee, intestate heir, executor or creditor). Interested party files petition for probate if there is a will K.S.A. § 59-2220; petition for administration if intestate. K.S.A. § 59-2219 Petition for administration must include names/addresses of heirs, probable value of assets, etc. Probate court approves PR and monitors actions. In the end, PR files a petition for final settlement and approval of accounts. Court examines all accountings and discharges PR.
2. There must be notice given to effected parties of the hearings to take place.
ii. Less-traditional processes.
1. Simplified administration
a. Streamlined, informal process. Petition must list all heirs, devisees, an inventory of assets, and a list of debts. It must also include a statement of the source of funds which will be used to pay off debts, and a proposed final order (how the assets ought to be distributed). Between filing and final hearing, PR is authorized to pay claims, sell personal property and make partial distributions to heirs/devisees without court supervision. Court examines accountings at noticed, final hearing. K.S.A. §§ 59-3201-3206
b. Notice of hearings is also required here.
2. Informal administration
a. Even less formal process. Petition contains statement regarding how assets will be distributed. Court determines whether informal admin. is appropriate and PR acts alone to manage estate. PR is officially discharged once debts listed in court order are paid. K.S.A. §§ 59-3301-3306
3. No Entitlement
a. The court may order either of theses processes after consideration, but is not required to order either one.
Statute of Limitations
i. Under UPC, no proceeding, formal or informal, may be initiated more than three years from the date of death UPC 3-108
1. KS is 6 months K.S.A. 59-617
Barring Creditors of the Decedent
i. Every state has a statute requiring creditors to file claims within a specified period of time (known as nonclaim statutes)
1. K.S.A 59-2239 is KS’s non-claim statute and requires claim within 4 months of notice to creditors
Contesting a Will
i. Contesting a will is an attempt by someone to prevent a particular will from being admitted to probate (deemed ineffective) on the basis that the will was not properly executed in the first place, was properly executed but later revoked, or was superseded by a later will.
ii. To contest, must have a direct pecuniary (monetary) interest in the estate
iii. Time Limit
1. K.S.A. 2225 states that a will must be contested during the administration process of accepting the will. After this time it is too late. Exception is that it allows for a competing will, and whichever will prevails will, for example, get the land.
II. INTESTATE SUCCESSION
Broad issues are the same, but details vary from state to state…on exam we will be given the applicable statute
Intestate Succession applies to three situations:
i. Do not have a will
ii. Have a will but does not dispose of all assets. The leftovers are disposed of by intestate succession statute
iii. Will or a trust that calls for the application of the intestate succession statute
1. Usually comes up if will or trust says “to my intestate heirs”
The goal is to proximate what the average person would have wanted done with his/her assets if the person had given it any thought; basically a legislative will.
SHARE OF SURVIVING SPOUSE
i. If there is a surviving spouse and no “issue,” spouse gets all of it.
ii. If there is surviving issue, then typically surviving spouse receives a fraction of the share of the estate.
iii. Unless specifically stated otherwise, the intestate share of a surviving spouse is:
1. if decedent leaves no surviving issue, entire intestate estate;
2. if decedent leaves surviving issue, one-half of the intestate estate.
iv. This is to be read literally. UPC does not apply. Does not matter what kids are coming from where, and which spouse. If spouse or if issue, rule applies. Period.
i. Direct lineal descendents
i. Entire estate to surviving spouse if there are no parents or children that are not issue of both; other examples are pretty generous as well. UPC 2-102(1), p. 61
ii. Parent survives, but NO descendant: Spouse takes $200k + ¾ UPC 2-102(2)
iii. All descendants are joint descendants AND there are OTHER descendants of the surviving spouse who are not descendants of the decedent: Spouse takes $150k + ½ UPC 2-102(3)
iv. ONE of the descendants is not a descendent of the surviving spouse: Spouse takes $100k + ½ UPC 2-102(4)
i. If survived by spouse and issue, surviving spouse gets half, and issue share the other half. If surviving issue and no spouse, issue get it all, and vice versa. K.S.A. 59-504,08
SHARES OF DESCENDANTS
i. Per Capita
1. If per capita applies at any given generation this means that everyone at
mative disinheritance, standing alone, is not enough. (“I leave my son nothing” is ineffective if son is an intestate heir.)
Minority rule: Affirmative disinheritance will suffice. UPC 2-101
ADVANCEMENTS AND ASSIGNMENTS
1. Scenario: Decedent who before he became a descendent, makes an inter vivos transfer to a decedent. That transfer might be treated as an advancement, thus being deemed part of the donee’s prospective intestate share.
2. Basis for the doctrine is that in the long-run the ancestor is treating the kids equally as compared to each other.
3. Can treat this transaction in one of three ways:
a. Loan, meaning son or daughter has obligation to repay the estate
b. Second option is that it is treated as an absolute gift, and as having never been paid, so the son or daughter gets a wind fall
c. Could be an advancement w/ no obligation to repay, but is factored in and taken into account when looking at amounts of distribution.
ii. Traditional Rule
1. A lifetime gift to a child it is deemed an advancement.
iii. Modern Rule
1. Question of intent which is left to the jury.
iv. Effect of Advancement on Distribution
a. If a donee wishes to share in mother or dad’s estate she must allow the value of her advancement to be brought into the hotchpot.
b. Bottom line is that it is a calculated decision on part of son or daughter to determine whether he or she wants to become part of the hotchpot.
c. She must determine which is larger, her advancement on the one hand, or on the other hand, her share of the estate after the estate has been augmented by the advancement.
a. Start w/ probate estate, and tack on the advancement. What you have then is what is called a hotchpot. At that point each person is entitled to a share of that hotchpot. If advancement greater than fractional share of hodgepot, you keep advancement and walk away.
3. Special Considerations
a. If it is American Per Stirpes method, and taking per stirpes, GC would step into C’s shoes, so if C had received an advancement, it would count against GC’s share.
b. If it is UPC method, because per capita, GC is not bound by the advancement to C, so he would take whatever his share would be w/o regard to the advancement to C.
v. Is it an advancement?
1. Legal/moral Obligations
a. Most courts would say tuition payments are not regarded as advancement at least through high school b/c there is a moral or legal obligation to make these payments. Most courts would say professional or graduate school does not entail obligation. College is up in the air right now.
2. Size of the Payment
a. Substantial transfers create a rebuttable presumption that it is an advancement.
b. The larger, the more likely we will say it is an advancement.