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Trusts and Estates
University of Toledo School of Law
Chapman, Douglas K.

Trusts and Estates

I. Intro/Background

A. Upon death, possessions are conceptually divided into 3 categories:

1. Property disposed of by will

2. Property disposed of via intestate succession

a. No will was written

b. The will was lost or destroyed

c. Will is invalid

d. Will does not dispose of some property

3. Non-probate estate (will substitutes)

a. Title to property vested in joint tenants w/ right of survivorship

b. Joint bank account

c. Life Insurance

d. pension plans (401k, IRA, etc.)

e. annuities

f. trusts

B. 3 Groups of heirs (Spouse not considered an heir because not related by blood)

1. Lineal heirs – heirs of your body- child, grandchildren, great grandchildren

2. Ancestors – Mother, Father, Grandparents on both sides

3. Collateral heirs – other persons related by blood. Siblings, Cousins, Nieces,

Uncles, and Aunts

C. Personal Representatives

1. Legal title to personalty passes to PR, once appointed. Equitable title to RP vests in taker immediately; title to RP is never floating around.

2. Duties

a. identify property owned by decedent

b. manage, preserve, and take care of decedent’s property

c. identify creditors, who are paid before any heirs may take

3. PR entitled to compensation for services performed in settling the estate.

D. Miscellaneous

1. Atty’s cannot write themselves into a will; narrow exception where testator is a closely related family member.

2. General Rule: RTGDD

3. Common limitation for estate matters: reliance on circumstantial proof, b/c decedent is dead.

4. Usually, state statutes will not allow complete disinheritance of a spouse, but can disinherit children.

a. However, once testator purports to make a gift, he cannot create unreasonable conditions to receiving the gift.

5. Misconduct leading to disinheritance – slayer statutes may make it as though title to RP never passed to slayer (legal fiction), or provide that slayer holds RP as constructive trustee. Slayer treated as though they predeceased the victim.

6. Shapiro – Cannot be unreasonable restriction on marriage. Can disinherit anybody you want, except spouse. Cannot give restrictions on something that is illegal.

II. Intestacy

A. Generally

1. In order to take by intestacy, a person must 1) be someone who is entitled to an intestate share, and 2) survive the decedent.

2. Inheritance – property you will get when there is not a will. If will then it is called a bequest(Personal Property) or devise (Real Property).

B. Spouses

1. The size of SS’s share depends on the jd’tion and who else survives the decedent.

2. The general theory that spouse will provide for children, acting as a conduit, is abrogated to protect D’s children from other marriages.

3. UPC rule for SS’s share of intestate estate – §2-102.

4. OH rule for SS’s share – §2105.06

5. Who is a spouse?

a. Putative spouse: has good faith belief that they are married, but some legal flaw prevents marriage from being recognized at law. Marriage could be flawed by ineffective marriage or divorce, where spouse remarries.

i. UPC says putative spouse = spouse

ii. Could have putative spouse situation in state that recognizes C/L marriage.

b. Co-habitators: have no rights in probate system

i. May have implied K cause of action, where recognized by state.

C. Children

1. Many issues can be involved here:

a. Who is a child, for purposes of intestacy?

b. Who can the child inherit from?

i. most statutes silent as to child’s ability to inherit f/ adoptive parent’s relatives.

c. Who can inherit from the child?

2. Adoption

a. Modern view is that formal adoption severs all of the adoptee’s relationship to natural parents; becomes treated like natural child of adoptive parents.

b. General rule is that must have consent of natural parent(s) to formally adopt, if natural parents are living.

c. An exception to rule of severance where step-parent adopts – adoptee can still inherit from natural parent. However, formal adoption is usually req’d – tx as own child insufficient.

d. Adoption of adults – some states restrict by req’ing that adoptive person must have had some parent-child relationship with adoptee during minority years. OH allows adoption where adoptee is retarded/disabled or could not get consent from natural parent.

3. Non-marital (illegitimate) children

a. Always inherit from mother

b. May inherit from father if:

i. Traditional view – depended upon father acknowledging paternity, or legitimizing by marrying mother.

ii. Modern – prove paternity before father’s death

c. Father of illegitimate child usually not allowed to inherit from child (may be able to if can show strong parental relationship).

4. Half-bloods and Unborn Children – see other outline.

D. Determining Survivorship

1. This goes to second part of intestacy inquiry: did the claimant survive the decedent?

2. If intestate taker does not survive the decedent, his issue may take per representation.

3. Uniform Simultaneous Death Act: who died first?

a. Where there is no sufficient evidence that persons have died other than simultaneously, the property of each person shall be disposed of as if he had survived.

b. UPC revised the USDA, requiring one person to have survived the other by 120 hours before being deemed to have survived the other person.

c. Persons can override statute by including a survival time requirement or defining “survive”.

E. Allocating Shares – once survivors who qualify as heirs are determined, need to determine relative size of shares.

1. Per stirpes

a. Only division is at primary share level (directly beneath decedent); thereafter, it is only subdivided.

2. Per Capita w/ Representation (OH)

a. It is per capita at the primary share level (first level with survivors), and with representation after that.

b. Only division is at primary share level (first level with survivors); thereafter, it is only subdivided.

3. Per Capita at each Generation (UPC)

a. There is a “true” division at each level, comprised at each level of the amount of the estate that remains.

D

X

Y

Z

C2

C1

C3

C4

C5

Assuming no SS

Per Stirpes

– 3 primary share when X, Y, and Z is alive

– If Y dies then s

pient.

b. Ex. – Intestate takers are A, B, and C. A got advancement of 5K, B got advancement of 10K, Intestate estate is 60K.

i. Hotchpot is 75K. Each taker entitled to 25K.

ii. A and B’s advancements are counted against their 25K of entitlement.

ii. A’s intestate share is 20K, B = 15K, C = 25K. These amounts = 60K, which is the

amount of the intestate estate.

III. Wills

A. Formalities

1. Writing

a. In most jd’tions, testaments recorded in other media are not recognized.

b. The will should recite the testator’s intent that the document is his will.

c. Oral wills are permitted in some states, but only in specific, usually emergency, circumstances (soldier facing death). (Ohio 1 of only 5 states that recognize)

i. Oral wills may have limitations regarding what can be devised (only personal property), or how much can be disposed of (dollar amount).

ii. Other requirements such as witnesses still exist, and the witnesses may have to record and probate the will within a certain period of time (record w/in 10 days; probate w/in 6 months).

2. Testator’s Signature

a. Purpose is to show the will was not created impulsively, the testator intended the document to be his will, and to help safeguard against forgeries.

b. The signature can be by any mark intended by the testator as his signature.

c. Some states (incl. OH) require that the signature be made at the end of the document; the UPC just says that the document must be signed.

d. The signature must be made by the testator, or by someone acting at the testator’s direction (proxy), in the presence of the testator.

3. Witnesses

a. Usually a minimum of two; generally there is no hard and fast age requirement (only that the witnesses be competent).

b. Some states (OH) require that the witnesses be in the presence of the testator when they sign; the UPC says that the witnesses do not have to sign in the testator’s presence, only within a reasonable time after the witnessing took place.

c. The requirement that witnesses be competent means not only that they be mentally sound and able to understand what they are doing, but in some states encompasses the notion that the witness be disinterested (not taking under the will).

i. OH view: RC 2107.15 – A devise made to a person who is one of only two witnesses to a will, the devise is void, and the witness becomes competent to testify as the execution of the will. If that person would be entitled to an intestate share were the will never executed, such person is entitled to the lesser of his intestate share or the amount of the devise.

– Statutes like this are commonly called “purging statutes”.

ii. UPC view: §2-505(b) – an interested person can witness the execution of a will with no problems.

iii. In a state that does not follow UPC and does not have purging statute, interested witnesses cannot save the will by disclaiming their interest, because they were still a devisee when the will was made.