Wills and Trusts
1) Introduction to Estate Planning
Terminology:
Executor: Personal representative named in a will
Administrator: personal representative appointed by the court
Succession: beneficial entitlement to the property of the decedent
Descent: Succession to real property
Distribution: Succession to personal property
Heir: person entitled to take under intestate succession laws
Expected: takes by inheritance
Prospective: may inherit but may be excluded
Heir presumptive: will inherit if the intestate dies immediately but who will be excluded if other relatives of closer relationship are born
Heir apparent: one who is certain to inherit unless excluded by a valid will
Ascendant or Ancestor: person related to an intestate or to a claimant to an intestate share in the ascending lineal line
Descendant: person related to an intestate or to a claimant to an intestate share in the descending lineal line
Collateral: relative who traces relationship to an intestate through a common ancestor but who is not in his lineal line of ascent or descent
Affinity: relationship by marriage
Consanguinity: relationship by blood
Escheat: property escheats to the state if no relatives of the intestate are entitled to take
Devise: A gift of real property in a will
Devisee: person who is named to take real property
Bequest: A gift of personal property (other than money) in a will
Legacy: A gift of money in a will; legacy is a type of bequest
Legatee: One who receives a legacy
Res or Corpus: property to which the trustee is responsible to administer in a trust
a) The Power to Transmit Property at Death: Its Justification and Limitations
i) The Right to Inherit and the Right to Convey
(1) Hodel v. Irving:
(a) ISSUE: Whether the original version of the “escheat” provision of the Indian Land Consolidation Act of 1983 effected a taking of appellees’ descendants’ property without just compensation
(b) RULE: The right to transmit property at death is a separate, identifiable stick in the bundle of rights called property and , if taken away, compensation must be paid.
(i) Thus, USSC upholds right of both the Federal and state governments to modify the rules governing devise and descent in order to prevent further division of small parcels of land
ii) Problem of the Dead Hand
(1) R(3rd) Property §10.1; Donor’s Intention Determines the Meaning of a Donative Document and is Given Effect to the Maximum Extent Allowed by Law
(a) Bundle of Property Rights; Right to dispose of property
(b) Unless disallowed by law, donor’s intention not only determines the meaning but also the effect of a donative document
(i) Posner: If allow the dead hand to control, at death, requirements become etched in stone. Children no longer have ability to convince parent that the restraint is unreasonable
(ii) Social Objective: It is the testator’s money and he should be free to do with it as he chooses.
(2) PROHIBITIONS/RESTRICTIONS on freedom of disposition:
(a) Spousal and creditor’s rig
nge of choices. (7 years to marry a Jewish girl)
(i) Furthermore: Dr. Shapira could, during his lifetime, withhold gifts at his choosing; He could also legally disinherit his children
(d) Provision made by father for breach/failure that son’s share go to State of Israel influenced court:
(i) Not a bare forfeiture; forfeiture with reason
(ii) Demonstrated depth of testator’s conviction; not punishment but clearly wanted his possessions to be used to promote and encourage Jewish faith and bloodlines
(e) Shelly v. Kraemer applies state action to courts enforcing private agreements.
(i) Ct. holds Shelly is distinguishable b/c the right to receive property is not an absolute right, does not extend—“court is not being asked to enforce any restriction upon … constitutional right to marry. Rather this court is being asked to enforce the testator’s restriction upon his son’s inheritance.”
b) Professional Responsibility:
i) Duties to Intended Beneficiaries:
(1) Privity Defense:
(a) NO PRIVITY DEFENSE:
(i) Simpson v. Calivas [p49];
π claimed negligence of the atty. b/c the phrase used in the will (“homestead”) was ambiguous and did not express the intent of the
