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Descedents Estates – Flashcards

Thomas Owen

7 July 2022

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UPC 6-101. Nonprobate Transfers on Death.

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PODs are nontestamentary. PODs are a quick way to transfer property. -no need for formalities of the will's act

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Will Substitutes and The Subsidiary Law of Wills

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1. Life Insurance: ambulatory--nonexistent until the testator's death--and revocable 2. Pension Accounts 3. Bank, Brokerage, and Mutual Fund Accounts--POD (pay on death) account; joint bank accounts ("impure" will substitutes - b/c it is shared ownership) 4. Revocable Trust Inter Vivos trust—

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Revocable Trusts

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The revocable trust is the most will-like of all the will substitutes; therefore, courts apply subsidiary rules from the law of wills, such as abatement and ademption when there is not enough trust property to satisfy the provisions calling for distribution on the death of the settlor (abatement) or the trust does not include a specific item of property that is to be distributed to a particular beneficiary (ademption).

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UTC (Uniform Trust Code) § 604 (2000)--

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provides that a person may bring a suit to challenge a revocable trust, but only after the trust becomes irrevocable by reason of the settlor's death.

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Estate of Hillowitz (Ct. of App. NY 1968)

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F: H was a partner in an investment club. In the event he dies, he left his share to his wife per the club's partnership agreement. When H died, the club transferred the money that represented H's share of the partnership to his wife per the agreement. Executors contended the agreement was invalid because it constituted an attempted testamentary disposition, but it did not follow the statute of wills. Rule: a partnership agreement clause providing that each partner's interest, upon his death, shall pass to his spouse, is valid and enforceable.

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TODs--Transfer on Death

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Securities are permitted to be registered in a transfer-on-death (TOD) form. TOD registrations are now allowed in nearly all states.

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In re Estate and Trust of Pilafas (Ariz. App. 1992)—

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presumption of revocation applicable only to wills Rule: where the terms of the trust provided that it could only have been revoked or modified by a writing delivered to the trustee, no presumption of revocation applied because it could not have been revoked by physical destruction.

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State Street Bank and Trust Co. v. Reiser (Mass. 1979)

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Rule: because the settlor had retained such authority during life that the bank could reach the trust assets to pay the settlor's debts after death to the extent that the settlor's estate was insufficient to satisfy such debts.

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Can Creditors Reach Nonprobate Assets?

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1. The creditors of a joint tenancy cannot reach the jointly held property after the joint tenant's death because the decedent's interest is treated as having vanished. 2. Life insurance proceeds are usually exempt from the insured's creditors if payable to a spouse or child, and the same is generally true of retirement benefits. US Savings Bonds with a POD beneficiary may also be exempt.

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UPC § 6-102

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permits the decedent's creditors to reach nonprobate transfers (except joint tenancies in real estate), such a revocable inter vivos trusts and joint bank accounts, if the probate estate is insufficient to pay the debts.

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UTC §505

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allows creditors to reach trust property

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Life Insurance

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A life insurance policy is an effective way to transfer property on death without Wills Act formalities. It is contract between the owner of the policy and an insurer. In exchange for the owner's payment of premiums, the insurer promises to pay a state amount, the proceeds or face value, to the beneficiary when a designated person, the insured, dies.

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Cook v. Equitable Life Assurance Society (Ind. 1981)

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Rule: a person cannot change her life insurance beneficiary through a will. Mr. Cook divorced Doris and remarried Margaret. He never changed his life insurance policy deeming his new wife as the beneficiary rather than his ex-wife. Through a holographic will, he did attempt to change the beneficiary to his new wife, Margaret; however, the court did not permit the change. The court stated, "equity aids the vigilant, not those who slumber on their rights." He had 14 years to change the beneficiary on the policy but failed to do so.

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Multiple-Party Bank and Brokerage Accounts

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Multiple-Party Accounts: contractual arrangements for the deposit of money with financial institutions, including: checking accounts, savings accounts, and certificates of deposit.

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Joint and Survivor Account:

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a joint account with equal lifetime and survivorship rights. "A and B, as joint accountholders with right of survivorship."Most people will get this if they want a joint account. Either A or B has the power to draw on the account and the survivor solely owns the balance of the account, which does not pass through probate.

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Varela v. Bernachea (FL 2005)

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Dad's girlfriend took all of his money out of the joint account. Rule: Joint accountholders have no restrictions and have an unlimited right to deposit and withdrawal on the account as if it was their own personal account. (UPC §6-222)

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UPC 6-201 through 6-227:

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UPC authorizes joint tenancy account with the right of survivorship, an agency account, and a POD account. Under UPC, joint accounts belong to the parties during their joint lifetimes "in proportion to the net contribution of each to the sums on deposit, unless there is clear and convincing evidence of a different intent." UPC 6-211(b).Extrinsic evidence is admissible to show that a joint account was opened solely for the convenience of the depositor

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Clymer v. Mayo (Mass. 1985)

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• Will + Trust - Read together A trust is funded with the expectancy at the death of the testator. Here the court said that even though the trust didn't have anything in it before the testator death but it will (through the life insurance proceeds) be funded at the time of her death. • Said that a testamentary trust is subject to the revocation by operation of law doctrine, such as when one divorces the provisions are extinguished subject to "operation of law" doctrine.

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NC Publicity

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NC and SC don't recognize publicity right. Publicity comes into play when money comes to the estate after person dies (i.e. Michael Jackson).Issue: Tee-Shirt bought in Target in Indiana with image of Marilyn Monroe - MM LLC stores in IN and the statue there sayCourt says MM never owned the publicity rights when she died.s they have a postmortem right. Wills - probate (except for property) is in the state where you are domiciled. But will says " or to which I shall be in any way entitled"

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General

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No right to inherit - Forms should only be starting point - No heirs to a will Beneficiaries take via will Personal property - state where domiciled Real Property - where it's located

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In terrorem

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fear in the beneficiary to contest the will - trying to scare heirs to abide by the will - so courts look at provisions to see if the clause is such

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Cy Pres

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Cy pres - doctrine gives court ability to say if the provision is met enough

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Dead Hand

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- power beyond grave i.e. if Dad were alive he might be able to make a decision if Daniel didn't quite meet the criterion. Court in Shapiro didn't agree that Daniel couldn't find a wife to meet his Dad's requirement

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Probate Process

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1. Is there a Will - if there is take it to the court to file it - If the will is not valid we can still probate 2. Executor then files application for probate and letters - If there is a will you would look at it to get individual entitled to receive - If not look to state statute - Proceeds from wrongful death pass through the intestate statutes not through beneficiaries of will 3. Court will issue a letter to you as executor to present to the bank etc. - You as administrator close accounts and open in the name of the estate - You can sign your rights as administrator away 4. Court is looking at this and sending letters to the beneficiaries

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Summary Administration of Estate

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File and walk away - mostly estates < $20k Generally used in husband/wife situations If you are a spouse and you are the sole beneficiary under the will then you lose your protection against creditors Debts are that of the decedents You lose your protection as spouse Works good if there are minimal debt and assets Spouse has a right to $20k off the top and minor children $2k per child.

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Notice to creditors

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- FOR a four week period - where the person was domiciled at death - File in newspaper of general jurisdiction OR - Post at court house and four other places - Fiduciaries have an obligation to notify the creditors if you know who they are

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TRUST Probate

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- Still need the letters (Application for letters of trusteeship under will) - Otherwise bank will want the whole trust - need something to show you can handle the business of the deceased person - If done properly than the formal steps we have gone over can be skipped - Trust is not public - just a will that says you have a trust - Will are public record - but a TRUST is not - i.e. John Edwards wife - only public record is that it went to a trust no proof of disinherantence

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Administrators Duties

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- 90 days after the personal representative qualifies they go around an inventory what the decedent owned at the time of death - In NC real estate passes outside of the probate process - - Have to write a check for 40C on the dollar up to $6k to the court when you filed the inventory with the court. Pay court first - You are also paying out bills of the decedent. - If there is no will court will ask for a bond from administrator unless heirs waive it -ensure fiduciary responsibility carried out - executors must live in the state where the decedents is or have a personal representative in that state - jurisdiction issue - have to waive your right otherwise. - Ideally process takes a year Death Notice to Crditiors 90 day inventory Tax (income and estate tax(>$5M when you die))

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Wrongful Death

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Goes through statute not will

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UPC 2-102(2)

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Spouse takes $300k + 3/4 of any balance if no surviving decendants but ther are surviving parents

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NC Distribution of Real and Personal Property

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Personal and Real Property treated differently Through intestate spouse takes all unless there are children of parents

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NCGS 39.13.6

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If it is the marital homestead passes to the surviving spouse outside the probate process

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NC does not recognize:

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same sex marriage common law marriage

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NC and UPC Adoption

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Takes you out of the biological parents line(even if by step-parent) Brady Bunch: Mike adoped his new wife's children. Children's father dies intestate NC - can't take from their uncle UPC - they can but uncle cannot take from them ADULT ADOPTION - UPC 705 must have relationship before person turns 18 - NC 48-5-102 must sign to say you understand what a parental relationship is. Stops the adoption of spouses.

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NC Equitable Adoption in

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* Elements of equitable adoption in NC: (1) an express or implied agreement to adopt the child, (2) reliance on that agreement, (3) performance by the natural parents of the child in giving up custody, (4) performance by the child in living in the home of the foster parents and acting as their child, (5) partial performance by the foster parents in taking the child into their home and treating the child as their own, and (6) the intestacy of the foster parents.

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N.C. and UPC ADOPTION DIFFERENCE

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- when you are adopted you are removed from the genetic lineage and inserted in their adoptive parents lineage. NC: The only exception is when a child is adopted by a step parent, the child keeps the one genetic parent that is married to their adoptive parent, not the other parent. UPC differs from NC: UPC- the adoptive children can also inherent from or through the genetic parents, but parents cannot inherent from children. - only goes one way. NC - adult adoption only where there is a parent child relationship. UPC must be parent child relationship in minority years.

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Post Humus Children

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Post Humus Children: children who are born after the death of the father. They were in utero when the father died. The child must be born within 10 lunar months after father's death. In all 50 states, children and spouses take to the exclusion of everyone else.

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NC Illegitimate Child

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Phillips v. Ledford: (NC) father has to legitimize the child. 3 ways to do that: 1- mom and dad get married. 2- any person who has been finally adjudged to be the father of such child ...; or 3- any person who has acknowledged himself during his own lifetime and the child's lifetime to be the father of such child in a written instrument executed or acknowledged before a certifying officer ... and filed during his own lifetime and the child's lifetime in the office of the clerk of superior court of the county where either he or the child resides.Orderly, efficient administration of estates - purpose of this rule. According to the supreme court.

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NC Assisted Reproductive Technology

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NCGS 49A-1 - status of child born as a result of artificial insemination. Any child conceived through assisted reproductive technology is considered a child of a husband and wife. Woodward v. Commissioner of Social Security (2002) - husband gets cancer and stores sperm. He dies from cancer and the wife 3 years later conceives with the sperm and has two daughters. She files for social security death benefits for the children. 3 issues the court looks at: 1- the welfare of the child 2- finality of closing the estate 3- the reproductive rights of parents. The court decides that there are rights when certain criteria are met: 1- genetic relationship between child and deceased 2- representative must show proof of decedent's affirmative consent to post humous conception and consent to support of any resulting child. 3- within some standard of time limitations 4- notice for all interested parties. UPC?? California says that the child has to born within 2 years along with all these other requirements.

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UPC 2-121(g)

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???

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CASE: Post Humously Conc. UPC 2-121 (g) Child born to gestational carrier.

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In re Martin B. (2008) - a grandfather left a trust for his children and heirs. One son get cancer and died. Before he died, he banked sperm. After his death, his wife had 2 children with the sperm of her deceased husband. She had one child 3 years after his death and the other 5 years after his death. Te court ruled that the trust should go to the children post-humously conceived because the grandfather stated all his heirs. The children are part of his heirs. UPC 2-121 (g) Child born to gestational carrier.

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Surrogate Issues

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Courts look to intent of the parties Sperm bank for general uses versus agreement of couples

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NC v UPC Advancements

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CL: Any inter vivos gift is an advancement Common law - any inter vivos gift is an advancement. Current times - there must be a written document. UPC 2-109(a) - no presumption. NC looks at the objective intent but does not require any writing for it to be an exception. There is still no presumption that gifts are an advancement. They can offer extrinsic evidence to show that it was an advancement and it was the intent of the testator. NC 29-24 If the advancee dies before the decedent at common law, the advancement still counts against the issue of advancee. UPC: if the advance dies before the decendent, the advancement does not coundt against the issue of advance, it is an equal split. Valuation - the value of property (land) the value is counted at the time is was given (not when decedent dies) in NC and in the UPC. If the advancement exceeds or equals the advancee's share, the advancee does not get anything else, but does not refund either.

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NC v. UPC Ancestors and Collaterals

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Statutory schemes that we see - laughing heirs - has the legislature cut it too close All persons related by blood or adoption to the Decedant are your collateral relatives In all jurisdictions if you are not survived by spouse, children, parents, grandfathers it goes to the brothers and sisters and their decendants Living siblings depending on distribution No surviving siblings then what? 2 basic schemes of distribution Parentelic 1st line is parents - 2nd line is grandparents Degree of Relationship - Degree of kingship Second cousin will always be in the third parentelic Limited Parentellic - Limit under NC and UPC limit Is grandparents - those in the 3rd or 4th parentelic line cannot take While both limit to the second degree N.C. limits even further - 5 degrees - they will let you go down the 2nd line until someone is found but not parrell

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NC v. UPC Right of Survivorship

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What equals deceased - legally dead day on your death certificate. Under UPC and NC would be a different outcome. IN NC - date of death is date on death certificate - strategic holding people on life support UPC 2-104 - survivorship 120 hours (5 days) by clear and convincing evidence - Neither benefits from the others estate if they don't survive by 120 hrs - REMEMBER: If one member of the class survives then they all survive

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N.C. Gen Stat. 31-a-3 Slayer Statutes

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Slayer defined 1. Person convicted of willfull and unlawful killing of a person 2. Entered a plea of guilty in open court as a principal or accessory before the fact of the willful and unlawful killing of aperson 3. Entere a plea of nolo contendere 4. Civil Standard - preponderance of the evidence - fits the definition of a slayer -BOP is on the people seeking to prove that i.e. OJ and ScottPeterson 5. Juvenile who is found to be delinquent by reason of committing an act that if committed by an adult, would make the adult a principal or accessory before the fact of the willful and unlawful killing of another person DOES NOT include those found not guilty by reason of insanity of being a principal or accessory before the fact of the willful and unlawful killing of another person 31a-4 Slayer determined to have predeceased the victim - going to use per sturpes - not per capita at each generation! REMEMBER THAT BUT ONLY FOR THE SLAYER. - If slain decedent has a will you are going to look at the - * lapse - whether a provision of a will lapses or not depends on the relationship of the beneficiary to the testor - 31A-5 So what happens to property by the entirety - slayers half held by the victims estate the other half stays with the slayer for life but passes to victims decendants

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Slayer Statutes - Estate Distribution Options

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1. Legal title goes to the slayer - being punished already for the crime 2. No to slayer - goes to the parents - presume slayer predeceased the victim and passed title 3. Trust - Constructive trust - legal title to the slayer to pass to the next of kin Construstive Trust - legal fiction - split title Trustee holds legal tile - States divided on how to handle

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Renouncing Your Share - Tax Purposes

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Medicare P 157 - if you are setting up a trust for someone who is receiving medicare and you don't want them to suffer because of that - YOU have to set up a special trust to ensure it is documented as a "supplement" Cannot renounce your share to stop paying taxes Father gives up his rights to his daugher to avoid IRS taxes

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WILLS

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Testor "must be capable of knowing and understanding in a general way" - 1. Must know nature of the property - 2. Natural objects of his or her bounty, and - 3. The disposition that he or she is making of that property And must be also be capable of -4. Relating these elements to one another and forming an orderly desire regarding the disposition of the property. - Presumpton is that Testator has testamentary capicity

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NC - Mental Capacity - Mandatory Jury Trial

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-- Majority Rule is that person contesting has the burden to prove lack of capacity -perponderance of evidence -Think of senility -subset - insane delusion think of paranoia - If Testator adjudicated insane and has guardian burden is shifted to prove T has testamentary capacity - Can have lucid interval

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General Will Stuff

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Legal Capacity 18 Marriage - Protection of property v. individual autonomy Will - Protection of Property v. Testamentary Freedom Alcoholic - can executive a will Can only Challenge if you have standing Drug addict - can execute a will Insane - depends - most wills contested because of capacity

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Establishing Testamentary Capacity

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If a person has Alzheimer's should you draft the will? You will need to establish testamentary capacity 1. Ask what property she has 2. Who the people are in her life 3. How she wants to divide the property 4. Best to have person sit out if they accompany a person and are going to be a beneficiary 5. If there is doubt don't do it -Might not want to video tape because it might show doubt

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Insane Delusion - subcategory of capacity

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Idea or belief that has no basis in factor reason, or a belief in a state or fact that a rational person would not believe and that affects the will. If insane delusion is present you only strike the provisions that are the product of the delusion. Rational person in the testator's position would have realized it was a delusion (woman left everything to NOW - 1920s)

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Case Capacity/Insane Delusion - Breeden v. Stone - Cunnungham Test

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Legal and Testamentary Capacity must be present - Hollographic Will - Has a 1991 holographic will - 1996 another holographic just before he commit suicide -- He did list off all the property and was over the age of 18 -- Court said he had capacity - Family members bring the claim to stop Sydney from being the beneficiary - Subset of capacity - INSANE Delusion -- It has to materially affect the content of the will -- Court looks to the first document and the family were not in that will either - Cunningham Test: looks to the actual written will, whcih was legible, possessing the motor skills required. His insane delusions did not affect or influence the disposition of the property in the will.

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Undue Influence

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A donative transfer procured by undue influence if the wrongdoer exerted such influence over the donor that it 1. Overcame the donor's free will and 2. Caused the donor to make a donative transfer that the donor would not otherwise have met. Elements 1. unquestionably suspect person 2. Opportunity to exercise influence 3. Disposition to influence 4. Actual influence.

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N.C. Undue Influence - Burden Shifting

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In N.C. must show that the influence was so pervasive that it caused the person to make such a will - Confidential relationship the assumption is undue influence and the burden shifts. The person must show that they did not unduly influence the decedents will. Majority of jurisdic. Confident. And suspicious circumstances will shift the burden Competent influencer will not leave a paper trail In N.C. don't need the suspicious circumstances - as long as there is a confidential relationship the burden shifts to the person to show. Attorney-client- Powers of attorney-Medical provider-Caretaker - NC care giver child is enough to shift burden - parent/child relationship alone is not enough Bring Undue Influence and Fraud together

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Cases Undue Influence

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- Courts tend to look at relationships and shifts with morals of the day! - Understand the bench - Older woman leaves her lover $$ - goes to attorney lover doesn't know - still court said he couldn't inherit "undue influence" - Kays jewler case (same sex partner) - Mother left one of her son out of the will(son predeceased her)- grandkids sue - Court held "No right to inherit" no undue influence because she clearly stated why - - Look for suceptability and Ability to resist - age, mental condition, single lonely, weakened intellect. - Relationship with testator - Motive of wrongdoer

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Fraud - Willful Deceit - Execution - Inducement

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Much less common that undue influence Must have some willful deceit as to the character or content of the instrument. If it's an innocent misrepresentation it is not fraud. Different to undue influence but usually brought at the same time Fraud in execution: you don't happen to know that some of the pages are a will! Fraud in inducement - telling a person something to induce them to make a will - i.e. telling a person someone is dead so you can inherit Factual statement made that is known to be incorrect N.C. Constructive Trust - exists for the wronged beneficiary

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Fraud Cases

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Puckett v. Krida 1994 Caretaker nurses - burden is on the nurses - there is a presumption of undue influence- court can't decide between fraud and undue influence Fraud - testator is provided with false and fraudulent information Court didn't distinguish - but based it on Fraud versus undue influence Latham v. Father Divine Mary Sheldon left her money to Father Divine - Black church and white lady leaves all her money to the church One will giving everything to the church and another will not executed because church through physical force, undue influence, and fraud prevented her from giving to the cousins. Settled the case with the church

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TORTIOUS INTERFERENCE WITH AN EXPENTACY

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Tort law suit not a will concept - has to have fraud, undue influence or duress --Only get here after you exhaust the probate remedy Schilling v.Herrera Suing caretaker of his sister -Caretaker moved in with P sister cared for her-She died - without brother's knowledge D had his sister change her information -Brother didn't have knowledge of the death so couldn't contest the probate proceedings-Barred from recovery under TC no duty owed by caretaker -Probate was closed so couldn't bring undue influence.-Appellate Ct. reversed stating there was a duty by D to the decedant to notify her brother

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NC WILLS FORMALITIES

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In NC only need two witnesses Don't have to know what they sign but it's best to tell them Don't have to sign in the presence of each other If you sign each page it is one continuous document IN NC and under UPC 1. Witnesses have to generally competent 2. Witnesses do not have to attest in front of each other 3. The testator must signify to both that what they are signing is his/her will whether it be through actual witnessing of signature on the will, or testator acknowledges that it is his/her signature. Read the attestation clause (don't have to) For most part never need witnesses again Self Proving Clause - is what stops you from having to track down the witnesses and drag them back in. Signature is prima facie evidence of their presence. MUST BE ONLY ONE ORIGINAL YOU CAN MAKE A COPY Pros and Cons to both If attorney keeps the will must be in a fire proof vault- but might look like they are soliciting business.Probably best to give the original copy to client.

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Functions of Formalities

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We look at Whether or not transferor intend to transfer: Ritual Function -The performance of some ceremonial for the purpose of impressing the transferor with the significance of his statements Evidentiary function -Supply satisfactory evidence to the court Protective Function: Ensure testor safeguarded from undue influence etc Channelling function: Standardized of forms simplifies administration

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Formalities Cases: Groffman P 228

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Widow challenged the will - statute at time required that both witness see the testor sign or acknowledge he signed, sign at the same time. TC said it was a valid will -On Appeal though reversed - had to follow the ceremonially procedure must sign at same time

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Formalities Cases:Stephens v Casdorph

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Mr Miller goes to bank in wheelchair to execute his will -Goes up to Debra teller at bank -Sits at her office desk and signs the will with her present -She then takes the will over to another teller to have them sign as witnesses -They sign without having seen Mr. Miller sign it The court said "no . . .not valid" -TC here says substantial compliance Appeals court reversed didn't meet the technical requirements

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NC Line of Sight v. Conscious Presence Test

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What does presence mean? Line of sight - used in NC - the witnesses could see the testator sign it. Means testator does not have to see the witnesses sign but must be able to see them sign if he were to look. Requires that testator be able to see the witnesses (upstairs not valid if witnesses are downstairs) Conscious presence - sight, hearing, or general consciousness of events comprehend that the witnesses are signing.

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NC and UPC Testator

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Does not have to sign in front of the witnessess at same time.

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TEST Purposes

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trick you will always see is that a will is not a will unless the testator has signed it. You will often see courts dispense with that requirement if it is one continuous transaction i.e. all in the lawyers office passing papers around.

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UPC Revised 2008

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- says you can just have a notary don't need two witnesses - but states haven't embraced it.

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Signature

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- what constitutes is what the testator intends - can be a nickname or an X - electronic signature - mark made by someone else at the direction of the testator. Not mandated by statute that you sign at the document - but it's a good idea to sign at the end of the document.

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NC Computer Wills - NC not allowed - Only in Nevada

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Nevada is the only jurisdiction to allow computer wills or electronic wills - i.e. Ryan Jenkins reality star writes his suicide note and a will on his computer leaves money and possession to family member - document was on the hard drive had not be printed out. So it's not accepted.

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NC - Video Wills Not allowed in any jurisdiction

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No jurisdiction allows a video to be used as a will - can be used as extrinsic evidence

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PURGING STATUTE Supernumerary

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If we have a will that has been witnessed by two people and one is an interested party then that individual's share will be striken and the will is distributed accordingly. If we have 3 - we have a supernumerary so even the interested person will still get his share,

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NC SWITCHED WILLS: NC does not allow reform

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N.C. Does not allow reform - but it will allow constructive trust to remedy the mistake - you would need evidence i.e. other will to show they were the same. Rule: A court may not rewrite a clear and unambiguous will even for the purpose of implementing the obvious intentions of the testator. re. Pavlinko - switched wills NC Follows the above case:

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NC Substantial Compliance : Not recognized in NC

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The court may deem a defectively executed will as being in accord with statutory formalities if there is clear and convincing evidence that the purposes of those formalities were served - NC does not recognize

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NC Harmless Error : Not recognized in NC

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Harmless Error : The court may excuse if there is clear and convincing evidence that the testator intended the document to be his well. NC does not recognize

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NC 31.3.3 Witnesses Signature

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• If the witnesses sign the will and leave prior to the signing by the testator, the law requiring that "the testator must signify to the attesting witnesses that the instrument is his instrument by signing it in their presence or by acknowledging to them his signature previously affixed thereto" has not been complied with. • Exception: There is a recognized exception to this general rule that the testator must sign the will before the witness. The exception provides that a will is validly attested even though the witnesses signed before the testator if the witnesses and the testator sign at practically the same time and place as to constitute one transaction. Notes: GOOD PRACTICE TO: (not required) • To have the testator sign each page of the document even though not required by statute (Not required by law) - don't have to sign at bottom but a good idea • To have inform the witnesses that what is in front of them is the will of the testator • To read the attestation clause out loud to testator and witnesses (not required by law) • To put the original will in a fireproof safe, or a safety deposit box • Also a copy in a place that you tell others where it is—some people put copies in the freezer

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NC Holographic Will - Probate Requirements

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NC does not require a date on a holographic will. What would make a letter constitute a valid holographic will? It would have to express testamentary intent. NC 31-3.4 and UPC: We don't look at the preprinted portions. If the handwritten portion of the will is enough to indicate the testator's intent, the will may be considered a holographic will and may be probated. NC 31-18.2 Mannar of Probate of Holographic Will: (1) Upon the testimony of at least three competent witnesses that they believe that the will is written entirely in the handwriting of the person whose will it purports to be, and that the name of the testator as written in or on, or subscribed to, the will is in the handwriting of the person whose will it purports to be; and (2) Upon the testimony of one witness who may, but need not be, one of the witnesses referred to in subdivision (1) of this section to a statement of facts showing that the will was found after the testator's death as required by G.S. 31 3.4.

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Cases: Kuralt Transfer

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In re estate of Kuralt Intent to make a deliberate transfer!!!***when analyzing holographic wills.

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Noncupative will - Terminally ill spoken before death

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- written when a person is terminally ill or is spoken just before death. 31-3.5: what can you dispose of with a nuncupative will? Can't dispose of property Spouse has to be notified and any next of kin. Has to be given the opportunity to dispute. Four week notice posted for any kin to step forward

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Revocation of Wills

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Three ways to revoke a will - Creating a new writing - Destroying previous will - Operation of law Just because you have Alzheimers doesn't mean you can't revoke a will...you can do so during a lucid moment. Must have capacity...same as you had to draft. AMERICAN STATES Fall into 3 Groups: 1. Revival - English common law courts

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NC - Revocation of Will N.C. Gen. 31-5.1

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"I...revoke my last will & testament"...as long as revocatory meets requirements for a valid holograph (in handwriting and among valuable personal effects)...if in drawer with other valuable objects then would be valid. If you write "void void void" across the top of your will, have you voided your will in NC? No, the word void has to at least touch some of the words. - In N.C. won't interpert who should receive if part crossed out and person not named.

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Wills CASES: Formality and Revocation

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Thompson v. Royall Not a formal will to null and void because it is not attested by witnesses. It is not a holograph because it is not in her handwriting. The Null and void is not touching any language in the will. Harrison Bird ***We never execute duplicate wills She instructed her attorney to tear up her will in four pieces by Phone...is it valid revocation? NO...it has to be done in her presence. The letter was found, but not the will. When the will is lost the presumption is that the will has been lost. Will is revoked not because of the tearing but because it was lost. Can you probate a copy of the will? Yes.

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NC Partial Revocation - Not allowed in NC

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NC does allow for partial revocation. T executes will that devises the residue of her estate to four main relatives. Change of amount...but no notation to make it a valid holograph.

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Revocation of Wills

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a. Revocation by Writing or Physical Act i. A will is an ambulatory document, which means that it is subject to modification or revocation by the testator during her lifetime. ii. All states permit revocation of a will in one of two ways: 1. By a subsequent writing with testamentary formalities, or 2. By a physical act such as destroying, obliterating, or burning the will.

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UPC 2-507: Revocation by Writing or by Act

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a. A will or any part thereof is revoked if: 1. By executing a subsequent will that revokes the previous will or part expressly or inconsistency; or; 2. By performing an act of the will, if the testator performed the act with the intent and for the purpose of revoking the will or part of if another individual performed the act in the testator's conscious presence and by the testator's direction. For purposes of this paragraph, "revocatory acct on the will" includes burning, tearing, canceling, obliterating, or destroying the will or any part of it. A burning, tearing, or cancelling is a "revocatory act on the will," whether or not the burn, tear, or cancellation touched any of the words on the will.

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Revocation by Inconsistency

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1. Modern view is to treat a subsequent will that does not expressly revoke the prior will, but makes a complete disposition of the testator's estate, as presumptively replacing the prior will and revoking it by inconsistency. 2.A codicil is a testamentary instrument that supplements, rather than replaces, an earlier will; the codicil supersedes the will to the extent of inconsistency between them.

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Revocation of Will Case: Harrison v. Bird - The burden of rebutting the presumption is on the proponent of the will.

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Fact Summary: After Speer died, Harrison (P), the sole beneficiary of Speer's will, filed for probate a document purporting to be Speer's last will and testament, despite the fact that Speer's attorney had torn Speer's will into four pieces after she informed him that she wanted to revoke her will. Rule of Law: A rebuttable presumption of revocation exists where a will cannot be found among a deceased's personal effects. Issue: Does a rebuttable presumption of revocation exist where a will cannot be found among a deceased's personal effects? Holding and Decision: Yes. A rebuttable presumption of revocation exists where a will cannot be found among a deceased's personal effects. Under Alabama state law, Speer's will was not lawfully revoked because her attorney destroyed it at her direction and consent but not in her presence. However, where a testator destroys the copy of the will in her possession, a presumption arises that she has revoked her will and all duplicates, even though a duplicate exists that is not in her possession. The burden of rebutting the presumption is on the proponent of the will. Under the facts of this case, there existed a presumption that Speer destroyed her will, thus revoking it. Harrison (P) did not present sufficient evidence to rebut presumption, ie, to convince the trier of fact that absence of the will was not due to Speer's destroying and thus revoking the will.

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Revocation of Will - Thompson v. Royall - Holding and Decision: In order to effect revocation by cancellation, the testator must actually mutilate, erase, deface, or otherwise mark the written portions of the testamentary instrument.

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Nature of Case: Action to probate a will. Fact Summary: Kroll attempted to revoke her will and codicil by signing notations on the back of each that purported to render them void. Rule of Law: Revocation of a will by cancellation is not accomplished unless the written words of the document are mutilated or otherwise impaired. Issue: May a memorandum written in another's handwriting on the reverse side of a testamentary instrument and signed by the testator, purporting to void the document, effect a revocation by cancellation of the instrument?

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Probate of Lost Wills

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1. In absence of a statute to the contrary, a will that is lost, destroyed without the consent of the testator, or destroyed with the consent of the testator but not in compliance with the revocation statute can be admitted into probate if its contents are proved. 2. 9/11 - wills that were stored in buildings that were destroyed, because those wills were not destroyed by the testators with the intent to revoke, they can still be probated if their terms can be proved from copies or otherwise. 3. In a few states, statutes prohibit the probate of a lost or destroyed will unless the will was "in existence" at the testator's death (and destroyed thereafter) or was "fraudulently destroyed" during the testator's life.

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NCGS § 31‑5.1. Revocation of written will.

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A written will, or any part thereof, may be revoked only (1) By a subsequent written will or codicil or other revocatory writing executed in the manner provided herein for the execution of written wills, or (2) By being burnt, torn, canceled, obliterated, or destroyed, with the intent and for the purpose of revoking it, by the testator himself or by another person in his presence and by his direction.

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Dependent Relative Revocation and Revival

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Doctrine of Dependent Relative Revocation (DRR): If the testator purports to revoke his will upon a mistaken assumption of law or fact, the revocation is in ineffective if the testator would not have revoked his will had he known the truth.

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Cases DRR and Revival -The doctrine of dependent relative revocation sustains a gift by will when such gift has been revoked in a codicil that substantially reaffirms the gift but is void by reason of the interest of a subscribing witness. That doctrine provides that if a testator cancels or destroys a will with a present intention of making a new one immediately and as a substitute and the new will is not made or, if made, fails of effect for any reason, it will be presumed that the testator preferred the old will to intestacy, and the old one will be admitted to probate in the absence of evidence overcoming the presumption. It is a rule of presumed intention.

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b. LaCroix v. Senecal Nature of Case: Appeal from judgment holding that a residuary devise and bequest under a codicil, which was virtually identical to a similar residuary devise and bequest in deceased's will, was void, but that there was not resulting intestacy as to that portion of the residue because it was valid under the will. Fact Summary: Dupre's niece, LaCroix (P), argued that a residuary clause in Dupre's codicil, which replaced a virtually identical clause in Dupre's will, was void because it was witnessed by the spouse of a beneficiary. Rule of Law: The doctrine of dependent relative revocation sustains a gift by will when such gift has been revoked in a codicil that substantially reaffirms the gift but is void by reason of interest of a subscribing witness. Issue: does the doctrine of dependent relative revocation sustain a gift by will, when such gift has been revoked in a codicil that substantially reaffirms the gift but is void by reason of the interest of a subscribing witness? Holding and Decision: Yes.

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Cases DRR Contd.

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d. Estate v. Alburn Nature of Case: Appeal from the admission of a will to probate. Fact Summary: Alburn revoked a will in the mistaken belief that this would reinstate an earlier revoked will. Rule of Law: Where a will is mistakenly revoked in the belief that an earlier revoked will would be revived, the doctrine of DRR may be applied to revive the mistakenly revoked will.

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UPC 2-509 Revival of Revoked Will

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a. If a subsequent will that wholly revoked a previous will is thereafter revoked by a revocatory act under Section 2-507(a)(2), the previous will remains revoked unless it is revived. The previous will is revived if it is evidence from the circumstances of the revocation of the subsequent will or from the testator's contemporary or subsequent declarations that the testator intended the previous will to take effect as executed. b. If a subsequent will that partly revoked a previous will is thereafter revoked by a revocatory act under Section 2-507(a)(2), a revoked part of the previous will is revived unless it is evident from the circumstances of the revocation of the subsequent will or from the testator's contemporary or subsequent declarations that the testator did not intend the revoked part to take effect as executed. c. If a subsequent will that revoked a previous will in whole or in part is thereafter revoked by another, later, will, the previous will revoked in whole or in part, unless it or its revoked part is revived. The previous will or its revoked part is revived to the extent it appears from the terms of the later will that the testator intended the previous will to take effect.

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NCGS § 31‑5.8. Revival of revoked will - not allowed except by re-execution

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No will or any part thereof that has been in any manner revoked can, except as provided in G.S. 31‑5.4, be revived otherwise than by a reexecution thereof, or by the execution of another will in which the revoked will or part thereof is incorporated by reference. (1953, c. 1098, s. 10; 1991, c. 587, s. 2.)

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Revocation by operation of law - divorce - that part of hte will is revoked - but not POD (life insurance, 401k)

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a. In all but a handful of states, statutes provide that a divorce revokes any provision in the decedent's will for the divorced spouse. b. Revocation statutes ordinarily apply only to wills, not to life insurance policies, pension plans, or other nonprobate transfers. c. UPC 2-804 d. Marriage: If the testator executes her will and subsequently marries, statutes in a large majority of states give the spouse his intestate share, unless it appears from the will that the omission was intentional or the spouse is provided for in the will or by a will substitute with the intent that the transfer be in lieu of a testamentary provision. e. Birth of children: A few states follow the old common law rule that marriage followed by birth of children revokes a will executed before marriage, but this rule has not been incorporated in the UPC and is rapidly disappearing. Almost all states have pretermitted child statutes, giving a child born after the execution of the parent's will, and not mentioned in the will, a share of the parent's estate.

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NCGS § 31‑5.3. - Will is not revoked by marriage

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Will not revoked by marriage; dissent from will made prior to marriage. will is not revoked by a subsequent marriage of the maker; and the surviving spouse may petition for an elective share when there is a will made prior to the marriage in the same manner, upon the same conditions, and to the same extent, as a surviving spouse may petition for an elective share when there is a will made subsequent to marriage.

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NCGS § 31‑5.4. Revocation by Divorce or Annulment - Revival

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Revocation by divorce or annulment; revival. Dissolution of marriage by absolute divorce or annulment after making a will does not revoke the will of any testator but, unless otherwise specifically provided in the will, it revokes all provisions in the will in favor of the testator's former spouse or purported former spouse, including, but not by way of limitation, any provision conferring a general or special power of appointment on the former spouse or purported former spouse and any appointment of the former spouse or purported former spouse as executor, trustee, conservator, or guardian. If provisions are revoked solely by this section, they are revived by the testator's remarriage to the former spouse or purported former spouse.

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NCGS § 31‑5.5. - Afterborn or Adopted Child

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After‑born or after‑adopted child; illegitimate child; effect on will. (a) A will shall not be revoked by the subsequent birth of a child to the testator, or by the subsequent adoption of a child by the testator, or by the subsequent entitlement of an after‑born illegitimate child to take as an heir of the testator pursuant to the provisions of G.S. 29‑19(b), but any after‑born, after‑adopted or entitled after‑born illegitimate child shall have the right to share in the testator's estate to the same extent he would have shared if the testator had died intestate unless: (1) The testator made some provision in the will for the child, whether adequate or not; (2) It is apparent from the will itself that the testator intentionally did not make specific provision therein for the child; (3) The testator had children living when the will was executed, and none of the testator's children actually take under the will; (4) The surviving spouse receives all of the estate under the will; or (5) The testator made provision for the child that takes effect upon the death of the testator, whether adequate or not.

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Components of a Will

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a. Doctrine of incorporation by reference b. Doctrine of acts of independent significance c. Integration of Will i. Under the doctrine of integration, all papers are present at the time of execution, intended to be part of the will, are integrated into the will. ii. Attorney can prevent any problem from arising under the integration doctrine by seeing to it that the will is fastened together before the testator signs and by having the testator sign or initial each numbered page of the will for identification.

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Republication by codicil versus Incorporation by Reference

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Publication of a will is the testator's statement to the witnesses, by words or by action, that a document is the testator's will. ii. Under the doctrine of republication by codicil, a will is treated as re-executed (republished) as the date of the codicil: "A will is treated as if it were executed when its most recent codicil was executed whether or not the codicil expressly republishes the prior will, unless the effect of treating it would be inconsistent with the testator's intent." iii. If the testator revokes a first will by a second will and then executes a codicil to the first will. The first will is republished, and the second will is revoked by implication ("squeezed out"). iv. Republication applies only to a prior validly executed will, whereas incorporation by reference can apply to incorporate into a will language or instruments that have never been validly executed.

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Case: Estate of Nielson

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1. Testator drew lines through the dispositive provisions of his typewritten will and wrote between the lines to shrine and Soc for Prevention of cruelty to animals. 2. Court held the handwritten words constituted a holographic codicil because they did not intend to incorporate the attested typed material.

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UPC 2-510: Incorporation by Reference

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A writing in existence when a will is executed may be incorporated by reference if the language of the will manifests this intent and describes the writing sufficiently to permit its identification.

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Case: Incorporation by Reference -

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Nature of Case: Appeal from a judgment incorporating a notebook by reference into the terms of a will. Fact Summary: Although Nesmith reserved the right in her will to make a further disposition of personal property by a memorandum, Greenhalge (D), the executor, refused to comply with one of Nesmith's bequests written in a notebook. Issue: May a properly executed will incorporate by reference into its provisions any document or paper not so executed and witnessed if it was in existence at the time of the execution of the will and is identified by clear and satisfactory proof as the paper referred to therein? Holding and Decision: Yes. Nesmith intended that the bequests in her notebook be accorded the same power and effect as those contained in the memorandum reference in her will. Simon v. Grayson: The letter found in the safe-deposit box was the letter referred to in the will, despite the discrepancy in dates. It was incorporated by reference into the will, becoming an integral part of the will.

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Holigraphic Codical - Used to valadite and improper Will.

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Issue: Can a valid, holographic codicil republish and validate a prior ineffective will? Holding and Decision: Yes. A valid, holographic codicil may incorporate and republish a prior will that would have been ineffective because of its failure to comply with formal requisites. Any writing that is properly executed may constitute a codicil, and, by the weight of authority , that codicil incorporates and validates the three-paragraph will, which but for the codicil, would have failed for want of execution and attestation. The judgments of the courts below must, therefore, be reversed and the will ordered admitted to probate. Concurrence: The majority's opinion is a commendable one since it implements the obvious intentions of the testator. Dissent: The language of the handwritten paragraph indicates that it was intended as an addition to the typed will and was not designed to serve as a codicil thereto. The entire page should, therefore, be deemed to constitute one will, which, because it does not comply with the statutory formalities, is ineffective and not appropriate for admission to probate.

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UPC 2-512 events of Independent Significance

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A will may dispose of property by reference to acts and events that have significance apart from their effect upon the dispositions made by the will, whether they occur before or after the execution of the will or before or after the testator's death. The execution or revocation of another individual's will is such an event. - We allow extrinsic evidence to show who the employees on the day are so they can receive. - i.e. will your car to a person then after will written years later you get a higher end car. May allow extrinsic evidence to determine what the car is and description can change. Doesn't matter that it is changing - independent of your estate plan - part of your day to day living.

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NCGS § 31‑47. Testamentary additions to trusts.

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(a) A will may validly devise property to: (1) The trustee of a trust established before the testator's death by the testator, by the testator and some other person, or by some other person, including a trust authorized by G.S. 36C‑4‑401.1; or (2) The trustee of a trust to be established at the testator's death, if the trust is identified in the testator's will and its terms are set forth in a written instrument executed before or concurrently with the execution of the testator's will, regardless of the existence, size, or character of the corpus of the trust during the testator's lifetime. The devise is not invalid because the trust is amendable or revocable, or because the trust instrument or any amendment thereto was not executed in the manner required for wills, or because the trust was amended after the execution of the testator's will or after the testator's death. A revocable trust to which property is first transferred under subdivision (2) of this subsection is an inter vivos trust and not a testamentary trust and, as of the date of the execution of the trust instrument, is subject to Article 6 of Chapter 36C of the General Statutes. (b) Unless the testator's will provides otherwise, property devised to the trustee of a trust described in subsection (a) of this section is not held under a testamentary trust of the testator, but it becomes a part of the trust to which it is devised, and shall be administered and disposed of in accordance with the provisions of the governing instrument setting forth the terms of the trust, including any amendments thereto made before or after the testator's death. (c) Unless the testator's will provides otherwise, a revocation or termination of the trust before the testator's death causes the devise to lapse. (d) A devise to a trust shall be construed as a devise to the trustee of that trust. (e) For purposes of this section, "devise," when used as a noun, means a testamentary disposition of real or personal property and, when used as a verb, means to dispose of real or personal property by will. (f) Nothing in this section alters, amends, or in any manner affects the application of the doctrine of acts of independent significance. (1955, c. 388; 1957, c. 783, s. 1; 1975, c. 161; 2007‑184, s. 1.)

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NCGS 31-52 Acts of Independence Signifiance

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NCGS 31-52 A will may dispose of property by reference to acts and events that have significance apart from their effect upon the disposition made by the will, whether they occur before or after the execution of the will or before or after the testator's death. These acts and events may include the execution or revocation of another individual's will and the safekeeping of items in a secured depository. NC Examples: • Like the doctrine of incorporation by reference, the doctrine of acts and events of independent significance has long been a part of the North Carolina common law. New N.C. Gen. Stat. § 31-52 merely codifies this well-established doctrine. Examples of this doctrine being recognized are almost too numerous to imagine. For example, a devise of $1,000 to each of the employees of the testators business as of the date of her death is valid because the hiring and firing of employees has significance apart from her will. . Doctrine of facts of independent significance: permits the use of facts and circumstances outside the will to impact the property disposition the testator made in the will. **Here you are looking for "non testamentary acts"

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Construction of Wills - Mistaken or Ambiguous Language

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The Traditional Approach: No Extrinsic Evidence, No Reformation 2 Traditional rules that, operating in tandem, bar the admission of evidence to vary the terms of the will: (1) Plain Meaning (or NO extrinsic evidence) rule: Extrinsic evidence may be admitted to resolve some ambiguities, but the plain meaning of the words of the will can't be disturbed by evidence that another meaning was intended; and (2) No reformation rule: Reformation is an equitable remedy that, if applied to a will, would correct a mistaken term in the will to reflect what the testator intended the will to say. • Traditionally this rule was strictly complied with. • Even the clearest mistakes will NOT be corrected. • Used in MC questions.

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Cases: Mahoney V. Grainger

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Mahoney v. Grainger (Mass. 1993)—cousins share in estate F: S left the bulk of her estate to 2 first cousins then the rest of her estate to be split amongst 25 cousins. The attorney drafted a residuary clause stating "all the rest and residue of my estate, I give to my heirs at law living at the time of my death." S's sole heir was her aunt rather than her 25 cousins, and the court would not admit the extrinsic evidence since the will was clear. Rule: a will duly executed and allowed by the court must, under the statute of wills, be accepted as the final expression of the intent of the person executing it. In N.C. you cannot get in extrinsic evidence unless latent - so look at HEIRS - the plural indicates that the person thought there was more than one heir.

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NC and UPC - Patent Ambiguities: No extrinsic evidence allowed

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ambiguity appears on the face of the document, so you can see that error exists. • CL, extrinsic evidence is NOT admissible to clarify a patent ambiguity, and the court is confined to the four corners of the will. • Mistake or omission: extrinsic evidence is NOT allowed Example: I leave my car to John. I leave my boat to ________. • CL and NC the answer is NO extrinsic evidence allowed to figure out who blank is supposed to be.

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NC - Latent Ambiguities: Extrinsic Evidence allowed

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conveys a sensible meaning on its face but cannot be carried out without further clarification. It manifests itself only when the terms of the will are applied to the testator's property or designated beneficiaries. There are 2 types of latent ambiguities: (1) Equivocation: when 2 or more persons or things fit the description in the will; and • Extrinsic E was allowed to resolve the issue. • Personal Usage Exception: If extrinsic evidence shows T always referred to the person in an indosyncratic manner, extrinsic evidence is admissible to show that testator meant someone other than the person with the legal name of the legatee. (2) Description in the will does not exactly fit any person or thing.

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NCGS 31-46

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*NC only allows extrinsic evidence if latent ambiguities. Correcting Mistakes Without the Power to Reform Wills Traditional refusal to reform wills rests on the premise that mischief will ensue if the courts are allowed to reject the seemingly clear words of the will.

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NC - Reforming Will - Mistake

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NO relief for the Mistake. *Examples: "I give all my property to my son David." T's son Ralph appears at death, can he take under the will when T believed that R had previously died. • General rule: R doesn't take • 2 exceptions to the general rule: 1. the mistaken ambiguity must be on the face of the document; and 2. Fraudulent Inducement—D lied to T about R being dead. • Under UPC and NC, if T fails to provide for a living child solely b/c he mistakenly believes the child to be dead, the child receives an intestate share in the testator's estate. • If T forgets update his will after a major life event, divorce/ birth of child, statutes in many states partially or completely revoke the testator's will automatically.

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Cases - Mistake

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Arnheiter v. Arnheiter (NJ 1956)—wrong street address F: Executrix of Guterl's will applied to the court to correct an obvious mistake in the will by changing the street number of property devised to correctly identify property owned by Guterl. Rule: an erroneous description of a particular devise will not cause the devise to fail, where less essential particulars can be eliminated leaving a resulting description that is clearly accurate. Erickson v. Erickson (CT 1998)—when fiancé turned into wife she was not included in will F: Ronald Erickson executed a will two days before getting married that was intended to leave his estate to his future wife but technically did not provide for the contingency of a subsequent marriage. - In N.C. we wouldn't have this because a subsequent marriage would invalidate the will. Rule: extrinsic evidence is admissible to establish the intent of the testator that his will is valid notwithstanding a subsequent marriage if a scrivener's error led the testator to believe that it would be valid.

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Nonprobate Transferors:

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drafting mistakes in nonpropate transfers, such as inter vivos trusts, can be corrected after the settlor's death.

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Doctrine of Probable Intent: Gifts by implication:

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A recurring oversight in drafting is a gap in the dispositive provisions, a particular contingency which occurs is NOT provided for. Ct.s may now use, Doctrine of Probable Intent, to fill the gaps. NJ codified doctrine: If a contingency occurs for which NO provision is made in the will, the court studies the family circumstances and the plan of testamentary disposition set forth in the will. The court then places itself in the position of the testator and decides how the testator probably would have responded to the contingency had she envisioned its occurrence. Fleming v. Morrison (1904) Lawyer assisted lawyer in fraudlent will prep. Lawyer should not have played along with the scheme. Was validly executed document. But judge didn't uphold it.

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NC - Antilapse Statutes - Death of Beneficiary Before Death of Testator

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If a devisee does not survive the testator, the devise lapses (it fails). -unless there are provisions to the contrary (anti-lapse statutes) Majority Rule (NC and UPC): Grandparent of the testator or lineal descendent of the grandparent of the testator. i.e. children passes i.e. spouse will lapse

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Specific Devise: look for "my" - Ademption only applied to Specific Devises - if devise fails goes to residue

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identified in the will in sufficient detail so it is clear which exact asset from the testator's estate the beneficiary is entitled to receive. • "I give my mother's diamond ring to Carly." • Look to "my" • i.e. I leave "my" 100 shares of Lowes to Jimmy • (here this would fail under ademption by exclusion because it is specific - due to "my")

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General Devise:

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insufficient described to be a specific—the exact property to which the gift refers cannot be determined when the testator executes the will or upon the testator's death. Most common is a legacy (money)—" I give $1000 to Bob." i.e. I leave 100 shares of Aspen Publishing, INC stock to Alice (this is general because it doesn't have "my" • This means that it is general and thus does not fail under ademption by exclusion (below) and Alice will receive the value of this bequest. If a specific or general devise lapses, the devise falls into residue.

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Demonstrative Devise:

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shares qualities of both specific and general. (specific source) - hybrid "I leave $50k from my account #1234567 at Wachovia Bank to Bob."

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Residuary Devise:

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the property remaining after all specific, general, and demonstrative are satisfied. If lapses, the heirs of the testator take by intestate No-residue-of-a-residue rule: common law, the lapsed residuary share passes by intestacy to the testator's heirs rather than to the remaining residuary devisees.

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Class gift:

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testator designates a group of beneficiaries by a generic reference rather than by their individual names. "I leave my bank account to Jill's children." If the devise is to a class of persons, and one member of the class predeceases the testator, the surviving members of the class divide the gift.

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Void Devise

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where a devisee is already dead at the time the will is executed, or the devisee is a dog or cat or some other ineligible taker, the devise is void.

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Case - Void Devise

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Estate of Russell (CA 1968)—leaving estate to the dog F: testator left her $10 gold piece and diamonds to Hembree, her only heir-at-law, and the residue of her estate to Charles Quinn and Roxy Russell, the latter being her dog, who predeceased her. Rule: an animal cannot take under a will, but it can be cared for through a trust. N.C. has statutory pet trusts. Used to be honorary prior to that you were requesting versus requiring. Now you can require. Some states won't allow residue of the residue - has to go through intestate succession. Supreme Ct. in CA ruled that way. Pet couldn't get it BUT Charles did not get the pet's share. Remember if to state in your will

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Precatory language:

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non-mandatory, suggestive language that is not binding on the beneficiary. "I wish," "I recommend," "I suggest"

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NC 31-42 and UPC: Anti Lapse

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If no contrary intent in the will, a lapsed gift is preserved if: 1. The beneficiary predeceases the testator (either before or after the execution of the will) 2. The predeceasing beneficiary leaves issue surviving the testator, and 3. The beneficiary is a grandparent of or a descendent of a grandparent of the testator. MUST look to the relationship of the beneficiary to Testator

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Antilapse Statutes (VOID/LAPSE)

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Antilapse Statutes: enacted in nearly all states whereby under certain circumstances, substituting another beneficiary for the predeceased devisee. Antilapse statutes do not prevent a lapse; they merely substitute other beneficiaries (usually descendants) for the dead beneficiary if certain requirements are met. Antilapse statutes do not kick in to the spouse. Antilapse statute is the default rule, it is not mandatory.

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CASES ANTILAPSE

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Ruotolo v. Tietjen (AC of CT 2006)—beneficiary predeceased testator F: Swanson executed a will leaving 1/2 of the residue of his estate "to Hanzel Brennan of Guilford, CT, if she survives me." HB died 17 days before the testator. HB's daughter, Kathleen Smaldone, sought to take HB's share. The bequest to HB does not lapse, but rather descends to her issue. Rule: issue of devisee who predeceased testator shall take the estate. NOTE: SOME STATES DO NOT ALLOW ISSUES OF STEPCIDREN TO TAKE

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NC CLASS GIFTS N.C. 31-42

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NOTE: naming children does not qualify as "class" gift but saying to "my children" qualifies as class. If you list names there is a rebuttable presumption of a class gift

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Cases Cass Gift

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Dawson v. Yucus (Ill. App. Ct. 1968)—to the nephews of my husband F: Nelle Stewart left a duly executed will containing 10 clauses. The second clause gave the 1/5 interest in farm lands that Stewart inherited from her husband to two of his nephews, Stewart Wilson and Gene Burtle. Each was to receive 1/2 of Stewart's 1/5 interest. Rule: Where the number of beneficiaries to a gift is certain, and the share each is to receive is also certain and in no way dependant for its amount upon the number who shall survive, it is not a gift to a class but to the individuals. Antilapse cannot come in because not related by blood Tried to get it classified as class - but it wasn't a class because she named them specifically NOT her nephews - even though she said she wanted it to stay on her husband's side of the family.

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Ademption by Extinction

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Ademption the failure of a specific gift because the property is not in the testator's estate when the testator dies. It occurs if a will includes an item of property, but the testator sells or gives the item away before death. On an EXAM make sure to go both - but give an answer!!! State if form over substantive and WHY - pick an answer ADEMPTION ONLY APPLIES To SPECIFIC DEVISES Generally speaking money is a general devise. Ademption only applies to specific devices.

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NC - Identity Theory - NC through case law will use intent theroy where property is missing because on involuntary act of Testator

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if a specifically devised item is not in the testator's estate, the gift is extinguished. - check out Anton - involuntary "modified intention theory"

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Intent Theory (UPC follows):

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if a specifically devised item is not in the testator's estate, the beneficiary may prove attempt to prove testator's intent and receive a replacement.

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N.C. Form versus Substance

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NC through case law, also practices form over substance. (i.e. 100 or tigertail for 85 shares of lion stock b/c of merger) Change in Form Versus Substance: Change in form is so minimum that a testator would not feel the need to change the will to account for the change In an identiy jurisdiction we will look to see if a specific devise, if so we will look to see why property is not there, then whether it was minimum or substantive i.e. J was suppose to get a ring from T. Ring lost in fire... J would get the insurance proceeds Otherwise, ademption occurs where a testator had knowledge of a transaction involving a specific devise, realizes the effect of the transaction of his or her estate plan, and has an opportunity to revise the will.

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NC - Intent Theory Mix - Case: Anton

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In re Estate of Anton (IA 2007)—duplex devised in will was sold prior to testator's death Rule: previous court reasoned that where property is missing from the estate because of some act or event involuntary as to the testator, there is no ademption. Rule "modified intention theory:" the identity rule will not be applied to cases where specifically devised property is removed from the estate through an act that is involuntary as to the testator. Court used a modified identity versus identity or intent theory - here property was removed from the estate through an involuntary act of the testator and because of that it is not going to adeem; therefore, beneficiary entitled to the balance. Made an exception to the identity theory because it was involuntary. N.C. like this case uses the identity theory but it has identified situations where involuntary acts prevent the ademption from occurring - i.e. a sale during the testator's lifetime when the act is involuntary (i.e. T incompentent) then beneficiary can receive the balance from the sale N.C. also ruled in a case where there was theft of property that was insured. Beneficiaries were entitled to the insurance proceeds collected by the state.

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UPC 2-606. Non Ademption of Specific Devises

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Nonademption of Specific Devises; Unpaid Proceeds of Sale, Condemnation, or Insurance; Sale by Conservator or Agent Deals with replacement property UPC 2-606(a)(5)--"To Bob, my Ford car" but T then trades in his Ford for a Bentley. Under the UPC, Bob will likely received the Bentley as a replacement of the Ford.

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Stock Splits

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Stock Splits and the Problem of Increase SPECIFIC versus General. If general then you will only get 100 if "my" 100 in NC you get the 300. i.e. here the stock value is the same, only the split makes it different. SPECIFIC DEVISE "my 100 shares" - in N.C. we are in Identity - so you may lose the stock in NC through ademption - is it a change in form or substance? Form - so now we have a different type of stock. Most courts hold that a corporate merger or reorg. Is only a change in form not substance. But sale of property/house - you get a whole other house - but you could try to argue form.

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NC Stock Splits - Modern Approach

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Modern Rule - will receive extra shares if there has been a stock split - only applies to a specific device "my" not general - you only get 100 shares versus 100 Most modern courts (NC) have discarded the old approach in the case of stock splits and have held that, absent a contrary showing of intent, a devisee of stock is entitled to additional shares received by the testator as a result of a stock split. In NC it would be a change in form not substance.

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Stock Splits -Old Fashioned Approach

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what ever the number of shares is. i.e. 100 shares versus new shares of 300 in the split

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NC - The Doctrine of Satisfaction (ademption by satisfaction) - presumption of satisfaction

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applies when the testator already transfers the property to the beneficiary between the time of will execution and time of death. Akin to the Doctrine of Advancements under intestacy law. NC has a presumption of satisfaction, if the subject matter of the inter vivos gift is the same as the subject matter of the testamentary gift. Example: T's will devises $50k to her son, S, and her residuary estate to her daughter, D. After executing the will, T gives S $30k. There is a presumption that the gift was in partial satisfaction of the legacy, so that S will take only $20k at T's death.

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NC and Most States -Exoneration of Liens

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When a will makes a specific devise of land, on which there is a mortgage, the question may arise whether the devised land passes free of the mortgage. devisee takes the land free of the mortgage; therefore, the mortgage is paid off by the estate Common law--Absent contrary language in the will, that the testator wanted the debt, like other debts, to be paid out of the residuary of the estate **UPC 2-607 and most states attach the mortgage to the property; therefore, the devisee is responsible for the mortgage.

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Abatement

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When the testator attempts to give away more property in the testator's will than the testator is actually able to give. Arises when the estate has insufficient assets to pay debts as well as all the devises. NO abatement on ESSAY - don't analyze -note remember demonstrative device see abatement worksheet Dora Vidal $8k Specific devices are given out first then general devices.Example House to daughter and equivalent in cash to son. When she dies not enough to pay son same as what house was valued. She didn't say what to do in that case. In NC son is out of luck - he will only get was is left. Under UPC there tends to be a compromise reached - daughter would keep the assets but would add son to title or give him cash. UPC 3-902--"if a testamentary plan would be defeated by" the usual order of abatement, "the shares of the distributes abate as may be necessary to give effect to the intention of the testator."

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NC and UPC - Ademption by satisfaction -

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does not apply to gifts made before the execution of a will. A specific gift cannot be satisfied by a gift of something else. Look to value of the gift on the date it was made. Under UPC a writing is required for advancement and ademptions by satisfaction. IN NC there is a presumption AGAINST advancement BUT in NC there is a presumption of ademption by satisfaction if the subject matter of the lifetime gift is the same as the subject matter of the will and the relationship of test/beneficiary is parent child. If the subject matter is different or the relationship is not parent child then no presumption of ademption.

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NON-PROBATE TRANSFERS

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4 Main "pure" will substitutes constitute the core of the nonprobate system: life insurance, pension accounts, joint accounts, and revocable trusts. "Imperfect" will substitutes are primarily joint tenancies, which more closely resemble completed lifetime transfers. 1. Life Insurance: ambulatory--nonexistent until the testator's death--and revocable 2. Pension Accounts 3. Bank, Brokerage, and Mutual Fund Accounts--POD (pay on death) account; joint bank accounts ("impure" will substitutes - b/c it is shared ownership) 4. Revocable Trust Inter Vivos trust—

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Revocable Trusts

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Most flexible of all will substitutes because the donor can draft both the dispositive and the administrative provisions precisely to the donor's liking. A trust is an arrangement whereby a trustee manages property in a fiduciary capacity for one or more beneficiaries. Trustee holds legal title to the property and the beneficiaries hold equitable title. can be one of the beneficiaries of the trust, but the same person cannot be the sole trustee and sole beneficiary b/c then the trustee would owe no duties to anyone except himself A settlor, grantor, or trustor is the person who creates a trust. Retains the power to revoke the trust and the right to the trust income, and as a trustee he also controls the management of the trust property. A trust may be created during the settlor's life, in which case it is an inter vivos trust.

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CASES trusts/stocks

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Farkas v. Williams (SC of IL 1955) stock certificates F: Farkas executed a written declaration of trust for four separate stock certificates and named Williams as beneficiary of all four. Farkas retained the power to revoke the trust and the power to vote, sell, redeem, exchange, or otherwise deal with the stock. Farkas also appointed himself as trustee. If F didn't revoke the trust, Williams was required to be alive when Farkas died or the trust would be automatically revoked. Plaintiffs argued the trust was testamentary because Farkas had too much control over the trust; therefore, it isn't an inter vivos trust. Rule: even if the settlor retains the power to revoke the trust and appoints himself as trustee, if the beneficiary obtains any interest in the trust before the settlor dies, a valid inter vivos trust may have been formed. Linthicum v. Rudi (SC of NV 2006) F: Ernette and Myrna Linthicum were the beneficiaries of Cobb's revocable inter vivos trust, but Cobb executed a new will and amendment to her trust, replacing respondent Arnold Rudi as the sole beneficiary. Rudi and Guardianship Services of Nevada petitioned for co-guardianship of Cobb's person and estate because Cobb was possibly delusional and paranoid. District court granted guardianship to GSofN. E and M then filed a complaint alleging incapacity and undue influence, and they sought a constructive trust and/or cancellation of the amended trust. Rudi argued E and M did not have standing. Rule: because the trust at issue is a revocable inter vivos trust and Cobb retained the ability to revoke the trust during his lifetime, E and M have at most, a contingent interest that has not yet vested. -no standing for beneficiaries, in a revocable trust, until settlor dies. UTC (Uniform Trust Code) § 604 (2000)--provides that a person may bring a suit to challenge a revocable trust, but only after the trust becomes irrevocable by reason of the settlor's death. Question 2 on p. 407—If Farkas is competent and no evidence of approval of looting, Williams can sue the third party trustee after Farkas' death.Beneficiary cannot challenge a trust until after death. However, if the settlor has a guardian due to incapacity, the guardian can sue the trustee while the settlor is still alive to "check" on the trustee's fiduciary duty.

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Payable on Death Contracts and Other Nonprobate Transfers

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If a spouse has been ommiteed from a will a spouse has an automatic right to the intestate share. Spouse can also elect to have the elective share - we pull back into the estate So if probate share is smaller amount of assets - spouse entitled to a large share So you do the math - to see which is better intestate or elective share

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Cases POD

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In elective share you pull in payable on death accounts/revocable trusts - things that normally would not be taken into account - but are if spouse is left out of the will In re Estate of Atkinson (Ohio 1961)F: PODs written out to decedent's children. Decedent specifically devised in his will that his wife, Emma Atkinson, should not share in the estate. Emma contested the will, claiming the PODs should be included in the entire estate. Court does not like this. Old rule: PODs are invalid. New rule: PODs are valid nonprobate transfers in all states. You cannot disinherit a spouse! Here, Emma would take 20% per statute, so she wanted the PODs to be included in the estate, so she could take 20% of the PODs. Estate of Hillowitz (Ct. of App. NY 1968) F: H was a partner in an investment club. In the event he dies, he left his share to his wife per the club's partnership agreement. When H died, the club transferred the money that represented H's share of the partnership to his wife per the agreement. Executors contended the agreement was invalid because it constituted an attempted testamentary disposition, but it did not follow the statute of wills. Rule: a partnership agreement clause providing that each partner's interest, upon his death, shall pass to his spouse, is valid and enforceable. UPC 6-101. Nonprobate Transfers on Death. PODs are nontestamentary. PODs are a quick way to transfer property. -no need for formalities of the will's act TODs--Transfer on Death Securities are permitted to be registered in a transfer-on-death (TOD) form. TOD registrations are now allowed in nearly all states.

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Revokable Trusts Examples

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Q: Suppose T had executed a subsequent will that expressly revoked the inter vivos trust, and the will was found among T's papers at death. The trust stated, "I may at any time during my lifetime by instrument in writing delivered to the trustee amend or revoke this declaration of trust in whole or in part." Is the trust revoked? A: No, if the trustee is a third party, the trust listed a specific method in which the settlor must deliver the written instrument to the trustee while the settlor is still living. However, if the settlor names himself as the trustee, then if there are papers evidencing the revocation found at the settlor/trustee's death, the trust is likely revoked.Q: S created a revocable life insurance trust, naming Wells Fargo bank as trustee. The trust revocation language stated that it could be revoked "by written instrument executed by the settlor and delivered to the trustee during the settlor's lifetime." Trust beneficiaries were wife E and 3 children. S and E divorced, S remarried M. He executed a will revoke the trust. Is it revoked? A: No

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NC and UTC 602 - If Trust is torn in pieces it is revoked

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UTC 602--if the trust is torn to pieces it is revoked. **NC has adopted You can create a spendthrift trust which says my creditors can't touch that If you still have all the rights to trust you creditors can go after your money

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Creditors Rights to TRUST FUNDS

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You can create a spendthrift trust which says my creditors can't touch that If you still have all the rights to trust you creditors can go after your money The creditors of a joint tenancy cannot reach the jointly held property after the joint tenant's death because the decedent's interest is treated as having vanished. Life insurance proceeds are usually exempt from the insured's creditors if payable to a spouse or child, and the same is generally true of retirement benefits. US Savings Bonds with a POD beneficiary may also be exempt.

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UPC § 6-102

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,permits the decedent's creditors to reach nonprobate transfers (except joint tenancies in real estate), such a revocable inter vivos trusts and joint bank accounts, if the probate estate is insufficient to pay the debts.

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CASES - CREDITORS/TRUST FUNDS

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State Street Bank and Trust Co. v. Reiser (Mass. 1979) Rule: because the settlor had retained such authority during life that the bank could reach the trust assets to pay the settlor's debts after death to the extent that the settlor's estate was insufficient to satisfy such debts.

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LIFE INSURANCE

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A life insurance policy is an effective way to transfer property on death without Wills Act formalities. It is contract between the owner of the policy and an insurer. Payment of Proceeds: the owner or the beneficiary, upon insured's death, may select different settlement options for the receipt of benefits, including: lump sum, installments, and annuity. Rule: a person cannot change her life insurance beneficiary through a will.

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CASE - LIFE INSURANCE

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Cook v. Equitable Life Assurance Society (Ind. 1981)—Mr. Cook divorced Doris and remarried Margaret. He never changed his life insurance policy deeming his new wife as the beneficiary rather than his ex-wife. Through a holographic will, he did attempt to change the beneficiary to his new wife, Margaret; however, the court did not permit the change. The court stated, "equity aids the vigilant, not those who slumber on their rights." He had 14 years to change the beneficiary on the policy but failed to do so.

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SUPERWILLS

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NOTE: SUPERWILLS A will trumping the beneficiary designations in all nonprobate transfers. The power to revoke an inter vivos trust created by the decedent can be exercised by will, if the trust so provides.

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Joint and Survivor Account:

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a joint account with equal lifetime and survivorship rights. "A and B, as joint accountholders with right of survivorship." Most people will get this if they want a joint account ither A or B has the power to draw on the account and the survivor solely owns the balance of the account, which does not pass through probate.Agency/Convenience Account: a joint account without survivorship rights whereby A intends for B to have the power to draw on the account during A's life but only for the convenience of A. Not for other purposes and not for B to receive the balance at A's death.

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CASE - JOINT ACCOUNTS

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Varela v. Bernachea (FL 2005)—Dad's girlfriend took all of his money out of the joint account. Rule: Joint accountholders have no restrictions and have an unlimited right to deposit and withdrawal on the account as if it was their own personal account. (UPC §6-222) UPC 2-511: Testamentary Additions to Trusts There are no incorporation by reference issues with trusts UPC 6-201 through 6-227: UPC authorizes joint tenancy account with the right of survivorship, an agency account, and a POD account. Under UPC, joint accounts belong to the parties during their joint lifetimes "in proportion to the net contribution of each to the sums on deposit, unless there is clear and convincing evidence of a different intent." UPC 6-211(b) Extrinsic evidence is admissible to show that a joint account was opened solely for the convenience of the depositor.

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POUR OVER WILLS

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Section D. Pour-Over Wills and Revocable Trusts in Modern Estate Planning Pour over will helps you avoid intestate account. So if you have a bank account in just your name the pour over will automatically assigns this account to the trust. Ex: "I leave the remainder of my estate in trust to the trustee of the Testator's Children Support Trust that I created on July 10, 2005."How to validate a pour-over will: That the will refer to the trust That the terms of the trust be set forth in a writing separate from the will. Reasons for a pour-over: 1. Inter vivos trust is easier to amend; 2. An inter vivos trust can serve as a receptacle for a variety of other assets, such as life insurance proceeds and annuity payments, to provide a unified disposition of the testator's property; and 3. The testator may pour-over into a trust created by someone else, such as a spouse. UCC §2-511. Testamentary Additions To Trusts.

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CASES - Trust Funding

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Clymer v. Mayo (Mass. 1985) • Will + Trust A trust is funded with the expectancy at the death of the testator. Here the court said that even though the trust didn't have anything in it before the testator death but it will (through the life insurance proceeds) be funded at the time of her death.• Said that a testamentary trust is subject to the revocation by operation of law doctrine, such as when one divorces the provisions are extinguished subject to "operation of law" doctrine. • Retitle the accounts in the name of the trust - no longer an individual assest - it passes under the terms of the trust. • Title the name of the assest in the name of the trust or you name the trust the beneficiary • Trust has to have a trust beneficiary, trustee, and trust res • Court says it's ok to fund a trust with life insurance and pension • So not invalid • Clara and James are divorced - MA did not include a trust as being revoked by divorce - operation of law • But Court says it doesn't matter because we are going to read the will and trust at the same time; therefore, James doesn't take. Her nieces and nephews take • If the entire trust was invalid then Marianne's parents would have taken it all • But court says not it's still a valid trust and funded upon death • They only took out the husband

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POWER OR ATTY V. Durable Power of Attorney

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Durable import because it allows the attorney to continue inspite of incapacity. Power of Attorney: principal/agent relationship whereby the agent, called an attorney-in-fact, is given a written authorization to act on behalf of the principal. The relationship ceases when the principal becomes incapacitated. Durable Power of Attorney: continues throughout the incapacity of the principal until the principal dies. • Authorized by UPC § 5-501 to 5-505 • Owes the fiduciary duties of loyalty, care, and obedience • Differences from trust: • Unlike a trustee, an agent's power under a durable power of attorney automically termintes upon the principal's death. The property subject to the durable power of attorney does not avoid probate. And an agent does not have a legal title to the property subject to the power, making many 3rd parties more reluctant to deal with an agent. • Can be drafted to say that two health care professionals must certifity that. • It would be springing when you have those terms

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DURABLE POWER OF ATTORNEY

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In re Estate of Kurrelmeyer (SC of VT 2006)—wife/trustee/POA Rule: Delegation of authority to create a trust through a durable general power of attorney to serve the interests of the principal does not violate public policy as a matter of law, even when a trust's dispositive terms may serve a function similar to that of a will. (Citing the ReS 2 of Agency) Trust is responsible for upkeep of taxes Life estate versus trust - trust keeps you from having to pay taxes etc Keep in mind an act can be disloyal or imprudent

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HEALTH CARE DIRECTIVES

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a. Advance Directives: Living Wills, Health Care Proxies, and Hybrids The Supreme Court has held that each person has a constitutional right to make health care provision for herself, including the right to refuse medical treatment. United States default is LIFE. Also the default as to organ donating is NOT a donator unless listed as one. Health Care Power of Attorney: Person who can make decisions for you regarding health care when you are not able to make for yourself(i.e. in surgery and they need someone to make a decision) Basic Types of Advance Directives: 1. Instructional Directives: such as a living will or a commonly used form known as a Medical Directive, which specify either generally or by way of hypothetical example how one wants to be treated in end-of-life situations or in the event of incompetence; 2. Proxy Directives: such as a health care proxy or durable power of attorney for health care, which designates an agent to make health care decisions for the patient; and 3. Hybrid or Combined Directives: incorporating both of the first 2, directing treatment preferences and designating an agent to make substituted decisions. Bush v. Schiavo (SC of FL 2004) Rule: a statute authorizing a state's governor to stay removal of artificial life-prolonging measures of a person in a persistent vegetative state, despite a court's determination that the person would have elected to terminate the life-prolonging procedures, is an unconstitutional violation of separation of powers.

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Rights of the Surviving Spouse

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Ownership of earnings between spouse is governed by the law of the spouses domicile at the time the property is acquired.

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2 Types of Property Systems:

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1. Separate Property System: whatever the spouse earns is his or hers. • Upon the death of 1 spouse, under the ES doctrine, the surviving spouse has a right to claim a share of the deceased spouse's property regardless of the terms of the deceased spouse's will • States typically have an elective share statute.2. Community Property System: all earnings of the spouses and property acquired from those earnings during the marriage, are community property unless both spouses agree to separate ownership. Undivided interests in property acquired during the marriage. So when you die you can only dispose of ½ ...so make sure. • Based on the concept of partnership and support • Each spouse owns ½ of everything; therefore, at death, the decedent spouse may only transfer ½ interest in the community asset to the decedent's heirs or will beneficiaries. This applies even if she tries to will around them, minus a contract prior to marriage. • Only 9 states follow this type of property system

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Rights of Surviving Spouse to Support

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The ownership of earnings between spouses is governed by the law of the state of domicile at the time the personal property was acquired during the marriage. The real property is governed by the state where the property is located. If there is a will and the surviving spouse has been left out of the will can chose to take the intestate share or elective share. Spouse has six months to make a claim You should petition right away then you can decide to go with intestate if you want don't miss deadline NET ASSETS - all real and personal property owned by the descedent alone, ½ of the value of property owned jointly with the surviving spouse, entire value of property with rights of survivorship with any other person, pension, and any other property that is included in taxable estate. You can contract in a pre or post nup. Agreement to not take otherwise spouse has right to a statutory share Elective share not automatic - have to file Intestate share automatic

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MOVING FROM SEP. PROP. STATE

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So what if you start in a separate property state move to a community property state? Is spouse of luck because there is no statute to protect? NO There is a quasi community statute - in community property jurisdictions. To stop a spouse going for an elective share have to separate attorneys list out all the property and waive it

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Social Security

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Generally, if a couple is divorced but was married for at least 10 years, the surviving ex-spouse receives his/her decedent ex-spouse's benefit.

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Employee Pension Plans

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ERISA gives spouse of employee survivorship rights to pension plan. • If one spouse wants to leave benefits to someone other than his/her spouse, the spouse has to sign off on it. • Prenuptial agreements cannot waive ERISA-covered pension rights.

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Homestead

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This is needed to provide for surviving spouses and minor children. • Designed to secure the family home to surviving spouse and minor children, free of the claims of the decedent's creditors • UPC - recommends that spouse gets 15K lump sum payment - NC $20K

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NCGS 30-3.1.

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Right to An Elective Share Non-probate assets such as trusts, etc...are included in the elective share. If decedent dies testate, the surviving spouse can only receive what he/she is given through the will or the spousal elective share. N.C. Gen. Stat. § 30 3.1 a) Elective Share.--The surviving spouse of a decedent who dies domiciled in this State has a right to claim an "elective share", which means an amount equal to (i) the applicable share of the Total Net Assets, as defined in G.S. 30-3.2(4), less (ii) the value of Net Property Passing to Surviving Spouse, as defined in G.S. 30-3.2(2c). The applicable share of the Total Net Assets is as follows:(1) If the decedent is not survived by any lineal descendants, one-half of the Total Net Assets. (2) If the decedent is survived by one child, or lineal descendants of one deceased child, one-half of the Total Net Assets. (3) If the decedent is survived by two or more children, or by one or more children and the lineal descendants of one or more deceased children, or by the lineal descendants of two or more deceased children, one-third of the Total Net Assets. (b) Reduction of Applicable Share.--In those cases in which the surviving spouse is a second or successive spouse, and the decedent has one or more lineal descendants surviving who are not lineal descendants of the decedent's marriage to the surviving spouse but there are no lineal descendants surviving by the surviving spouse, the applicable share as determined in subsection (a) of this section shall be reduced by one-half.

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N.C. Gen. Stat. § 30 3.4

answer

The right of the surviving spouse to file a claim for an elective share must be exercised during the lifetime of the surviving spouse (UPC follows too)

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UPC § 2-201 to § 2-214

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Elective Share: surviving spouse must elect to receive this share, typically there is a will whereby the surviving spouse was left with less than what the elective share provides. • Allows you to pull in assets that are non-probate to decipher what is part of the elective share • UPC 2-202: elective share determined by how long the marriage has lasted, see UPC 2-202 • NC looks at what marriage it is--second marriage? Third? Etc... • If surviving spouse is incompetent, the guardian/durable power of attorney can elect for the incapacitated surviving spouse. Intestate Share: the automatic share given if the decedent dies without a will. If this amount is less than the elective share statute, the surviving spouse can opt for the elective share amount.

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Incompetent Surviving Spouse

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In re Estate of Cross (SC of OH 1996)—surviving spouse on Medicaid F: Nonutilization of income or resources renders a Medicaid recipient ineligible. The guardian had to take against the will in favor of the elective share. Rule: the guardian of an incompetent surviving spouse can elect against the decedent's will if it's in the "best interests" of the surviving spouse.UPC 2-212: provides that if a representative elects the elective share for an incompetent surviving spouse, the portion of the elective share that exceeds what the decedent spouse provided for the survivor must be placed in a custodial trust for the benefit of the surviving spouse. - no jurisdiction has caught on to this????

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POSSIBLE EXAM QUESTIONS

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Smokey Robinson example: they were married for years but he went through a dark period and they divorced - back together for 10 years - introduces her as his wife - but they never remarried! So by law revoked any provisions in a will! Legal relationship is not there anymore. Farrah Fossett and Ryan O'Neill - Ryan got nothing. He claim that she had agreed to marry him right before her death? Should that give him a right to spousal share? What if she married him on her death bed.

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Must the Surviving Spouse Accept a Life Estate?

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Once the amount of the ES has been determined, the surviving spouse is credited w/ the value of all other interest given her by the will (or will substitute). If those amounts do not satisfy the ES, the difference must be made up either: • Pro rata contributions from all the other beneficiaries (majority & UPC rule);OR • From the residuary estate • UPC and the majority of states say that if the spouse rejects the life estate and elects to take her share in fee simple, she is not charged. 2-209 When the surviving spouse takes his/her spousal share the amount is taken pro rata from each of the other beneficiaries shares listed in the will. f. Waiver -Can the spouse agree to waive the survivor's elective share? NC ---see statute to the right ---->

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Migrating Couples and Multistate Property Holdings

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Traditional conflict of laws rules is used to determine which state governs marital property: • The law of situs controls problems related to land. • The law of marital domicile at the time personal property is acquired controls the characterization of the property—separate or community • The law of marital domicile at the death of one spouse controls the survivor's marital rights.The problems arise because: • RP is governed by the laws of the state where it is located • PP is characterized at the time it is acquired as either separate or community property based on the laws of the spouse's domicle at the time of acquisition, and • The "at time of death" spousal protection a surviving spouse is entitled to depends on the spouses' domicile at the time of death of the first spouse.

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