Trust, Wills, & Estates Outline

I. Intestate Succession

A. General Principles

B. Share of the Surviving Spouse

  1. Decedent Not Survived by Descendants or Parents
    • Surviving spouse inherits the entire estate.
  2. Decedent Survived by Descendants
    • Under many state statutes, the surviving spouse inherits one-half or one-third of the estate.
    • The UPC provides variations depending on whether the descendants are also children of the surviving spouse and if the surviving spouse has other children.
    • California: surviving spouse gets 100% of CP and at least 1/3 of SP depending on surviving kindred or issue.
  3. Decedent Survived by Parents
    • In some jurisdictions, a surviving parent is entitled to a nominal amount of the estate exceeding a certain value (e.g., $200,000).
    • California: If decedent is survived by parents, surviving spouse gets ½ of SP, remainder to parents.

C. Share of Children and Remote Descendants

  1. Surviving Spouse
    • Descendants take the portion of the estate not passing to the surviving spouse.
  2. No Surviving Spouse
    • Estate is distributed to the decedent's descendants.
    • Living children share equally.
    • California: If no surviving spouse, SP passes to issue, then to parents, then to parent's issue, then to grandparents or their issue, then to predeceased spouse’s issue.
  3. Child Predeceases Intestate Decedent
    • Distribution methods address how to handle the share of a deceased child:
      • Strict Per Stirpes: Estate is divided at the children's generation, with each line taking an equal share, regardless of living members.
      • Modern Per Stirpes/Per Capita with Representation: Estate is divided at the closest generation with living descendants, with shares of deceased members passing to their descendants.
      • Per Capita at Each Generation (UPC): Similar to Modern Per Stirpes, but shares are pooled at each generation and divided equally among representatives at the next level.
  4. Adopted Children
    • Generally treated the same as biological children for inheritance purposes.
    • Equitable adoption may apply in some situations where formal adoption did not occur.
    • California: Adopted person dies intestate - property is distributed among those who would have been kindred.
  5. Children Born Out of Wedlock
    • Inheritance through the mother is permitted in all states.
    • Inheritance through the father requires proof of paternity.
    • Uniform Parentage Act establishes paternity through acknowledgment, adjudication, or adoption.
    • California: Natural parent may not inherit from the child unless they acknowledged the child.
  6. Half-Blood Children
    • Treated equally as whole-blood children in most states.

D. Share of Ancestors and Collaterals

  1. Surviving Descendants or Spouse
    • Ancestors and collaterals generally inherit nothing.
  2. Surviving Parents, Siblings, or Descendants of Siblings
    • Parents and siblings take in equal shares if there are no surviving spouse or descendants.
    • Surviving parent takes a double share.
    • Descendants of deceased siblings take per stirpes.
  3. Descendants of Grandparents
    • Inherit if there are no surviving descendants, spouse, parents, or siblings.
    • Divided equally between maternal and paternal lines.
  4. Descendants of Great-Grandparents
    • Allowed to inherit in a minority of jurisdictions.
  5. Escheat
    • Property passes to the state if there are no heirs.

E. Advancements

F. Simultaneous Death

II. Wills

A. General Principles

B. Execution Requirements

  1. Governing Law
    • The law of the decedent's domicile at death governs personal property distribution.
    • Law of the jurisdiction where real property is located governs its distribution.
    • California: Law where will was executed or where testator is domiciled governs validity.
  2. Compliance with Law
    • Will must comply with the law of the domicile at the time of execution or the law where it was executed.
  3. Formal Requirements
    • Writing: Will must be in writing.
    • Signature: Testator must sign the will.
      • Location of the signature can impact validity.
      • Signature on the testator's behalf is allowed in some circumstances.
    • Witnesses: Two or more witnesses are generally required.
      • Witness requirements vary by state.
      • Interested witnesses may be allowed under modern statutes.
  4. Testamentary Capacity
    • Testator must be 18 years old and of sound mind at the time of execution.
    • Capacity requires understanding of:
      • Nature and extent of property.
      • Natural objects of bounty.
      • Disposition being made.
      • Testamentary plan.
  5. Testamentary Intent
    • Testator must intend the document to be their will.
    • Must understand they are creating a document with legal effect after death.
    • Generally must know and approve the contents of the will.

C. Types of Wills

  1. Attested Will
    • Meets the formal requirements of writing, signature, and witnesses.
  2. Holographic Will
    • Handwritten will.
    • Material provisions must be in the testator's handwriting.
    • Signed by the testator.
    • Witnesses are not required.
    • Some states require a date.
  3. Nuncupative (Oral) Will
    • Not permitted in most states, including those adopting the UPC.
    • May be valid in some states for limited personal property dispositions made in contemplation of death.
  4. Conditional Will
    • Validity is conditioned upon an event.
    • Courts may construe excess language as an explanation rather than a condition to uphold validity.

D. Components of a Will

  1. Integration
    • All pages present at execution and intended to be part of the will constitute the complete document.
  2. Codicil
    • A supplement or addition to a will.
    • Must be executed with the same formalities as a will.
    • Republishes the will as of the date the codicil is executed.
    • May validate an invalid will.
  3. Incorporation by Reference
    • Allows incorporation of an existing document into the will if:
      • It existed at the time of will execution.
      • The will shows the intent to incorporate it.
      • It is described with sufficient certainty for identification.
  4. Acts of Independent Significance
    • Permits designation of a beneficiary or disposition based on an act or event outside the will if it has significance apart from the will.
  5. Personal Property List (UPC)
    • Allows a separate list disposing of personal property (not money).
    • Must describe beneficiaries and property with reasonable certainty.
    • Can be created after the will is executed.
  6. Dispositions to an Inter Vivos Trust
    • Allows gifts to trusts in existence at death, even if created after the will.

E. Revocation

  1. Methods of Revocation
    • Subsequent Instrument: A later will or codicil can revoke a prior will in whole or in part.
    • Physical Act: Burning, tearing, canceling, obliterating, or destroying the will with the intent to revoke.
      • Requirements for revocation by physical act vary by jurisdiction.
    • Operation of Law: Certain events, such as divorce or homicide, can revoke provisions.
  2. Dependent Relative Revocation
    • Allows a court to revive a revoked will if the testator revoked it based on a mistaken belief about the law or facts.
  3. Revival
    • Republication by Codicil: Executing a codicil to a revoked will can revive it.
    • Intention to Revive: Some jurisdictions consider the testator's intent when reviving a previously revoked will.
  4. Lost Wills
    • If a will is lost, its proponent must prove its contents by clear and convincing evidence.

F. Contractual Wills

  1. Requirements
    • Must be in writing and signed by the party against whom enforcement is sought.
    • May be established through:
      • Provisions in the will.
      • Express reference to a contract and extrinsic evidence.
      • A signed writing evidencing the contract.
  2. Joint Wills
    • A single instrument serving as the will of multiple people.
    • Does not create a presumption of a contract not to revoke.
  3. Reciprocal Wills
    • Separate wills with identical or reciprocal provisions.
    • Does not create a presumption of a contract not to revoke.
  4. Enforceability
    • Enforceable only against the party who signed the contract.
    • No remedy for breach while the testator is alive.

G. Will Contests

  1. Grounds for Contest
    • Lack of Testamentary Capacity: Testator lacked the mental capacity to execute the will.
    • Undue Influence: Testator was coerced into making the will.
    • Fraud: Testator was deceived into making the will.
    • Mistake: Error in the will's execution or content.
  2. Standing to Contest
    • Only directly interested parties who stand to benefit financially can contest.
  3. No-Contest Clauses
    • Designed to deter contests by forfeiting the beneficiary's share if they challenge the will.
    • Enforceability varies by jurisdiction.
    • California: Enforceable unless the contest was based on forgery, revocation, improper execution, or fraud/undue influence.

H. Construction Problems

  1. Lapsed Legacies
    • A gift fails if the beneficiary predeceases the testator.
    • Anti-lapse statutes may substitute beneficiaries, typically descendants of the deceased beneficiary.
    • California: Anti-lapse statute applies unless the will states otherwise. Gift passes to issue of the intended beneficiary.
  2. Ademption by Extinction
    • Applies only to specific bequests.
    • Gift fails if the property is no longer in the testator's estate at death.
    • Traditional Approach (Identity Theory): Focuses on whether the specific property is in the estate.
    • UPC Approach (Intent Theory): Considers the testator's intent.
  3. Ademption by Satisfaction
    • A gift may be satisfied by an inter vivos transfer if that was the testator's intent.
    • UPC: Requires an express writing to presume satisfaction.
  4. Abatement
    • Occurs when the estate's assets are insufficient to satisfy all gifts.
    • Gifts are reduced in a specific order to cover debts and expenses.
    • California: Abatement follows the order of intestate property, residuary devises, general devises, demonstrative devises, and specific devises.
  5. Ambiguities and Mistakes
    • Extrinsic evidence is generally admissible to resolve ambiguities but not to correct mistakes.
    • Courts may consider surrounding circumstances to determine the testator's intent.
  6. Exoneration of Liens
    • Common Law: Beneficiary of encumbered property could have the lien paid from the estate.
    • Most states (UPC): Beneficiary takes subject to the lien.
  7. Gifts to Classes
    • A gift to a group of people described collectively.
    • Class remains open until the named person dies or the gift becomes possessory.
    • Common Law: Deceased member's share passes to their estate.
    • UPC: Deceased member's share may pass to their issue.

I. Non-Probate Transfers

  1. Will Substitutes
    • Methods of transferring property outside of probate.
  2. Revocable Trusts
    • Allow the settlor to retain control over assets during their lifetime.
    • Assets pass to beneficiaries outside of probate upon the settlor's death.
  3. Pour-Over Wills
    • A devise of property to a trust created during the testator's lifetime.
    • Property passes according to the trust's terms.
  4. Other Will Substitutes
    • Bank accounts and securities registered in beneficiary form.
    • Payable-on-death clauses in contracts.
    • Life insurance proceeds payable to a named beneficiary.
    • Joint tenancy with right of survivorship.
    • Tentative (Totten) Trusts.

III. Family Protection

A. Spouse's Forced or Elective Share

  1. Purpose
    • Protects a surviving spouse from disinheritance.
  2. Elective Share
    • Allows the spouse to choose between taking under the will or taking a statutory share of the estate.
  3. Waiver
    • Spouse can waive the elective share in writing after fair disclosure.
    • California: Omitted spouse receives their share of CP and up to ½ share of SP unless:
      • Omission was intentional
      • Decedent provided a substitute transfer outside the will
      • Waiver agreement exists.
  4. Augmented Estate
    • The elective share is calculated based on an augmented estate, including certain non-probate assets.
    • California: No augmented estate. Spouse gets 100% of CP and a share of SP depending on survivors.

B. Share of After-Born or Pretermitted Child

  1. Omitted Child
    • A child born or adopted after the will's execution who is not provided for in the will.
    • California: Pretermitted child gets an intestate share unless:
      • Omission was intentional
      • Decedent provided a substitute transfer outside the will
      • Decedent had other children and left the estate to the omitted child's other parent.
  2. Intestate Share
    • Omitted child is generally entitled to an intestate share unless the omission was intentional or other provisions were made.
    • California: Omitted child receives intestate share, unless the omission was intentional, the decedent provided for the child outside of the will, or the decedent had other children and left the estate to the omitted child's other parent.

C. Homestead Allowance and Exempt Property

  1. Homestead Allowance
    • Allows the surviving spouse and minor children to live in the family home for a certain period.
  2. Exempt Property
    • Permits the surviving spouse to claim specific personal property of the decedent up to a certain value.

D. Limitations on Charitable Bequests

IV. Living Wills and Durable Health Care Powers

A. Purpose

B. Living Will

  1. Instructions for Medical Treatment
    • Specifies life-prolonging measures to be taken or withheld if terminally ill or incapacitated.
  2. Requirements
    • Must be in writing, signed, and witnessed.

C. Durable Health Care Power of Attorney

  1. Appointment of Agent
    • Designates an agent to make healthcare decisions on the individual's behalf.
  2. Scope of Authority
    • Agent can make any healthcare decision the principal could make if they had capacity.
  3. Requirements
    • Must be in writing, signed, and may require witnessing.

D. Revocation

E. Agent's Authority

  1. Executed Power of Attorney
    • Agent must act in accordance with the durable health care power of attorney.
  2. Family Consent Laws
    • May allow family members to make decisions if no agent is designated or the power of attorney is unclear.
  3. Effective Period
    • Continues until the principal's death or revocation, even if the principal becomes incapacitated.

F. General Considerations

Trusts & Estates Outline

I. Trusts

A. What is a Trust?

B. Types of Trusts

1. Express Trusts

2. Inter Vivos Trusts

3. Testamentary Trusts

4. Pour-Over Trusts

5. Remedial Trusts

6. Other Types of Trusts

C. Trustee Powers and Duties

1. Duty of Loyalty and Good Faith

2. Duty of Care (Prudence)

3. Other Duties

D. Modification and Termination

1. Termination

2. Modification

E. Beneficiary Rights and Creditor Claims

F. Principal and Income

G. Powers of Appointment

II. Future Interests

A. Introduction

B. Fee Simple Interests

C. Future Interests of the Grantor

D. Future Interests of Transferees

1. Remainders

2. Executory Interests

E. Rule Against Perpetuities

III. Construction Problems

A. Gifts to Classes

B. Gifts to Heirs

C. Ademption

D. Abatement

E. Lapsed Legacies

F. Ambiguities and Mistakes

G. Will Contests

H. Non-Probate Transfers


Revision #2
Created 17 January 2025 17:22:12 by Ekospirit
Updated 17 January 2025 17:33:28 by Ekospirit