Trusts & Estates – Spring 2001, U of Iowa – Prof. Kurtz

I.       Introduction to Estate Planning

A.    Introduction

1.                  Most wealth passes w/o probate

a)                 Life insurance/pensions

b)                 Family home

c)                 Joint tenancy

2.                  Contract rights prevent probate from applying

3.                  85% of Americans have no will

4.                  Definitions

a)                 Will – a legal document that disposes of property upon death

b)                 Testator – writer of will

c)                 Decedent – dead person

d)                 Executor – personal representative who administers estate of testator

e)                 Administrator – personal representative of intestate decedent

f)                   Heir – person who takes property from decedent who dies w/o will

g)                 Beneficiary – person who takes from a testator

h)                 Settler/Donor/Trustor – writer of inter vivos trust

i)                    Probate –

(1)                process by which will is validated

(2)                process of administering estate

5.                  Simply being named a beneficiary of a will has not value

B.     The power to transmit property at death: Justifications and Limitations

1.                  It appears that the right to make a bequest of one’s property has constitutional protection under takings clause (Hodel – if statute completely inhibits ability to transfer property to by descent or devise it is unconst. If there’s no compensation)

2.                  Inheritance is not a natural right (Shapira)

3.                  If a condition on a right to receive a bequest can be reasonably complied with, it will be enforced if not otherwise invalid (Shapira – son disinherited if he doesn’t marry a Jewish girl, since there was reasonable opportunity for him to find someone suitable within his community.)

C.    Probate Process

1.                  Probate courts deal only with in-rem wealth (Hecht – dispute must be over “property”).

2.                  Probate takes place with or w/o a will.

3.                  Probated wills become part of the county land records

4.                  Functions of probate

a)                 Title proving – generate documents to prove devisee’s/heirs ownership

b)                 Title clearing – cleaning up debts, taxes, ect.

c)                 Restricting time of probate (five year rule???)

5.                  Probate ct. has jurisdiction over assets that form the probate estate:  all assets owned by decedent in decedent’s name, capable of passing by will or intestacy.  E.g. furnishings, bank accounts, stocks and bonds

6.                  Third-party K benefit not generally a part of the estate.

7.                  Creditor should be notified of probate by mail once each week for two weeks

8.                  Any party who would be enriched by denial of probate may contest a will.

9.                  Functions of executor are to:

a)                 Collect

b)                 Pay expenses

c)                 Settle up

10.             Intestacy law may be incorporated into will, and partial intestacy sometimes occurs.

II.     Intestacy

A.    Basic scheme

1.                  Common elements of intestacy laws

a)                 Surviving spouse gets something

b)                 Spouse may or may not be an “heir”

c)                 Once spouse is accounted for, decedents take; absent them, ancestors; absent them, collaterals

d)                 In-laws are not heirs

2.                  At common law, widow received life estate in 1/3 of husband’s lands of which he was seized during marriage.  Widower got life estate in wife’s legal and equitable estates in land. 

3.                  Modernly, widows and widowers get equal provisions and take in fee simple.  Typically they get between 1/3 and 100% of estate.

a)                  UPC 2-102

b)                 IC 633.211, .212, .218

4.                  Spouse must relinquish dower/curtesy rights in real property in order for it to be sold (during other spouses life).  If spouse doesn’t relinquish rights, she can cancel conveyances made by decedent.

5.                  Personalty that is exempt or not needed to pay debts goes to spouse under IC 633.211

6.                  Spouse may pick and choose which property to take under IC 633.218

7.                  In simultaneous death cases, donee is presumed to have predeceased donor (rationale is avoiding double expenses) (Uniform Simultaneous Death Act)

a)                 Burden of proving survivorship falls on party claiming survivorship.  Preponderance of evidence is the standard (Janus).  If there’s no way to tell who died first, donee died first.

b)                 There must be “sufficient evidence” of survivorship to allow a trial court’s finding of survivorship to be upheld (id).

c)                 Physicians determine when death occurs

d)                 UPC has 120-hour rule that reverses order of demise if donee doesn’t live 5 days past death of donor. (must the disaster be common???).

8.                  First line of heirs is decscendants.  Children are the fist line of takers.

9.                  More closely related, living descedants take to the exclusion of their own descendants.

10.             Children all take equally

11.             Children will step into shoes of deceased parent.

12.             Death of the entire generation that was nearest to the intestate will produce diff’t distribution results in diff’t states.  IA adopts the “per stirpes” rule, so division is always made at the child line

a)                 Under per capita system, estate is divided evenly at nearest level that has at least one survivor.

b)                 Under UPC scheme, estate is distributed at nearest level containing at least one survivor, but then shares of deceased members of that level are combined and distributed evenly among the next generation.  This way everybody at a given degree of consanguinity takes evenly. (But what about children of surviving members of nearest level???)

13.             If there are no descendants, then ancestors and collaterals may take.

a)                 IC 633.219

(1)                Parents get equal shares

(2)                If parents are dead, each parents descendants take

(3)                Iowa has early escheat – if great-grandparents or their issue cannot be found, the estate goes to the state.

b)                 IC 633.214(c)

(1)                 inapplicable to adopted children

14.             IA judges must recuse themselves if within 4^th degree of consanguinity

15.             Lawyer can serve as executor only if within 4^th degree.

16.             Domicile at death determines applicable law of intestacy.

B.     Transfers to Children

1.                  Adoption can extinguish the right to inherit (Hall).  Maj. Rule is that right to inherit from biological parents ceases upon adoption (exception for adopted step-children)

a)                 IC 633.223 allows inheritance from both biological and adoptive parents of adopted step-children??

b)                 UPC 2-114

c)                 UPC includes adopted children in class gifts, IA law is silent, so rules of construction must apply

2.                  Rules of statutory construction will generally permit adopted children to take as heirs – but quiry as to whether adopted adults count

3.                  Adoptoin should be legitimate to assure right to take (O’Neal).  However, “virtual adoption” based on equity can be argued.

4.                  If male consents, then child by artificial insemination is his child. 

5.                  Factors to determine fatherhood

a)                 Has father acknowledged parentage, or

b)                 Has court declared fatherhood (some states allow this to be proved after death of father, not IA)

(1)                I.C. .222 – father may inherit from child if acknowledgment was mutual

6.                  Children born after death of father are heirs if conceived while father is alive.  I.C. 633.220

7.                  Biological children inherit from mother unless adopted.  IC .221. 

8.                  Adult adoptees can inherit from the adopter, but not necessarily through the adopter

9.                  At common law, gift to a child was presumed to be an advancement (pre-payment on intestate share).  Now, such transfers are presumptively gifts and not advancements (presumption can be rebutted by a writing) 

a)                 In IA, heir of a advancee who predeceases testator is not penalized by having advance taken into account.

b)                 See IC .224

10.             If a gift is treated as an advancement, then donee must allow its value to be counted in the hotchpot if he wants to share in the estate (gift added to estate and then subtracted from donee’s share before distribution).

11.             Transfer of an expectancy by an heir apparent might be enforced as an equitable K.

12.             Homicide by an heir is a bar to succession

a)                 If homicide is intentional, heir should not get use of inheritance (Mahoney).  Standard of proof for intent is preponderance of evidence (id.).  Solution is to allow legal title to pass to heir but to force heir to hold equitable title in constructive trust for others

(1)                Maj. Rule is that killer is treated as having predeceased victim.

(2)                See I.C. 633.535(1)

13.             Inheritance can be disclaimed.  I.C. .704

a)                 Under tax law, only “qualified disclaimers” can avoid gift tax liability.

(1)                 IRC 2518

b)                 Can be used to avoid multiple death taxes

c)                 Might be used screw creditors

d)                 If public treasury is adversely affected by disclaimer, beneficiaries of the disclaimer will hold in constructive trust for the gov’t (Troy – medicare patient disclaims, sister must hold in trust for government).

e)                 under UPC 2-801(d)(1), disclaimer cannot make children of disclaimer better off

III.  Wills: Capacity and Contests

A.    Mental Capacity

1.                  Under IC .264, a person must be of “full age” and sound mind to execute a valid will

a)                 Full age means 18 years old or having been married, whether divorced or not.  IC .3(18).

2.                  Testator cannot establish sound-mindedness simply by declaring it

3.                  Testator need only know (stritmatter) (burden of disproving is on contestant):

a)                 Nature & extent of property

b)                 Persons who are the natural objects of bounty

c)                 Disposition testator is making

d)                 How these elements relate so as to form an orderly plan for disposition

4.                  Complete mental health not necessary, but a drunk is not of sound mind.

5.                  Objects are to honor rationality of disposition process and to protect testators from exploitation.

6.                  Persons are presumed competent

7.                  Idiosyncratic behavior is tolerated

8.                  Psychiatric incompetence should be irrelevent to the inquiry, as should judicially declared incompetence, to the issue of testamentary capacity.

9.                  An “insane delusion” is a false belief held against all evidence & reason.  Only part of will caused by insane delusion fails, unless whole will was so caused (Stritmatter).

10.             “False belief” alleged to have influenced disposition must have its falseness established by contestants (Honigman).

11.             Pre-mortem probate may make it more difficult to change a will and also exposes testator’s will to the public.

12.             Failure to document testator’s mental capacity may result in malpractice liability (CB 210) (Attorney should not witness will because he may be barred from testifying about testator’s capacity).

B.     Undue Influence

1.                  Elements of Undue influence:

a)                 Testator susceptible

b)                 Alleged influencer had opportunity to unduly influence

c)                 Alleged influencer was disposed to exercise influence to gain favor

d)                 Will evidences result that is likely product of undue influence

2.                  Contestant has burden of proving undue influence

3.                  A relationship suggestive of undue influence, such as a fiduciary relationship, may place burden of disproving influence on donee.  (E.g., Lipper – son acted as attorney) (Moses – younger boyfriend could not disprove his influence).

C.    Fraud

1.                  Fraud occurs when testator is influenced by misrepresentation to do something testator would not have otherwise done (CB 213).  Misrepresentation must be made w/

a)                 Intent to deceive

b)                 Purpose of influence

2.                  Two types of fraud:

a)                 Fraud in the inducement occurs when facts are misprepresented.

b)                 Fraud in the execution occurs when contents of instrument are misrepresented

3.                  If devisee uses fraud, ect., to prevent new will from being executed, he will hold property in constructive trust for intended devisee. (Father Divine)

4.                  A tort action is available in some states for intereference with an expectancy (CB 221-22).  P must show that D’s conduct was itself tortious as to the testator, and does no invoke a no-contest clause by bringing the action.

IV. Wills: Formalities and Forms

A.    Execution of  Attested Wills

1.                  Prior to 1540, there was no way to pass property by devise

2.                  Formalities have been minimalized, but most states are stricter than the UPC

3.                  Four functions of statute of wills (CB 224-25):

a)                 Ritual function serves to drive home seriousness of testementary act

b)                 Evidentary function assures that testator’s words are available

c)                 Protective function avoids improper influence, assures sound-mindedness

d)                 Channeling function allows people to break from laws of intestate succession by creating safe harbor – courts know what a will is meant to do

4.                  Statute should not operate to frustrate its own purposes with its formalities (CB 223)

5.                  UPC 2-502;

6.                  I.C. .279

a)                 In writing

b)                 Signed by testator

(1)                IA does not require that signature be at foot of will

c)                 Declared by testator

d)                 Request of witnesses by testator

e)                 Two witnesses who sign in each other’s presence and in presence of testator

f)                   Witness must be at least 16 years of age

g)                  If witness is interested, he is not impacted if there are at least two disinterested witnesses.  Otherwise witness is barred unless an heir, in which case he can take no greater than his heir’s share.  No case law on whether court can invoke this rule by motion.  Interest is measured at time of execution (Parsons).

7.                  Testator’s signature should be on will at at time of acknowledgment, and witness should be able to see signature at time of acknowledgment (Groffman).  Testator should be present when witness signs.  Two tests:

a)                 Line of sight test (Maj. Rule) – testator must be in position that would have enabled him to see witnesses sign;

b)                 Conscious presence test (UPC)– testator should be able to tell somehow that nearby witness is in the process of signing

8.                  In IA, will cannot effectively choose drafting attorney as executor.

9.                  At common law, interested witness could not testify in court (parsons).

10.             Purpose in interested witness rule is to protect testator from undue influence/fraud (parsons).

11.             Lawyer should perform ceremony that is valid in all states. See safety procedures on pp. 243-44.   Most states will recongnize a will as valid if it is properly executed:

a)                 In the state where the testator was domiciled at death

b)                 State where the will was executed; or

c)                 State where testator was domiciled when will was executed

12.             If witnesses are unavailable, a self-proving affidavit reciting that all requirements of due execution have been performed will allow probate (CB 245).

13.             UPC 2-503 “harmless error” rule would change outcome of Pavlinko (where wife and husband accidentily executed each other’s wills and probate was denied).

14.             Substantial compliance doctrine might allow probate of an improperly executed will (e.g. Ranney – signed affidavit provides witness signatures that were missing from will).  Burden of proving substantial compliance by clear and convincing evidence falls on proponents of will.  But common law and majority rule is strict compliance.

B.     Execution of Holographic wills

1.                  A holograpic will is handwritten by the testator and signed by him; witnesses are not needed.

2.                  Most states follow UPC 2-502(b)

a)                 Signature and material portions must be in testator’s handwriting

b)                 Testamentary intent can be established by looking at non-handwritten portions of will

3.                  The hanwritten portion must clearly express a testamentary intent (Johnson – printed form will rejected because handwritten language alone revealed no intent)

4.                  If the will contains words that are of testamentary disposition that are not in testator’s handwriting, the will is invalid (Johnson) (even if other language in handwriting is sufficient to dispose????)

5.                  A paper of informal character, such as a letter, can serve as a holographic will as long as it complies with requirements (Kimmel’s estate)

a)                 Conditional language may reveal testamentary intent, but condition need not necessarily occur if it’s possibility is not what induced the testator to make the will.

b)                 Any words intended to be a signature will be recognized as such (e.g., “father”)

6.                  Not all states permit holographic wills.  Some only allow them for military personell.

7.                  Writing should affirmatively give property to devisees – it should not be in passive voice.

C.    Revocation of Wills

1.                  Will may be revoked by physical act or by writing.  See UPC 2-507.

2.                  Two requirements (Thompson)

a)                 The doing of the acts specified

b)                 Intent to revoke – animo revocandi

3.                  Oral revocation is not allowed in any state.

4.                  Failure to revoke results in probate of will.

a)                 Lost or destroyed wills that have not been revoked can still be probated if the contents can be proven

5.                  If a testator intends a new will to replace an old will, then the old will is revoked. 

a)                 If new will is invalid, old will is not revoked

6.                  New will that does not completely dispose of estate is presumed to be a condocil to an old will.  It revokes old will to the extent that it is inconsistent.

7.                  Physical act of destruction should be by testator or someone in testator’s prescence at testator’s direction.(Harrison)

8.                  Some states require that revocation by cancellatoin must involve defacing the actual words on the will (thompson)

a)                 IA requires ceremony to cancel will.  IC .684

b)                 Maj. Rule and UPC allow cancellation to occur anywhere on document.

c)                 If an essential, such as the signature, is voided, then entire will is revoked.  Otherwise issue of partial v. full revocation may come up.

9.                  A lost will is presumed revoked

10.             Any markings found on will are presumed to be those of the testator.  (What effect are they given???).

11.             If partial revocation by physical act is illegal, then entire will will be probated if original language can be ascertained (CB 284-85).

D.    Dependant Relative Revocation and Revival

1.                  Doctrine:  If testator purports to revoke will on mistaken assumption of law or fact, revocation ineffective is testator would not have revoked knowing the truth. (CB 286).

a)                 Key with new wills is whether recocation and making of new will were part of one scheme in which one act was dependent on the other (Carter)

b)                 If destruction is by physical act, motive behind the act must be addressed. (Carter)

2.                  Maj. Rule requires:

a)                 That there be an alternative plan of disposition that fails, or

b)                 Mistake is recited in the terms of the revoking instrument, or

c)                 Is mistake is established by clear and convincing evidence

3.                  If new will is destroyed w/ intent of reinstating old, but old will cannot be reinstated, new will stands for probate (Alburn).

4.                  There are 3 groups of law regarding revival

a)                 Common law is that old will is not revoked unless new will remains effective at testator’s death

b)                 Maj. Rule assumes second will is revoked by execution of new will, but that if new will is revoked then old will is revived if testator would have intended so.

c)                 Minority rule is that old will cannot be revived unless it is reexecuted

d)                 IA requires old will to be reexecuted or to be incorporated by reference IC .284

5.                  The UPC assumes old will remains revoked, but if new will is only partially cancelled then old provisions are assumed revived.  UPC 2-509.

6.                  In maj. Of states, divorce revokes provision of will for spouse.  See UPC 2-804 (spouse and relatives treated as if they disclaim their share).  In IA, relatives are not excluded I.C. ???

7.                  Maj. Of states permit partial revocation.  Revoked provisions go to residuary legatees

E.     Components of a will

1.                  Doctrine of integration puts together all papers present at execution that are intended to be part of will.  All pages valid as long as last page is validly executed

2.                  Doctrine of republication by condicil treats will as being reexecuted on date of condicil.  Only applies when updating will carries out testators intent, and applies only to wills that were originally properly executed (CB 303, but see CB 313????).

3.                  Incorporation by reference allows a non-executed, non-witnessed document to be referred to in will and thereby incorporated, if the document exists at the time the will is executed and upon probate is identified by clear and satisfactory proof to be the paper referrerd to (Clark – notebook kept in desk incorporated in will)

a)                 UPC 2-510, 2-513 (allowing list to include anything but money and allowing preparation or modification at any time)

b)                 IA allows disposition of household goods to be changed by testator through incorporated document, even if written after execution of will.

c)                 Republication by condocil may result in reference being valid where document didn’t exist at time of original execution (e.g. Clark).

d)                 Language created after execution cannot be given effect under common law.

4.                  If will names property or beneficiary designations that are motivated by a lifetime motive/significance that is independent of testamentary significance, gift can be upheld under doctrine of Acts of independent signifigance.  Doesn’t matter whether events take place before or after execution.  See UPC 2-512.

F.     Contracts relating to wills

1.                  If a will violates a K, K is enforced by imposing a contstructive trust on the probate beneficiary.

2.                  Some states require K to make will be in writing

3.                  Value of claim might be evidenced by value of services rendered by P or value stated by testator in K.

4.                  Spouses sometimes enter into contracts not to revoke their wills

a)                 Joint will – single instrument executed by two or more persons as the will of both (not recommended)

b)                 Mutual wills – separate wills w/ reciprocal provisions

c)                 Joint and mutual wills – joint will that devises property in accordance with a contract (not reccomended)

d)                 See UPC 2-514

5.                  Representing both spouses creates ethical problems.  Exit is to explain to clients that marriage is being represented as entity.

6.                  Contract rights might be subordinated by public policy (e.g. Via – second spouse takes elective share despite K w/ first spouse not to do anything to alter dispostion of property).  Maj. Rule is to enforce K.

7.                  IA presumes that wills are neither contractual or mutual unless contrary intention is expressed in will. I.C. .270

V.   Will Substitutes: Nonprobate Transfers

A.    Contracts w/ payable-on-death provisions

1.                  Traditional rule is that P.O.D. designations in contracts other than life insurance contracts are invalid (Wilhoit).

2.                  NY allows instruments with P.O.D. provisions to be enforced without compliance to statute of wills (Hillowitz).  Examples include

a)                 K to make a will

b)                 Inter vivos trust in which settlor reserves life estate

c)                 Insurance policy

d)                 Partnership agreement giving partnership to surviving members

3.                  UPC 6-101 classifies many non-probate transfers as nontestamentary, and therefore free from statute of wills requirements.

4.                  UPC 6-101 has an anti-lapse provision benefiting issue of K beneficiaries than predecease benefactor.

5.                  Maj. Rule is that beneficiary of life insurance K cannot be changed by will (Cook).

6.                  Maj. Rule does not change beneficiary of life insurance policy upon divorce.  UPC 2-804 revokes spouse’s interest.

7.                  Beneficiaries of P.O.D. accounts must survive testator under UPC 6-212.

B.     Multiple-party bank accounts/Joint tenancies

1.                  Totten trust is created if O makes deposit in savings account in the name of “O as trustee for A.”

a)                 Donor has complete control over assets while alive

b)                 Donee’s interest ripens into  ownership if he survives donor, money is in accounts, and creditors don’t wipe out acount

(1)                In IA, creditors must first exhaust probate estate

(2)                Donee’s creditors have priority over donor’s creditors

2.                  Joint accounts are presumed to be intended for survivor.

a)                 Contrary intent of donor must be proven by clear an convincing evidence (Franklin)

b)                 Lack of donative intent must relate back to inception of account (Id.)

3.                  Common law prevented creditors from attacking joint account after death

4.                  Joint tenancy must be severed into tenancy of common before it can be lawfully conveyed (so it cannot be devised by will).

5.                  Joint tenancy non-revocable, unlike P.O.D. designation.

C.    Revocable trusts

1.                  A trust is a device that separates ownership and management of property for the beneficial enjoyment of the property. 

a)                 Trustee handles administration

b)                 Beneficiary enjoys

2.                  Revocable trust can be taken back by settlor at any time, irrevocable trust cannot be taken back at mere whim of settlor.

a)                 Maj. Rule is that if instrument is silent, trust is irrevocable by default (Restatement rule)

b)                 IA rule is that silence indicates revocability by default, effective June 2000, prospectively.

c)                 If power to revoke is restricted by words of the trust, those restrictions must operate (Pilifas – trust should have been drafted so that it could be revoked in whole or in part)

3.                  Trusts are not testamentary if some interest passes to beneficiary during life of settlor (Farkas – even potential to become entitled to benefit is enough)

4.                  If sole beneficiary of trust is trustee, no trust exists due to merger.

5.                  Trustee owes duties to all beneficiaries of trust.

6.                  Trusts allow estate to avoid ancillary probate costs.

7.                  There are no tax advantages to using revocable trust, since gov’t treats assets as belonging to donor.

8.                  A pour-over trust is one to which assets are willed (usually in form of residuary estate).  See UTATA 2-511 (CB 373).  Assets that are poured over from will into a non-revocable trust are out-of-reach of testator’s creditors (State Street)

9.                  A revocable trust that cannot be found is not presumed revoked (contrast to wills) (Pilifas).

10.             After exhausting probate estate, creditors may look to assets in revocable trust created by decedent, including assets from a pour-over will (State Street).

11.             A pour-over trust might be terminated by probate court if its purposes have become impossible to fulfill (Clymer – divorce made tax benefit impossible, so trust is obliterated.

12.             If trust and will are integrated so that trust is dependent on probate of will (trust has no other assets), statute of will may apply (Clymer – divorce revokes portion of trust that was created by will for benefit of ex-husband).

D.    Planning for incapacity

1.                  Power of attorney – authorize agent to deal with principles property

a)                 At common law, power terminated upon principles incapacity

b)                 Where broadly worded power allows acts that may be contrary to principles interests, in should be intepreted to dissallow such acts w/o specific authority (Franzen – revocation of trust allowed even though power did not speak of the specific trust involved)

c)                 Statutes allow “durable” power of attorney.  Must be created by written instrument, in some states witnessed/notarized

2.                  Trust can be used to create a private stand-by conservatorship by calling for the naming of a conservator upon a finding by the settlor’s physician that settlor is incompetent.

a)                 Conservators tend to have less power than power of attorney or trustee

b)                 Conservatoship is public (even standby???)

3.                  Two types of advance directives are available re health care when incapacitated

a)                 Living will

(1)                These tend to lack clout

b)                 Health care power of attorney triggered whenever principle loses capacity to make decisions.  Two standards:

(1)                Substituted judgment standard – surrogate should make decision that principal would make; if that’s unknown, then

(2)                Best interests standard – decide what is best for patient

4.                  Incompetents don’t lose right to refuse medical treatment

5.                  Decision to refuse care can be made by family members.  Standards for making decision are left to state courts (Cruzan).

6.                  Sup. Ct. has decided that there is not constitutional right to assisted suicide, but neither is there a constitutional ban on it.  It’s up to state courts.

7.                  Uniform Anatomical Gift Act allows legal document that gifts body or parts

VI. Interpretation of Wills

A.    Admission of Extrinsic Evidence

1.                  Maj. Rule follows plain meaning doctrine: Plain meaning cannot be disturbed by introduction of extrinsic evidence.

2.                  Staute of wills requires that a duly executed will be accepted as the final expression of what the testator intended, regardless of drafting errors (Mahoney – “heirs at law” used by attorney results in aunt inheriting, even though testator wanted cousins to take)

3.                  Only when the meaning of language is not clear can extrinsic evidence be used for purposes of interpretation (Id.).

4.                  Signer of document must have “animus Testandi” (intent to make disposition of property) when signing a document in order for the document to be a valid will (Fleming – sham will signing in exchange for sex does not create valid will).

5.                  A latent ambiguity is one which is not apparent on the face of the will but is disclosed by collateral facts – extrinsic evidence is admissible to show ambiguity and to prove meaning (Russell).

6.                  A patent ambiguity is one which appears on the face of the will.  Circumstances surrounding execution of will, but not oral declarations of testator, may be taken into account when interpreting the ambiguity (Id.).

7.                  A mere false description may be stricken by the court and the testators intent will be carried out (CB 426, note 5).

8.                  In many states a marriage subsequent to the execution of the will presumably revokes the will, unless the will states otherwise.  Presumption is rebuttable.  Whether the contingency is provided for depends on the language of the will itself, but extrinsic evidence that is clear and convincing may be used to correct scrivenor’s error (Erickson).

a)                 This is substantially the position of the UPC §12.1

9.                  Innocent misprepresenation that misles the testator should be treated just like fraud for purposes of admitting extrinsic evidence to reveal the intent of the testator (Id.).

B.     Death of Beneficiary before Death of Testator

1.                  At common law, if devisee predeceases testator, devise fails and falls into residuary estate.  Maj. Of states have antilapse statutes that substitute a new beneficiary (CB 438-39). 

a)                 Anti-lapse statutes only apply when devisee bears a particular relationship with the testator

(1)                IC .273(1) – issue of devisee who survive testator can take devise.

(2)                UPC 2-605 requires that devisee be grandparent lineal descendent of grandparent, and that issue survive testator by 120 hours.

b)                 Anti-lapse statute is a default rule that can be changed by will.

c)                 Anti-lapse statutes operate prospectively

d)                 An express requirement of survivorship is presumed to opt-out of anti-lapse statute (CB 444)

(1)                UPC 603(b)(3) assumes that statute remains operative.

(2)                Drafter should make clear what happens if devisee predeceases testator.

2.                  Common law provided for different types of legacies

a)                 Specific – devisee gets a certain item (might have to be purchased out of general fund)(what about ademption????)

b)                 General -  can be paid out of any estate asset

c)                 Demonstrative – gives money from specific source (if source is short, remaining amt. is a general legacy)

d)                 Residuary – not a, b, or c

3.                  A specific, general, or demonstrative devise that fails falls into the residuary estate.

4.                  A residuary devise that fails

a)                 passes to testators heirs, even if more residuary legatees remain (no-residue-of-a-residue rule) (minority rule), or

b)                 To other residuary devisees Residue-of-a-residue rule) (Maj. Rule). (If all are dead, does it go to testator’s heirs or to anti-lapse takers?).

5.                  If devisee is dead when will is executed, devise is void by default at common law (will should state contrary intent, if any).

6.                  Courts may tend to construe will to avoid escheat (e.g. Jackson – “and” converted to “or” so that stepchildren could inherit house).

7.                  A class gift is a gift to a group of persons typically described by a common relationship to someone

a)                 Class gifts are presumptively included in anti-lapse statutes, so issue will take portion of deceased class member (Maj. Rule).

b)                 If legacy was made a class gift, surviving members of class divide the gift.

c)                 If beneficiaries are described by individual names, extrinsic evidence can be used to show an intent to make a class gift (CB 449)

d)                 If provision gives property away in portions that add up to a whole, Restatement suggests that this is a strong indication of an intent to make a class gift (Dawson) (e.g. Moss – shares of newspaper given sister and her children in equal shares, sister predeceases life estate beneficiary, so her shares go to children, not residuary legatee).

C.    Changes in Property After Execution of Will

1.                  If testator makes a specific devise that is not in probate estate at time of death, the devise is subjected to “ademption” meaning that if the property was disposed of during testator’s lifetime, the devise is taken away. 

a)                 To avoid ademption:

(1)                Classify bequest as non-specific

(2)                Construe will at time of death

(3)                Make exceptions – e.g., testator incompetent at time property was sold by conservator.

b)                 Ademption may be found applicable to trusts (e.g. Wasserman – testator gave building to revocable trust, devisee could not recover it.

c)                 Two theories of ademption

(1)                Identity theory (1969 UPC): If property is not in probate estate, legatee cannot take, except for

(a)               Remaining balance of purchase price

(b)               Unpaid amt. of condemnation award

(c)                Unpaid insurance proceeds following destruction of property

(d)               Property owned as a result of testator forclosing a mortgage that was devised to devisee

(e)                Sale price of specifically devised property sold by conservator

(2)                Intent theory (1990 UPC 2-606): Ask why property isn’t in probate estate.  Where testator didn’t know property was disposed of or didn’t have opportunity to change will, then something might be substituted for the bequest (money) if the testator would have desired so.  Identity theory exceptions remain adopted.

2.                  Common law “satisfaction of legacies” is analagous to advancement, and is applicable to general bequests (what is this???)

3.                  If estate cannot pay off all debts and devises, devises have to be reduced. 

a)                 Unless will provides otherwise, abatement occurs in the following order (CB 468):

(1)                Residuary

(2)  &nbs