I. Introduction

A. Terminology

1. Descentintestate entitlement of heirs at law (realty)

2. Distributionintestate entitlement of next of kin (personalty)

3. Linealsancestors and descendants in the blood line, such as parents, grandparents, grandchildren, etc.

4. Collateralsnon lineal relatives who are related by blood or adopted (aunt, uncles, cousins, etc.)

5. Testate

a. Testatorperson who makes a will

b. Attested Willswills that are witnessed

c. Holographic Willsunwittnessed, signed by testator and handwritten material

d. Devisegift of realty under will (devisee)

e. Bequestgift of personalty by will

f. Legacygift of cash by will

g. Codicildocuments executed with all the formalities of a will which add, delete, or change provisions in a will

6. Probateprocess of proving after a testator’s death that her will is valid

a. Executorappointed by will

b. Administratorappointed by court

c. Function of Probatetransfer title, make sure its clear, protect creditors, distribute the rest

B. Testamentary Power

1. Historicalstatute of will, statute of frauds, wills act

2. UPCadopted in whole or in part by about 1/3 of the states

3. Restatements

4. Constitutional PrinciplesBefore Hodel, generally viewed as solely out of statute

a. Hodel v. Irvingcourt held invalid under taking clause of the 5th Amendment a federal statute under which Indian lands could not pass but instead escheated to the tribe (Constitution prohibited Congress from totally abolishing both descent and devise)

1. Problems with holding: Is the right really abolished if you can still transfer inter vivos? Is regulatory takings analysis a good fit for inheritance discussion? Never says right to transfer/pass on property is constitutional right, but just says it is tied to Anglo American scheme of law.

D. Taxation, Improvidence, and Inheritance

1. Taxationtestamentary freedom is disrupted by taxation (estate, gift, generation skipping tax)

2. Dissipation of Wealth; Improvidenceno system does as effective a job of redistribution as taxation and improvidence

E. Competing Intereststensions between living beneficiaries and decedent s

1. Taxationdirect taxes on wealth transfers

2. Tensions Among Beneficiaries

3. Claims by Third Partiescreditors, spouses, greedy children, charities, etc.

4. Control from the Gravedead hand desire (Rule Against Perpetuities) but it is respected in some areas of the law

a. Condition a gift on marriageShapira v. Union National Bankfathers will conditioning his son’s inheritance on the son being married to a Jewish woman and whose parents were both Jewish was upheld

1. If it was conditioned on the son not marry at all, it would have been void for public policy but reasonable restrictions on marriage are valid

5. Elective Share Rights

F. Probate and Non-probate Transfers

1. Non-probate Transfers: Will Substitutes

a. Life Insuranceowner may designate a beneficiary to receive the proceeds of the policy and upon death, they are payable without regard to terms of the will or intestacy

b. Retirement Plan InterestsParticipant/Employee in an employer’s retirement plan and the owner of an individual retirement account (IRA) may designate one or more to receive benefits without regard to will

c. Joint Tenancy PropertyPasses to surviving joint tenant regardless of will or intestacy

d. Other payable on Death Arrangements (POD)Many states allow bank accounts, and some allow securities such as stocks and bonds to be payable on that person’s death directly to a beneficiary

e. TrustDepending on terms of the agreement

i. Exception for testamentary power of appointment (if decedent had and exercised a power of appointment over trust property, then it passes on death in accordance with the exercise of that power but still probably not probate

f. Small Estatestates may allow estates to be collected upon affidavit for small estates (which ranger between 5K-100K dollars), which don’t give title, just possession

f. Estate Planning ImplicationsCritical to consider non-probate property when doing estate planning

2. Probate Propertypasses under terms of will or intestacy

3. Probate Administrationprocess by which title to probate property of a decedent is transferred to her heirs or devisees in each case after payment of all legitimate charges against the estate (taxes, debts, costs of administration)

a. Probate vs. Probate AdministrationProbate is process of validating the will, and usually can be admitted in less than a month, whereas probate administration is almost for a period of months or even years.

b. Necessity of Probate AdministrationIf no probate property, don’t need administration or some other circumstances

i. Tangible Personalty

1. only tangible personal property such as household furnishing

2. no dispute among decedents surviving family members and

3. claims of creditors can be resolved without dispute

ii. RealtyIf probate property included real estate, a probate administration will probably be necessary because they need to be able to prove clear title to real estate

iii. Third parties—L If asset controlled by a third party, such as a bank account or securities, third party may require probate to release the asset

c. Probate Administration Procedureform varies from state to state

i. court supervision of personal representative

ii. Under UPCstreamlined and flexible (can occur without prior notice and without judicial involvement if no one interested requests formal proceedings

iii. If there is a will, you file the original and it becomes property of the state, then you give notice to potential beneficiaries, etc, and letters are issued that give the administrator or executor authority from the court

d. Choosing the Personal Representativefamily members, banks, trust companies, business associates

i. Duties of the Administratorcollect assets, manage, receive and pay creditors claims, distribute the rest

ii. Role of the Attorneymany times representatives have attorneys to help

ii. creditors of decedentmost states have special statutes of limitation that require creditors to submit their claims within a short period of time

iii. Other potential claimantsmay be duty to notify potential claimants

e. Why try to avoid probate process? Money, time, uncertainty

G. Attorney Duties to Client

1. Simpson v. CalivasDuty runs from a drafting attorney to an intended beneficiary (third party beneficiary status) because there is foreseeability of liability of heirs and beneficiaries can sue for malpractice.

2. Hoytz v. MinyardIssue as to whether attorney owed Judy a duty to deal with her in good faith as there is evidence she had a special confidence in him

H. Who May InheritState Definitions of FamilySurviving Spouse

1.Peffely-Warner v. BowenA woman partner in a meretricious relationship is not a widow with respect to intestate devolution (or social security act)

a. Three tests to determine:

1. Valid Marriage Test

2. Intestacy Devolution Test

3. Legal Impediment test

2. In re Estate of CooperNY refusal to allow same sex marriages does not violate the Equal Protection Clause. Survivor of a homosexual relationship alleged to be a spousal relationship is not entitled to election against decedent’s will

3. In re Estate of GardinerPost operative male to female transsexual, married MG, court held marriage void (look at their birth certificate)opposite sex in the narrow sense

4. Status Based (relationship must be recognized by the state) for intestacy and surviving spouse statutes

a. Exception: Common Law Marriage (only 11 states, and limited to opposite sex)

5. Divorce or annulmentnot a spouse for intestate succession purposes

6. Formal Separationnot divorced and is considered a spouse (unless order purports to terminate all marital rights

7. Desertion or Adulterygenerally won’t affect marital status, spouse

8. Common law Marriages

a. Majoritynot spouse

b. Minoritypersons who live together as husband and wife and hold themselves out to the public as such but no formal marriage ceremony are treated as being married

I. Who May InheritState Definitions of a FamilyDescendants

1. Posthumous ChildrenWhere, for purposes of inheritance, it is to a child’s advantage to be treated as in being from the time of conception rather than the time of birth, the child will be so treated If born alive

a. Time of gestation (rebuttal presumption)280 days

2. Adopted Children

a. Hall v. Vallandinghamstatute in which adoption by a step parent cut off inheriting from ancestors of a deceased natural parent (elimination of dual inheritance was upheld)

b. UPCchildren can inherit from natural relatives but natural relatives can’t inherit from them.

c. Some states allow inheritance from both natural and adoptive parents if a stepparent adopts the child

d. Some statues allow for inheritance if it is clear that relationship was one of parent and child and it is established that they would have adopted but for a legal barrier

e. Some statues distinguish between minor and adult adoption (adult “lovers” may use this in order to inherit)

f. O’Neal v. Wilkesbecause aunt had no authority to enter into an adoption contract, it was invalid and child couldn’t inherit through intestacy

g. Adoption

Common LawModern Statutes

Natural Adoptive Natural Adoptive

Y Yinherit from NY

Y N inherit through NY

Y Nparents inherit N Y

h. Equitable Adoptionsomeone who has not been formally adopted may be treated as adopted for inheritance purposes

1. Rationaleprotect against consequences of reliance on an adoption that was not properly performed

2. Requirements—GA: 1. agreement fro adoption between natural and adopting parents, 2. natural parents give up custody, 3 the child lives with the adopting parents, and 4. the adopting parents treat the child as a natural child (THIS IS NOT IN EVERY STATE)

3. O’Neal v. Wilkeschild not acknowledged by her natural father, mother died, and place with couple who raised her as their natural child by another family member. Court denied virtual adoption because no one with the authority to consent to the adoption did so

4. Virtual adoption parents and their relatives are not heirs of the child

i. Common Adoption Issues

1. Retroactivitynatural born under documents that were in existence before a statute treating adopted as natural born were enacted

2. Applicability to Class Giftssome appear only to apply to intestacy and there is a question about class gift (vs. UPC applies to all three situations)

3. Nonmarital Childrenchildren of unmarried parents were given harsh treatment by the common law (couldn’t inherit from neither father nor mother) and only child’s spouse and descendents could inherit

a. Today, all jurisdictions permit inheritance from the mother but rules regarding father vary

1. Trimble v. GordonSC held that denying a nonmarital child inheritance rights violated Equal Protection Clause using strict scrutiny test even though not a suspect class, but Lalli held that you could permit inheritance only if father had married mother or had been formally adjudicated the father by a court during father’s lifetime

2. Uniform Parentage Actadopted in one third of states, presumed to have a parent child relationship if:

a. while the child is a minor, the father receives the child into his home and openly holds out the child as his natural child or

b. acknowledges paternity in a writing filed appropriately

3. In most states, paternity can be proven after death by clear and convincing evidence

4. UPCif the father openly acknowledges and supports the child

4. Artificial Insemination

a. Woodward v. Social Securitychildren who are artificially inseminated are entitled to inheritance of children if father dies before birth if it is shown that it is the genetic child of the father and that he affirmatively consented to conception

-look at statue to determine intestacy (not a natural or constitutional right)

-children should all be treated the same (vs. rights of other family members)

b. In some jurisdictions, birth is treated as natural and husband of mother is treated as natural father

c. Man who provided is not eh parent unless he is mother’s husband

d. Surrogate Motherhoodwife of natural father may not be mother without a formal adoption

e. Hecht v. Superior Courtcourt upheld devise to decedent’s girlfriend of sperm that he had stored with a sperm bank (is a child conceived after the death of the donor allowed to inherit as an heir?)

5. Half Bloods and Step Siblingsmost states no longer discriminate against adopteds or nonmarital children, but some still provide different shares for half bloods

a. Majority Rule(UPC)share equal, but in a few states, half bloods receive half the share a full blood would get

b. Step Siblings are not heirs in most states

6. Aliensmost modern statues have no discrimination against them but some do

II. The Default: Intestate Succession

A. Intestate Succession in GeneralStatutory Estate Plan (legislature’s guess at what average decedent would want done with her property)

1. Property Subject to Intestate Successionprobate property only

a. Abolition of Dower and Curtsey (assumed here)

b. Net Probate Estatereduced by taxes, debts, administrative expense, etc.

2. Governing Lawstatue statutes in the state where resident for personalty and where land is located for realty (and differences in state law occur)

B. Surviving SpouseThe share of a surviving spouse of intestate varies from state to state (and may depend upon who survived)

1. UPCgenerally greater than share under non UPC

a. Fixed Dollar Amount (set by each state and UPC only makes recommendation plus at least a fraction of any balance in the estate, notwithstanding the existence of other potential beneficiaries

1. Support Theorysurviving spouse will need a certain minimum amount to avoid being supported by state

b. Remaining estate under UPCentire estate to spouse if no descendant or parent or if all of decedent’s descendants are also descendants of the spouse

c. This is different from traditional laws of intestacy

1. Descendants by another relationship of the decedent or spouseFixed dollar amount also varies if other kids

a. if kids from another marriagefixed amount is 100K

b. if survivor has kids from another marriage and all qdecedents’ kids were survivor’s, then 150K + ½ balance

2. Spouse’s share if no descendentsif parents survived, spouse gets first 200K plus ¾ of the balance

2. Non-UPC statesless generous than UPC states (many limit to 1/3 or ½ of the estate)

a. If decedent was not survived by any descendants, some states give all

3. Decedent’s Probable Intent

a. Entire Estate? Unless there are children by a former marriage, or substantial family property, most decedents probably want the surviving spouses to take the entire estate

4. Nonprobate Property Ignored

a. This may raise issues of disinheritance of spouse, which most jurisdictions won’t allow

5. Survivorship

a. Janus v. TarasewiczS and T (spouses) died after having taken laced Tylenol. Stanley pronounced dead that evening, but T on life support for two days. Insurance named T as primary beneficiary and mother is contingent, insurance company paid to T estate and court agreed that T did survive S.

b. Uniform Simultaneous Death Actunless will contains explicit survivorship condition, most jurisdictions determine survivorship under USDA, in which the prospective recipient of property is treated as having predeceased the owner if there is not sufficient evidence as to the order of death (this doesn’t apply, for example, in Janus, when there was adequate evidence T outlived J.

c. UPCheir must survive an intestate decedent by more than 120 hours

6. Common Disaster Clausesshould plan for possibility of multiple deaths that occur in rapid succession (this comes in form of common disaster clause that may produce more problems than it solves)

C. Descendants: Representation(child’s descendants represent the dead child and divide shares among themselves)

1. Per Stirpes every child takes what their parent would have, and if there is more than one child, they divide the shares equally into however many children there are

-divide property into shares at the first level

Example: (D)—SS 1/2

(C1) (C2) (C3)

GC1 GC2 GC3

1/81/8¼

a. Division occurs as if both children were alive

b. Division at child level regardless of whether any children are living

c. Equality under bloodlineseach child’s blood line will receive the same share of D’s estate

d. If a child has no representatives, no share for him (C3)

Each line of descendants receives an equal share of the estate (make sure each branch adds up to the same for each child of decedent)

3. Per Capita Representationdivide shares at the level in which there is at least one alive and provide for representation of any deceased descendant on that level (then do same as per stirpes) (Old UPC)

Only difference with per stirpes is the level at which equality of lines starts

(make sure each branch adds up for each heir at which there is a living one)

4. Per Capita at each generation (1990 UPC)initial divisions made at level where one or more alive but the shares of deceased persons on that level are treat as one pot and dropped down and divided equally among representatives on the next level

make sure each generation has the same shares across the board

D. Ancestors and CollateralsTypically, if descendants, whatever doesn’t go to spouse goes to them. If no descendants but a spouse, sometimes spouse gets all. In others (UPC) that will be the case only if there is not some other heir. IF decedent not survived by any descendants, the portion of the estate that doesn’t pass to a surviving spouse divided among ancestors and collaterals

1. ParentsIf one or both parents survive, usually then passes to parents in equal shares

a. Limitations on the Right to Inheritif a parent abandoned decedent as a child, in many states they can’t inherit from that child

1. UPCIf parent openly treated child as a child and did not refuse to support, then the parent can inherit

b. If no surviving parentsome such as UPC would leave all to surviving spouse while others would leave share the parents would have received to descendants of the parents

2. Parent’s Descendants (First line collaterals)Whatever spouse and parents don’t take will pass to descendants of the decedent’s parents

3. More Remote Heirs: The Parentelic SystemIf no descendant, no parent or descendant of a parent, some states follow parentelic system in which it goes up and down the family tree again (grandparents-second line collaterals, etc.) and if none, estate given to living descendants of the nearest lineal ancestor of whom descendants are living (with representation)