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Wills Outline Complete
I. The Living and the Dead: Whose Money Is It?
A. Introduction
Shapira v. Union National Bank—Ohio Common Pleas Court, 1974
Issue: Whether a will that requires a son, in order to recover his portion of the estate, to marry a woman with two Jewish parents within 7 years of the testator’s death violates either the federal Constitution or the public policy of the State of Ohio? NO
Holding: “[P]ublic policy should not, and does not preclude the fulfillment of Dr. Shapira’s purpose, and that in accordance with the weight of authority in this country, the conditions contained in his will are reasonable restrictions upon marriage, and valid.”-7
Rule: “Basically, the right to receive property by will is a creature of the law, and is not a natural right or one guaranteed or protected by either the Ohio or the United States Constitution.”-4
“[A] testator may legally entirely disinherit his children.”-4
“The great weight of authority in the United States is that gifts conditioned upon the beneficiary’s marrying within a particular religious class or faith are reasonable.”-4
1. Note on Terminology
a. “A testator is a person who has written a will. A person who dies with a duly executed will dies testate. A person who dies without a will dies intestate. An intestate decedent’s property passes to that person’s heirs, who are designated by the jurisdiction’s statute on intestate succession.”-7
b. “[W]hen testator’s will disposes of property, the persons designated to take that property are not called heirs, but devisees (or sometimes legatees). A clause directing disposition of property is called a devise, a legacy, or a bequest. Historically, the word ‘devise’ was used to describe a disposition of money, and ‘bequest’ was used to describe a disposition of personal property other than money. Today, the terms are often used interchangeably.”-7
B. Inheritance Rights More Generally
1. The term “escheats” means “passes to.”-9
2. In Hodel v. Irving, “Congress had enacted the ‘Indian Land Consolidation Act,’ which provided that undivided fractional interests in tracts of land within a reservation would escheat if the interest represented two percent or less of the total acreage in the tract and if the interest earned its owner less than $100 in the year before it was due to escheat. [Justice O’Connor, writing for the majority, held] ‘[T]he regulation here amounts to virtually the abrogation of the right to pass on a certain type of property – the small undivided interest – to one’s heirs. . . . Since the escheatable interests are not, as the United States argues, necessarily de minimis, . . . a total abrogation of these rights cannot be upheld. . . . The difference in this case is the fact that both descent and devise are completely abolished.’”-9
3. Mark L. Ascher, Curtailing Inherited Wealth
a. “My major premise is that all property owned at death, after payment of debts and administration expenses, should be sold and the proceeds paid to the United States government.”-10
4. Adam J. Hirsch & William Wang, A Qualitative Theory of the Dead Hand
a. “The traditional rationales for testamentary freedom are as varied as they are controversial. Perhaps oldest is the notion that testators have a natural right to bequeath.”-12
b. “Another argument for freedom of testation, also premised upon the goal of wealth enhancement, is that such freedom supports, as it were, a market for the provision of social services.”-12
c. “A secondary justification for the right of testation is that it would in practice be difficult to curtail.”-13
d. “A final justification for freedom of testation, formulated with disarming unaffectedness by Professor Simes, is simply that the power to bequeath comports with political preferences . . . .”-13
5. Miscellaneous
a. “In every state, the Statute of Wills permits a decedent to write a will disposing of his property at death.”-15
b. “The Shapira case indicates that courts typically give effect to testators’ stated preferences, even when those preferences might be offensive to others.”-16
c. In Riggs v. Palmer, the court held: “It was the intention of the law-makers that the donees in a will should have the property given to them. But it never could have been their intention that a donee who murdered the testator to make the will operative should have any benefit under it. . . . No one shall be permitted to profit by his own fraud, or to take advantage of his own wrong, or to found any claim upon his own iniquity, or to acquire property by his own crime.”-16
Ford v. Ford—Ct. of App. of Md., 1986
Issue: Whether a legatee who intentionally murders the testator while insane may recover property under the will of the victim? YES
Holding: “[T]he slayer’s rule is simply not applicable when the killer was not criminally responsible at the time he committed the homicide.”-21
“We hold that the slayer’s rule does not operate to preclude Pearl Rose Ford from inheriting under the will of her victim.”-21
Rule: “We believe that for a homicide to be ‘felonious’ in the context of the slayer’s rule, it must be a felony for which the killer is criminally responsible under Maryland’s criminal insanity test. Therefore, if a killer is ‘insane’ at the time he killed, the killing is not felonious in the contemplation of the slayer’s rule. If the killing is not felonious, even though it may be intentional, the rule does not apply.”-21
C. Slayer Statutes and the Uniform Probate Code
1. “Most states have enacted statutes to deal with the slayer-heir.”-24
2. “Perhaps the most comprehensive slayer statute is the one included in the Uniform Probate Code (“UPC” or “the Code”).”-24
3. “The Uniform Probate Code was approved by NCCUSL in 1969, and a number of states enacted probate codes based in part or in whole on the UPC.”-24
4. The Joint Editorial Board’s “efforts resulted in a number of amendments, and, in 1990, in a wholesale revision of Article II of the Code, which deals with ‘Intestacy, Wills, and Donative Transfers.’ . . . A number of state legislatures have adopted the 1990 version of the Code, a number have retained their 1969 versions, and in other states, the Code has not been adopted, but has had a discernible impact on state legislation or case law.”-25
5. UPC § 2-803
a. The term “‘disposition or appointment of property’ includes a transfer of an item of property or any other benefit to a beneficiary designated in a governing instrument. ‘Governing Instrument’ means a governing instrument executed by the decedent. ‘Revocable,’ with respect to a disposition, appointment, provision, or nomination, means one under which the decedent, at the time of or immediately before death, was alone empowered, by law or under the governing instrument, to cancel the designation in favor of the killer, whether or not the decedent was then empowered to designate himself in place of his killer, and or the decedent then had capacity to exercise the power.”-25
b. Subsection (b) provides in summary: A person who “feloniously and intentionally” kills the decedent forfeits all benefits under a will, and if the decedent dies intestate, the decedent’s intestate estate passes as if the killer disclaimed his share.-25
c. Subsection (c) provides in summary: A person who meets the above standards revokes any revocable disposition of property in a governing instrument. Such a person also severs the interests of the decedent and killer in property jointly held at the time of death.-26
d. Subsection (g) provides in summary: A conviction for intentional murder conclusively establishes that the killer meets the requirements of this section. In the absence of a conviction, the court must determine, under the preponderance of the evidence standard, whether the killer would be criminally accountable for the felonious and intentional killing.-26
II. The Role of the Lawyer, and the Lawyer-Client Relationship
A. Introduction
1. “First, estates lawyers are sometimes litigators, representing clients with claims to a decedent’s estate. . . . Second, estates lawyers are sometimes policymakers – devising and evaluating rules for transmission of wealth from one generation to the next.”-27
2. “Perhaps the most important role of the estates lawyer, however, is the role of planner. Clients come to lawyers with objectives in mind: they want to assure that their property reaches its intended beneficiaries; they want to minimize their taxes; they want to protect beneficiaries from creditor claims.”-27
3. “Litigation is the estate planner’s enemy. In most cases, if a lawyer drafts a document that results in litigation, the lawyer has not done her job – even if the document is ultimately upheld and construed as the lawyer intended it to be construed.”-28
Hotz v. Minyard—S. Ct. of S.C., 1991
Issue: Whether a genuine issue of material fact exists regarding whether Dobson breached his fiduciary duty to Judy by misrepresenting her father’s will, where Dobson had been a family attorney and accountant for 20 years, and had represented Judy in the past, but was technically representing only her father with respect to the will? YES
Holding: “We find the evidence indicates a factual issue whether Dobson breached a fiduciary duty to Judy when she went to his office seeking legal advice about the effect of her father’s will.”-30
“Similarly, we find evidence to present a jury issue whether Law Firm should be held vicariously liable for Dobson’s conduct since Dobson was acting in his capacity as a lawyer when he met with Judy to discuss the will in January 1985.”-31
Rule: “A fiduciary relationship exists when one has a special confidence in another so that the latter, in equity and good conscience, is bound to act in good faith. . . . An attorney/client relationship is by nature a fiduciary one.”-30
4. Notes
a. Rule 1.6 of the MRPC provides that a lawyer shall not reveal information relating to representation of a client unless the client consents after consultation, except for a few exceptions.
b. Rule 1.7 provides that a lawyer shall not represent a client if representation of that client will be directly adverse to another client, unless the lawyer reasonably believes that the representation will not adversely affect the interest of the other client, and each client consults after consultation.-32
Barcelo v. Elliott—S. Ct. of TX, 1996
Issue: Whether “an attorney who negligently drafts a will or trust agreement owes a duty of care to persons intended to benefit under the will or trust, even though the attorney never represented the intended beneficiaries”? NO
Rule: “At common law, an attorney owes a duty of care only to his or her client, not to third parties who may have been damaged by the attorney’s negligent representation of the client.”-35
“We believe the greater good is served by preserving a bright-line privity rule which denies a cause of action to all beneficiaries whom the attorney did not represent.”-37
“[A]n attorney retained by a testator or settlor to draft a will or trust owes no professional duty of care to persons named as beneficiaries under the will or trust.”-38
5. Notes
a. “The malpractice ‘revolution’ of the last several decades has, in the vast majority of states, displaced the privity rule endorsed in Barcelo v. Elliott.”-40
6. Martin D. Begleiter, Attorney Malpractice in Estate Planning – You’ve Got to Know When to Hold Up, Know When to Fold Up
a. “If the attorney’s negligence in estate planning causes loss to a beneficiary, the attorney shall make good that loss. That is not to say that attorneys should make good all ‘losses’ to beneficiaries in wills they drafted . . . . Many acts or omissions do not constitute negligence, and the attorney is required only to use the degree of care and skill of reasonable lawyers under comparable circumstances.”-41
III. Probate and Non-Probate Transfers
A. Probate: What Is It, and Who Needs It?
1. “[D]eath is the focal point for most gratuitous transfers of wealth.”-43
2. “If Jane Doe has not left a will, her closest relative, or one of her closest relatives, will generally petition for an appointment as her personal representative (traditionally called her administrator). When more than one person is interested in becoming administrator, local statutes will generally prescribe priority among the applicants. If Jane Doe has left a will naming an executor, the executor will generally petition for ‘letters testamentary,’ which entitle the executor to serve as Jane’s personal representative. The personal representative then bears responsibility for collecting all of Jane’s assets. Because the personal representative has legal authority to act on behalf of Jane’s estate, a purchaser can rely on a deed executed by the personal representative, and a bank will be protected if the bank releases funds to the personal representative.”-44
3. “If Jane has left a will, the personal representative will offer the will for probate; she will have to prove that the will was properly executed, and she will provide notice to persons who might have reason to contest the will. If probate is uncontested, or if the personal representative overcomes any challenges to the will’s probate, the personal representative will distribute Jane’s assets to the persons named in the will – after paying taxes, creditor claims, and expenses of administering the estate. . . . That, in a nutshell, is the probate process.”-44